Design And Building Agreement

Exhibit 10.9


Standard Form of Agreements Between
Owner and Design/Builder


AIA Document A191 - Electronic Format


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


Copyright 1985, (C) 1996 The American Institute of Architects, 1735 New York Avenue, NW, Washington, DC 20006-5292. Reproduction of the material herein or substantial quotation of its provisions without the written permission of the AIA violates the copyright laws of the United States and will subject the violator to legal prosecution.


________________________________________________________________________________


1996 EDITION


TABLE OF ARTICLES


PART 1 AGREEMENT


1. Design/Builder 6. Dispute Resolution - Mediation
and Arbitration 2. Owner 7. Miscellaneous Provisions 3. Ownership and Use of Documents and 8. Termination of the Agreement
Electronic data 9. Basis of Compensation 4. Time 10. Other Conditions and Services 5. Payments


PART 2 AGREEMENT


1. General Provisions 8. Changes in the Work 2. Owner 9. Correction of Work 3. Design/Builder 10. Dispute Resolution - Mediation
and Arbitration 4. Time 11. Miscellaneous Provisions 5. Payments 12. Termination of the Agreement 6. Protection of Persons and Property 13. Basis of Compensation 7. Insurance and Bonds 14. Other Conditions and Services


Standard Form of Agreements Between
Owner and Design/Builder


AIA Document A191 - Electronic Format


This document comprises two separate Agreements: Part 1 Agreement and Part 2 Agreement. Before executing the Part 1 Agreement. the parties should reach substantial agreement on the Part 2 Agreement. To the extent referenced in these Agreements, subordinate parallel agreements to A191 consist of AIA Document A491, Standard Form of Agreements Between Design/Builder and Contractor. and AIA Document B901, Standard Form of Agreements Between Design/Builder and Architect.


PART 1 AGREEMENT


1996 EDITION


________________________________________________________________________________ AGREEMENT


made as of the 10th day of March in the year of Two Thousand (In words, indicate day, month and year.)


BETWEEN the Owner: (Name and address) IPG Photonics Corporation PO Box 519, 660 Main Street Sturbridge, MA 01566


and the Design/Builder: (Name and address) Aho Construction Inc. Appleton Business Center New Ipswich, NH 03071


For the following Project: (Include Project name, location and a summary description.) Three Story Office and Technology Building, Building #1 & Building #2 20 Old Webster Road, Oxford, MA


The architectural services described in Article 1 will be provided by the following person or entity who is lawfully licensed to practice architecture: (Name and address) (Registration Number) (Relationship to Design/Builder) Maugel Architects 5554 Employed by Design/Builder 30 Domino Drive Concord, MA 01742


Normal structural, mechanical and electrical engineering services will be provided contractually through the Architect except as indicated below:


(Name, address and discipline) (Registration Number) (Relationship to Design/
Builder) Kimball Chase 30734 Employed by Design/Builder 29 New Hampshire Avenue Portsmouth, NH 03801


BLW Engineers, Inc. 38446 Employed by Design/Builder 465 Newtown Road Littleton, MA 01460


The Owner and the Design/Builder agree as set forth below.


TERMS AND CONDITIONS-PART I AGREEMENT


ARTICLE 1
DESIGN/BUILDER


1.1 SERVICES


1.1.1 Preliminary design, budget, and schedule comprise the services required to accomplish the preparation and submission of the Design/Builder's Proposal as well as the preparation and submission of any modifications to the Proposal prior to execution of the Part 2 Agreement.


1.2 RESPONSIBILITIES


1.2.1 Design services required by this Part 1 Agreement shall be performed by qualified architects and other design professionals. The contractual obligations of such professional persons or entities are undertaken and performed in the interest of the Design/Builder. Design/Builder represents and warrants that all parties engaged by it to perform services hereunder will have all necessary licenses, certifications and other professional qualifications.


1.2.2 The agreements between the Design/Builder and the persons or entities identified in this Part 1 Agreement, and any subsequent modifications, shall be in writing. These agreements, including financial arrangements with respect to this Project, shall be promptly and fully disclosed to the Owner upon request.


1.2.3 Construction budgets shall be prepared by qualified professionals, cost estimators or contractors retained by and acting in the interest of the Design/Builder.


1.2.4 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 the Architect and other design professionals, performing any portion of the Design/Builder's obligations under this Part 1 Agreement. Without limiting the generality of the foregoing, the Design/Builder shall indemnify and hold harmless the Owner and any subsidiary, parent or affiliate of the Owner, or other persons or entities designated by the Owner, and their directors, officers, agents, employees, and designees for all losses, liabilities, claims, injuries, damages and expenses, including attorneys' fees, resulting from the acts, errors and omissions committed by the Design/Builder, and all professional engineering consultants, subcontractors and suppliers engaged by the Design/Builder. This Paragraph 1.2.4 shall survive the termination of this Agreement.


