Document L7xvmzG3BYXKBOppgXJV83Bq

PURCHASE CONTRACT AC'CE AND ABSTRACT CELANESE CHEMICAL CC .wPANY, INC. SUPPLIER Arthur_Brothers. Inc. COMMOOITY/SERVICE Maintenance and miscellaneous construction services FACILITY Bishop, Corpus Christi, Bay City and Pampa CONTRACT TERM 3 years beginning December 30, 1985 TERMINATION RIGHTS AND NOTICE REQUIREMENTS Contract is on an "as needed" basis MAXIMUM QUANTITY MINIMUM FIXED UNIT PRICE AMD F.O.B. Markups - up to $10,000,000 annual direct wages - 30.5% of which 3.5% is for insurance Mcont'd) Over $10,000,000 annual direct wages 27.5% of which .5% is for insurance PRICE CHANGE PROVISIONS PLAINTIFF'S EXHIBIT CONTRACT HO. 014-456 ORIGINAL CONTRACT DATE- 12/30/8$ THIS NOTICE DATE: 9/8/86 - REQUIREMENTS O^ARTIAL O FUt-C TOTAL DOLLAR VALUE Estimated value for 3 years is over $45,000,000 TERMS OF PAYMENT special features/remarks This amendment increases the markup for liability insurance by 3% from .5% to 3.5% on the first $10,000,000 annual direct wages. See supplement letter TRS-127-86 for additional requirements. *(cant'd) Overtime markup is 10.8% applicable to the premium portion of overtime. DISTRIBUTION -- WITH OOCUMENT COPV `j Executive Records - Dallas (original) k F. G. Israel - Dallas s; ft A.C. Enlow - Bay City C. R. Pennington - Bay City G. B. Durett - Bay City T. R. Lowrie - Pampa D. A. Fiveash - Pampa L. E. Moore - Pampa J. A. Pollard - CCTC L. W. Hartman - CCTC D. D. Arnold - CCTC DISTRIBUTION -- WITHCjlJT OOCUMENT COPV D. L. Yancey - Bishop G. R. Llewellyn - Bishop R. C. Seawright - Bishop ABSTRACTED BYl ne.^daL 16876 y/?c November 3, 1986 ELANESE CHEMICAL COMPANY, INC. TRS-127-8 6 Mr. Aaron Starks Arthur Brothers Inc. P. O. Box 792 Kingsville, Texas 78363 re: Maintenance and Construction Services Contract Increased Liability Insurance Cost Dear Aaron: Attached is the signed acknowledgement copy of your October 23, 1986 letter. This letter is signed on the additional conditions. ABI will furnish T. R. Shandley, Dallas Office, the following .5 information: 1 1. Quarterly ABI will furnish the accumulated direct wage costs billed to Celanese beginning September 8, 1986. 2. ABI will promptly notify Celanese when the $10MM direct wage expenditure is reached. 3. ABI will require any.other customer to pay their equal share of the liability premium and Celanese will be credited that amount. ABI will notify Celanese on a quarterly basis of all insurance costs received from other customers. 4. ABI agrees to continue to work closely with Employers Casualty to reduce the liability insurance premium cost for the 9/87 through 9/88 contract period. Please acknowledge ABI's agreement to the above conditions by signing and returning one copy of this letter to my attention. Yours very truly. T. R. Shandley Aareed to Aaron F. Stark: Vice-President TRS: cp 168V Interoffice iUciiiornii<limi TO (Nam* and Location) P. E. Hime FROM (Nam# and Location) T. R. Shandlev RECEIVED NOV 0 7 tQflfi DATE November 3, REFERENCE NO. TRS-126-86 COAMESC QIWUTY 1986. Re: Arthur- Brothers Inc., Maintenance and Construction Services Contract - Increased Liability Insurance. Premium The attached letters from ABI outlines the details of their increased cost of liability insurance for $5.5MM coverage in lieu of the $15.5MM coverage that ABI had at the time the contract was negotiated. Also contained in the letter is the increase in the contract markup to cover their new insurance premiums. The contract markup will be increased by 3.0% on the first $10,000,000 of billed annual wage cost. The period of the insurance coverage is from September 8, 1986 through September 6, 1987. We will review ABI's insurance premiums at that time. Our insurance department stated that ABI's insurer probably has the best costs at this time. Please sign the letters on the first three pages, all marked with a red clip. The letters are to be returned to me for distribution. TRS:cp cc: J. T. Cockburn T. R . Shandley 16878 P. 0. SOX 792 TELEPHONE 592-6416 ARTHUR BROTHERS INCORPORATED HIWAY 77 BYPASS KINGSVILLE, TEXAS 78363 October 23, 1986 Celanese Chemical Company, Inc. P. 0. Box 47320 Dallas, Texas 75247 Attention: Mr. T. R. Shandley, Purchasing Manager Re: Cost Plus Fee Maintenance and Construction Services Dear Rogers: Because of the uncontrolled increased cost of liability insurance, we propose to amend the referenced contract as per attachment. 