TxDOT may, at any time, terminate this Agreement and the performance of the Work by Developer in whole or in part, if TxDOT determines, in its sole discretion, that a termination is in TxDOT's best interest. TxDOT shall terminate by delivering to Developer a written Notice of Termination for Convenience or Notice of Partial Termination for Convenience specifying the extent of termination and its effective date. Termination (or partial termination) of this Agreement shall not relieve any Surety of its obligation for any claims arising out of the Work performed.
Developer acknowledges and agrees that TxDOT has no obligation to issue Pilot System NTP 1 or any other NTP hereunder, and further agrees that unless and until Pilot System NTP 1 or such other NTP is issued, TxDOT shall have no liability to Developer hereunder.
After receipt of a Notice of Termination for Convenience or Notice of Partial Termination for Convenience, and except as otherwise directed by TxDOT, Developer shall immediately proceed with the following obligations, regardless of any delay in determining or adjusting any amounts due under this Section 15:
15.2.1 Stop Work as specified in the notice.
15.2.2 Notify all affected Subcontractors that this Agreement is being terminated and that their Subcontracts (including orders for materials, services or facilities) are not to be further performed unless otherwise authorized in writing by TxDOT.
15.2.3 Place no further Subcontracts (including orders for materials, services or facilities), except as necessary to complete the continued portion of the Work, if any, or for mitigation of damages.
15.2.4 Unless instructed otherwise by TxDOT, terminate all Subcontracts to the extent they relate to the Work terminated.
15.2.5 Assign to TxDOT in the manner, at the times, and to the extent directed by TxDOT, all of the right, title, and interest of Developer under the Subcontracts so terminated, in which case TxDOT will have the right, in its sole discretion, to accept performance, settle or pay any termination settlement proposal arising out of the termination of such Subcontract.
15.2.6 Subject to the prior written approval of TxDOT, settle all outstanding liabilities and all termination settlement proposals arising from termination of Subcontracts that are required to be terminated hereunder.
15.2.7 No later than 90 Days from the effective date of termination, unless extended in writing by TxDOT upon written request of Developer within this 90 -Day period, provide TxDOT with an inventory list of all materials, supplies, equipment, Hardware and Software previously produced, purchased or ordered from Suppliers for use in the Work and not yet used in the Work, including its storage location, as well as any documentation or other property required to be delivered hereunder which is either in the process of development or previously completed but not yet delivered to TxDOT, and such other information as TxDOT may request; and transfer title and deliver to TxDOT through bills of sale or other documents of title, as directed by TxDOT, (a) the Work in process, completed Work, supplies, equipment, any Hardware, Software and other material produced or acquired for the Work terminated that has not already been provided to TxDOT, and (b) the Design Documents, Construction Documents and all other completed or partially completed drawings (including plans, elevations, sections, details and diagrams), specifications, records, samples, information and other property that would have been required to be furnished to TxDOT if the Work had been completed.
15.2.8 Complete performance in accordance with the Contract Documents of all Work not terminated.
15.2.9 Take all action that may be necessary, or that TxDOT may direct, for the safety, protection and preservation of (a) the public, including public and private vehicular movement, (b) the Work and (c) equipment, machinery, materials and property related to the Project that is in the possession of Developer and in which TxDOT has or may acquire an interest.
15.2.10 As authorized by TxDOT in writing, use its best efforts to sell. at reasonable prices, any property of the types referred to in Section 15.2.7; provided, however, that Developer (a) is not required to extend credit to any purchaser, and (b) may acquire the property under the conditions prescribed and at prices approved by TxDOT. The proceeds of any transfer or disposition will be applied to reduce any payments to be made by TxDOT under the Contract Documents or paid in any other manner directed by TxDOT.
15.2.11 If requested by TxDOT, withdraw from the portions of the Project Site designated by TxDOT and remove such materials, equipment, tools and instruments used by, and any debris or waste materials generated by, Developer and any Subcontractor in the performance of the Work as TxDOT may direct.
15.2.12 Take other actions directed by TxDOT.
15.3.1 Acceptance of this Agreement as hereinafter specified shall not relieve Developer of responsibility for damage to materials. The Developer shall continue to be responsible for damage to materials after issuance of the Notice of Termination for Convenience or a Notice of Partial Termination for Convenience, except as follows:
(a) Developer's responsibility for damage to materials for which partial payment has been made as provided herein shall terminate when TxDOT's Authorized Representative certifies that those materials have been stored in the manner and at the locations directed by TxDOT.
(b) The Developer's responsibility for damage to materials purchased by TxDOT subsequent to the issuance of the notice that this Agreement is to be terminated shall terminate when title and delivery of those materials has been taken by TxDOT.
