GMP ADDENDUM Sample Clauses

The GMP Addendum is a contractual provision that supplements an agreement by establishing a Guaranteed Maximum Price (GMP) for a project or scope of work. It typically outlines the maximum amount the owner will pay the contractor, including details on allowable costs, contingencies, and procedures for handling cost overruns or savings. This clause ensures that the contractor is incentivized to control costs, while the owner is protected from unexpected budget increases, thereby allocating financial risk and promoting cost certainty for both parties.