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1) CM/GC's Contingency. The specific amount to be allocated for the CM/GC's Contingency shall be three percent (3%) of the Construction Cost. The agreed amount will be included in the FAP and authorized by the City Council. The CM/GC's Contingency is available to pay Construction Costs for work that, as of the date of this Agreement, have not been procured from the trade contractors and that is shown in the Construction Documents. The CM/GC's Contingency shall not include: owner-initiated changes in scope; costs attributable to differing site conditions; or costs attributable to the negligence, errors or omissions by the Architect or other design professional. CM/GC shall not expend any portion of the CM/GC's Contingency without first providing written notification to the City/Agency. 2) City/Agency Contingency. The specific amount to be allocated for the City/Agency's Contingency shall be five percent (5%) of the Construction Cost. This amount will be included in the FAP and authorized by the City/Agency Council. The City/Agency Contingency is available to pay Construction Costs incurred on account of concealed conditions at the Project site that an experienced construction manager/general contractor performing CM/GC's obligations under this Agreement would not reasonably have discovered before construction and that are either a) subsurface or latent physical conditions at the site differing from those indicated, or b) unknown physical conditions at the site of any usual nature, different materially from those ordinarily encountered and generally recognized as inherent in work of the character provided for in the contract. 3) The City/Agency shall not be responsible for the cost of items covered by the CM/GC's Contingency that exceed the amount authorized by the City Council. Nothing in this Agreement shall relieve the Architect or any design professional from any liability for negligence, errors, omissions, breaches of contract or similar failures to satisfy obligations. I. Withholdinq Payment. City/Agency may withhold, or on account of subsequently discovered evidence nullify, the whole or a part of any payment to such extent as may be necessary to protect City/Agency from loss, including costs and attorneys' fees, on account of (1) defective or deficient Work or Services not remedied; (2) claims filed; (3) failure of CM/GC to make payments properly to its employees or Trade Contractors; or (4) failure to adhere to the Project Schedule or to achieve sufficient progress with the Work or the Services such that CM/GC is unlikely to achieve timely completion of the Project. Section 6. ADDITIONAL SERVICES: If City/Agency desires the performance of Services not otherwise included within the Services described in Exhibit "A", CM/GC shall provide such Services upon receipt of a written change order approved in advance by the City/Agency Council by motion duly made and carried. Such change order shall include a description of the Atty/Agr/2005.003 030805/L. Beck/507588v7 Page 5 of 30 --""T-'