15.3.2 When TxDOT's Authorized Representative determines that Developer has completed the Work directed to be completed prior to termination and such other work as may have been ordered to secure the applicable portion of the Project for termination, TxDOT's Authorized Representative will recommend that TxDOT formally accept such Work, and immediately upon and after the acceptance by TxDOT, Developer will not be required to provide for continuing safety, security and maintenance at the applicable Project Site.
After receipt of a Notice of Termination for Convenience or Notice of Partial Termination for Convenience, Developer shall submit a final termination settlement proposal to TxDOT in the form and with the certification prescribed by TxDOT. Developer shall submit the proposal promptly, but no later than 90 Days from the effective date of termination unless Developer has requested a time extension in writing within such 90-Day period and TxDOT has agreed in writing to allow such an extension. The Developer's termination settlement proposal shall then be reviewed by TxDOT and acted upon, returned with comments, or rejected. If Developer fails to submit the proposal within the time allowed, TxDOT may determine, on the basis of information available, the amount, if any, due Developer because of the termination and shall pay Developer the amount so determined, and Developer shall be bound by TxDOT's determination.
Developer and TxDOT may agree, as provided in Section 15.4, upon the whole or any part of the amount or amounts to be paid to Developer by reason of the total or partial termination of Work for convenience pursuant to this Section 15. Such negotiated settlement may include a reasonable allowance for profit solely on Work which has been completed as of the termination date and subsequently inspected and accepted by TxDOT. Such agreed amount or amounts, exclusive of settlement costs, shall not exceed the total Price for the Project as a whole or, individually, for the applicable Pilot System or Project Segment with respect to which a total or partial termination for convenience has occurred, as reduced by the amount of payments otherwise made and the applicable Price of Work not terminated. Upon determination of the settlement amount this Agreement will be amended accordingly, and Developer will be paid the agreed amount as described in this Section 15.5. Nothing in Section 15.6 prescribing the amount to be paid to Developer in the event that Developer and TxDOT fail to agree upon the whole amount to be paid to Developer by reason of the termination of Work pursuant to this Section 15.5, shall be deemed to limit, restrict or otherwise determine or affect the amount or amounts which may be agreed upon to be paid to Developer pursuant to this Section 15.5. TxDOT's execution and delivery of any settlement agreement shall not affect any of its rights under the Contract Documents with respect to completed Work, relieve Developer from its obligations with respect thereto, including Warranties, or affect the rights of TxDOT or Developer under any Performance Bond(s), Payment Bond(s), Maintenance Bond(s), other bonds and/or letters of credit as to such completed or non-terminated Work.
If Developer and TxDOT fail to agree upon the whole amount to be paid Developer by reason of the termination of Work for convenience pursuant to this Section 15, the amount payable (exclusive of interest charges) shall be determined by TxDOT in accordance with the following, but without duplication of any items or of any amounts agreed upon in accordance with Sections 15.4 and 15.5:
15.6.1 TxDOT will pay Developer the sum of the following amounts for Work performed prior to the effective date of the Notice of Termination for Convenience or Notice of Partial Termination for Convenience:
(a) Developer's actual reasonable out-of-pocket cost, without profit, for all Work performed, including mobilization, demobilization and work done to secure the applicable portion of the Project for termination, including reasonable overhead and accounting for any refunds payable with respect to insurance, bond or letter of credit premiums, deposits or similar items, as established to TxDOT's satisfaction. In determining the reasonable cost, deductions will be made for the cost of materials, supplies, Hardware, Software and equipment to be retained by Developer, amounts realized by the sale of such items, and for other appropriate credits against the cost of the Work. When, in the opinion of TxDOT's Authorized Representative, the cost of a contract item of Work is excessively high due to costs incurred to remedy or replace defective, Nonconforming Work or rejected Work, the reasonable cost to be allowed will be the estimated reasonable cost of performing that Work in compliance with the requirements of the Contract Documents and the excessive actual cost shall be disallowed.
(b) A sum, as profit on clause (a) above, determined by TxDOT to be fair and reasonable, but in no event to exceed 4% of the amount determined under clause (a); however, if it appears that Developer would have sustained a loss on the entire contract had it been completed, TxDOT shall allow no profit under this clause (b) and shall reduce the settlement to reflect the indicated rate of loss.;
(c) The cost of settling and paying claims arising out of the termination of Work under Subcontracts as provided in Section 15.2.6, exclusive of the amounts paid or payable on account of supplies or materials delivered or services furnished by the Subcontractor prior to the effective date of the Notice of Termination for Convenience or Notice of Partial Termination for Convenience of Work under this Agreement, which amounts shall be included in the cost on account of which payment is made under clause (a) above;
(d) The reasonable out-of-pocket cost (including reasonable overhead) of the preservation and protection of property incurred pursuant to Section 15.2.9 and any other reasonable out-of-pocket cost (including overhead) incidental to termination of Work under this Agreement, including the reasonable cost to Developer of handling material returned to the vendor, delivered to TxDOT or otherwise disposed of as directed by TxDOT, and including a reasonable allowance for Developer's administrative costs in determining the amount payable due to termination of this Agreement.
