Construction Agreement

EXHIBIT 10.5


CONSTRUCTION AGREEMENT BETWEEN
GENERAL CONTRACTOR AND OWNER
DESIGN BUILD


THIS AGREEMENT, is made and entered into this 28th day of October, 1998 by and between Noah's Construction, Inc., a ("Contractor") and Caddx Controls, Inc., a ("Owner").


RECITALS:


WHEREAS, Owner has title or an agreement to acquire title to certain real property as described in Exhibit A ("Property");


WHEREAS, Owner desires that certain improvements be made on said real property, the scope and purposes as generally outlined in the specifications and plan as described in Exhibit B ("Project");


WHEREAS, Contractor desires to provide certain architectural, engineering and construction services to complete Project for Owner and shall complete detailed specifications and plans, to be set forth in Exhibit C; and


WHEREAS, Contractor and Owner desire to set forth in writing the term and conditions of their Agreement and intend to be legally bound by their Agreement.


NOW, THEREFORE, for and in consideration of the above premises, and of the following terms, conditions and mutual covenants of Contractor and Owner as hereinafter stated, IT IS HEREBY AGREED:


SECTION 1


OWNER'S OBLIGATIONS


1.01 Project. Owner shall provide Property for Project. Owner shall furnish at Owner's expense certified surveys describing the physical characteristics, soil reports, legal restrictions, utility locations and legal description; and an ALTA title policy or other title report acceptable to Contractor. Contractor shall be entitled to rely upon the accuracy and the completeness of such information furnished by Owner.


1.02 Other Requirements. Owner shall furnish at Owner's expense all necessary approvals; easements; assessments; expenses; building, use or occupancy and other governmental permits and licenses required for the construction; use or occupancy of permanent structures of Project; any bonds that may be required; and any legal services that may be required to obtain such items.


1.03 Owner's Participation. Owner shall timely furnish Contractor complete information regarding Owner's requirements for Project. Owner shall designate in writing a representative who shall have authority to approve Change Orders and to furnish information on a timely basis. Owner shall promptly give notice to Contractor of any known fault or defect in Project or nonconformance with Project requirements.


1.04 Funding. Prior to Contractor commencing construction and at any subsequent time requested by Contractor, Owner shall furnish evidence acceptable to Contractor that sufficient funds are available and committed for the entire Cost of Project as set forth in Section 4. If such evidence is not furnished by Contractor, Section 8.02 shall apply.


1.05 Safety. Owner shall require and cause all of Owner's tenants and all contractors separately hired by Owner to abide by and fully adhere to all applicable federal, state and local safety laws and regulations and to comply with Contractor's request for the elimination or abatement of safety hazards. Owner shall indemnify and hold Contractor harmless from all claims and damages arising from safety hazards caused by Owner's tenants and by separate contractors employed by Owner. Owner shall be responsible for the elimination or abatement of safety hazards created at Project by other persons employed by Owner as separate contractors or by Owner's tenants.


1


Owner shall cause such separate contractors and such tenants to coordinate and cooperate with Contractor in all other respects of construction.


1.06 Subcontractors. Owner shall not have a contractual relationship with Contractor's subcontractors and Owner shall communicate with such subcontractors through Contractor.


SECTION 2


CONTRACTOR'S OBLIGATIONS


2.01 Design and Engineering. Based upon Owner's requirements, Contractor shall perform the necessary design and engineering and shall prepare detailed construction drawings and specifications to be set forth in Exhibit C (to be signed by Owner and Contractor). Construction of Project shall be in accordance with these drawings and specifications and with any subsequent drawings and specifications as approved in writing by Owner and Contractor. The drawings and specifications shall remain the property of Contractor and are not to be used by Owner for other projects without the written consent of Contractor.


