CONSTRUCTION SERVICES AGREEMENT

(Ohio – Private Commercial Project)

[// GUIDANCE: This template is drafted for a private, non-residential construction project governed by Ohio law. If the Project is a “public improvement” under R.C. Chapter 153, additional statutory bonding and retainage requirements apply; customize Sections 5.4 and 7.3 accordingly. Always confirm current statutory thresholds and local recording office practices before final execution.]

TABLE OF CONTENTS

1. Document Header
2. Definitions
3. Scope of Work & Performance Standards
4. Contract Price; Payment Procedures
5. Lien Law Compliance & Security Instruments
6. Representations & Warranties
7. Covenants
8. Default; Remedies
9. Risk Allocation
10. Dispute Resolution
11. General Provisions
12. Execution Block

1. DOCUMENT HEADER

1.1 Agreement

This Construction Services Agreement (this “Agreement”) is made and entered into as of [EFFECTIVE DATE] (the “Effective Date”) by and between:

(a) [OWNER LEGAL NAME], a [STATE] [ENTITY TYPE] having its principal place of business at [ADDRESS] (“Owner”); and

(b) [CONTRACTOR LEGAL NAME], a [STATE] [ENTITY TYPE] having its principal place of business at [ADDRESS] (“Contractor”).

Owner and Contractor are sometimes referred to herein individually as a “Party” and collectively as the “Parties.”

1.2 Recitals

A. Owner desires to have certain construction services performed in connection with the project commonly known as “[PROJECT NAME]” located at [PROJECT ADDRESS] (the “Project”).
B. Contractor represents that it is duly qualified, licensed, and willing to perform the Work (as defined below) in accordance with the terms of this Agreement.
C. In consideration of the mutual covenants contained herein, the Parties agree as follows.

2. DEFINITIONS

For purposes of this Agreement, the following capitalized terms shall have the meanings set forth below. Defined terms include the singular and plural forms and shall apply throughout this Agreement, including all Exhibits and Schedules.

“Applicable Law” means all federal, state, and local statutes, regulations, ordinances, codes, and orders applicable to the Project, including without limitation the Ohio Revised Code (“R.C.”), specifically R.C. Chapter 1311 (Mechanics’ Liens) and R.C. § 4113.61 (Prompt Pay).

“Change Order” has the meaning provided in Section 3.4.

“Contract Documents” means this Agreement, Exhibit A (Scope of Work & Specifications), Exhibit B (Project Schedule), Exhibit C (Payment Schedule), Exhibit D (Insurance Requirements), Exhibit E (Form of Lien Waiver), and any written Change Orders.

“Contract Price” means the lump-sum amount of $[AMOUNT] or such other amount as may be adjusted pursuant to this Agreement.

“Final Completion” means the date on which (i) the Work is fully performed in accordance with the Contract Documents; (ii) all punch-list items are completed; (iii) Contractor has delivered all close-out documentation, warranties, and final lien waivers; and (iv) Owner has accepted the Work in writing.

“Notice of Commencement” has the meaning set forth in Section 5.1(a).

“Retainage” has the meaning set forth in Section 4.4.

“Subcontractor” means any third party retained by Contractor to perform any portion of the Work.

“Work” means all labor, materials, equipment, and services required to complete the Project as more particularly described in Exhibit A, as may be modified by Change Orders.

3. SCOPE OF WORK & PERFORMANCE STANDARDS

3.1 Performance of the Work

Contractor shall diligently perform the Work in a good and workmanlike manner, using new materials of good quality, and in strict accordance with the Contract Documents, Applicable Law, and industry standards.

3.2 Project Schedule

Contractor shall commence the Work on [COMMENCEMENT DATE] and shall achieve Substantial Completion on or before [SUBSTANTIAL COMPLETION DATE] and Final Completion on or before [FINAL COMPLETION DATE], subject to extensions granted under Section 9.4 (Force Majeure).

3.3 Supervision & Coordination

Contractor shall provide competent supervision and shall be solely responsible for the means, methods, techniques, sequences, and procedures of construction.

