Construction Management Contract

STANDARD FORM OF AGREEMENT BETWEEN OWNER AND
PROJECT CONSTRUCTION MANAGEMENT CONSULTANT WHERE THE PROJECT CONSTRUCTION
MANAGER-MANAGEMENT CONSULTANT IS NOT A CONSTRUCTOR


AIA DOCUMENT B801/CMa - 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.


This document is intended to be used in conjunction with the 1992 editions of AIA Documents B141/CMa, A101/CMa and A201/CMa.


Copyright 1973, 1980, copyright 1992 by The American Institute of Architects, 1735 New York Avenue, N.W., Washington, D.C., 20006-5292. Reproduction of the material herein or substantial quotation of its provisions without written permission of the AIA violates the copyright laws of the United States and will subject the violator to legal prosecution.


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AGREEMENT made effective as of the 13th day of January in the year of nineteen hundred ninety-eight. (In words, indicate day, month and year)


BETWEEN the Owner: (Name and address) The Resort at Summerlin, Limited Partnership, a Nevada limited partnership, c/o Seven Circle Resorts, Inc., 1160 Town Center Drive, Suite 200, Las Vegas, Nevada 89134


and the Project Construction Management Consultant ("Construction Consultant"): (Name and address) Rider Hunt (NV) L.L.C., 2530 Paseo Del Prado, Building C, Suite 301, Las Vegas, NV 89102


for the following Project: (Include detailed description of Project, location, address and scope.) The Resort at Summerlin - Hotel Casino & Entertainment Complex, more particularly described as follows: A luxury Hotel of approximately 600 rooms and a 49,000 square foot Casino, along with a Convention Center, Parking Garage, Restaurants, Health Spa, Retail Shops, the entire 54.5 acre site on which the Complex is to be located, and related furniture, furnishings, and equipment. The Hotel consists of two towers, the second tower not being significantly different than the first tower.


The Architect is: (Name and address) Paul Steelman Ltd., 3330 West Desert Inn Road, Las Vegas, Nevada 89102


The Construction Manager is: J.A. Jones Construction Co., a North Carolina corporation, 1050 E. Flamingo Road #E-127, Las Vegas, Nevada 89119


The Owner and Construction Consultant agree as set forth below.


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AIA DOCUMENT B801/CMa - OWNER-CONSTRUCTION MANAGER AGREEMENT - 1992 EDITION - AIA - COPYRIGHT 1992 - THE AMERICAN INSTITUTE OF ARCHITECTS, 1735 NEW YORK AVENUE, N.W., WASHINGTON, D.C., 20006-5292. Unlicensed photocopying violates U.S. copyright laws and is subject to legal prosecution. This document was electronically produced with permission of the AIA and can be reproduced without violation until the date of expiration as noted below.


Electronic Format B801/CMa-1992
User Document: FORM - 3/16/1998.
AIA License Number 105525, which expires on 6/30/1998 - Page #1 2
Terms and Conditions of Agreement Between
Owner and Project Construction Management Consultant


ARTICLE 1
CONSTRUCTION CONSULTANT'S
RESPONSIBILITIES


1.1 CONSTRUCTION CONSULTANT'S SERVICES


1.1.1 The Construction Consultant's services consist of those services performed by the Construction Consultant, Construction Consultant's employees and Construction Consultant's consultants as enumerated in Articles 2 and 3 of this Agreement and any other services included in Article 14.


1.1.2 The Construction Consultant's services shall be provided in conjunction with the services of (i) an Architect as described in the edition of AIA Document B141/CMa, Standard Form of Agreement Between Owner and Architect, Construction Manager-Adviser Edition, current as of the date of this Agreement as modified ("Architect Contract"); and (ii) the Construction Manager as described in the edition of AIA Document A111, Standard Form of Agreement Between Owner and Construction Manager, current as of the date of this Agreement, as modified ("Construction Contract").


