Form 19-1

Commercial Construction Contract

[Guaranteed Maximum Price]

Basic Information

Effective Date:

Owner:

Address:

Phone:

E-mail:

Architect/Engineer (“Owner Rep”):

Address:

Phone:

E-mail:

Contractor:

Contractor’s Representative for Project:

Address:

Phone:

E-mail:

Lender:

Address:

Phone:

E-mail:

Project: [include general description of improvements to be constructed]

Project Site: [state physical address of site and attach legal description as identified in exhibit A]

Contract Price: [the sum of the costs of construction, contractor’s contingency, owner’s con­tingency, and contractor’s fee as identified in exhibit C]

Guaranteed Maximum Price:

Substantial Completion Date:

Insurance and Bond Requirements: [see exhibit D at form 19-3 in this chapter]

Plans: [specifications and drawings as identified in exhibit B]

Owner and Contractor agree to the following terms and conditions.

A.Definitions

A.1.“Allowance” means a dollar amount specified to be used for portions of the Work that have not been fully defined in the Plans or where a range of options is available for Owner’s selection.

A.2.“Applicable Law” means all federal, state, and local laws, rules, and regulations applicable to the Project, the Work, or the Contractor, as indicated by the context.

A.3.“Bid” means a response to a request for bids. The term includes proposals sub­mitted in response to a request for proposals.

A.4.“Business Day” means a day other than a Saturday, Sunday, or national holiday. As used in this Contract, the term “days” means calendar days. All periods are measured in calendar days unless business days are specified.

A.5.“Change Order” means a description of changes in the Work, and any increase or decrease in the Guaranteed Maximum Price and extension or reduction of Contract Time resulting from such changes, that has been signed by Owner and Contractor.

A.6.“Claim” means a demand or assertion by one of the parties seeking, as a matter of right, payment of money or other relief with respect to the terms of the Construction Docu­ments, and also includes other disputes and matters in question between Owner and Contrac­tor arising out of or relating to the Construction Documents.

A.7.“Commencement Date” means the date on which a written notice to proceed is delivered by Owner Rep to Contractor.

A.8.“Concealed Conditions” means physical conditions in existence on the Effec­tive Date located beneath the surface of the ground, or concealed or unknown conditions in an existing structure, that are at variance with the conditions indicated in the Construction Docu­ments or are substantially different from those conditions shown in the Construction Docu­ments and that Contractor could not have discovered by the exercise of reasonable diligence.

A.9.“Conditions to Final Payment” means the conditions required by this Contract that must be satisfied by Contractor or waived by Owner in writing for Owner to be obligated to make the Final Payment to Contractor.

A.10.“Construction Documents” mean the documents identified in paragraph B.1.

A.11.“Contractor’s Contingency” means the amount identified in Exhibit C that is for Contractor’s exclusive use in connection with unanticipated increases to the Costs of Con­struction. The Contractor’s Contingency is not intended to be used to cover increases to the Costs of Construction due to changes in the Scope of Work resulting from errors in the Owner Information or changes to the Scope of Work requested by Owner.

A.12.“Contract Time” means the period provided in this Contract for reaching Sub­stantial Completion, and, if specified, the period for achieving Final Completion.

A.13.“Cost Savings” means the amount equal to the Guaranteed Maximum Price less the total amount paid by Owner to Contractor under this Contract. It does not include savings that result from Owner’s failure to use all of the Owner’s Contingency or to fully use an Allowance or trade discounts, or from Owner’s decisions during construction to use less costly materials than called for in the Plans and Specifications, or to reduce the Scope of Work.

A.14.“Drawings” means the graphic and pictorial portions of the Construction Docu­ments showing the design, location, and dimensions of the Work.

A.15.“Excused Delay” means a delay in Contractor’s performance under the terms of this Contract due to acts of God, strikes, lockouts, labor shortages, labor restrictions by any governmental authority, civil riot, floods, abnormal adverse weather conditions that exceed [number] days, unavoidable casualties, or any cause beyond the control of Contractor, a Sub­contractor, or a Supplier of any tier, that could not have been avoided using reasonable dili­gence. “Excused Delay” does not include delay resulting from negligence, default, or any condition not constituting an Excused Delay.

A.16.“Final Completion” means all the Work required by the Plans has been com­pleted, all punch list items from the Substantial Completion review have been completed, and all Conditions to Final Payment have been satisfied.

A.17.“Governmental Approvals” means all approvals required by governmental enti­ties with jurisdiction over the Property or Improvements for the Project to be used for its intended purpose, including, if applicable, a Certificate of Occupancy.

A.18.“Improvements” means the buildings, structures, landscaping, and other improvements to be constructed on the Property by Contractor according to the Construction Documents.

A.19.“Liquidated Damages” means an estimate of the amount of damages, as shown on Exhibit C, that Owner is likely to incur as a result of the failure of the Project to be Sub­stantially Complete by the Substantial Completion Date due to Contractor’s Unexcused Delay.

A.20.“Major Subcontractor” or “Major Sub-subcontractor” or “Major Supplier” means a Subcontractor, Sub-subcontractor, or Supplier whose contract price exceeds 10 per­cent of the Costs of Construction, or other amount agreed on by Owner and Contractor.

A.21.“Owner Information” means the survey of the Property or Project Site, reports from Owner’s consultants, Property restrictions, and other information provided by Owner with its request for Bids for the use of bidders in preparing their Bids. The term does not include Plans and Specifications.

A.22.“Owner’s Contingency” means the amount identified in Exhibit C that is for Owner’s exclusive use in connection with the Project. The Owner’s Contingency may be used by Owner to cover increases in the Costs of Construction resulting from errors in the Owner Information and changes in the Scope of Work.

A.23.“Plans” means the Drawings and Specifications approved by Owner and Con­tractor identified in Exhibit B and any amendments made after the Effective Date.

A.24.“Project Site” means the area(s) within the Property where the Improvements will be constructed.

A.25.“Property” means the real property described in Exhibit A.

A.26.   “Reservation” means Owner’s statutory 10 percent reservation required under chapter 53 of the Texas Property Code.

A.27.Scope of Work” means the Work covered by the Construction Documents.

A.28.“Specifications” means a detailed description of the building components and materials and installation requirements prepared by the Architect/Engineer for the Project.

A.29.“Subcontractor” means a person who contracts directly with Contractor to per­form a portion of the Work for the Project.

A.30.“Substantial Completion” or “Substantially Complete” means that the Improve­ments have reached the stage at which they are usable for the purposes intended, all Govern­mental Approvals have been obtained, and only minor or cosmetic Work remains to be completed.

A.31.“Sub-subcontractor” means a person who contracts directly with a Subcontrac­tor or Sub-subcontractor to perform a portion of the Work for the Project.

A.32.“Supplier” means a person who contracts with Owner, Contractor, a Subcon­tractor, or a Sub-subcontractor to furnish materials or equipment for the Project.

