I have not used Open Book contracts, but as I understand open concept is applied to cost part. The contractor will share real cost with owner and get certain agreed profit margin over it. The contractor is not promising to do cheapest. Same time the performance obligation is not dropped, and contractor is required to provide the quality and warranty, if applicable. Open book would not imply cheapest at no performance assurance.
• Air Liquide
Thank you for your contribution.
To go further, the Contractor is compensated according to the number of working hours, time an hourly rate. The hourly rate depends upon the country of origin of the employee.
The contractual manning plan specifies the country of origin, and therefore the rate.
However, it happens that the actual country of origin may be different than the one specified in the contract
The question is:
Knowing that we have an "Open Book" contract, does the contractor has an obligation to invoice with the rate as per the contract's country of origin rate, or according to the actual country of origin rate?
As illustration, the contract mentions a project manager coming from France, whereas he actually comes from China. Which rate shall be used?
Terms are basically things that we agree to do or not to do. For example, a Tenant agrees to pay money for rent, while the Landlord agrees to let the Tenant occupy the property in return. Or a software company will let you use their software for a predetermined amount of time.
Conditions are items that must be satisfied before the transaction becomes binding upon the seller and the buyer. Or after signing/award, the conditions can be items for dissolution of the agreement.
For example, some buyers insert a condition for due diligence that allows the buyer to verify all important details before committing to purchase.
Or if you fail to deliver on or stick to what was agreed, the conditions can spell out how the contract will be terminated.
Are the contracts customer contract? Perhaps it may be useful to present the contracts based on the unexpired residue of the term left and whether or not the consent of the customer is required (for assignment). Are the contracts being assigned to a third party? Will the customer have to consent to the assignment?
If you are terminating the contract, you may need to look at the requirements under the term of the contract that will allow you to terminate without liability.