1.2.5 If the Design/Builder believes or is advised by the Architect or by another design professional retained 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 the Architect shall be obligated to perform any act which either believes will violate any applicable law.


1.2.6 Nothing contained in this Part 1 Agreement shall create a contractual relationship between the Owner and any person or entity other than the Design/Builder.


1.3 BASIC SERVICES


1.3.1 The Design/Builder in consultation with the Owner and any other persons or entities designated by Owner shall develop a written program and budget for the Project to ascertain Owner's needs and to establish the requirements for the Project


1.3.2 The Design/Builder shall visit the site, become familiar with the local conditions, and correlate observable conditions with the requirements of the Owner's program, schedule, and budget.


1.3.3 The Design/Builder shall review laws applicable to design and construction of the Project; correlate such laws with the Owner's program requirements; and advise the Owner if any program requirement may cause a violation of such laws. Necessary changes to the Owner's program shall be accomplished by appropriate written modification or disclosed as described in Paragraph 1.3.5.


1.3.4 The Design/Builder shall review with the Owner alternative approaches to design and construction of the Project.


1.3.5 The Design/Builder shall submit to the Owner a Proposal, including the completed Preliminary Design Documents, a statement of the proposed contract sum, and a proposed schedule for completion of the Project. Preliminary Design Documents shall consist of preliminary design drawings, outline specifications and other documents sufficient to establish the size, quality and character of the entire Project, its architectural, structural, mechanical and electrical systems, and the materials and such other elements of the Project as may be appropriate. Deviations from the Owner's program shall be disclosed in the Proposal. If the Proposal is accepted by the Owner, the parties shall then execute the Part 2 Agreement. A modification to the Proposal before execution of the Part 2 Agreement shall be recorded in writing as an addendum and shall be identified in the Contract Documents of the Part 2 Agreement.


1.3.6 The Design/Builder shall plan and organize all meetings, record minutes of meetings, and circulate such documents to the appropriate parties for information and review on or before the next scheduled meeting.


1.4 ADDITIONAL SERVICES


1.4.1 The Additional Services described under this Paragraph 1.4 shall be provided by the Design/Builder and paid for by the Owner if authorized or confirmed in writing by the Owner. "Authorized" means approved in writing, including subsequent written confirmation of previous verbal authorization by the Owner.


1.4.2 Making revisions in the Preliminary Design Documents, budget or other documents when such revisions are:


.1 inconsistent with approvals or instructions previously given by the
Owner, including revisions made necessary by adjustments in the
Owner's program or Project budget. "Approval" means approval in
writing, including subsequent written confirmation of previous verbal
approvals by the Owner;


.2 required by the enactment or revision of codes, laws or regulations
subsequent to the preparation of such documents; or


.3 due to changes required as a result of the Owner's failure to render
decisions in a timely manner.


1.4.3 Providing more extensive programmatic criteria than that furnished by the Owner as described in Paragraph 2.1. When authorized, the Design/Builder shall provide professional services to assist the Owner in the preparation of the program. Programming services may consist of:


.1 consulting with the Owner and other persons or entities not designated
in this Part 1 Agreement to define the program requirements of the
Project and to review the understanding of such requirements with the
Owner;


.2 documentation of the applicable requirements necessary for the
various Project functions or operations;


.3 providing a review and analysis of the functional and organizational
relationships, requirements, and objectives for the Project;


.4 setting forth a written program of requirements for the Owner's
approval which summarizes the Owner's objectives, schedule,
constraints, and criteria.


1.4.4 Providing financial feasibility or other special studies.


1.4.5 Providing planning surveys, site evaluations, or comparative studies of prospective sites.


1.4.6 Providing special surveys, environmental studies, and submissions required for approvals of governmental authorities or others having jurisdiction over the Project, but not including renderings required for or in connection with such approvals.


1.4.7 Providing services relative to future facilities, systems, and equipment.


1.4.8 Providing services at the Owner's specific request to perform detailed investigations of existing conditions or facilities or to make measured drawings thereof.


1.4.9 Providing services at the Owner's specific request to verify the accuracy of drawings or other information furnished by the Owner.


1.4.10 Coordinating services in connection with the work of separate persons or entities retained by the Owner, subsequent to the execution of this Part 1 Agreement.


1.4.11 Providing analyses of owning and operating costs.


1.4.12 Providing interior design and other similar services required for or in connection with the selection, procurement or installation of furniture, furnishings, and related equipment.


