Guaranteed maximum price clause samples

.5 A date by which the Owner must accept the Guaranteed Maximum Price. § 2.2.4 In preparing the Construction Manager’s Guaranteed Maximum Price proposal, the Construction Manager shall include its contingency for the Construction Manager’s exclusive use to cover those costs considered reimbursable as the Cost of the Work but not included in a Change Order.

(b) Reasonable costs outlined in Section6.3(a) also may be allowable as a Cost of the Work, even if such costs are not fully recovered from the responsible Subcontractor(s), provided the Construction Manager, with the approval of the Owner (which approval shall not be unreasonably withheld), (i) after due consideration, determines that continuing efforts to obtain full recovery from the responsible Subcontractor(s) are unlikely to achieve significant additional recoveries and (ii)thus recommends resolving or settling the back charge/credit at an amount less than full recovery; provided, further, however, that any unrecovered costs shall be covered by the Construction Manager’s contingency and shall not result in any increase in the Guaranteed Maximum Price. § 6.3.1 The Construction Manager (with respect to its suppliers, Subcontractors and all Sub-subcontractors) shall provide Owner advance written notice and shall obtain Owner’s approval for any proposed subcontract change order, material purchase order, or other financial commitment in an amount in excess often thousand dollars ($10,000.00) prior to placing such order or entering into such agreement (regardless of whether or not any such commitment will affect the Guaranteed Maximum Price). It is agreed that sums applicable to any subcontract change order, purchase order or other financial commitment entered into in violation of the above notice and approval requirement shall not be included in the amounts owing to Construction Manager or Subcontractors ( of any tier) whether as Costs of the Work or as reasonable termination costs in the event of termination. The Construction Manager also shall provide to the Owner copies of all final, executed Change Orders with any Subcontractors.

§ 6.6.5 Royalties and license fees paid for the use of a particular design, process or product required by the Contract Documents; the cost of defending suits or claims for infringement or violation of patent rights, copyrights or other intellectual property rights arising from such requirement of the Contract Documents; and payments made in accordance with legal judgments against the Construction Manager resulting from such suits or claims and payments of settlements made with the Owner’s consent. However, such costs of legal defenses, judgments and settlements shall not be included in the calculation of the Construction Manager’s Fee or subject to the Guaranteed Maximum Price. In the event Construction Manager incurs any royalties, fees, costs of defense of any lawsuits or judgments as a result of improper use or violation of intellectual property rights by the Construction Manager or any Subcontractor (or any tier), which use or violation was not required by the Contract Documents, such costs shall not be reimbursable as a Cost of the Work. Furthermore, if such royalties, fees, costs or judgments are excluded by the next to the last sentence of Section3 .17 of AIA Document A201-2007 or other provisions of the Contract Documents, then they shall not be included in the Cost of the Work.

§ 7.2.4 If, subsequent to final payment and at the Owner’s request, the Construction Manager incurs costs described in Section6. 1.1 and not excluded by Section6.8 to correct defective or nonconforming Work, the Owner shall reimburse the Construction Manager such costs and the Construction Manager’s Fee applicable thereto on the same basis as if such costs had been incurred prior to final payment, but not in excess of the Guaranteed Maximum Price. If the Construction Manager has participated in savings as provided in Section5.2.1, the amount of such savings shall be recalculated and appropriate credit given to the Owner in determining the net amount to be paid by the Owner to the Construction Manager.

Pursuant to Section 2.2.6 of the Agreement, the Owner and Construction Manager hereby amend the Agreement to establish a Guaranteed Maximum Price. As agreed by the Owner and Construction Manager, the Guaranteed Maximum Price is an amount that the Contract Sum shall not exceed. The Contract Sum consists of the Construction Manager’s Fee plus the Cost of the Work, as that term is defined in Article 6 of this Agreement.

§ A.2.1.2 Itemized Statement of the Guaranteed Maximum Price. An itemized statement of the Guaranteed Maximum Price organized by trade categories, allowances, contingencies, alternates, the Construction Manager’s Fee and other items that comprise the Guaranteed Maximum Price, is set forth in Section2 of the GMP Proposal.

§ A.1.1.2 Itemized Statement of the Guaranteed Maximum Price. Provided below is an itemized statement of the Guaranteed Maximum Price organized by trade categories, allowances, contingencies, alternates, the Construction Manager's Fee, and other items that comprise the Guaranteed Maximum Price.