3.4 Changes in the Work

No deviation from the Contract Documents shall be made without a written Change Order executed by the Parties identifying any adjustment to the Contract Price, Project Schedule, or other terms.

[// GUIDANCE: Use a standardized Change Order form and maintain a contemporaneous Change Order log for ease of audit and dispute prevention.]

4. CONTRACT PRICE; PAYMENT PROCEDURES

4.1 Schedule of Values

Contractor shall submit a schedule of values itemizing the Contract Price for Owner’s approval prior to the first payment application.

4.2 Progress Payments

(a) Applications – On or before the [DAY] of each month, Contractor shall submit a properly completed payment application for Work performed through the last day of the preceding month, supported by partial lien waivers in the form attached as Exhibit E.
(b) Certification & Payment – Owner shall, within ten (10) days after receipt, approve or reject the payment application. Approved amounts shall be paid within twenty-one (21) days after Owner’s receipt, consistent with R.C. § 4113.61.

4.3 Final Payment

Owner shall make final payment of the unpaid balance of the Contract Price within thirty (30) days after Final Completion, receipt of a sworn final lien waiver from Contractor and all Subcontractors, and satisfaction of all contractual conditions precedent.

4.4 Retainage

Owner shall withhold retainage equal to [RETAINAGE PERCENT] % of each progress payment (the “Retainage”); provided that Retainage shall not exceed ten percent (10%) of the Contract Price and shall be reduced to five percent (5%) upon fifty percent (50%) completion of the Work, consistent with the limitations in R.C. § 4113.61(D). Retainage shall be released with the final payment, subject to lien-free status of the Project.

5. LIEN LAW COMPLIANCE & SECURITY INSTRUMENTS

5.1 Notice of Commencement

(a) Owner Obligation – Pursuant to R.C. § 1311.04, Owner shall execute and record a Notice of Commencement (“NOC”) in the county recorder’s office where the Project is located not later than ten (10) days after commencement of the Work and shall conspicuously post a copy at the Project site.
(b) Contractor Cooperation – Contractor shall timely provide Owner with all information required for the NOC and shall deliver a copy of the recorded NOC to all Subcontractors and material suppliers.

5.2 Lien Waivers

Contractor shall provide, and shall cause its Subcontractors to provide, partial and final unconditional lien waivers in the forms set forth in Exhibit E as a condition precedent to any payment.

5.3 Discharge of Liens

If any mechanics’ lien or bond claim is filed or served against the Project by anyone claiming by, through, or under Contractor, Contractor shall, within ten (10) days of notice, cause such lien to be released, bonded off, or otherwise discharged in accordance with R.C. § 1311.11, at Contractor’s sole expense.

5.4 Payment Bond (Optional)

[Check one]
☐ Contractor shall furnish, within ten (10) days after the Effective Date, a payment bond in the penal sum of 100% of the Contract Price, issued by a surety company authorized to transact business in Ohio, in a form reasonably acceptable to Owner.
☐ Not Applicable – The Parties waive the requirement for a payment bond.

[// GUIDANCE: When a Payment Bond is provided, attach as Exhibit F and cross-reference Section 5.4 in Exhibit F.]

6. REPRESENTATIONS & WARRANTIES

6.1 By Contractor

(a) Contractor is duly organized, validly existing, and in good standing under the laws of its state of organization and is qualified to transact business in Ohio.
(b) Contractor possesses all licenses and permissions required to perform the Work.
(c) The Work will be free from defects in workmanship and materials for a period of [WARRANTY PERIOD] year(s) from Final Completion (“Warranty Period”).
(d) Contractor will comply with all Applicable Law, including safety and environmental regulations.

6.2 By Owner

Owner possesses full legal right, title, and interest in the Project site sufficient to authorize the Work and to enter into this Agreement.

6.3 Survival

The representations and warranties contained in this Section 6 shall survive Final Completion for the duration of the Warranty Period and any applicable statutory limitation period.

7. COVENANTS

7.1 Affirmative Covenants of Contractor

(a) Maintain insurance in the types and limits set forth in Exhibit D and provide certificates of insurance prior to commencing Work.
(b) Pay Subcontractors and suppliers in accordance with their respective agreements and Ohio’s Prompt Pay statute.
(c) Maintain accurate books and records relating to the Work and permit Owner to audit same upon reasonable notice.

