What does the contractor pay if a data hall is late, and is that the owner’s only remedy?
Nscale’s design-build contract for four buildings in Ward County, Texas sets a completion date per building, a 14-day grace period and then $714,285.71 a day, about $5 million a week, capped at $60 million. The cap does not limit the contractor’s duty to finish the work, and it falls away for fraud, gross negligence, wilful misconduct or abandonment. Delay damages come on top of the owner’s other remedies, including termination. If the contractor ever overturns them, it must pay the owner’s actual losses, lost profits included, with no cap.
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What the filed contracts say
Contract
What the filed wording says
Nscale Ward County design-build
After a 14-day grace period the design-builder pays $714,285.71 a day until the building reaches its milestone.
Nscale Ward County design-build
Each of the four buildings has its own date, from August 2026 to February 2027.
Nscale Ward County design-build
Delay damages are capped at $60 million, but the cap does not limit the duty to complete and does not apply to fraud, gross negligence, wilful misconduct or abandonment.
Nscale Ward County design-build
If the design-builder overturns the delay damages, it pays the owner’s actual losses, including lost profits, with no cap.
The filed wording
§ 2.3.2 Liquidated Damages The Design-Builder’s liability for liquidated damages resulting from the Design-Builder’s failure to achieve Substantial Completion within the Contract Time shall be as follows:.1 The monetary amount of liquidated damages shall be: If Early Access Date is not achieved by the date stipulated e, then Design-Builder shall be entitled to fourteen (14) days grace period from liability to pay liquidated damages. From day 15, the Design-Builder shall pay Owner 714,285.71U.S. Dollars per day, for each day, or portion thereof, of delay until the relevant milestone has been achieved. … .2 The following date(s) or event(s) shall trigger the commencement of the assessment of liquidated damages: Phase of Works Substantial Completion 14 days grace Date LDs apply from LDs per day (USD) Building 1 August 1, 2026 YES August 15, 2026 714,285.71 Building 2 December 22, 2026 YES January 6, 2027 714,285.71 Building 3 January 24, 2027 YES February 8, 2027 714,285.71 Building 4 January 24, 2027 YES February 8, 2027 714,285.71
Nscale Ward County data centre design-build agreement (AIA A141, four buildings near Odessa, Texas), section 2.3.2.1 and .2 · KiNRG S-1/A, Exhibit 10.13
Each extract is quoted from the contract as filed with the SEC, checked against the filed text when it was added; “…” marks words left out. Filers redact commercial terms, so a [***] or [*] is the filer's, not ours. The summaries describe the wording, not how a court would read it, and each contract's defined terms and other clauses can change the effect. General information drawn from public filings. It is not legal advice on any transaction, and using this page does not create a lawyer-client relationship. Views are personal.
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