1 Please acknowledge this amendment by signing below and returning the copy to us. Please keep the original for your file. Celanese Chemical Company, Inc Arthur Brothers, Inc Vice-President Operations Vice-President 16879 1986 CONTRACT AMENDMENT ARTICLE 10. CONTRACTOR'S FEE, (a) For providing labor and supervision therefor Contractor shall be paid in addition to the amount provided in Article 9 hereof, a Fee, which consists of three components, of 30.5% of the direct wage cost attributable to (i) actual straight-time hours worked (ii) the straight-time portion of any overtime hours worked. The Fee consists of three components (i) 25% for all payroll costs, employees benefits and small tools (ii) 2.0% for profit and overhead, and (iii) 3.5% for General and Umbrella Liability Insurance Coverage, as per the following schedule: SEPTEMBER ..8,.:.:.1986 .THRU SEPTEMBER 6. 1987 Total Annual Direct Wage Cost (Exclusive of Premium Portion of Overtime) $10,000,000 or less Payroll costs, employee benefits, and small tools 25.0% General and Umbrella Liability Insurance Coverage (Renegotiated each like period thereafter) 3.5% Overhead and Profit f Total Fee: 2.0% 30,5% $10,000,000 or more Payroll costs, employee benefits, and small tools 25.0% General and Umbrella Liability Insurance Coverage .5% Overhead and Profit Total Fee: 2.0% 27.5% Contractor shall be paid a markup equal to 10.8 percent of that portion of Contractor's total direct wage cost attributable to the premium portion of wages paid for overtime hours worked by its authorized employees on authorized work hereunder. It is understood that Company may, in the future, wish Contractor to perform similar work at other Company plants. Such other plants may be added to this Agreement using the same conditions and percentage Fee and markups described herein. The annual period for the work performed at such other plant shall be deemed to have the same commencement date as the annual period hereunder. ACKNOWLEDGEMENT: P. E. HIME 16880 ' P. O. 30X792 TELEPHONE 582-6418 ARTHUR BROTHERS INCORPORATED HIWAY 77 BYPASS KINGSVILLE. TEXAS 78363 October 27, 1986 Celanese Chemical Company, Inc. P. 0. Box 47320 Dallas, Texas 75247 o 0CT29nm Attn: Mr. T. R. Shandley, Purchasing Manager Re: Cost Plus Fee Maintenance & Construction Services Contract Dear Rogers: Attached is a copy of our Liability Policy Renewal Premiums, i i as you requested. If you need any additional information, please give me a call. Thank you for your help and understanding in this matter. AFS/lb Enclosure Very truly yours, ARTHUR BRO)TTHHER^S INC. a Cm^ 'sJ' Aaron F.- Starks Vice-President 16881 EmPLOYeps casuanY company 4501 GOLLIHAR | CORPUS CHRISTI. TEXAS 78411 (5121 853-0171 JERRY J. CRIOER, Senior Marketing Executive October 24, 1986 Arthur Brothers, lac. P.0. Box 792 Kingsville, Texas 78363 RE: Premiums Calculations for 9/7/86-87 Dear Larry: Please find belov the annual premium for the renewal policy year: Texas Multi-Peril Liability Policy Limits $500,000 CSL Premium $105,204 Payment Basis 25* dovn/balance in 9 mo. installments Excess Liability Policy $500,000 $70,000 Umbrella Liability Policy $1,000,000 $130,575 " " Umbrella Liability Excess $3,500,000 Limits $84,545 "" If you need any additional information, please give me a call. We appreciate your business. Sincerely, JC/sa AUSO MPRCtKNTINC 16882 lATtaHAk biac tNtWHANCK