1.1.3 The Construction Consultant shall provide sufficient organization, personnel and management to carry out the requirements of this Agreement in an expeditious and economical manner consistent with the interests of the Owner.


1.1.4 The services covered by this Agreement are subject to the time limitations contained in Subparagraph 13.5.1.


ARTICLE 2
SCOPE OF CONSTRUCTION CONSULTANT'S
BASIC SERVICES


2.1 DEFINITION


2.1.1 The Construction Consultant's Basic Services consist of those described in Paragraphs 2.2 and 2.3 and any other services identified in Article 14 as part of Basic Services.


2.2 PRE-CONSTRUCTION PHASE


2.2.1


2.2.2


2.2.3


2.2.4


2.2.5


2.2.6


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AIA DOCUMENT B801/CMa - OWNER-CONSTRUCTION MANAGER AGREEMENT - 1992 EDITION - AIA - COPYRIGHT 1992 - THE AMERICAN INSTITUTE OF ARCHITECTS, 1735 NEW YORK AVENUE, N.W., WASHINGTON, D.C., 20006-5292. Unlicensed photocopying violates U.S. copyright laws and is subject to legal prosecution. This document was electronically produced with permission of the AIA and can be reproduced without violation until the date of expiration as noted below.


Electronic Format B801/CMa-1992
User Document: FORM - 3/16/1998.
AIA License Number 105525, which expires on 6/30/1998 - Page #2 3 2.2.7


2.2.8


2.2.9


2.2.10


2.2.11


2.2.12


2.2.13


2.2.14


2.2.15


2.2.16


2.2.17


2.2.18


2.2.19


2.2.20


2.2.21


2.3 CONSTRUCTION PHASE -


- -------------------------------------------------------------------------------- AIA DOCUMENT B801/CMa - OWNER-CONSTRUCTION MANAGER AGREEMENT - 1992 EDITION - AIA - COPYRIGHT 1992 - THE AMERICAN INSTITUTE OF ARCHITECTS, 1735 NEW YORK AVENUE, N.W., WASHINGTON, D.C. 20006-5292. Unlicensed photocopying violates U.S. copyright laws and is subject to legal prosecution. This document was electronically produced with permission of the AIA and can be reproduced without violation until the date of expiration as noted below.


Electronic Format B801/CMa-1992 User Document: FORM--3/16/1998. AIA License Number 105525, which expires on 6/30/1998--Page #3 4
ADMINISTRATION OF THE
CONSTRUCTION CONTRACT


2.3.1 The Construction Phase will commence with the award of the initial Construction Contract or purchase order and, together with the Construction Consultant's obligation to provide Basic Services under this Agreement, will end on the later of Owner's written acceptance of the completed Project or acceptance of a final account for the completed Project.


2.3.2


2.3.3


2.3.4


2.3.5


2.3.6


2.3.7


2.3.8


2.3.9 The Construction Consultant shall develop cash flow reports and forecasts for the Project and advise the Owner and Architect as to variances between actual and budgeted or estimated costs.


2.3.10 The Construction Consultant shall maintain accounting records on authorized Work performed under unit costs, additional Work performed on the basis of actual costs of labor and materials, and other Work requiring accounting records.


2.3.11 The Construction Consultant shall develop and implement procedures for the review and processing of applications by Construction Manager for progress and final payments in strict compliance with Paragraphs 9.3, 9.4, 9.5 and 9.6.1 of the General Conditions of the Construction Contract and this Agreement.


2.3.11.1 Based on the Construction Consultant's observations and evaluations of the Construction Manager's Application for Payment, the Construction Consultant shall review and prepare a valuation of the appropriate amounts due the Construction Managers.


