Agreement Between Owner & Contractor

AIA Document A111


STANDARD FORM OF AGREEMENT
BETWEEN OWNER AND CONTRACTOR


where the basis of payment is the
COST OF THE WORK PLUS A FEE
with or without a Guaranteed Maximum Price
1987 EDITION


THIS DOCUMENTS HAS IMPORTANT LEGAL CONSEQUENCES; CONSULTATION WITH
AN ATTORNEY IS ENCOURAGED WITH RESPECT TO ITS COMPLETION
OR MODIFICATION.


The 1987 Edition of AIA Document A201, General Conditions of the Contract for Construction is adopted in this document by reference. Do not use with other
general conditions unless this document is modified.


This document has been approved and endorsed by The Associated General
Contractors of America.


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AGREEMENT


made as of the day of in the year of Nineteen Hundred and


BETWEEN the Owner: Horseshoe Gaming, Inc., (NAME AND ADDRESS) Horseshoe International, Inc., et al.
330 S. 4th Street
Las Vegas, Nevada 89101


and the Contractor: Manhattan Construction Company and Whitaker (NAME AND ADDRESS) Construction Company, Inc. d.b.a. Manhattan/
Whitaker, A Joint Venture
P.O. Box 8176
Shreveport, Louisiana 71148


the Project is: Construction of a Hotel for the Horseshoe Casino (NAME AND ADDRESS) Bossier City, Louisiana


the Architect is: Friedmutter and Associates (NAME AND ADDRESS) 4285 S. polaris, Suite 100
Las Vegas, Nevada 89103


The Owner and Contractor agree as set forth below.


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Copyright 1920, 1925, 1951, 1958, 1961, 1963, 1967, 1974, 1978 @1987 by
The American Institute of Architects, 1735 New York Avenue, N.W.
Washington, D.C. 20006. 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 be
subject to legal prosecution. - --------------------------------------------------------------------------------


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ARTICLE 1
THE CONTRACT DOCUMENTS


1.1 The Contract Documents consist of this Agreement, conditions of the Contract (General, Supplementary and other Conditions), Drawings, Specifications, Addenda issued prior to execution of this Agreement, other documents listed in this Agreement and Modifications issued after execution of this Agreement; these form the Contract, and ar as fully a part of the Contract as if attached to this Agreement or repeated herein. The Contract represents the entire and integrated agreement between the parties hereto and supersedes prior negotiations, representations or agreements, either written or oral. An enumeration of the Contract Documents, other than Modifications, appears in Article 16. If anything in the other Contract Documents is inconsistent with this Agreement, this Agreement shall govern.


ARTICLE 2
THE WORK OF THIS CONTRACT


2.1 The Contractor shall execute the entire Work described in the Contract Documents, except to the extent specifically indicated in the Contract Documents to be the responsibility of others, or as follows:


ARTICLE 3
RELATIONSHIP OF THE PARTIES


3.1 The Contractor accepts the relationship of trust and confidence established by this Agreement and covenants with the Owner to cooperate with the Architect and utilize the Contractor's best skill, efforts and judgments in furthering the interests of the Owner; to furnish efficient business administration and supervision; to make best efforts to furnish at all times an adequate supply of workers and materials; and to perform the Work in the best way and most expeditious and economical manner consistent with the interests of the Owner. The Owner agrees to exercise best efforts to enable the Contractor to perform the Work in the best way and most expeditious manner by furnishing and approving in a timely way information required by the Contractor and making payments to the Contractor in accordance with requirements of the Contract Documents.


ARTICLE 4
DATE OF COMMENCEMENT AND SUBSTANTIAL COMPLETION


4.1 The date of commencement is the date from which the Contract Time of Subparagraph 4.2 is measured; it shall be the date of this Agreement, as first written above, unless a different date is stated below or provision is made for the date to be fixed in a notice to proceed issued by the Owner.


(INSERT THE DATE OF COMMENCEMENT, IF IT DIFFERS FROM THE DATE OF THIS AGREEMENT OR, IF APPLICABLE, STATE THAT THE DATE WILL BE FIXED IN A NOTICE TO PROCEED.)


Unless the date of commencement is established by a notice to proceed issued by the Owner, the Contractor shall notify the Owner in writing not less than five days before commencing the Work to permit the timely filing of mortgages, mechanic's liens and other security interests.


4.2 The Contractor shall achieve Substantial Completion of the entire Work not later than


(INSERT THE CALENDAR DATE OR NUMBER OF CALENDAR DAYS AFTER THE DATE OF COMMENCEMENT. ALSO INSERT ANY REQUIREMENT FOR EARLIER SUBSTANTIAL COMPLETION OF CERTAIN PORTIONS OF THE WORK, IF NOT STATED ELSEWHERE IN THE CONTRACT DOCUMENTS.)