7.2 Negative Covenants of Contractor

Contractor shall not assign this Agreement, transfer any interest herein, or subcontract all or substantially all of the Work without Owner’s prior written consent, which may be withheld in Owner’s sole discretion.

7.3 Retainage Account (if required)

If the aggregate Contract Price exceeds the statutory threshold for retainage trust accounts under R.C. § 1311.26, Owner shall establish and maintain a segregated retainage account, and Contractor shall be designated as a beneficiary thereof.

7.4 Notice & Cure

Each Party shall give the other written notice of any breach of this Agreement within five (5) days after discovery and afford the breaching Party a cure period of ten (10) days (or such longer period as is reasonably required, provided the breaching Party commences cure within such ten-day period and diligently prosecutes same to completion).

8. DEFAULT; REMEDIES

8.1 Events of Default – Contractor

(a) Failure to prosecute the Work with diligence or to maintain the Project Schedule after written notice and failure to cure within the applicable period.
(b) Failure to pay Subcontractors or suppliers when due.
(c) Filing of a voluntary or involuntary petition in bankruptcy.
(d) Failure to discharge a mechanics’ lien in accordance with Section 5.3.

8.2 Owner Remedies

Upon a Contractor Event of Default, Owner may, in its sole discretion and without prejudice to other remedies:
(i) suspend payments;
(ii) terminate this Agreement for cause pursuant to Section 11.3(b);
(iii) take over the Work and offset the cost of completion from any amounts due or to become due to Contractor; and/or
(iv) seek damages, specific performance, or injunctive relief.

8.3 Events of Default – Owner

Failure to make undisputed payments within the time frames set forth in Section 4 constitutes an Owner Event of Default if not cured within ten (10) days after written notice.

8.4 Contractor Remedies

Upon an Owner Event of Default, Contractor may suspend the Work after ten (10) days’ notice and may terminate this Agreement for cause pursuant to Section 11.3(c) and recover the unpaid balance of the Contract Price plus reasonable demobilization costs.

8.5 Attorneys’ Fees

The prevailing Party in any action to enforce this Agreement shall be entitled to recover its reasonable attorneys’ fees and costs.

9. RISK ALLOCATION

9.1 Indemnification by Contractor

Contractor shall indemnify, defend, and hold harmless Owner, its affiliates, officers, directors, employees, and agents from and against any and all claims, damages, losses, and expenses, including reasonable attorneys’ fees, arising out of or resulting from (i) performance of the Work, (ii) any negligent act or omission or willful misconduct of Contractor or its Subcontractors, or (iii) any breach of this Agreement by Contractor, except to the extent caused by the gross negligence or willful misconduct of Owner.

9.2 Limitation of Liability

NOTWITHSTANDING ANYTHING TO THE CONTRARY, THE TOTAL CUMULATIVE LIABILITY OF EITHER PARTY UNDER THIS AGREEMENT SHALL NOT EXCEED THE CONTRACT PRICE, PROVIDED THAT THIS LIMITATION SHALL NOT APPLY TO (i) A PARTY’S INDEMNIFICATION OBLIGATIONS UNDER SECTION 9.1, (ii) DAMAGES ARISING FROM A PARTY’S GROSS NEGLIGENCE OR WILLFUL MISCONDUCT, OR (iii) A PARTY’S FAILURE TO OBTAIN AND MAINTAIN REQUIRED INSURANCE.

9.3 Insurance

Contractor shall procure and maintain, at its sole cost, the insurance policies described in Exhibit D, naming Owner as an additional insured (except for workers’ compensation).

9.4 Force Majeure

Neither Party shall be liable for delay or failure in performance caused by events beyond its reasonable control, including acts of God, terrorism, labor strikes, or governmental orders. The Project Schedule shall be equitably adjusted for the duration of the force majeure event.

10. DISPUTE RESOLUTION

10.1 Governing Law

This Agreement shall be governed by and construed in accordance with the laws of the State of Ohio, without regard to its conflict of law principles.