2.3.11.2


2.3.11.3


- -------------------------------------------------------------------------------- AIA DOCUMENT B801/CMa - OWNER-CONSTRUCTION MANAGER AGREEMENT - 1992 EDITION - AIA - COPYRIGHT 1992 - THE AMERICAN INSTITUTE OF ARCHITECTS, 1735 NEW YORK AVENUE, N.W., WASHINGTON, D.C. 20006-5292. Unlicensed photocopying violates U.S. copyright laws and is subject to legal prosecution. This document was electronically produced with permission of the AIA and can be reproduced without violation until the date of expiration as noted below.


Electronic Format B801/CMa-1992 User Document: FORM--3/16/1998. AIA License Number 105525, which expires on 6/30/1998--Page #4 5 2.3.11.4


2.3.12


2.3.13 The Construction Consultant, in consultation with the owner and Architect, may reject Work which does not conform to the requirements of the Contract Documents, upon written direction of Owner.


2.3.14


2.3.15 With respect to the Construction Manager's own Work, the Construction Consultant shall not have control over or charge of and shall not be responsible for construction means, methods, techniques, sequences or procedures, or for safety precautions and programs in connection with the Work of the Construction Managers, since these are solely the Construction Manager's responsibility under the Contract for Construction. The Construction Consultant shall not be responsible for a Construction Manager's failure to carry out the Work in accordance with the respective Contract Documents. The Construction Consultant shall not have control over or charge of acts or omissions of the Construction Managers, Subcontractors, or their agents or employees, or any other persons performing portions of the Work not directly employed by the Construction Consultant.


2.3.16


2.3.17 Upon direction of the Owner, the Construction Consultant shall review requests for changes, assist in negotiating Construction Manager's proposals, submit recommendations to the Architect and Owner, and, if they are accepted, assist in the preparation of Change Orders and Construction Change Directives for Owner's signature as provided in Paragraphs 7.2.1 and 7.3.1 of the General Conditions.


2.3.18 The Construction Consultant shall assist the Architect in the review, evaluation and documentation of Claims.


2.3.19


2.3.20


- -------------------------------------------------------------------------------- AIA DOCUMENT B801/CMa - OWNER-CONSTRUCTION MANAGER AGREEMENT - 1992 EDITION - AIA - COPYRIGHT 1992 - THE AMERICAN INSTITUTE OF ARCHITECTS, 1735 NEW YORK AVENUE, N.W., WASHINGTON, D.C. 20006-5292. Unlicensed photocopying violates U.S. copyright laws and is subject to legal prosecution. This document was electronically produced with permission of the AIA and can be reproduced without violation until the date of expiration as noted below.


Electronic Format B801/CMa-1992 User Document: FORM--3/16/1998. AIA License Number 105525, which expires on 6/30/1998--Page #5 6 2.3.21


2.3.22


2.3.23


2.3.24


2.3.25


2.3.26


2.3.27


2.3.28 Duties, responsibilities and limitations of authority of the Construction Consultant as set forth in the Contract Documents shall not be restricted, modified or extended without prior written consent of the Owner.


ARTICLE 3
ADDITIONAL SERVICES


3.1 GENERAL


3.1.1 The services described in this Article 3 are not included in Basic Services unless so identified in Article 14, and they shall be paid for by the Owner as provided in this Agreement, in addition to the compensation for Basic Services. The Optional Additional Services described under Paragraph 3.3 shall only be provided if authorized or confirmed in writing by the Owner. If services described under Contingent Additional Services in Paragraph 3.2 are required due to circumstances beyond the Construction Consultant's control, the Construction Consultant shall notify the Owner prior to commencing such services. If the Owner deems that such services described under Paragraph 3.2 are not required, the Owner shall give prompt written notice to the Construction Consultant. If the Owner indicates in writing that all or part of such Contingent Additional Services are not required, the Construction Consultant shall have no obligation to provide those services.


3.2 CONTINGENT ADDITIONAL SERVICES


3.2.1 Providing services required because of significant changes in the Project including, but not limited to, changes in size, quality, complexity or the Owner's schedule.


