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<br />EXHIBIT "I^
<br />Terms of Governmental Contract
<br />Attached is a subcontract between Braley Sand and Gravel, a sub-
<br />contractor, with Kelran Constructors, Inc., a general contractor, for
<br />work to be pertormed for the City of Aurora in Arapahoe and Douglas
<br />Counties, known as the Rampart Parallel Raw Water Transmission Line -
<br />Phase Ii.
<br />As you will note, the contract was let and entered into October 3,
<br />1979, and work under the contract commenced then.
<br />The written contract to date provides for the delivery of 35,000
<br />tons, more or less, and the subcontractor, Braley Sand and Gravel, has
<br />been advised as of this date that between 55,000 and 60,000 tons will
<br />ultimately be necessary. No written amendment has yet been provided as
<br />the general contractor is stilt estimating this increase. Nevertheless,
<br />one can see a minimum of 35,000 tons. To date 25% to 30~ of these materials
<br />have been delivered (8,000 to 9,000 tons).
<br />Please note Section 5 in terms of prosecution of work and performance,
<br />stating that the contractor requires prompt and diligent work whenever
<br />the work becomes available or at such other time or times as the contractor
<br />may direct. Braley Sand and Gravel has been advised that the 35,000
<br />tons must be delivered by January of 1980, weather permitting, so that
<br />the only interruption in work could be weather. Continual deliveries
<br />are necessary daily to meet these requirements. In addition, if the
<br />contract for additional materials is forthcoming, the upwards to 60,000
<br />tons would be delivered through March of 1980.
<br />Finally, there is no surety under the Subcontract as the general
<br />contractor, Kelran Constructors, Inc., has a blanket bond and surety
<br />required by statute which includes all subcontractors, of which Braley
<br />Sand and Gravel Is one. Please note Page 4 of the Contract which tollows
<br />stating "Section 9, Insurance, is deleted and the subcontractor will
<br />comply with the insurance requirements of General Contract, Page GC-7, a
<br />copy of which is attached." Then referring to the next page, Page 5
<br />(which is a copy of Page GC-7), the performance bond of the general
<br />contractor covers all his subcontractors. The subcontractor's coverage
<br />under this bond of the general contractor takes care of the subcontractor's
<br />performance as it is "security for the faithful performance of this
<br />contract, for the payment of all persons performing labor and furnishing
<br />material, and for ail other obligations incurred in connection with the
<br />work." (Page 5, Paragraph 32) Thus, there is no bonding or surety from
<br />the subcontractor, Braley Sand and Gravel, to the municipality, the City
<br />of Aurora, as the payment and performance bond is with the general contractor,
<br />Kelran, who is responsible for all his subcontractors.
<br />EXHIBIT "I" - Terms of Governmental Contract - Narrative
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