2.02 Construction. Contractor shall be responsible for the construction of Project and shall provide all supervision, labor, materials, tools, machinery, equipment and other items necessary for the completion of Project. Contractor shall use Contractor's best efforts to complete construction at the earliest possible time and shall at all times furnish sufficient materials and labor to assure an efficient completion of Project. Contractor is experienced and qualified to perform the work provided for herein and shall finance its own operations hereunder. Contractor shall operate as an independent contractor and not as an agent of Owner.


2.03 Completion Date. The work to be performed under this Agreement shall be substantially completed on or before the 1st day of June 1999 (Completion Date) as set forth in Paragraph 5.01, subject however, to delays beyond the Contractor's control. In the event the work to be performed under this Agreement shall not be substantially completed by the Completion Date, then there shall be a penalty of -0-.


2.04 Accounting. Contractor shall keep detailed records necessary for financial accounting of Project. Owner shall have access to Contractor's records, drawings, receipts and similar data relating to Project. Contractor shall specifically itemize all changes in Cost of Project and all Change Orders. Contractor shall maintain all records for a period of three years after Final Payment or longer where required by law.


2.05 Safety. Contractor shall take precautions for the safety of Contractor's employees and shall comply with applicable provisions of federal, state and local safety laws to prevent accidents or injury to persons on Project.


2.06 Subcontracts. All construction that Contractor does not perform shall be performed by subcontractors. The term "Subcontractor" shall not include any separate contractor employed by Owner or such separate contractor's subcontractors. Contractor shall be responsible for the management of subcontractors in the performance of their work. Contractor shall cause all subcontractors to indemnify and hold harmless Owner and Contractor form all claims for bodily injury and property damage that may arise, other than property damage required to be insured by Owner as set forth in Section 7.02.


2.07 Clean Conditions. Contractor shall maintain Project free from the accumulation of construction waste and rubbish. Upon completion of Project, Contractor shall deliver Project in a "clean" condition, free from all trash, rubbish, debris, Contractor's tools, construction equipment and machinery, surplus materials and inventory.


2.08 Warranties. Contractor warrants that all materials and equipment furnished shall be new, unless otherwise specified, and that all construction shall be of good quality, free from improper workmanship and defective materials and in conformance with the drawings and specifications. Contractor warrants that title to all work, materials and equipment shall pass to Owner upon delivery to Owner free and clear of all liens, claims, security interests or encumbrances ("Liens").


2


Contractor shall correct all work performed by Contractor which proves to be defective in material and workmanship within a period of one year from the date of completion. Upon written notice of such defects, Contractor shall, at Contractor's option, either make necessary repairs or request Owner to make such repairs at Contractor's expense. Contractor will secure required certificatess of inspection, testing or approval and any and all express warranties from manufacturers, suppliers and subcontractors, and deliver same to Owner.


2.09 Manufactured Equipment. Contractor shall guarantee manufactured equipment for ninety (90) days after initial use. Contractor shall collect all warranties and equipment manuals and deliver same to Owner. Contractor shall assist Owner's maintenance personnel with the testing and initial start up of such systems and equipment.


SECTION 3


MUTUAL REPRESENTATIONS


3.01 Litigation. Contractor and Owner hereby warrant and represent that neither is a party to or threatened with any litigation proceeding or controversy before any Court or administrative agency nor in default with respect to any judgment, order, writ, injunction, decree, rule, or regulation before any Court or administrative agency which might result in any adverse effect on representations, statements and conditions set forth in this Agreement.


3.02 Conflicts. The execution of this Agreement by Contractor and Owner will not violate or conflict with or result in a breach of or constitute a default under any agreement or instrument which they may be bound. No consent of any third party not a party to this Agreement is required.


3.03 Accuracy of Information. Contractor and Owner hereby warrant and represent that this Agreement does not contain any false statements and that this Agreement does not omit any material facts.


3.04 Authorization. Contractor and Owner have the requisite power and authority for execution of this Agreement.


3.05 Legal Responsibilities. Contractor and Owner shall comply, abide by and ful ...