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Contract Pricing — Page 1

Firm pricing, no labor escalation over 4 years

All pricing shall be firm and final. No adjustments allowed for labor increases. With 50 elevators over 4 years, labor cost increases of 3-5% annually compound fast. No mechanism to recover.

$200K-$500K in unrecoverable labor costs

Contract Pricing — Page 1

Turn-key code compliance, no change orders

All code compliance costs absorbed by contractor. No change orders allowed for code-related work. With 50 units across multiple jurisdictions, unforeseen code requirements are guaranteed.

$50K-$200K exposure

Schedule Risk — Page 12

Liquidated damages: $1,000 per day per elevator

$1,000 per calendar day per elevator for any delay. On a 50-unit project, that is $50,000 per day of total exposure. No force majeure protection for union contract expiration mid-project.

$50,000/day total exposure

Contract Pricing — Page 83

After-hours work required at no additional cost

All disruptive work must be performed after hours at no additional cost to the owner. Premium time adds 50-100% to labor costs. On a 4-year project with 50 units, this shifts massive labor cost to the contractor.

50-100% labor premium absorbed

Equipment Specification

Gearless and MRL machines, no approved alternates

Spec called for gearless and machine-room-less machines with no approved alternates. Sole-source equipment on a 50-unit project creates lead time and pricing risk. MRL runs 20-25% more than conventional.

15-25% equipment premium

Financial — Page 11

5% retainage held until consultant punch list

Retainage release depends on consultant's punch list completion, not substantial completion. On a $5M+ contract, that is $250K+ held at the end of the project with no defined timeline for release.

$250K+ tied up in retainage

Contract Language — Page 3

Incumbent termination poison pill

Submitting this bid allows the owner to terminate your existing contracts on other properties at will, with no penalties, regardless of remaining term. If you have 2 years remaining at $500K/year on other properties, you lose $1M in revenue just by bidding.

$1M+ in existing contract revenue at risk

Contract Language — Page 6

Unlimited scope clause

Any work not specifically mentioned but required to achieve the 'level of maintenance intended' shall be performed at no additional cost. The owner can argue any maintenance activity is 'intended' even if not listed in the spec.

$10K-$50K+ per dispute, unlimited occurrences

Contract Pricing — Page 9

One-way price adjustment

If you reduce maintenance hours, contract price decreases by the same percentage. But if equipment requires more hours, no price increase allowed. On a $2M/year contract, reducing 10% of hours loses $200K in revenue. Increasing 10% of hours, you absorb the cost.

Asymmetric pricing risk on $2M/year contract

Staffing — Page 6

Supervisor visit minimums across 4 regions

Semi-annual supervisor visits required for 250+ units across 4 regions. At 50+ buildings, that is 100+ supervisor site visits per year. Supervisor labor at $120-150/hr, 2-4 hours per visit including travel.

$24K-$60K/year in supervisor labor

Equipment — Page 12

Unlimited repair and replacement, 1963-2026 equipment

Contractor responsible for repair and replacement of all equipment. Portfolio includes units from 1963 to 2026 with 8 different manufacturers. Single controller replacement runs $20K-$40K. Single machine replacement $30K-$60K.

Catastrophic replacement liability

Equipment — Page 17

Obsolescence risk across multi-manufacturer portfolio

Portfolio spans Otis, Fujitec, MCE, TKE, Schindler, KONE, Mitsubishi, and Dover equipment. 50+ units over 20 years old. Single controller board replacement or upgrade runs $15K-$50K per unit.

$750K-$2.5M in potential upgrades over contract term

Equipment Specification — Page 14

MRL specified but control space HVAC not in mechanical scope

Machine-room-less elevators require dedicated HVAC in the control space at the top of the hoistway. Spec calls for MRL traction on all 12 units but the mechanical scope has no provision for control space cooling. If it falls to the elevator contractor, that is $3K-$5K per unit.

$36K-$60K in unpriced HVAC scope

Code Compliance — Page 22

Seismic requirements not addressed in structural

Project is in Seismic Design Category D. ASME A17.1 Section 8.4 requires seismic switches, rope retainers, and counterweight guards. Structural drawings show no seismic bracket provisions in the hoistway. Elevator contractor will need to coordinate and may absorb retrofit costs.

$8K-$15K per unit, $96K-$180K total

Contractor Scope — Page 31

Temporary elevator service during construction

Spec requires elevator contractor to provide temporary service elevator for construction use starting at month 6. Temporary service wears the car, tracks, and doors before the building is even occupied. Repair and restoration costs at turnover are contractor's responsibility.

$15K-$25K per unit in wear and restoration

Contract Pricing — Page 8

Allowance-based cab finishes, amounts undefined

Cab interior specifications reference a finish allowance but the amount is not defined in the bid documents. Architect's finish schedule not included. Elevator contractor is expected to carry an allowance with no basis for pricing.

$50K-$120K in undefined finish scope

Equipment Specification — Page 18

Destination dispatch specified, single manufacturer

Spec requires destination dispatch system with specific performance metrics that map to one manufacturer's proprietary system. No approved alternates listed. Single-source equipment on a 12-unit hotel creates pricing leverage for the OEM and lead time risk for the contractor.

15-20% premium over open-protocol systems

Schedule — Page 4

Substantial completion tied to hotel opening date

Liquidated damages tied to hotel opening, not elevator substantial completion. If any other trade delays the opening, elevator contractor is still exposed to LDs if their scope isn't 100% complete by that date. No sequencing protection in the contract.

$2,500/day LD exposure, no fault protection