A.33.“Warranty Documents” means the written warranties on equipment, materials, labor, or the Work provided by Contractor, a Subcontractor, or a Supplier of any tier or a man­ufacturer.

A.34.   “Work” means the labor, coordination, management, materials, equipment, and other materials and services required to construct the Project.

Terms not defined in this Contract or in the other Construction Documents have the meanings ascribed to them by common usage.

B.Construction Documents

B.1.Construction Documents.      This Commercial Construction Contract between Owner and Contractor consists of the following Construction Documents:

Drawings:

Specifications:

Addenda to this Contract:

Change Orders:

Warranty Documents:

Approved Construction Schedule:

This Contract and its Exhibits:

Owner’s Request for Bids/Proposals:

Contractor’s Bid/Proposal and Bid Qualifications and Exclusions:

B.2.Resolving Ambiguity or Conflict in Construction Documents.      If there is an ambiguity or conflict, the Construction Documents are to control in the following order: (1) Change Orders, (2) Addenda, (3) this Contract, (4) Drawings, (5) Specifications, (6) Sched­ule, (7) Warranty Documents, (8) Owner’s Request for bids/Proposals, and then (9) Contrac­tor’s Bid/Proposal and Bid Qualifications and Exclusions.

C.The Work

C.1.Scope of Work.      Contractor will furnish all Work necessary to construct the Project as stated in, or reasonably inferable from, the Construction Documents.

C.2.Interpretation of Construction Documents by Owner Rep.      Owner Rep will reasonably interpret the Construction Documents in accordance with the intention of the par­ties as expressed in the Construction Documents. Owner Rep will take into consideration industry and trade custom and usage only in the case of ambiguity in or conflict between the Construction Documents. Contractor will follow Owner Rep’s interpretation. Contractor may make a Claim if Contractor disputes the interpretation.

C.3.Conditions Reviewed by Contractor.      Contractor represents to Owner that it has made an inspection of the Property and the conditions existing at and in the vicinity of the Project Site, has determined normal weather conditions for the Project Site, has reviewed the Construction Documents and the Owner Information, and agrees to construct the Project for the Contract Price and within the Contract Time. Time is of the essence of this Contract.

C.4.Field Confirmations.      Before proceeding with the Work, Contractor will field check and verify all dimensions, grades, lines, levels, or other conditions or limitations at the Property to avoid construction or drainage errors.

C.5.Reporting Discovered Nonconformity.      Contractor has reported to Owner Rep all errors or omissions detected in the Plans and Owner Information before the Effective Date and will promptly report to Owner Rep any errors or omissions detected in the Owner Infor­mation after the Effective Date. Adjustments in the Contract Time and Contract Price may be made by Change Order resulting from errors or omissions that were detected and timely reported to Owner Rep.

C.6.Reporting Concealed Conditions.      Contractor will promptly notify Owner Rep if Contractor encounters Concealed Conditions. Contractor will provide Owner with an esti­mate of any additional costs and impact to the Construction Schedule resulting from the Con­cealed Conditions. Contractor and Owner will execute a Change Order for any agreed-on changes to the Work.

D.Contractor Obligations.      Contractor agrees to perform its obligations under the Con­struction Documents, including the following:

D.1.Work.      Perform the Work in a good and workmanlike manner, free from defects in labor and materials, and in accordance with the Construction Documents and Appli­cable Law.

D.2.Schedules, Insurance, and Bonds.      Provide Owner Rep with the following within ten days after the Effective Date and before the commencement of the Work:

a.Construction Schedule.      Construction Schedule as described in paragraph G.1.

b.Schedule of Values.      Schedule of Values as described in paragraph F.5.

c.Insurance and Bonds.      Performance and payment bonds and insurance required under Exhibit D. [See form 19-3 in this chapter.]

D.3.Cooperation.      Cooperate with any contractor or supplier engaged by Owner to perform Work at the Project Site to minimize delay and disruption to the Project.

D.4.Subcontract Compliance.      Comply with the terms of its subcontracts.

D.5.Subcontractor Payments.      Pay Subcontractors and Suppliers within seven days after receipt from Owner of payment for their Work.

D.6.Subcontractor List.      Provide and periodically update a list of Subcontractors as described in paragraph H.5.

D.7.Reporting Errors and Omissions.      Promptly report errors or omissions in the Plans and Owner Information to Owner Rep.

D.8.As-Built Drawings.      Maintain as-built drawings at the Project Site as described in subparagraph J.6.c.xii.

E.Owner Obligations.      Owner agrees to perform its obligations under the Construction Documents, including the following:

E.1.Access.      Provide Contractor with timely access to the Project Site.

E.2.Utility Connections.      Provide utility connections necessary for the Work to the Property line unless utility extension is part of the Work.

E.3.Supervision of Owner Rep.      Require Owner Rep to respond to submissions, including shop drawings, Draw Requests, and requests for clarification, in a timely manner so as not to cause undue delay to the Project.

E.4.Timely Decisions.      Make decisions on Allowances, changes, selections, and other decisions in a timely manner so as not to cause undue delay.

E.5.Timely Payments.      Make timely payments of amounts owed to Contractor in accordance with section J.

E.6.Cooperation.      Require third-party contractors and vendors performing Work at the Project Site to cooperate with Contractor and to be liable for damages caused to Contrac­tor’s Work.

F.Contract Price

F.1.Determination.      The Contract Price is the sum of the (a) Costs of Construction, (b) Contractor’s Contingency, (c) Owner’s Contingency, and (d) Contractor’s Fee, provided that the Contract Price shall not exceed the Guaranteed Maximum Price. The Contract Price includes the Allowances shown on Exhibit C. The Guaranteed Maximum Price may be changed only by Change Order.

F.2.Costs of Construction.      The Costs of Construction include the following actual costs:

a.Subcontract Prices.      The price of approved subcontracts.

b.Contractor’s Labor.      The cost of Contractor’s direct labor for performance of the Work, whether on-site or at fabrication shops off-site assembling or manufacturing materials to be installed on the Project. The wages paid must not be materially higher than the standard paid for similar work by other con­tractors in the location of the Project.

c.Contractor’s Supervision.      Contractor’s superintendent, Project manage­ment, and administrative staff on-site devoting full time and attention to man­aging the Project. Off-site Project managers’ costs will be paid upon written agreement with Owner based on their time devoted to the Project.

d.Fringe Benefits.      The cost of standard labor fringe benefits for Contractor’s Labor and Contractor’s Supervision for on-site personnel. Fringe Benefits means costs for Contractor’s Labor and Contractor’s Supervision for on-site personnel in addition to wages for the employer’s required contributions for employment taxes, insurance, and other employer labor cost required by applicable labor agreement or by law. Fringe Benefits also includes employer contributions for qualified retirement plans, health insurance, and paid leave, provided such costs are standard in the industry and are based on wages or salaries included in the Costs of Construction. However, the Costs of Con­struction will not include employee profit sharing or bonuses (except quali­fied retirement plans).