10.2 Forum Selection

Subject to Section 10.3, the Parties irrevocably submit to the exclusive jurisdiction of the state courts located in [COUNTY], Ohio for any suit, action, or proceeding arising out of or relating to this Agreement.

10.3 Arbitration [Optional]

[Check one]
☐ Arbitration Elected – Any dispute not resolved within thirty (30) days after senior executive negotiations shall be finally settled by arbitration administered by the American Arbitration Association in accordance with its Commercial Arbitration Rules. The seat of arbitration shall be [CITY], Ohio. Judgment on the award may be entered in any court having jurisdiction.
☐ Arbitration Not Elected – Section 10.2 controls.

10.4 Jury Trial Waiver [Optional]

EACH PARTY HEREBY KNOWINGLY AND VOLUNTARILY WAIVES ANY RIGHT TO A TRIAL BY JURY TO THE EXTENT PERMITTED BY APPLICABLE LAW.

10.5 Injunctive Relief

Nothing in this Section 10 shall limit either Party’s right to seek temporary, preliminary, or permanent injunctive relief in a court of competent jurisdiction to prevent irreparable harm.

11. GENERAL PROVISIONS

11.1 Amendments; Waivers

No amendment or waiver of any provision of this Agreement shall be effective unless set forth in a writing executed by both Parties. Waiver of any breach shall not be deemed to be a waiver of any subsequent breach.

11.2 Assignment

Neither Party may assign this Agreement without the prior written consent of the other, except that Owner may assign this Agreement to a lender providing construction financing upon written notice to Contractor.

11.3 Termination

(a) For Convenience – Owner may terminate this Agreement for convenience upon seven (7) days’ written notice; Contractor shall be paid (i) for Work executed to the termination date, (ii) reasonable demobilization costs, and (iii) reasonable overhead and profit on Work not executed (capped at five percent (5%) of the unpaid Contract Price).
(b) For Cause by Owner – Upon a Contractor Event of Default and failure to cure within the applicable period, Owner may terminate this Agreement, take possession of the Work, and finish the Work by whatever reasonable method Owner deems expedient.
(c) For Cause by Contractor – Upon an Owner Event of Default and failure to cure within the applicable period, Contractor may terminate this Agreement and recover the unpaid balance of the Contract Price and reasonable demobilization costs.

11.4 Severability

If any provision of this Agreement is determined to be unenforceable, the remainder shall remain in full force, and the unenforceable provision shall be reformed to the minimum extent necessary to effectuate the Parties’ intent.

11.5 Entire Agreement

This Agreement, together with the Contract Documents, constitutes the entire agreement between the Parties and supersedes all prior discussions and understandings.

11.6 Counterparts; Electronic Signatures

This Agreement may be executed in counterparts, each of which shall be deemed an original. Signatures transmitted electronically or by facsimile shall be deemed original signatures.

12. EXECUTION BLOCK

IN WITNESS WHEREOF, the Parties have executed this Agreement as of the Effective Date.

[/// Notary acknowledgments and/or witness signatures may be added here if required by local practice or lending requirements.]

EXHIBIT LIST

Exhibit A – Scope of Work & Specifications
Exhibit B – Project Schedule
Exhibit C – Payment Schedule
Exhibit D – Insurance Requirements
Exhibit E – Form of Lien Waiver
Exhibit F – [Optional] Payment Bond

[// GUIDANCE:
1. Lien Compliance – Verify county recorder indexing requirements for the Notice of Commencement and confirm delivery of a copy to each potential claimant (R.C. § 1311.04).
2. Prompt Pay – The statutory interest rate under R.C. § 4113.61(E) applies to late payments; insert current rate or reference statute.
3. Retainage – Confirm Retainage percentages align with lender or owner policy; never exceed statutory caps.
4. Insurance – Ensure Contractor’s policies include completed operations coverage extending through the Warranty Period.
5. Bonding – If the Project is converted to a public improvement, comply with R.C. §§ 153.54-153.571 for performance and payment bonds.
6. Customization – Replace bracketed placeholders, attach all referenced Exhibits, and review state and local amendments enacted after the date of this template.]