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


- -------------------------------------------------------------------------------- AIA DOCUMENT B801/CMa - OWNER-CONSTRUCTION MANAGER AGREEMENT - 1992 EDITION - AIA - COPYRIGHT 1992 - THE AMERICAN INSTITUTE OF ARCHITECTS, 1735 NEW YORK AVENUE, N.W., WASHINGTON, D.C., 20006-5292. Unlicensed photocopying violates U.S. copyright laws and is subject to legal prosecution. This document was electronically produced with permission of the AIA and can be reproduced without violation until the date of expiration as noted below.


Electronic Format B801/CMa-1992
User Document: FORM - 3/16/1998. AIA License Number 105525, which expires
on 6/30/1998 - Page #6 7 replacement of such Work.


3.2.3 Providing services made necessary by the termination or default of the Architect or a Construction Manager, by major defects or deficiencies in the Work of a Construction Manager, or by failure of performance of either the Owner or Contractor under a Contract for Construction.


3.2.4


3.2.5 Providing services in connection with a public hearing, arbitration proceeding or legal proceeding except where the Construction Consultant is party thereto.


3.3 OPTIONAL ADDITIONAL SERVICES


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


3.3.2 Providing services to investigate existing conditions or facilities or to provide measured drawings thereof.


3.3.3 Providing services to verify the accuracy of drawings or other information furnished by the Owner.


3.3.4 Providing services required for or in connection with the Owner's selection, procurement or installation of furniture, furnishings and related equipment.


3.3.5


3.3.6


ARTICLE 4
OWNER'S RESPONSIBILITIES


4.1 The Owner shall provide full information regarding requirements for the Project, including a program which shall set forth the Owner's objectives, schedule, constraints and criteria, including space requirements and relationships, flexibility, expandability, special equipment, systems, and site requirements.


4.2 The Owner shall establish and update an overall budget for the Project based on consultation with the Construction Consultant and Architect, which shall include the Construction Cost, the Owner's other costs and reasonable contingencies related to all of these costs.


4.3 If requested by the Construction Consultant, the Owner shall furnish evidence that financial arrangements have been made to fulfill the Owner's obligations under this Agreement.


4.4 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 Construction Consultant in order to avoid unreasonable delay in the orderly and sequential progress of the Construction Consultant's services.


4.5 The Owner shall retain an architect whose services, duties and responsibilities are described in the edition of AIA Document B141/Cma, Standard Form of Agreement Between Owner and Architect, Construction Consultant-Adviser Edition, current as of the date of this Agreement, as modified. The Construction Consultant shall not be responsible for actions taken by the Architect.


4.6 The Owner shall furnish structural, mechanical, chemical, air and water pollution tests, tests for hazardous materials, and other laboratory and environmental tests, inspections and reports required by law or the Contract Documents.


4.7 The Owner shall furnish all legal, accounting and insurance counseling services as may be necessary at any time for the Project, including auditing services the Owner may require to verify the Construction Manager's Applications for Payment or to ascertain how or for what purposes the Construction Managers have used the money paid by or on behalf of the Owner.


4.8 The Owner shall furnish the Construction Consultant with a reasonable quantity of Construction Documents.


4.9 The services, information and reports required by Paragraphs 4.5 through 4.8 shall be furnished at the Owner's expense, and the Construction Consultant shall be entitled to rely upon the accuracy and completeness thereof. - -------------------------------------------------------------------------------- AIA DOCUMENT B801/CMa - OWNER-CONSTRUCTION MANAGER AGREEMENT - 1992 EDITION - AIA - COPYRIGHT 1992 - THE AMERICAN INSTITUTE OF ARCHITECTS, 1735 NEW YORK AVENUE, N.W., WASHINGTON, D.C., 20006-5292. Unlicensed photocopying violates U.S. copyright laws and is subject to legal prosecution. This document was electronically produced with permission of the AIA and can be reproduced without violation until the date of expiration as noted below.