e.Materials/Equipment.      Materials and equipment installed as a part of the Project as specified in the Construction Documents, including freight for delivery to the Project, a reasonable standard allowance for waste, and sales or use taxes paid by Contractor unless Owner has furnished Contractor with a certificate of exemption from the payment of such taxes. Unreturned excess materials are owned by Owner.

f.Construction Equipment Costs.      Costs for machinery, equipment, tools, and temporary structures and outbuildings on the Project. These costs will be at standard rental rates for the location of the Project, whether owned by or rented by Contractor.

g.Demolition and Site Clearing.      The cost of clearing the site and demolition and removal of existing structures and vegetation required for performance of the Work.

h.Site Office.      Office supplies, copy charges, delivery charges, and other rea­sonable direct costs of maintaining a job site office.

i.Bonds and Insurance Premiums.      The percentage of Contractor’s insurance premiums allocated to this Project for the insurance required in this Contract and the cost of providing any required payment and performance bonds.

j.Building Permit.      Fees for the building permit, licenses, and inspections by governmental authorities required for the Work.

k.Royalties/Licenses.      Costs of use of designs, products, or processes required by the Construction Documents as part of the Work.

l.General Conditions.      Reasonable job site costs incurred in performing the Work, including costs such as for utilities not paid by Owner, a job site trailer if needed due to the scope of construction, temporary restrooms used at the site, on-site security, construction fencing, and site cleanup (“General Condi­tions”).

F.3.Exclusions.      Costs not included in paragraph F.2., including those specifically listed below, are excluded from the Costs of Construction:

a.Certain Personnel.      Contractor management and other employees or per­sonnel not located full-time on the Project site, unless Owner’s advance writ­ten approval is obtained.

b.Principal Office.      Contractor’s principal office overhead.

c.General Overhead.      Contractor’s general overhead including costs of bor­rowing.

d.Costs over GMP.      Costs and expenses of any kind that, when added to the rest of the Costs of Construction and Contractor’s Fee would be in excess of the Guaranteed Maximum Price, as adjusted by Change Order.

e.Correction Costs.      Costs to correct Work to bring it into conformance with the Construction Documents.

F.4.Discounts.      Owner will be notified if material or equipment price discounts are available for advance cash payments. If so notified, and if Owner advances the funds for such purchases, Owner is entitled to the associated discount.

F.5.Schedule of Values.      Contractor will prepare a Schedule of Values. The Sched­ule of Values must be approved in writing by Owner Rep before commencement. The Sched­ule of Values will apportion the Guaranteed Maximum Price between each constituent element of the Work.

F.6.Entitlement to Savings.      Upon Final Payment by Owner to Contractor and pro­vided Contractor is not in default of this Contract, Owner shall pay Contractor the percentage of Cost Savings, if any, shown on Exhibit C, provided that Owner retains the right to withhold payment for any outstanding Claims related to the Project in an amount reasonably deter­mined by Owner to protect Owner from liability.

F.7.Allowances.      Contractor shall include in the Contract Price the Allowances shown in Exhibit C. Items covered by Allowances shall be supplied for such amounts and by such persons or entities as Owner may direct, but Contractor is not required to employ persons or entities to whom Contractor has reasonable objection. Unless otherwise provided in the Construction Documents, the following guidelines apply:

a.Materials and Equipment Less Discounts.      Allowances shall cover the cost to Contractor of materials and equipment delivered at the site and all required taxes, less applicable trade discounts.

b.Unloading and Handling Costs.      Contractor’s costs for unloading and han­dling at the site, labor, installation costs, overhead, profit, and other expenses contemplated for stated Allowances amounts shall be included in the Costs of Construction but not in the Allowances.

c.Change Orders.      Whenever costs are more than or less than Allowances, the Guaranteed Maximum Price shall be modified by Change Order. The amount of the Change Order shall reflect the difference between actual costs and the Allowances.

d.Prompt Selection by Owner.      Owner shall select materials and equipment under an Allowance with reasonable promptness.

G.Contract Time

G.1.Construction Schedule.      Contractor will promptly prepare and submit to Owner Rep for approval a Construction Schedule, using the critical path method, detailing how Substantial Completion will be achieved by the Substantial Completion Date. Contractor will periodically revise and resubmit the Construction Schedule to Owner Rep upon change orders, Excused Delays, or other events that cause the critical path or the Substantial Comple­tion Date to change.

G.2.Risk of Loss before Final Completion.      If the Work is damaged or destroyed before its final completion, Contractor will bear the risk of loss and will diligently proceed with restoration or replacement and completion of the Work.

G.3.Acceleration of Work.      If there is a delay in the Work that is not an Excused Delay, and in the determination of Owner Rep the Work will not reach Substantial Comple­tion by the Substantial Completion Date, Owner Rep may direct Contractor to accelerate the Work at no cost to Owner by means of overtime, additional crews, additional shifts, or rese­quencing of the Work to achieve Substantial Completion by the Substantial Completion Date.

G.4.Owner Suspension or Delay in Work Commencement.      Owner may, with or without cause, by written directive, require Contractor to suspend or delay commencement of the Work in whole or in part for a length of time as desired by Owner. The Guaranteed Maxi­mum Price and Contract Time are to be equitably adjusted for increases in the Costs of Con­struction and for the time caused by such delay or suspension under this paragraph. However, no such equitable adjustment shall be made if Owner has the right to order delay or suspen­sion of the Work under another provision of the Construction Documents or if an Unexcused Delay by Contractor would have caused such suspension or delay.

H.Subcontracts

H.1.Subcontracting.      Contractor may subcontract all or any part of the Work.

H.2.Terms.      Subcontracts with Subcontractors and Suppliers must meet the follow­ing requirements:

a.Writing.      Be in writing.

b.Assumption of Obligations.      Require the Subcontractor to assume toward Contractor all of the obligations and responsibilities that Contractor owes to Owner under the Construction Documents.

c.Consistent with Contract.      Be consistent with the terms of this Contract.

d.Terms of Contract Applicable to Subcontractors.      Require compliance with the terms of this Contract applicable to Subcontractors, including require­ments for insurance and lien waivers.

e.Contingent Assignment to Owner.      Require that the Subcontractor provide a copy of the subcontract to Owner if Contractor’s right to perform under this Contract has been terminated.

f.Subcontracts Assignable to Owner and Contractor’s Surety.      Be assignable to Owner or to Contractor’s surety for the Project on the same terms.

g.Subcontractor’s Obligations Not Assignable.      Prohibit assignment of the Subcontractor’s obligations.

H.3.Delivery of Pertinent Portion of Construction Documents.      Contractor will provide each Subcontractor with a copy of the Construction Documents, or a copy of the por­tions to which Subcontractor will be bound, before entering into subcontracts.

