AMD 1996 Annual Report Download - page 129

16.2.4.2 NON-QUALIFYING COSTS. Items that otherwise would qualify as
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Reimbursable Costs shall be excluded from Reimbursable Costs if such costs
duplicate previous work or were incurred to correct errors or omissions.
Injuries to persons at the Site do not qualify as Reimbursable Costs.
Examples of these and other costs excluded from Reimbursable Costs are set
forth in
Schedule 16.2.4. Such examples shall be utilized in the interpretation and
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application of the principles set forth in this Section 16.2.4.
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16.2.4.3 SPECIFIED COSTS. Costs which are specifically identified in
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other provisions of the Contract as being the responsibility of either
COMPANY or CONTRACTOR shall be paid by the responsible party.
16.2.4.4 CHANGES IN PROJECT BUDGET. Additional Reimbursable Costs
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incurred as a result of a change in the scope of the work approved by
Change Order shall be added to the Budgeted Cost of the Work. Additional
Reimbursable Costs incurred as a result of an unforeseen event or condition
(excluding price or cost increases) or force majeure shall be paid by
COMPANY and will result in an adjustment of the Budgeted Cost of the Work.
16.3 CONTRACTOR'S FEE. COMPANY shall pay CONTRACTOR a fee (the "FEE")
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which shall consist of the Budgeted Fee set forth in Section 16.3.1 and as
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increased by incentives, if any, earned by CONTRACTOR'S cost savings or as
decreased by overruns, if any, caused by CONTRACTOR'S overruns pursuant
to Section 16.3.2, and adjusted by adjustments in the Fee pursuant to
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Section 16.10.
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16.3.1 THE FEE. The Budgeted Fee (the "BUDGETED FEE") shall be
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DEM8,120,000, adjusted as set forth in Section 16.10 (which does not include
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value added taxes associated with such Fee). At the time that the Project
Budget is finalized prior to commencement of the Construction Work, the total
budgeted Cost of the Work will be determined. That total budgeted Cost of the
Work shall be referred to herein as the "BUDGETED COST OF THE WORK". If the
parties revise the Project Budget due to changes, additions or omissions
pursuant to Section 10.3 or Section 14.3.1 or due to COMPANY'S delay pursuant to
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Section 14.4, the Budgeted Cost of the Work shall also be revised
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accordingly, but the Budgeted Fee shall only be adjusted in accordance with
Section 16.10. As of the date of this Agreement, the Budgeted Cost of the Work
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is DEM460,544,936 (which does not include value added taxes associated with
such Fee).
16.3.2 CALCULATE INCENTIVE CHANGES IN FEE. If, upon completion of
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the Project, the actual Cost of the Work equals the Budgeted Cost of the Work,
the Fee shall be the original Budgeted Fee. If, upon completion of the Project,
the actual Cost of the Work is less than the Budgeted Cost of the Work, the Fee
shall be increased by twenty percent (20%) of the amount of savings up to, but
not exceeding a maximum total Fee (i.e., Budgeted Fee plus cost savings) of
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DEM16,675,000 (which does not include value added taxes associated with such
Fee). For purposes of calculating the foregoing increase in the Fee, if
CONTRACTOR performs directly (i.e., without any subcontractor) the Construction
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Work for the Clean Room, that portion of the total Budgeted Cost of the Work
attributable to the Construction Work performed directly by CONTRACTOR for the
Clean Room shall be subtracted from the total Budgeted Cost of the Work, and
that portion of the actual Cost of the Work attributable the Construction Work
performed directly by CONTRACTOR for the Clean Room shall be subtracted from the
actual Cost of the Work, so that any savings attributable to the Construction
Work performed directly by CONTRACTOR for the Clean Room shall be excluded in
determining the amount of the savings upon which increases in the Fee are to be
calculated. If, upon completion of the
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Source: ADVANCED MICRO DEVIC, 10-K, March 20, 1997