§3.4.3.1 The sum of the Cost of the Work and the Contractor’s Fee is guaranteed by the Contractor not to exceed ($ ), subject to additions and deductions by changes in the Work as provided in the Contract Documents. Such maximum sum is referred to in the Contract Documents as the Guaranteed Maximum Price. Costs which would cause the Guaranteed Maximum Price to be exceeded shall be paid by the Contractor without reimbursement by the Owner.

(G) Landlord shall submit to at least three (3)reputable construction companies as reasonably designated by Landlord, with reasonable promptness after the date Landlord receives the Final Plans, a bid package that describes Landlord’s 41st Floor Work. Landlord shall use Landlord’s diligent efforts to obtain from each of such construction companies a bona fide bid to perform Landlord’s 41st Floor Work. Landlord shall have the right to request that the construction companies submit alternative bids, assuming, for example, that (a)the construction company acts as a general contractor for a fixed price, (b)the construction company acts as a construction manager for a construction management fee (without providing a guaranteed maximum price), and (c)the construction company acts as a construction manager for a construction management fee and provides a guaranteed maximum price. Landlord shall advise Tenant of Landlord’s receipt of the bids from the aforesaid construction companies. Tenant shall have three (3)days to review such bids and modify the Final Plans or any items described therein in an attempt to lower the amount of such bids. Following such three (3)day period, Landlord shall have the right to let the construction contract to the lowest responsible bidder (with the understanding that Landlord shall have the right to exercise Landlord’s reasonable business judgment in selecting the form of contractual arrangement for the construction contract) (the aforesaid construction contract that Landlord lets for Landlord’s 41st Floor Work being referred to herein as the “Construction Contract”).

§ 4.4.3 If the Owner and Design-Builder agree on a proposal, the Owner and Design-Builder shall execute the Design-Build Amendment setting forth the terms of their agreement at the contract sum and terms set forth in that Agreement. The Agreement shall be a cost plus a fee with a Guaranteed Maximum Price. It is anticipated that the Guaranteed Maximum Price for the Project will be established on or about February 28, 2018.

Guaranteed Maximum Price.Guaranteed maximum price contracts (GMP) are common for design-build and commercial and residential projects. GMP contracts share many of the same contract provisions as cost-plus and fixed-price contracts. A contractor performing work pursuant to a cost-plus, GMP or fixed-price contract will all enter into trade contracts directly. Both cost-plus and GMP contracts generally include an agreed lump sum or percentage fee which is called out and separately identified and the contracts are considered 'open' book providing the owner with full disclosure of the project costs. A fixed-price contract provides the owner with a single lump sum amount without specifically identifying the breakdown of fee or costs and is typically 'closed' book thereby providing the owner with little detail as to the project costs. In a GMP contract, unlike the cost-plus contract, the Company provides the owner with a guaranteed price for the overall construction (adjusted for change orders issued by the owner) and with a schedule which includes a completion date for the project. In addition, cost overruns in a GMP contract would generally be the Company's responsibility and in the event the Company's actions or inactions result in delays to the project, the Company may be responsible to the owner for costs associated with such delay. For many of the Company's commercial and residential GMP contracts, the final price is generally not established until the Company have awarded a substantial percentage of the trade contracts and it has negotiated additional contractual limitations, such as mutual waivers of consequential damages as well as aggregate caps on liabilities and liquidated damages.

1. Landlord shall perform certain improvements to the Premises (collectively, the “Landlord’s Work”) using its own contractors in accordance with those plans and specifications prepared by Landlord’s architect and mutually agreed to between Landlord and Tenant, and generally consistent with the initial Test Fit (the “Plans and Specifications”) in compliance with all applicable Legal Requirements. Landlord agrees to contribute an amount equal to $50.00 per rentable square foot of the Premises ($389,550.00) (“Landlord’s Work Allowance”) towards the Landlord’s Work, subject to the guaranteed maximum price set forth below. Landlord hereby approves the initial Test Fit attached hereto as Exhibit F-2 (the “Test Fit”). In addition, Landlord shall also provide Tenant with up to $.10 per rentable square foot of the Premises ($779.91) for the initial Test Fit prepared by Tenant’s architect. Tenant shall reimburse Landlord for all costs in excess of Landlord’s Work Allowance (the “Excess”) on a monthly basis in proportion to the amount the Excess represents to the total costs of Landlord’s Work, subject to the guaranteed maximum price. Notwithstanding the foregoing, Tenant may elect to reimburse Landlord for the Excess through the payment of additional Fixed Rent which shall be amortized by Landlord at the rate of eight percent (8%) over the Lease Term.