H.4.Owner’s Review of Subcontractors and Subcontractors’ Bids.      Owner may require Contractor to provide Bids from Major Subcontractors, Major Sub-subcontractors, and Major Suppliers. Owner, Owner Rep, and Contractor will review the Bids and agree on selection. Contractor will not use a subcontractor or supplier to whom Owner has a reasonable objection. Contractor will not be required to enter into a subcontract or other agreement if Contractor reasonably objects to use of such subcontractor or supplier. If Owner requires Con­tractor to use a specific subcontractor or supplier instead of the subcontractor or supplier rec­ommended by Contractor who has submitted a lower Bid, the Guaranteed Maximum Price will be increased by the additional amount of the Bid from Owner’s required subcontractor or supplier.

H.5.Directory.      Contractor will provide Owner Rep with a written list of all its Subcontractors and Suppliers, and the Major Sub-subcontractors and Major Suppliers of any tier, with the address and telephone number of each. An updated list will be provided to Owner Rep within fifteen days after any change. A final list will be provided to Owner Rep on or before the date of Final Completion of the Project.

H.6.Owner’s Objection to Any Subcontractor.      Contractor will not use any Sub­contractor to whom Owner or Owner Rep has a reasonable objection. If the replacement of the Subcontractor due to Owner’s objection results in an increase in cost over the Contractor’s anticipated total Costs of Construction, reasonable adjustment to the Guaranteed Maximum Price will be made by Change Order.

H.7.Owner May Confirm Payments to Subcontractors and Sub-subcontractors.       Owner has the right to contact any Subcontractor or Sub-subcontractor to obtain informa­tion on payments made by Contractor under the subcontract and to obtain lien waivers and bills-paid affidavits.

I.Contingent Assignment of Subcontracts

I.1.Events Triggering Assignment.      Each subcontract is assigned by Contractor to Owner and the surety under a performance bond provided by Contractor, contingent on the occurrence of all of the following:

a.Contractor Default.      Contractor is in default under the Construction Docu­ments.

b.Termination of Contractor.      Owner has terminated Contractor under this Contract pursuant to paragraph N.3. or section O.

c.Assumption of Subcontract.      Owner has notified Contractor and the Subcon­tractor in writing that it assumes the subcontract or that it has made demand on the surety and the surety has so notified the Subcontractor.

I.2.Contacting Subcontractors and Suppliers.      Owner and the surety have the right to contact any Subcontractor or Supplier to obtain a copy of the subcontract, to deter­mine if Contractor is in default under the Subcontract, and to confirm or negotiate the terms for assumption.

I.3.Results of Assumption.      Assumption by Owner results in the following:

a.Equitable Adjustment of Subcontract Price.      If the Work has been sus­pended for more than thirty days, the Subcontract price will be equitably adjusted for increases in cost caused by the suspension; contractor will be lia­ble for the additional Costs of Construction.

b.Replacement Contractor.      Owner may assign a subcontract that it has assumed to a replacement contractor but will remain liable for the obligations under the subcontract.

c.Continued Liability of Contractor.      Contractor will remain liable to Owner and the Subcontractor or Supplier for             any unpaid amounts due to the Subcon­tractor or Supplier, and for any increases in the Costs of Construction described in paragraph F.2., even if the increase does not result in the total Contract Price exceeding the Guaranteed Maximum Price.

J.Payment

J.1.Progress Draws and Final Payment.      The Contract Price is payable through Progress Draws and Final Payment as described in this section. Owner will have the right to withhold the statutory Reservation from each Progress Draw. Retainage due to Contractor will be included in the Final Payment.

J.2.Progress Payments.      On or before the twenty-fifth day of each month after the commencement of Construction (the “Draw Date”), Contractor will assemble and present to Owner Rep a Draw Request for payment for conforming Work performed since the previous Draw Date. The amount of each Draw will be computed as follows, in the following order of operations:

a.Assigned Percentage of Completion.      For each item in the Schedule of Val­ues (“Scheduled Value Item”) the Contractor will assign a percentage for the conforming Work accomplished through the Draw Date.

b.Draw Individual Scheduled Amount.      Multiply each item on the Schedule of Values by its assigned percentage of completion (“Draw Individual Sched­uled Value Amount”).

c.Costs of Construction for Each Scheduled Value Item.      Determine the Costs of Construction for the Draw period, separate such Costs of Construction by Scheduled Value Item, and calculate the    subtotal of the Costs of Construc­tion for each Scheduled Value Item.

d.Lesser Of.      Compare each Draw Individual Scheduled Value Amount with the assembled Costs of Construction for each item in the Schedule of Values and include the lesser of the two figures in the amount of the Draw Request.

e.Sum of Lesser Amounts.      The total Draw will be the sum of the lesser of the two figures for each Scheduled Value.

f.Contractor’s Fee.      Calculate Contractor’s Fee earned through the Draw Date by multiplying the Contractor’s Fee percentage by the total calculated in subparagraph e. above.

g.Deduct Statutory Reservation.      Deduct the statutory Reservation from the sum of subparagraphs e. and f. above.

h.Deduct Previous Payments to Contractor.      Deduct payments previously made to Contractor.

i.Deduct Paid by Owner to Contractor’s Suppliers and Subcontractors. Deduct amounts paid by Owner to Contractor’s suppliers or subcontractors.

j.Deduct Amounts Authorized to Be Withheld.      Deduct amounts that Owner Rep has determined to withhold as provided in paragraph J.10.

J.3.Supporting Documents.      Each Progress Draw Request must include the fol­lowing supporting documents:

a.Records.      The receipts, invoices, delivery tickets, subcontractor draws, and other documentation reasonably required by Owner Rep substantiating the Costs of Construction for the Draw Period for which payment is sought.

b.Contractor’s Bills-Paid Affidavit.      Bills-Paid Affidavit by Contractor in the form attached as Exhibit E. [See form 19-4 in this chapter.]

c.Subcontractors’ Bills-Paid Affidavits.      Bills-Paid Affidavit by each Subcon­tractor in the form attached as Exhibit F. [See form 19-5.]

d.Contractor’s Conditional Partial Release.      Contractor’s Conditional Partial Release in the form attached as Exhibit G. [See form 19-6.]

e.Contractor’s Unconditional Partial Release.      Contractor’s Unconditional Partial Release in the form attached as Exhibit H. [See form 19-7.]

f.Subcontractors’ Conditional Partial Releases.      Subcontractor’s Conditional Partial Release from each Subcontractor to be paid from the Draw in the form attached as Exhibit G. [See form 19-6.]

g.Subcontractors’ Unconditional Partial Releases.      Subcontractor’s Uncondi­tional Partial Release from each Subcontractor for which Contractor received payment as a part of the prior month’s Progress Draw in the form attached as Exhibit H. [See form 19-7.]

J.4.Payment of Undisputed Items.      Owner Rep will review the Draw Request and advise Owner whether to pay it in full or in part. Contractor will promptly provide any addi­tional documentation reasonably requested and answer any questions on the Draw Request. Owner Rep will promptly notify Contractor of any disputed items in the Draw Request. Owner will have thirty days after the later of (a) the Draw Date or (b) the date that Owner Rep received the Draw Request and required documentation, to pay undisputed items. Undisputed items not paid when due will bear interest until paid at the rate specified in the Texas Prompt Payment Act, Texas Property Code chapter 28.

