Construction Management Agreement (2010)Full Document 

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EXECUTION COPY

 

 

 

CONSTRUCTION MANAGEMENT AGREEMENT

between

MADISON SQUARE GARDEN, L.P.

Owner,

and

TURNER CONSTRUCTION COMPANY,

Construction Manager

Project:

MADISON SQUARE GARDEN TRANSFORMATION

New York, N.Y.

As of July 8, 2010

Jones Day

222 East 41st Street

New York, New York 10017

 

 

 


TABLE OF CONTENTS

 

          Page
Article 1    Contract Documents/Precedence    3
Article 2    General Provisions    7
2.1    Pre-Construction Phase Services and Construction Phase Services/ Burden Rate    7
2.2    Quality of Work and Standard of Care    7
2.3    Design-Assist    8
2.4    Concealed Conditions    9
2.5    Hazardous Materials    9
2.6    Continued Operation of the Garden and the Phasing Plan    14
2.7    Labor Harmony    15
2.8    Construction Manager’s Qualifications    16
2.9    Owner’s Financial Arrangement    16
Article 3    Construction Manager’s Compensation    16
3.1    Pre-Construction Phase Compensation/Early Start Work Compensation/Early Start Work Retainage    16
3.2    Construction Phase Compensation/Fixed Fee/Bonus/Liquidated Damages    18
3.3    Construction Phase Compensation/General Conditions Costs    21
3.4    Construction Phase Compensation/Reimbursable Costs    22
3.5    Construction Phase Compensation/Additional Fees and Additional General Conditions Costs    22
3.6    Construction Phase Compensation/Subcontract Retainage/Fixed Fee Retainage    22
3.7    Construction Phase Compensation/GMP Contingency    23
3.8    Construction Phase Compensation/Cost Savings    25
Article 4    Items Included in Costs    26
Article 5    Items Not Included in Costs    29
Article 6    Schedule of Work and Early Occupancy    30
Article 7    Construction Manager’s Work and Warranty    37
7.1    Pre-Construction Phase Services    37
7.2    Construction Phase Services    39
7.3    Warranty    43

 

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TABLE OF CONTENTS

(continued)

 

Article 8    Subcontracting of the Work    45
Article 9    Discount, Rebates and Refunds    48
Article 10    Accounting Records    48
Article 11    Applications for Payment    49
11.1      Pre-Construction Phase Compensation Payments    49
11.2      Early Start Work Compensation Payments and Balance of the Work Compensation Payments    49
Article 12    Assignment    52
12.1      Assignment by Construction Manager    52
12.2      Assignment by Owner    52
Article 13    Liens and Claims    53
Article 14    Events of Default and Termination or Suspension of Agreement    54
14.1      Termination by Owner for Cause    54
14.2      Termination by Owner for Convenience    56
14.3      Owner’s Right to Suspend, Stop or Interrupt the Work    58
14.4      Construction Manager’s Right to Terminate the Agreement    58
Article 15    Subguard/Bonds    59
Article 16    Management of the Work by Construction Manager and Owner    59
16.1      Construction Manager’s Personnel    59
16.2      Owner’s Personnel    59
Article 17    Consultants    60
Article 18    Codes    60
Article 19    Insurance    61
Article 20    Owner’s Elections    62
Article 21    Materials and Equipment    63
Article 22    Substitutions    64
Article 23    Changes in the Work    66
Article 24    Inspection and Testing    69
Article 25    Ownership and Use of Documents; Confidentiality    71
Article 26    Nondisclosure    72
Article 27    Right to Perform Work And to Award Separate Contracts; And Cooperation With Separate Contractors    72

 

ii


TABLE OF CONTENTS

(continued)

 