1.4.13 Providing services for planning tenant or rental spaces.


1.4.14 Making investigations, inventories of materials or equipment, or valuations and detailed appraisals of existing facilities.


ARTICLE 2
OWNER


2.1 RESPONSIBILITIES


2.1.1 The Owner shall provide information regarding requirements for the Project, including but not limited to the Owner's design objectives, constraints and criteria


2.1.2 [deleted]


2.1.3 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 render decisions in a timely manner pertaining to documents submitted by the Design/Builder in order to avoid unreasonable delay in the orderly and sequential


progress of the Design/Builder's services. The Owner may obtain independent review of the 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 Design/Builder's services. If the Owner fails to render decisions pertaining to the documents submitted by the Design/Builder within ten (10) working days after submission by Design/Builder, and if such would cause the Design/Builder to incur additional expenses in order to keep the Project on schedule (for such items as overtime, rush orders, or other similar expenses), then the Design/Builder shall so notify the Owner in writing.


2.1.4 The Owner shall furnish surveys describing physical characteristics, legal limitations and utility locations for the site of the Project, and a written legal description of the site. The surveys and legal information shall include, as applicable, grades and lines of streets, alleys, pavements, and adjoining property and structures; adjacent drainage; rights-of-way, restrictions, easements, encroachments, zoning, deed restrictions, boundaries and contours of the site; locations, dimensions and necessary data pertaining to existing buildings, other improvements and trees; and information concerning available utility services and lines, both public and private, above and below grade, including inverts and depths. All the information on the survey shall be referenced to a Project benchmark. Design/Builder acknowledges that it has received from Owner the surveys and materials required under this subparagraph.


2.1.5 [deleted]


2.1.6 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.


2.1.7 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.


2.1.8 The Owner shall promptly obtain easements, zoning variances, and legal authorizations regarding site utilization where essential to the execution of the Owner's program.


2.1.9 Those services, information, surveys, and reports required by Paragraphs 2.1.4 through 2.1.8 which are within the Owner's control shall be furnished at the Owner's expense, and the Design/Builder shall be entitled to rely on them, provided that Owner shall not be responsible for the contents of materials prepared by others.


2.1.10 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 Part 1 Agreement.


2.1.11 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.


2.1.12 The Owner may reject the Proposal submitted by the Design/Builder under Paragraph 1.3.5 of this Part I Agreement for any reason without incurring liability to Design/Builder, except for work previously authorized by the Owner


ARTICLE 3
OWNERSHIP AND USE OF DOCUMENTS
AND ELECTRONIC DATA


3.1 Drawings, specifications, and other documents and electronic data furnished by the Design/Builder are instruments of service. The Design/Builder's Architect 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 Part 1 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 Paragraphs 3.2 and 3.3.


3.2 If the Part 2 Agreement is not executed, the Owner shall not use the drawings, specifications, and other documents and electronic data furnished by the Design/Builder without the written permission of the Design/Builder. Drawings, specifications, and other documents and electronic data 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, unless the Design/Builder is adjudged to be in default under this Part 1 Agreement or under any other subsequently executed agreement, or by agreement in writing. Nothing contained in Sections 3.1 and 3.2 shall prevent Owner from using designs and concepts described by the drawings in other documents in the construction of other projects.


3.3 If the Design/Builder defaults in the Design/Builder's obligations to the Owner, the Architect shall grant a license to the Owner to use the drawings, specifications, and other documents and electronic data furnished by the Architect to the Design/Builder for the completion of the Project, conditioned upon the Owner's execution of an agreement to cure the Design/Builder's default in payment to the Architect for services previously performed and to indemnify the Architect with regard to claims arising from such reuse without the Architect's professional involvement.


3.4 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 Paragraph 3.1.


ARTICLE 4
TIME


4.1 The Design/Builder shall prepare and submit to the Owner a schedule for the performance of the Basic and Additional Services which shall not exceed the time limits contained in Paragraph 10.1 and shall include allowances for periods of time required for the Owner's review and for approval of submissions by authorities having jurisdiction over the Project.


4.2 If the Design/Builder is delayed in the performance of services under this Part 1 Agreement through no fault of the Design/Builder, any applicable schedule shall be adjusted as may be mutually agreed.


ARTICLE 5
PAYMENTS


5.1 The initial payment provided in Article 9 shall be made upon execution of this Part 1 Agreement and credited to the Owner's account as provided in Subparagraph 9.1.2.