J.5.Claims for Payment Disputes.      Either party may make a Claim in connection with a payment dispute.

J.6.Final Payment.      Final payment will be made according to the following job inspection and closeout process, and is subject to the conditions precedent to final payment, as follows:

a.Substantial Completion; Final Completion.      When Contractor determines that the Work has progressed to the point of reaching Substantial Completion, Contractor will give written notice to Owner Rep, and Owner Rep will promptly inspect the Work. If Owner Rep determines that the Work is Sub­stantially Complete, Owner Rep will issue a certificate of substantial comple­tion and prepare a punch list for Work that needs to be completed along with an agreed-on time for completion. If Owner Rep determines that the Work is not acceptable or is not Substantially Complete, Owner Rep will prepare a written list of Work that needs to be remedied or completed to achieve Sub­stantial Completion. Contractor shall perform the Work to achieve Final Completion of the Work, including completion of all punch list items, within thirty days after receipt of Owner Rep’s list or within an agreed-on period for completion. Owner Rep will determine the dates for Substantial and Final Completion.

b.Final Draw.      Upon Owner Rep’s written acknowledgement that the punch list has been completed, Contractor will submit a Final Draw Request. The amount of the final draw (“Final Payment”) will be the balance of the Con­tract Price, after deducting amounts paid by Owner to Suppliers, Subcontrac­tors, and Sub-subcontractors, amounts for unreleased mechanic’s liens, amounts withheld by Owner pursuant to paragraph J.10., and previous pay­ments to Contractor.

c.Conditions Precedent to Final Payment.      The following are Conditions Precedent to Final Payment:

i.Final Draw Request.      Receipt and approval by Owner, upon recom­mendation of Owner Rep, of a Final Draw Request.

ii.List of Subcontractors and Suppliers.      Receipt by Owner Rep of Con­tractor’s final and accurate list of Subcontractors and Suppliers in com­pliance with paragraph H.5.

iii.Conditional Final Releases.      Executed and acknowledged Conditional Final Releases from Contractor and all Subcontractors, in the form attached as Exhibit I. [See form 19-8 in this chapter.] The amounts con­tained in these Releases must match amounts stated as owed in the Final Bills-Paid Affidavits. [See forms 19-9 and 19-10.]

iv.Final Bills-Paid Affidavits.      Executed and acknowledged Final Bills-Paid Affidavits from Contractor, Subcontractors, and Suppliers, in the forms attached as Exhibits J and K. [See forms 19-9 and 19-10.]

v.Subcontractors’ Unconditional Partial and Final Releases.       Uncondi­tional Partial Releases (Exhibit H) and Unconditional Final Releases (Exhibit L) from Subcontractors who have been previously paid. [See forms 19-7 and 19-11.]

vi.Suppliers’ and Sub-subcontactors’ Unconditional Partial and Final Releases for Amounts Previously Paid.      Unconditional Partial Releases (Exhibit H) and Unconditional Final Releases (Exhibit L) from Suppli­ers and Sub-subcontractors of all tiers who have been previously paid. [See forms 19-7 and 19-11.]

vii.Suppliers’ and Sub-subcontactors’ Conditional Final Releases for Amounts Not Previously Paid.      Conditional Final Releases from all Subcontractors, Sub-subcontractors, and Suppliers of all tiers who have not been previously paid, in the form attached as Exhibit I. [See form 19-8.]

viii.Release of All Filed Mechanic’s Liens.      Receipt by Owner Rep of exe­cuted, acknowledged releases of all filed mechanic’s liens against the Project, or Contractor will provide satisfactory evidence that Contractor has bonded around such lien claims pursuant to chapter 53 of the Texas Property Code.

ix.Bond to Pay Claims.      If a Subcontractor or Supplier of any tier refuses to provide a Conditional or Unconditional Release for the applicable amount stated in the Bills-Paid Affidavits, or if there is otherwise a dis­pute about payment, satisfactory evidence that Contractor has bonded around such lien claims pursuant to chapter 53 of the Texas Property Code or has provided other arrangements accepted by Owner in writing as sufficient to secure indemnity from such lien or claim.

x.Subcontractors’, Sub-subcontractors’, and Suppliers’ Conditional Final Releases.      Conditional Final Releases from each Subcontractor, Sub-subcontractor, or Supplier from whom Owner has received a notification of nonpayment or the right to assert a claim, unless Contractor has pro­vided Owner with satisfactory evidence that Contractor has bonded around such a lien claim pursuant to chapter 53 of the Texas Property Code or has provided other arrangements accepted by Owner in writing as sufficient to secure indemnity from such lien or claim.

xi.Warranty Documents.      Contractor has assigned and delivered to Owner all required warranty documents required that have been assigned to Owner.

xii.As-Built Drawings.      As-built drawings have been delivered to Owner Rep.

xiii.Owner Manuals and Training Completed.      All Owner Manuals and keys have been delivered to Owner Rep, and Project control/security and other systems checkout and training contemplated by the Construc­tion Documents has been performed.

J.7.Date of Final Payment.      The Final Payment, including release of all Retainage payable to Contractor, is due within fifty days after the Conditions Precedent to Final Payment have been satisfied or waived by Owner in writing.

J.8.Filing Affidavit of Completion.      Owner will file in the real property records of each county in which the Project is located and provide notice to Contractor of its Affidavit of Completion (Exhibit O) [see form 19-14] within three Business Days after both of the follow­ing have occurred: (a) the Conditions Precedent to Final Payment have been met, and (b) Owner Rep has received Contractor’s Final Draw Request.

J.9.Resolution of Lien Claims.      Any notice of lien claims or lien affidavits filed after notice and recordation of the Owner Affidavit will be resolved by Contractor and Owner Rep in accordance with one of the methods described in subparagraph J.6.c.viii., ix., or x. above, at Owner’s sole discretion.

J.10.Withholding Payment.      Owner has the right to withhold from payments other­wise due to Contractor amounts deemed reasonably necessary, on advice from Owner Rep, to protect Owner from damage or liability due to any of the following:

a.Defects.      Uncorrected defective work.

b.Overruns.      Reasonable evidence that the Contract Price will exceed the Guaranteed Maximum Price before Final Completion.

c.Injuries or Property Damages.      Claims of injury or property damage to Owner, a third party, or another contractor.

d.Delays.      Reasonable evidence that Substantial Completion will not be reached according to the Construction Schedule, as revised.

e.Work Defaults.      Repeated failure by Contractor to perform the Work according to the Construction Documents.

f.Mechanic’s Liens.      Mechanic’s liens filed or noticed on the Project not removed by Contractor’s furnishing a bond acceptable to Owner pursuant to chapter 53 of the Texas Property Code or other Contractor arrangements accepted by Owner in writing as sufficient to secure indemnity from such lien or claim.

When the basis for withholding has been resolved, Owner will promptly pay to Con­tractor any amounts not needed to protect Owner from damage or liability.