Article 28

   Additional Provisions    74
28.1      Practice of Architecture and/or Engineering    74
28.2      Effectiveness of Agreement    74
28.3      Enforcement of Subcontracts    74
28.4      Cooperation    74
28.5      Independent Contractor    75
28.6      Access and Cooperation    75
28.7      Performance of Work During the Pendency of Disputes    75
28.8      Integrity and Ethical Conduct/Prohibited Interests    75
28.9      Notices    76
28.10    Construction of Language    78
28.11    Captions and Titles    78
28.12    No Waiver    78
28.13    Indemnification    79
28.14    Severability    80
28.15    Duty Same as Covenant    80
28.16    Waiver of Consequential Damages    80
28.17    Rights and Remedies    80
28.18    Dispute Resolution, Governing Law and Consent to Jurisdiction    80
28.19    Binding Effect    81
28.20    Interpretations in Writing    81
28.21    CADD Format    81
28.22    Knowledge of Construction Manager    81
28.23    No Third-Party Beneficiary Rights    81

 

iii


TABLE OF CONTENTS

(continued)

 

EXHIBITS   
Exhibit “A”    Letter
Exhibit “B”    Construction Documents
Exhibit “C”    Environmental Reports/Remediation Plans
Exhibit “D”    Milestone Completion Plan
Exhibit “E”    Progress Schedule
Exhibit “F”    Phasing Plan
Exhibit “G”    General Conditions Summary
Exhibit “H-1”    Preconstruction Phase Services
Exhibit “H-2”    Preconstruction Phase Staff Commitment and Hourly Rates
Exhibit “H-3”    Construction Phase Staff Commitment
Exhibit “I”    Cooperation
Exhibit “J”    Insurance Requirements for Licensed Asbestos Abatement Subcontractors
Exhibit “K”    Cost Estimate
Exhibit “L”    Insurance Requirements for CCIP and Subguard Insurance Policy
Exhibit “M”    Shop Drawing Submittal Procedures and Requirements
Exhibit “N”    Insurance Requirements for Construction Manager and/or Owner
Exhibit “O”    Form 36 - MSG Subcontract
Exhibit “P”    Subcontract Approval Letter
Exhibit “Q”    Subguard Insurance Policy Specimen
Exhibit “R-1”    Interim Release from Construction Manager
Exhibit “R-2”    Final Release from Construction Manager
Exhibit “S”    Coordination

 

iv


INDEX OF DEFINED TERMS

 

     Page

100% CDs With ASI #1 and ASI #2

   14

1st Summer Shutdown Completion

   32

1st Summer Shutdown Completion Date

   31

1st Summer Shutdown Liquidated Damages

   20

1st Summer Shutdown Period

   31

2nd Summer Shutdown Completion

   32

2nd Summer Shutdown Completion Date

   31

2nd Summer Shutdown Liquidated Damages

   21

2nd Summer Shutdown Period

   31

3rd Summer Shutdown Completion

   32

3rd Summer Shutdown Completion Date

   31

3rd Summer Shutdown Liquidated Damages

   21

3rd Summer Shutdown Period

   31

90% CDs

   14

Applicable Laws

   60

Architect

   1

Assumptions and Qualifications

   62

Base Work

   18

Change Order

   67

Changes

   66

Completion Dates

   31

Completions

   32

Confidential Information

   71

Construction Budget

   40

Construction Documents

   1

Construction Manager

   1

Construction Manager’s Statement

   66

Construction Phase

   39

Consultants

   2

Contract Documents

   3

Costs

   26

Costs of the Work

   26

Design Team

   1

Design-Assist Subcontractors

   8

Differing Concealed Conditions

   9

Differing Environmental Conditions

   11

Early Start Work

   17

Early Start Work Compensation

   17

Early Start Work Fee

   17

Early Start Work Fee Retainage

   18

Early Start Work General Conditions Costs

   17

Early Start Work Retainage

   17

Early Start Work Subcontract Costs

   17

Emergency Change Order

   68

 

v


INDEX OF DEFINED TERMS

(continued)

 

