Cost And Fee Contract Template for Nigeria

The Cost And Fee Contract is a specialized agreement used in complex projects where the exact scope and costs cannot be precisely determined at the outset. Common in Nigerian infrastructure, construction, and consulting projects, this contract type allows for the recovery of actual costs plus a predetermined fee. It is particularly relevant when projects involve variable costs, uncertain scope, or require flexibility in execution. The document incorporates Nigerian legal requirements, including compliance with the Public Procurement Act 2007 and local content regulations. It is designed to provide transparency in cost tracking, clear fee calculation methodologies, and robust control mechanisms while protecting both parties' interests. This contract type is often preferred in government projects, large-scale developments, and specialized consulting engagements where traditional fixed-price contracts may not be suitable.

1. Parties: Identification of the contracting parties, including their legal status and registered addresses

2. Background: Context of the agreement, including the project scope and reasons for choosing a cost-plus arrangement

3. Definitions: Detailed definitions of key terms, especially those related to costs, fees, and reimbursable expenses

4. Scope of Services: Detailed description of the services to be provided, including deliverables and performance standards

5. Cost Components: Definition and categorization of allowable costs, including direct costs, indirect costs, and overhead

6. Fee Structure: Detailed explanation of how fees will be calculated, including percentage or fixed fee arrangements

7. Payment Terms: Terms and conditions for payment, including invoicing procedures, payment schedules, and currency

8. Cost Control Mechanisms: Procedures for cost monitoring, reporting, and approval of expenditures

9. Accounting and Records: Requirements for maintaining cost records, accounting standards, and documentation

10. Audit Rights: Client's rights to audit costs and related documentation

11. Term and Termination: Duration of the agreement and grounds for termination

12. Obligations of the Parties: Specific responsibilities and obligations of both parties

13. Representations and Warranties: Standard warranties regarding capacity, authority, and performance capabilities

14. Liability and Indemnification: Allocation of risks and responsibilities between parties

15. Dispute Resolution: Procedures for resolving disputes, including applicable law and jurisdiction

16. General Provisions: Standard boilerplate clauses including notices, amendments, and assignment