5.2 Subsequent payments for Basic Services, Additional Services, and Reimbursable Expenses provided for in this Part 1 Agreement shall be made monthly on the basis set forth in Article 9. Applications for Payment for Part 1 Basic Services, Additional Services and Reimbursable Expenses shall be prepared by the Design/Builder and submitted to the Owner monthly. Applications for Payment shall be dated the last day of the agreed monthly payment period, and the amount claimed shall be for the value of the services rendered, provided that the total amount claimed shall not exceed the total amount stated in Article 9. Each Application for Payment shall be supported by such evidence as to its correctness as the Owner or its lender may reasonably direct.


5.3 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.


5.4 Payments due the Design/Builder under this Part 1 Agreement which are not paid when due shall bear interest from the date due at the rate specified in Paragraph 9.5, or in the absence of a specified rate, at the legal rate prevailing where the project is located unless the Owner in good faith disputes any amount alleged to be due, in which case no interest shall accrue until the dispute is resolved


ARTICLE 6
DISPUTE RESOLUTION - MEDIATION
AND ARBITRATION


6.1 Claims, disputes or other matters in question between the parties to this Part 1 Agreement arising out of or relating to this Part 1 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, unless the parties mutually agree otherwise.


6.2 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 Part 1 Agreement and with the American Arbitration Association. A demand for mediation shall be made within a reasonable time after the claim, dispute or other matter in question has arisen. In no event shall the demand for mediation be made after the date when institution of legal or equitable proceedings based on such claim, dispute or other matter in question would be barred by the applicable statute of repose or limitations.


6.3 Demand for arbitration shall be filed in writing with the other party to this Part 1 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.


6.4 [deleted]


6.5 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.


ARTICLE 7
MISCELLANEOUS PROVISIONS


7.1 Unless otherwise provided, this Part 1 Agreement shall be governed by the law of the place where the Project is located.


7.2 The Owner and the Design/Builder, respectively, bind themselves, their partners, successors, assigns and legal representatives to the other party to this Part 1 Agreement and to the partners, successors and assigns of such other party with respect to all covenants of this Part 1 Agreement. Neither the Owner nor the Design/Builder shall assign this Part 1 Agreement without the written consent of the other.


7.3 Unless otherwise provided, neither the design for nor the cost of remediation of hazardous materials shall be the responsibility of the Design/Builder, provided, however, the Design/Builder shall report to the Owner the presence and location of any hazardous material that a Design/Builder of similar skill and expertise should have noticed.


7.4 This Part 1 Agreement represents the entire and integrated agreement between the Owner and the Design/Builder and supersedes all prior negotiations, representations or agreements, either written or oral. This Part 1 Agreement may be amended only by written instrument signed by both the Owner and the Design/Builder.


7.5 Prior to the termination of the services of the Architect or any other design professional designated in this Part 1 Agreement, the Design/Builder shall identify to the Owner in writing another architect or design professional with respect to whom the Owner has no reasonable objection, who will provide the services originally to have been provided by the Architect or other design professional whose services are being terminated.


ARTICLE 8
TERMINATION OF THE AGREEMENT


8.1 This Part 1 Agreement may be terminated by either party upon seven (7) days' written notice should the other party fail to perform substantially in accordance with its terms through no fault of the party initiating the termination.


8.2 This Part 1 Agreement may be terminated by the Owner without cause upon at least seven (7) days' written notice to the Design/Builder.


8.3 In the event of termination not the fault of the Design/Builder, the Design/Builder shall be compensated for services performed to the termination date.


ARTICLE 9
BASIS OF COMPENSATION


The Owner shall compensate the Design/Builder in accordance with Article 5, Payments, and the other provisions of this Part 1 Agreement as described below.


9.1 COMPENSATION FOR BASIC SERVICES


9.1.1 FOR BASIC SERVICES, compensation shall be as follows:


9.1.2 AN INITIAL PAYMENT of Five Thousand Dollars ($5,000.00) shall be made upon execution of this Part I Agreement and credited to the Owner's account as follows:


9.1.3 SUBSEQUENT PAYMENTS shall be as follows: Owner shall make monthly progress payments on account of the contract sum for the percentage of completion of each portion of the work.


9.2 COMPENSATION FOR ADDITIONAL SERVICES


9.2.1 FOR ADDITIONAL SERVICES, compensation shall be as follows:


9.3 REIMBURSABLE EXPENSES


9.3.1 [deleted]


9.3.2 [deleted]


9.4 [deleted]


9.5 INTEREST PAYMENTS


9.5.1 The rate of interest for past due payments shall be as follows: One and one-half (1.5%) percent per month. (Annual rate of 18%).


(Usury laws and requirements under the Federal Truth in Lending Act, similar state and local consumer credit laws and other regulations at the Owner's and Design/Builder's principal places of business, at the location of the Project and elsewhere may aff ...