     Page

Employee Benefits Program

   7

Environmental Laws

   13

Environmental Reports

   10

Environmental Work Product

   10

Events of Default

   54

Excused Delays

   34

Field Clarification Memoranda

   68

Field Orders

   68

Final Completion

   32

Final Completion Date

   31

Fixed Fee

   18

Fixed Fee Retainage

   23

Fixed General Conditions Costs

   22

Garden

   1

General Conditions Costs

   26

General Conditions Summary

   18

General Conditions Work Items

   26

GMP Contingency

   23

Governmental Authority

   33

Guaranteed Costs

   25

Guaranteed Maximum Price

   62

Guaranteed Maximum Price Statement

   63

Hazardous Materials

   13

Identified Party

   8

Indemnitees

   79

Key Personnel

   59

Letter

   2

Milestone Completion Certificate

   33

Milestone Completion Deficiency Notice

   33

Milestone Completion Notice

   33

Milestone Completion Plan

   30

Non-Concealed Conditions

   9

O, U, O & A

   44

Officer Statement

   16

Owner

   1

Owner’s Representative

   59

Permitted Assignee

   52

Phasing Plan

   14

Post 1st Summer Completion Dates

   31

Post 1st Summer Completions

   32

Post 1st Summer Periods

   31

Post 2nd Summer Completion Dates

   31

Post 2nd Summer Completions

   32

Post 2nd Summer Periods

   31

 

vi


INDEX OF DEFINED TERMS

(continued)

 

     Page

Pre Construction Phase Fee

   16

Pre-Construction Phase

   37

Pre-Construction Phase Compensation

   16

Pre-Construction Reimbursables

   16

Program Change

   66

Progress Schedule

   38

Project Approvals

   33

Project Manager

   2

Project Site

   1

Project Team members

   2

Property Insurance

   61

Punch List

   43

Punch List Items

   43

Reimbursable Costs

   27

Remediation Plans

   10

Requisition

   49

Savings

   25

Shop Drawings

   41

Subcontract Costs

   27

Subcontract Retainage

   23

Subcontractor Delay Claim

   28

Subcontractors

   45

Subcontracts

   45

Subguard Insurance Policy

   23

Substantial Completion

   32

Substantial Completion Date

   31

Summary Schedule of Changes to the Agreement

   62

Summary Schedule of Design Changes

   62

Summer and Post Summer Completions

   32

Summer and Post Summer Periods

   31

Supplemental Milestone Completion Notice

   33

Third Party Assignee

   53

Third Party Claims

   79

Urgent Environmental Delay Notification

   11

Urgent Force Majeure Delay Notification

   35

W&P

   9

Work

   2

Work Request

   66

 

vii


THIS AGREEMENT is made as of the 8th day of July, 2010, by and between MADISON SQUARE GARDEN, L.P., a limited partnership, having an office at Two Pennsylvania Plaza, New York, New York 10121-0091 (“Owner”) and TURNER CONSTRUCTION COMPANY, a New York corporation, having an office at 375 Hudson Street, New York, New York 10014 (“Construction Manager”).

W I T N E S S E T H:

WHEREAS, Owner owns the property commonly known as Four Penn Plaza and the improvements thereon known as “Madison Square Garden” (the “Garden”) and has acquired a license or other rights of ingress and egress with respect to other areas along Seventh Avenue between 31st and 33rd Streets, the Seventh Avenue Plaza area (including the area to the West of Two Penn Plaza), the stairs and escalators to the taxiway area (including certain areas beneath the Garden owned or controlled by Amtrak), as well as the curbs and sidewalks servicing all such other areas (which Garden and other areas are hereinafter collectively referred to as the “Project Site”); and

WHEREAS, Owner has decided that, in order to take the Garden into the 21st century while allowing Owner to remain in its legendary arena, it wishes to undertake a comprehensive transformation, renovation, refurbishment and repair of, and perform other construction work to, the arena and the other areas comprising the Garden, generally consisting of substantial improvements to the Project Site arena, which may include among other things: a dramatically redesigned Seventh Avenue entrance; new, more comfortable seats, with better sightlines that put patrons closer to the action; new, wider and more spacious public

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