J.11.Owner Payment to Subcontractors.      Owner will promptly notify Contractor if Owner receives a notice of nonpayment from a Subcontractor or Supplier of any tier. If Con­tractor does not provide Owner Rep with an Unconditional Release (Exhibit L) [see form 19-11] for the amount owed, or satisfactory evidence that Contractor has bonded around the claim within fifteen days after notification, Owner may make payment by joint check to Contractor and the claimant, unless a payment bond has been provided for the Project.

J.12.Acceptance of Final Payment.      Final Payment will be deemed accepted by Contractor when the check has been deposited or wire transfer received. Acceptance of Final Payment by Contractor constitutes a waiver of all claims by Contractor not previously received in writing by Owner Rep.

K.Change Orders and Required Changes

K.1.Guaranteed Maximum Price and Contract Time.      Owner, without invalidating the Contract, may order changes in the Work. All changes will be made by written Change Order, signed by Owner and Contractor, that states the adjustment in the Guaranteed Maxi­mum Price and the Contract Time.

K.2.Contractor to Proceed.      If Owner and Contractor cannot agree on the adjust­ment to the Guaranteed Maximum Price, Owner may require Contractor to proceed with the Work by written Required Change signed by Owner. The Guaranteed Maximum Price will be adjusted on a time and materials basis.

L.Claims

L.1.Contractor’s Claims.      Contractor’s Claims for extensions of time or changes to the Guaranteed Maximum Price must be submitted to Owner Rep in writing within seven days after the date when the events giving rise to the Claim occurred. Within fourteen days after the submission of such Claim, Contractor will furnish Owner Rep with Contractor’s cal­culations of additional time needed to complete the Work and, if applicable, the anticipated increase to the Costs of Construction and documentation supporting Contractor’s Claim. Con­tractor will furnish additional information in support of such Claims as reasonably required by Owner or Owner Rep. Contractor will proceed with the Work during the pendency of any such Claims.

L.2.Material Breaches.      Notwithstanding anything to the contrary in the Construc­tion Documents, Contractor agrees that it will not attempt in any way to recover or pursue a Claim for delay if Contractor or a Subcontractor, Sub-subcontractor, or Supplier to Contractor has, before the claimed Delay, materially breached any contractual duty or obligation in the Construction Documents, or any duty or obligation at common law or created by statute, to the extent such breach causes, affects, or otherwise contributes to such delay, and such breach remains uncured at the time a Claim accrues.

L.3.Owner Claims.      Owner agrees to notify Contractor of any Claim, including Claims for Unexcused Delay and defects in the Work, within five Business Days after Owner becomes aware of the basis for the Claim.

L.4.Initial Decision Maker Process.      All Claims arising under this Contract will be first submitted to Owner Rep as the Initial Decision Maker. Owner Rep’s decision is a condi­tion precedent to proceeding with mediation, as provided for in paragraph L.5. Owner Rep will issue a decision within thirty days after receiving the Claim and supporting documenta­tion. Owner Rep may extend the initial decision deadline for up to an additional thirty days in order to receive supporting documentation and data and replies from the opposing party. If Owner Rep is unable to render a decision within the allotted period, or if either party is dissat­isfied with the decision, either party may request mediation.

L.5.Mediation.      If the dispute is not resolved by the decision of the Initial Decision Maker, either party may request mediation of the dispute using a neutral mediator to be agreed on by the parties. Contractor will continue to perform the Work during the pendency of medi­ation.

L.6.Litigation.      If a resolution is not reached through mediation, either party may pursue litigation.

M.Material Breach

M.1.Owner’s Default.      Each of the following constitutes a material breach of this Contract by Owner:

a.Time Defaults.      Failure to timely render or otherwise furnish responses, decisions, or selections according to the Construction Documents.

b.Payment Defaults.      Failure to comply with Owner’s payment obligations under the Construction Documents.

c.Substantial Breach.      Substantial breach of any of Owner’s obligations under this Contract.

M.2.Contractor’s Default.      Each of the following constitutes a material breach of this Contract by Contractor:

a.Work Commencement Default.      Failure by Contractor to commence the Work in accordance with the provisions of this Contract.

b.Work Prosecution Default.      Failure by Contractor to prosecute the Work to completion in a diligent, efficient, timely, workmanlike, skillful, and careful manner and in strict accordance with the provisions of the Contract.

c.Time Defaults.      Failure by Contractor to use an adequate number of quali­fied personnel or adequate amount of equipment to complete the Work with­out causing Unexcused Delay.

d.Performance Defaults.      Contractor’s persistent failure to perform any of its material obligations under the Contract.

e.Payment Defaults.      Contractor’s persistent failure to make prompt payments when due to its Subcontractors and Suppliers unless Contractor has a bona fide dispute with any such Subcontractor or Supplier.

f.Bankrupt.      Contractor creates any situation or state of facts that would authorize or permit an involuntary petition in bankruptcy to be filed against Contractor.

g.Breach of Timely Completion.      Contractor has not met, or in Owner Rep’s and Owner’s reasonable opinion, based on the schedules required by the Con­struction Documents, will not meet the dates of Substantial Completion set forth in the Construction Documents.

N.Remedies

N.1.Owner Remedies

a.Owner’s Right to Suspend Work.      If Contractor fails, after notice to correct Work that is defective or not in conformance with the requirements of the Construction Documents, or repeatedly fails to perform the Work in accor­dance with the Construction Documents, Owner or Owner Rep may issue a written notice to Contractor to suspend the Work, in whole or part, until Con­tractor cures the reasons for issuance of the suspension notice. Owner’s right in this section does not create a duty by Owner to suspend work for the bene­fit of Contractor or Subcontractors of any tier.

b.Owner Cure.      If Contractor is in default and does not within ten Business Days after receipt of Owner’s or Owner Rep’s written notice to commence and continue diligent, continuous effort to correct the default, Owner may cure such default and withhold payment from Contractor for the reasonable cost and expenses incurred for Owner’s cure. If insufficient amounts remain to be paid to Contractor, Contractor must pay Owner the reasonable costs and expenses to cure in excess of the remaining funds to be paid to Contractor.

N.2.Contractor Remedies.      Contractor will give written notice to Owner or Owner Rep if Owner is in material breach of Owner obligations under the Construction Documents. The notice will state the specific items of Owner default and notify Owner that Owner must cure the items within ten Business Days of receipt of the notice or Contractor may suspend Work until Owner’s material breach is cured or corrected. Contractor may terminate the Con­tract in accordance with paragraph N.3. if suspension of the Work by Contractor under this section continues without Owner cure for thirty or more days.