15.6.2 Developer acknowledges and agrees that it shall not be entitled to any compensation in excess of the value of the Work performed (determined as provided in Section 15.6.1) plus its settlement costs, and that items such as lost or anticipated profits, unabsorbed overhead and opportunity costs shall not be recoverable by it upon termination of this Agreement. The total amount to be paid to Developer, exclusive of costs described in Sections 15.6.1(c) and (d), may not exceed the total Price for the Project as a whole or, individually, for the applicable Pilot System or Project Segment with respect to which a total or partial termination for convenience has occurred, less the amount of payments previously made. Furthermore, in the event that any refund is payable with respect to insurance, letter of credit or bond premiums, deposits or other items which were previously passed through to TxDOT by Developer, such refund shall be paid directly to TxDOT or otherwise credited to TxDOT. Except to the extent that TxDOT will have expressly assumed the risk of loss, there will be excluded from the amounts payable to Developer under Section 15.6.1, the fair value, as determined by TxDOT, of equipment, supplies, Hardware, Software, machinery, materials and property which is destroyed, lost, stolen, or damaged so as to become undeliverable to TxDOT, or sold pursuant to Section 15.2.10. Information contained in the EPDs may be a factor in determining the value of the Work terminated. Upon determination of the amount of the termination payment, this Agreement shall be amended to reflect the agreed termination payment, Developer shall be paid the agreed amount, and the applicable Price shall be reduced to reflect the reduced scope of Work.
15.6.3 If a termination hereunder is partial, Developer may file a proposal with TxDOT for an equitable adjustment of the applicable Price for the continued portion of this Agreement. Any proposal by the Developer for an equitable adjustment under this clause shall be requested within 90 Days from the effective date of termination unless extended in writing by the TxDOT. The amount of any such adjustment as may be agreed upon shall be set forth in an amendment to this Agreement.
The amount otherwise due Developer under this Section 15 shall be reduced by (a) the amount of any claim which TxDOT may have against any Developer-Related Entity in connection with this Agreement, (b) the agreed price for, or the proceeds of sale, of property, materials, supplies, equipment, Hardware, Software or other things acquired by Developer or sold, pursuant to the provisions of this Section 15, and not otherwise recovered by or credited to TxDOT, (c) all unliquidated advance or other payments made to or on behalf of Developer applicable to the terminated portion of the Work or Agreement, (d) amounts that TxDOT deems advisable, in its sole discretion, to retain to cover any existing or threatened claims, Liens and stop notices relating to the Project, including claims by Utility Owners, (e) amounts payable to TxDOT as Liquidated Damages or Stipulated Damages; (f) amounts that TxDOT deems advisable, in its sole discretion to retain to cover any existing or anticipated Losses incurred by TxDOT; (g) the cost of repairing any Nonconforming Work (or, in TxDOT's sole discretion, the amount of the credit to which TxDOT is entitled under Section 5.6.2) and (h) any amounts due or payable by Developer to TxDOT.
TxDOT may from time to time, under such terms and conditions as it may prescribe and in its sole discretion, make partial payments on account against costs incurred by Developer in connection with the terminated portion of this Agreement, whenever in the opinion of TxDOT the aggregate of such payments shall be within the amount to which Developer will be entitled hereunder. If the total of such payments is in excess of the amount finally agreed or determined to be due under this Section 15, such excess shall be payable by Developer to TxDOT upon demand together with interest at the rate of the lesser of (a) 12% per annum or (b) the maximum rate allowable under applicable Law.
15.9.1 Provisions shall be included in each Subcontract (at all tiers) regarding terminations for convenience, allowing such terminations to be passed through to the Subcontractors and establishing terms and conditions relating thereto, including procedures for determining the amount payable to the Subcontractor upon a termination, consistent with this Section 15.
15.9.2 Each Major Subcontract shall provide that, in the event of a termination for convenience by TxDOT, the Subcontractor will not be entitled to any anticipatory or unearned profit on Work terminated or partly terminated, or to any payment which constitutes consequential damages on account of the termination or partial termination.
Under no circumstances shall Developer be entitled to anticipatory or unearned profits or consequential, special, indirect or other damages as a result of a termination or partial termination under this Section 15. The payment to Developer determined in accordance with this Section 15 constitutes Developer's exclusive remedy for a termination hereunder.
Anything contained in this Agreement to the contrary notwithstanding, a termination under this Section 15 shall not waive any right or claim to damages which TxDOT may have and TxDOT may pursue any cause of action which it may have at Law, in equity or under the Contract Documents.
The failure of the parties to agree on amounts due under this Section 15 shall be a dispute to be resolved in accordance with Section 19.
All costs claimed by Developer under this Section 15 shall be allowable, allocable and reasonable in accordance with the cost principles and procedures of 48 CFR Part 31.