, subject to adjustments of this Contract Time as provided in the Contract Documents.


(INSERT PROVISIONS, IF ANY, FOR LIQUIDATED DAMAGES RELATING TO FAILURE TO COMPLETE ON TIME.)


2 3
ARTICLE 5
CONTRACT SUM


5.1 The Owner shall pay the Contractor in current funds for the Contractor's performance of the Contract the Contract Sum consisting of the Cost of the Work as defined in Article 7 and the Contractor's Fee determined as follows: (STATE A LUMP SUM, PERCENTAGE OF COST OF THE WORK OR OTHER PROVISION FOR DETERMINING THE CONTRACTOR'S FEE, AND EXPLAIN HOW THE CONTRACTOR'S FEE IS TO BE ADJUSTED FOR CHANGES IN THE WORK.)


A. Base Contract Fee: 3.75%
B. Change In Work Fee: 3.75%
C. Change In Work General Conditions: 5.00%, SUBJECT TO EVALUATION
AT JANUARY 1, 1997. IF AT THE DISCRETION OF THE OWNER, THE
GENERAL CONDITIONS NEED TO BE ADJUSTED, THE CONTRACTOR WILL HAVE
30 DAYS TO PROVIDE SUBSTANTION OR DOCUMENTATIONS PRIOR TO ANY
ADJUSTMENT.


5.2 GUARANTEED MAXIMUM PRICE (IF APPLICABLE)


5.2.1 The sum of the Cost of the Work and the Contractor's Fee is guaranteed by the Contractor not to exceed Dollars ($________________________), subject to additions and deductions by Change Order 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. (INSERT SPECIFIC PROVISIONS IF THE CONTRACTOR IS TO PARTICIPATE IN ANY SAVINGS.)


Savings Split: Owner 75%
Contractor 25%


5.2.2 The Guaranteed Maximum Price is based upon the following alternates, if any, which are described in the Contract Documents and are hereby accepted by the Owner: (STATE THE NUMBERS OR OTHER IDENTIFICATION OF ACCEPTED ALTERNATES, BUT ONLY IF A GUARANTEED MAXIMUM PRICE IS INSERTED IN SUBPARAGRAPH 5.2.1. IF DECISIONS ON OTHER ALTERNATES ARE TO BE MADE BY THE OWNER SUBSEQUENT TO THE EXECUTION OF THIS AGREEMENT, ATTACH A SCHEDULE OF SUCH OTHER ALTERNATES SHOWING THE AMOUNT FOR EACH AND THE DATE UNTIL WHICH THAT AMOUNT IS VALID.)


N/A


5.2.3 The amounts agreed to for unit prices, if any, are as follows: N/A (STATE UNIT PRICES ONLY IF A GUARANTEED MAXIMUM PRICE IS INSERTED IN SUBPARAGRAPH 5.2.1.)


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ARTICLE 6
CHANGES IN THE WORK


6.1 CONTRACTS WITH A GUARANTEED MAXIMUM PRICE


6.1.1 Adjustments to the Guaranteed Maximum Price on account of changes in the Work may be determined by any of the methods listed in Subparagraph 7.3.3 of the General Conditions.


6.1.2 In calculating adjustments to subcontracts (except those awarded with the Owner's prior consent on the basis of cost plus a fee), the terms "cost" and "fee" as used in Clause 7.3.3.3 of the General Conditions and the terms "costs" and "a reasonable allowance for overhead and profit" as used in Subparagraph 7.3.6 of the General Conditions shall have the meanings assigned to them in the General Conditions and shall not be modified by Articles 5, 7 and 8 of this Agreement. Adjustments to subcontracts awarded with the Owner's prior consent on the basis of cost plus a fee shall be calculated in accordance with the terms of those subcontracts.


6.1.3 In calculating adjustments to this Contract, the terms "cost" and "costs" as used in the above-referenced provisions of the General Conditions shall mean the Cost of the Work as defined in Article 7 of this Agreement and the terms "fee" and "a reasonable allowance for overhead and profit" shall mean the Contractor's Fee as defined in Paragraph 5.1 of this Agreement.


6.2 CONTRACTS WITHOUT A GUARANTEED MAXIMUM PRICE


6.2.1 Increased costs for the items set forth in Article 7 which result from changes in the Work shall become part of the Cost of the Work, and the Contractor's Fee shall be adjusted as provided in Paragraph 5.1.


