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A Letter of Understanding (LOU) is a formal text that sums up the terms of an undertakings of a contract which may have been negotiated up to this point only in spoken form or otherwise informally. It reviews the terms of an agreement for a service , a project or a deal and is often written as a step before a more detailed contract is issued.
Construction bidding is the process of submitting a proposal to undertake, or manage the undertaking of a construction project. The process starts with a cost estimate from blueprints and material take offs .
The owner is in more control of the project; however, the risks are transferred to the owner. [11] A cost plus contract states that a client agrees to reimburse a construction company for building expenses such as labor, materials, and other costs, plus additional payment usually stated as a percentage of the contract's full price.
A parent company guarantee (PCG) is a guarantee by a parent company of a contractor’s performance under its contract with its client, where the contractor is a subsidiary of the parent company.
A letter of intent (LOI or LoI, or Letter of Intent) is a document outlining the understanding between two or more parties which they intend to formalize in a legally binding agreement. The concept is similar to a heads of agreement , term sheet or memorandum of understanding .
The model was first studied in 1976 and studies through the 1990s showed that adopting such a model could generate 10% savings on project time and 7% on cost. [6] The wider adoption of ECI was a recommendation of the 1994 Latham Report into systemic failings in the British construction industry; the practice became increasing popular during the early 2000s.
Obtaining construction loans are easier with this type of contract. [9] [8] The profit margins and percentages are greater for engineers and contractors. [8] [9] Payments and instalments are made on regular basis which provides the contractor with a reliable cash flow. [8] [9] Management of the contract is a lot easier for the owner. [8] [9]
Also Abrams' water-cement ratio law. A law which states that the strength of a concrete mix is inversely related to the mass ratio of water to cement. As the water content increases, the strength of the concrete decreases. abrasion The process of scuffing, scratching, wearing down, marring, or rubbing away a substance or substrate. It can be intentionally imposed in a controlled process using ...