N.3.Termination.      If one party defaults and the default is not cured by exercise of the remedies specified in paragraph N.1. or N.2., upon an additional ten Business Days’ prior written notice specifically describing the default, and provided the defaulting party has not commenced diligent, good-faith, continuous, and effective action to cure the default within the ten-day period, this Contract may be terminated by an additional written notice from the nondefaulting party to the defaulting party. If there is such a termination, the following for­mula is agreed on as a reasonable and fair way to assess the actual damages, without the expense and delay associated with other forms of dispute resolution:

a.Damages to Contractor.      If termination resulted from an act of default of Owner, Owner will pay to Contractor, within thirty days after written notice from Contractor, an amount equal to all amounts due and owing for the Work performed in accordance with the Construction Documents at the time of the termination, plus 10 percent of the remaining Guaranteed Maximum Price to compensate Contractor for the lost profit.

b.Damages to Owner.      If termination resulted from an act of default of Con­tractor, Owner may do any of the following:

i.Take Over Work.      Use all materials, equipment, tools, and construction equipment owned by Contractor and occupy the Project site.

ii.Accept Subcontracts and Supplier Agreements.      Accept assignment of Subcontracts and assume, in Owner’s sole discretions, any agreements with Suppliers and Sub-subcontractors.

iii.Costs to Complete.      Finish the Work as expeditiously as reasonably possible provided the costs for completion and correction of the Work are reasonable and necessary. If requested, Owner will furnish Contrac­tor a statement of costs in correcting and completing the Work, along with reasonable documentation of such costs. If Owner terminates according to this paragraph, no further payments will be due Contractor until final completion is reached. If, at that time, Owner’s costs to com­plete and correct the Work exceed the unpaid balance of the Guaranteed Maximum Price, Contractor will pay the difference to Owner upon writ­ten demand.

iv.Liquidated Damages.       Assess liquidated damages if Substantial Com­pletion has not been achieved as provided in Exhibit C.

c.Recourse to Performance Bond.      Upon the occurrence of a Contractor default, Owner may make demand on the surety to perform its obligations under a Performance Bond provided for the Project.

N.4.Damages for Contractor’s Unexcused Delay.      If the Work is not Substantially Complete by the Substantial Completion Date due to Contractor’s Unexcused Delay, Owner may assess liquidated damages as provided in Exhibit C.

N.5.Excused Delay.      If it is determined that Contractor has been delayed by an Excused Delay, the time to complete the Work will be extended by one day for each day of an Excused Delay. This extension of the Contract Time will be Contractor’s sole remedy for an Excused Delay, and no monetary damage or other compensation is due Contractor for such delay.

N.6.Damages for Owner’s Delay.      If it is determined that Contractor has been delayed by an Excused Delay, the time to complete the Work will be extended by one day for each day of an Excused Delay. This extension of the Contract Time will be Contractor’s sole remedy for an Excused Delay, unless the delay is due to acts of Owner constituting unreason­able interference with Contractor’s ability to perform the Work that continues after notice of the interference is given by Contractor. The exercise by Owner of any right provided by this Contract, including suspension of Work, does not constitute unreasonable interference with Contractor’s ability to perform the Work. Contractor will be entitled to the General Condi­tions and other direct Costs of Construction described in paragraph F.2. for each day of delay due to Owner’s interference.

N.7.Waiver of Consequential Damages.      Except as provided in this section N., Owner and Contractor each waive the right to recover consequential damages in a suit or action brought against the other arising out of a default under the Construction Documents, regardless of whether the claim for recovery is based in contract or tort.

O.Owner’s Right to Terminate for Convenience.      Owner has the right to terminate this Contract for Owner’s convenience by giving Contractor thirty days’ prior written notice of termination. Upon such termination, Contractor will be entitled to payment as described in subparagraph N.3.a.

P.Warranties 

P.1.Express Warranty.      Contractor warrants to Owner that labor, materials, and equipment furnished under the Contract will be new and of high quality and will be free from defects and that all Work will be performed in a good and workmanlike manner and will con­form to the Construction Documents. Work will be considered defective if it does not conform to the Construction Documents.

P.2.Ten-Year Structural Component Warranty.      Contractor additionally expressly warrants all structural components of the Project, including the foundation, for ten years fol­lowing Substantial Completion.

P.3.One-Year Callback and Correction of Work.      For a period of one year follow­ing Substantial Completion, Contractor will repair or replace any defective Work at no charge if Owner provides written notice to Contractor of a warranty claim during the one-year war­ranty period.

P.4.Assignment of Third-Party Warranties.      Contractor hereby assigns all equip­ment, roofing, and other vendor warranties to Owner and will deliver all manuals, books, instructions, and warranty policy documentation to Owner as part of the Conditions to Final Payment.

P.5. Cumulative of Other Warranties and Remedies.      The warranties set forth in this section P. are cumulative of, and in addition to, all other warranties or remedies available at law or by this Contract and can be assigned by Owner.

Q.Safety

Q.1.Construction Means, Methods, Techniques, Sequences, and Procedures.
Owner will not have control over or charge of and will not be responsible for construction means, methods, techniques, sequences, or procedures used or for safety precautions and pro­grams in connection with the Work, since these are solely Contractor’s responsibility.

Q.2.Compliance with Applicable Laws.      Contractor shall give notices and comply with applicable laws, ordinances, rules, regulations, and lawful orders of public authorities bearing on safety of persons and property and their protection from damage, injury, or loss.

Q.3.Remedy Contractor-Caused Property Damage.      Contractor shall promptly remedy damage and loss to property at the site, or off-site, if caused in whole or in part by Contractor, a Subcontractor, or anyone directly or indirectly employed by any of them or by anyone for whose acts they may be liable and for which Contractor is responsible.

Q.4.Reasonable Precautions and Reasonable Protection.      As between Contractor and Owner, Contractor shall be responsible for all safety at the Project Site, including safety of personnel, material, and the Work. Contractor shall be responsible for providing any secu­rity necessary to prevent damage or loss to materials, equipment, the Improvements, and other property in the vicinity of the Project until Final Completion.

R.Indemnity

R.1.Claims Other than Employee Claims.      To the fullest extent permitted by applicable law, Contractor shall indemnify, defend, and hold harmless Lender, Owner, Owner’s members, managers,  partners, affiliated companies of Owner, and any partner, and their respective officers, directors, shareholders, employ­ees, and agents (collectively, the “Indemnitees”) from all claims, suits, actions, proceedings, damages, losses, and expenses whatsoever, including attorney’s fees, connected with performance of this Contract or the construction contem­plated by this Contract to the extent caused by the breach of contract, negli­gence, or other act or omission of Contractor, its Subcontractors, Sub-subcontractors of any tier, or anyone directly or indirectly employed by them or anyone for whose acts they may be liable.

R.2.Employee Claims.      In addition, regarding claims for the bodily injury or death of an employee of Contractor, its agent(s), or its Subcontractors of any tier (hereinafter referred to as “Employee Claim” or “Employee Claims”), Contractor will indemnify, defend, and hold harmless Indemnitees from all such Employee Claims, suits, actions, proceedings, damages, losses, and expenses whatsoever connected with performance of this Contract, including such Employee Claims, damages, losses, or expenses actually or allegedly arising in whole or in part from the negligence of Indemnitees. It is the expressed intent of Contractor and Owner that in the case of an Employee Claim, the indemnity pro­vided for in this section is an indemnity extended by Contractor to indemnify and protect Indemnitees from the consequences of Indemnitees’ own negligence whether or not that negligence is the sole or contributing cause of the resul­tant Employee Claims. Contractor further agrees in this connection to defend at its own expense Indemnitees from any claims or litigation in connection with any such Employee Claims.