6.3 ALL CONTRACTS


6.3.1 If no specific provision is made in Paragraph 5.1 for adjustment of the Contractor's Fee in the case of changes in the Work, or if the extent of such changes is such, in the aggregate, that application of the adjustment provisions of Paragraph 5.1 will cause substantial inequity to the Owner or Contractor, the Contractor's Fee shall be equitably adjusted on the basis of the Fee established for the original Work.


ARTICLE 7
COSTS TO BE REIMBURSED


7.1 The term Cost of the Work shall mean costs necessarily incurred by the Contractor in the proper performance of the Work. Such costs shall be at rates not higher than the standard paid at the place of the Project except with prior consent of the Owner. The Cost of the Work shall include only the items set forth in this Article 7.


7.1.1 LABOR COSTS


7.1.1.1 Wages of construction workers directly employed by the Contractor to perform the construction of the Work at the site or, with the Owner's agreement, at off-site workshops.


7.1.1.2 Wages or salaries of the Contractor's supervisory and administrative personnel when stationed at the site with the Owner's agreement. (IF IT IS INTENDED THAT THE WAGES OR SALARIES OF CERTAIN PERSONNEL STATIONED AT THE CONTRACTOR'S PRINCIPAL OR OTHER OFFICES SHALL BE INCLUDED IN THE COST OF THE WORK, IDENTIFY IN ARTICLE 14 THE PERSONNEL TO BE INCLUDED AND WHETHER FOR ALL OR ONLY PART OF THEIR TIME.)


7.1.1.3 Wages and salaries of the Contractor's supervisory or administrative personnel engaged, at factories, workshops or on the road, in expediting the production or transportation of materials or equipment required for the Work, but only for that portion of their time required for the Work.


7.1.1.4 Costs paid or incurred by the Contractor for taxes, insurance, contributions, assessments and benefits required by law or collective bargaining agreements and, for personnel not covered by such agreements, customary benefits such as sick leave, medical and health benefits, holidays, vacations and pensions, provided such costs are based on wages and salaries included in the Cost of the Work under Clauses 7.1.1.1 through 7.1.1.3.


4 5 7.1.2 SUBCONTRACT COSTS


Payments made by the Contractor to Subcontractors in accordance with the requirements of the subcontracts.


7.1.3 COSTS OF MATERIALS AND EQUIPMENT INCORPORATED IN THE COMPLETED CONSTRUCTION


7.1.3.1 Costs, including transportation, of materials and equipment incorporated or to be incorporated in the completed construction.


7.1.3.2 Costs of materials described in the preceding Clause 7.1.3.1 in excess of those actually installed but required to provide reasonable allowance for waste and for spoilage. Unused excess materials, if any, shall be handed over to the Owner at the completion of the Work or, at the Owner's option, shall be sold by the Contractor, amounts realized, if any, from such sales shall be credited to the Owner as a deduction from the Cost of the Work.


7.1.4 COSTS OF OTHER MATERIALS AND EQUIPMENT, TEMPORARY FACILITIES AND RELATED ITEMS.


7.1.4.1 Costs, including transportation, installation, maintenance, dismantling and removal of materials, supplies, temporary facilities, machinery, equipment, and hand tools not customarily owned by the construction workers, which are provided by the Contractor at the site and fully consumed in the performance of the Work; and cost less salvage value on such items if not fully consumed, whether sold to others or retained by the Contractor. Cost for items previously used by the Contractor shall mean fair market value.


7.1.4.2 Rental charges for temporary facilities, machinery, equipment, and hand tools not customarily owned by the construction workers, which are provided by the Contractor at the site, whether rented from the Contractor or others, and costs of transportation, installation, minor repairs and replacements, dismantling and removal thereof. Rates and quantities of equipment rented shall be subject to the Owner's prior approval.


7.1.4.3 Costs of removal of debris from the site.


7.1.4.4 Costs of telegrams and long-distance telephone calls, postage and parcel delivery charges, telephone service at the site and reasonable petty cash expenses of the site office.


7.1.4.5 That portion of the reasonable travel and subsistence expenses of the Contractor's personnel incurred while traveling in discharge of duties connected with the Work.


7.1.5 MISCELLANEOUS COSTS


7.1.5.1 That portion directly attributable to this Contract of premiums for insurance and bonds.


7.1.5.2 Sales, use or similar taxes imposed by a governmental authority which are related to the Work and for which the Contractor is liable.


7.1.5.3 Fees and assessments for the building permit and for other permits, licenses and inspections for which the Contractor is ...