Electronic Format B801/CMa-1992
User Document: FORM - 3/16/1998. AIA License Number 105525, which expires
on 6/30/1998 - Page #7


8 4.10 Prompt written notice shall be given by the Owner to the Construction Consultant and Architect if the Owner becomes aware of any fault or defect in the Project or nonconformance with the Contract Documents.


4.11 The Owner reserves the right to perform construction and operations related to the Project with the Owner's own forces, and to award contracts in connection with the Project which are not part of the Construction Consultant's responsibilities under this Agreement. The Construction Consultant shall notify the Owner if any such independent action will interfere with the Construction Consultant's ability to perform the Construction Consultant's responsibilities under this Agreement.


4.12 Information or services under the Owner's control shall be furnished by the Owner with reasonable promptness to avoid delay in the orderly progress of the Construction Consultant's services and the progress of the Work.


ARTICLE 5
CONSTRUCTION COST


5.1 DEFINITION


5.1.1 The Construction Cost shall be the total cost or estimated cost to the Owner of all elements of the Project designed or specified by the Architect.


5.1.2 Construction Cost shall also include the compensation of the Construction Consultant and Construction Consultant's consultants.


5.1.3 Construction Cost does not include the compensation of the Architect and Architect's consultants, costs of the land, rights-of-way, financing or other costs which are the responsibility of the Owner as provided in Article 4.


5.2 RESPONSIBILITY FOR CONSTRUCTION COST


5.2.1 Evaluations of the Owner's Project budget, preliminary estimates of Construction Cost and detailed estimates of Construction Cost prepared by the Construction Consultant represent the Construction Consultant's best judgment as a person or entity familiar with the construction industry. It is recognized, however, that neither the Construction Consultant nor the Owner has control over the cost of labor, materials or equipment, over Construction Managers' and subcontractor's methods of determining bid prices, or over competitive bidding, market or negotiating conditions. Accordingly, the Construction Consultant cannot and does not warrant or represent that bids or negotiated prices will not vary from the Project budget proposed, established or approved by the Owner, or from any cost estimate or evaluation prepared by the Construction Consultant.


5.2.2


5.2.3


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AIA DOCUMENT B801/CMa - OWNER-CONSTRUCTION MANAGER AGREEMENT - 1992 EDITION - AIA - COPYRIGHT 1992 - THE AMERICAN INSTITUTE OF ARCHITECTS, 1735 NEW YORK AVENUE, N.W., WASHINGTON, D.C., 20006-5292. Unlicensed photocopying violates U.S. copyright laws and is subject to legal prosecution. This document was electronically produced with permission of the AIA and can be reproduced without violation until the date of expiration as noted below.


Electronic Format B801/CMa-1992
User Document: FORM - 3/16/1998. AIA License Number 105525,
which expires on 6/30/1998 - Page #8


9 5.2.4


.1


.2


.3


.4


5.2.5


ARTICLE 6
CONSTRUCTION SUPPORT ACTIVITIES


6.1 Construction support activities, if provided by the Construction Consultant, shall be governed by separate contractual agreements unless otherwise provided in Article 14.


6.2 Reimbursable expenses listed in Article 14 for construction support activities may be subject to trade discounts, rebates, and refunds which shall accrue to the Owner, and the Construction Consultant shall make provisions so that they can be secured.


ARTICLE 7
OWNERSHIP AND USE OF
ARCHITECT'S DRAWINGS, SPECIFICATIONS
AND OTHER DOCUMENTS


7.1 The Drawings, Specifications and other documents prepared by the Architect are instruments of the Architect's service through which the Work to be executed by the Construction Managers is described. The Construction Consultant may retain one record set. The Construction Consultant shall not own or claim a copyright in the Drawings, Specifications and other documents prepared by the Architect, and unless otherwise indicated the Architect shall be deemed the author of them and will retain all common law, statutory and other reserved rights, in addition to the copyright. All cop ...