[R.2./R.3.]   Limitations.      In claims against any person or entity indemnified under this section by an employee of Contractor, a Subcontractor, or anyone directly or indirectly employed by them or anyone for whose acts they may be liable, the indemnification obliga­tion under this agreement shall not be limited by a limitation on amount or type of damages, compensation, or benefits payable by or for Contractor or a Subcontractor under workers’ compensation acts, disability benefit acts, or other employee benefit acts.

S.Miscellaneous

S.1.Effect of Invalid Provision.      Should any clause in this Contract be found invalid by a court of law, the remainder of the Contract shall not be affected thereby, and all other provisions of this Contract shall remain valid and enforceable.

S.2.Entire Agreement; Modification.      The Construction Documents contain the entire agreement between the parties for the construction of the Project and cannot be modi­fied except by written Change Order or modification.

S.3.Nonassignment.      This Contract shall not be assigned by Contractor without the written consent of Owner. This limitation shall not apply to Contractor’s right to retain Sub­contractors for the prosecution of portions of the Work in the normal course of its construction business.

S.4.Execution of Other Documents; Further Action.      Each party shall, on demand, execute or obtain such other documents or instruments and corrective filings or instruments and use all commercially reasonable efforts to do or cause such other things as may be reason­ably necessary or desirable to effect the provisions and purposes of this Contract.

S.5.Fees and Expenses of Actions.      If any litigation (an “Action”) is commenced, including an Action for declaratory relief, to enforce or interpret the terms of this Contract, or any document or instrument executed in connection with or pursuant to this Contract, or involving any controversy or Claim between or among the parties to this Contract, whether sounding in contract, tort, or statute, whether through arbitration, probate, bankruptcy, receiv­ership, or other judicial or administrative proceeding, the prevailing party in such Action (the “Prevailing Party”) shall be entitled to recover reasonable attorney’s fees, paralegal costs, expert witness and consulting expert fees and costs, and other expenses, costs, and necessary disbursements incurred by the Prevailing Party in the investigation, preparation, pursuit, or defense of any claim asserted by any party in such Action in addition to any other relief to which the Prevailing Party may be otherwise entitled, at law or hereunder, in the amount determined by the fact finder(s) or the court.

S.6.Gender and Number.      Unless otherwise required by context, the genders shall include each other and the singular shall include the plural and the plural the singular.

S.7.Headings.      Headings, tables of contents, captions, titles, and marginal nota­tions are for convenience only and shall not limit or restrict the interpretation or construction of the passage(s) to which such headings, tables of contents, captions, titles, and notations may relate.

S.8.Notices.      Any notice to be given or to be served on any party hereto, in connec­tion with this instrument, must be in writing and may be given in person or by courier, over­night delivery service, e-mail, or certified or registered mail. Such notice shall be deemed to have been given and received when actually received, in the case of hand delivery, overnight delivery service, or express mail; when a certified or registered letter containing such notice, properly addressed, with postage prepaid, is deposited in the United States mail; and, if given by e-mail, when received by the party to whom it is addressed. Notice shall be given to Owner, Owner Rep, and Contractor at the addresses set forth at the beginning of this Contract. Any party hereto may at any time by giving five days’ written notice to the other party hereto designate any other address, phone number, or e-mail address in substitution of the address, phone number, or e-mail address set forth at the beginning of this Contract to which such notice shall be given. Owner Rep must be copied on any notice given to Owner.

S.9.Schedules, Addenda, Exhibits, and Attachments.      All schedules, addenda, exhibits, and attachments and other documents or items identified as being attached hereto (the “Exhibits”) shall be a part of this Contract for all purposes. Exhibits may be changed from time to time as the parties may agree. When Exhibits are changed, they shall be redrafted in accordance with agreed changes, dated as of the effective date of such changes, and signed by the parties. Copies of changed Exhibits shall be furnished to each party, and such changed Exhibits shall become a part of this Contract for all purposes. An Exhibit that has been changed shall cease to be a part of this Contract, and the most recently dated Exhibit, signed by all parties, shall govern.

S.10.Third-Party Beneficiaries; None Created.      Nothing express or implied in this Contract is intended to confer, nor shall anything herein confer, on any person other than the parties hereto and the respective successors or assigns of the parties hereto, any rights, reme­dies, obligations, or liabilities whatsoever.

S.11.Waiver.      No waiver of any term of this Contract shall be valid unless it is in writing and signed by both parties. The failure of any party at any time or times to require per­formance of any provision hereof shall in no manner affect the right to enforce the provision. No waiver by any party of any condition contained in this Contract, or of the breach of any term, provision, representation, warranty, or covenant contained in this Contract, in any one or more instances, shall be deemed to be or construed as a further or continuing waiver of any such condition or breach or as a waiver of any other condition or of the breach of any other term, provision, representation, warranty, or covenant.

S.12.Lender Cooperation.      Contractor agrees to cooperate, and cause its Subcon­tractors to cooperate, with the reasonable requirements of any Lender that Owner may elect to obtain financing from, including the requirement that Contractor subordinate, and cause its Subcontractors to subordinate, any lien they may have by statute against the Property to the lien of the Lender.

S.13.Independent Contractor.      Contractor occupies the status of an independent contractor, as that term is defined in the construction industry.

   
[Name of owner]

   
[Name of contractor]

Exhibit A

Project Site Legal Description

Exhibit B

Plans and Specifications

1.Specifications:

Section   Title   Date    Pages

2.Drawings:

Number   Title   Date

3.Addenda including Supplemental Conditions, if any:

Number   Date   Pages

Addenda relating to bidding/proposal requirements are not part of the Construction Documents unless the bidding/proposal documents are also listed as Construction Documents in paragraph B.1. of this Contract.

Exhibit C

Contract Price; Guaranteed Maximum Price;
Allocation of Savings; Liquidated Damages

The Contract Price for the Project is the sum of the following amounts:

Total Contract Price not to exceed $[amount], the Guaranteed Maximum Price

Cost Savings (as defined in section A.) shall be allocated between Owner and Contractor as follows:

Owner:      [percent]%

Contractor:         [percent]%

Check if applicable:

¨   Liquidated Damages

Owner has the right to assess Liquidated Damages in the amount of $[amount] per day for each day after the Substantial Completion Date that Substantial Completion has not been achieved due to Contractor’s Unexcused Delay. Owner has the right to withhold Liquidated Damages from the amounts due to Contractor. Owner and Contractor stipulate that the dam­ages for the prospective breach of the Contract are difficult to measure and the Liquidated Damages amount is a reasonable estimate of actual damages.