AGREEMENT OF ENGINEERING, PROCUREMENT AND CONSTRUCTION SERVICES

NO. 008/LEGAL/SDJ-PP/III/2015

BY AND BETWEEN

PT. SRIWIJAYA LINTAS RAYA

AND

PT. PP (PERSERO), Tbk.

JAKARTA,
23 MARET 2015 / MARCH 23RD, 2015
 AGREEMENT
OF
ENGINEERING, PROCUREMENT AND CONSTRUCTION SERVICES
No. 008/LEGAL/SDJ-PP/III/2015

This Agreement for Engineering, Procurement and Construction Services (hereinafter shall
be referred to as “Agreement”) is made and entered into on Monday, dated March 20th,
2015, by and between:

1. PT. SRIWIJAYA LINTAS RAYA, a limited liability company established under the laws of
the Republic of Indonesia, having its registered address at Graha BIP lantai 5, Jl.
JenderalGatotSubrotoKav. 23, South Jakarta, in this matter is represented by
KusnadiSukarja in his capacity as the President Director pursuant to Deed No. 06 dated
January 16th, 2015, made before EngawatiGazali, SH, Notary in Jakarta, and Syailendra
in his capacity as the Head of Tender Execution, therefore representing the Board of
Directors, therefore acting for and on behalf of PT SriwijayaLintas Raya, hereinafter shall
be referred to as the “Company”;

and

2. PT. PP (PERSERO), Tbk., a limited liability company established under the laws of the
Republic of Indonesia, having its registered address at Jl. Adam Malik No. 103, Medan,
in this matter is represented by Ir. RoyaldiRosman, MM in his capacity as the Head of
Operation Division I, based on the Deed No. 19, dated April 15 th, 2014, made before
WiwiekWidhiAstutu, SH, Notary in Jakarta, therefore representing the Board of Directors,
therefore acting for and on behalf of PT PP (PERSERO), Tbk., hereinafter shall be referred
to as the “Contractor”.

Hereinafter the Company and the Contractor shall individually be referred to as “Party”
and collectively referred to as “Parties”.

Witnesseth that:

1. Whereas, the Company is a coal trading company which requires construction

services for mining roads of the Company (the "Project").

2. Whereas, the Contractor has the required expertise and know-how to fulfill the needs
and to provide the services as required by the Company.

3. Whereas, the Parties agree to enter into and bind themselves into this Agreement,
consisting of:
a. General Provisions
b. Special Provisions
c. Annex I, Bill of Quantity (BOQ)
d. Annex II, Design as reference for BOQ calculation.

4. The Agreement (including the General Provisions, Special Provisions and the Annexes
hereto) constitutes the entire agreement between the Company and the Contractor
with respect to the subject matter of the contract and supersedes all prior
 commitments, arrangements, agreements and contracts (whether written or oral)
made between or entered into by the Parties with respect thereto prior to the date of
the Agreement except to the extent they are expressly incorporated herein.

In witness whereof this Agreement is made and executed and duly stamped by the Parties
hereto in 2 (two) counterparts and shall respectively have the same legal effect.

[EXECUTION ON THE FOLLOWING PAGE]

 [EXECUTION PAGE] [HALAMAN TANDATANGAN]

PT.SRIWIJAYA LINTAS RAYA PT. PP (PERSERO), Tbk.

_____________________________ _____________________________
Name : Kusnadi Sukarja Name : Ir. Royaldi Rosman, MM
Designation : President Director Designation : Head of Operation Division I

_____________________________
Name : Syailendra
Designation :Kepala Pelaksana Tender
 SECTION I

GENERAL PROVISIONS

ARTICLE 1
DEFINITIONS

The following words, terms, and phrases as used in this Agreement shall have the meanings
as set forth:

1. Advance Payment means the initial payment as identified as such in the Special
Provision.

2. Advance Payment Bond means an advance payment bond in compliance with Special
Provisions 6 and 10.

3. Affiliate has the meaning given in Article 15.

4. Agreement shall be this agreement including the General Provisions, Special Provisions,
annexes and all the amendments and/or addendums made and executed by the
Parties and shall constitute as an integrated and inseparable part of this Agreement.

5. Authorities means any national, regional, municipal or local government and any
division, ministry, department, agency or other emanation of any of the same, including
any court, commission, board, branch or similar authority of such government.

6. BANI has the meaning given to it in Special Provision 12.

7. Commencement Date means the date on which the Contractor shall be released to
commence the Works as notified in the SPMK pursuant to Article 3, paragraph 1.

8. Commissioning means the commissioning activities to be undertaken by the Contractor

as more particularly described in Article 14A.

9. Consent means any permit, consent, approval, authorisation, agreement, no objection

certificate, waiver or licence which must be obtained from any person (including both
private persons and Authorities) in order for the Work under the Agreement to be
performed and for any goods to be transported, imported or exported, including
agreements for the obtaining of rights of way, easements, land purchase or leasing, and
the like with persons who would otherwise possess rights to prevent or impede the
carrying out of any part of the Works (or towards whom the Company or the Contractor
would otherwise incur liability by reason of the carrying out of the Works).

10. Contract Price shall be the price asstipulated in the Special Provisions, as adjusted from
time to time in accordance with this Agreement.

11. Contractor's Documents means the calculations, computer programs and other
software, designs, drawings, manuals, photographs, models (including physical three
dimensional models) and other documents and data of a technical nature supplied or
 created by the Contractor under the Agreement.

12. Contractor’s Equipment shall be all apparatus, machinery, vehicles and other things
required for the execution and completion of the Works and the remedying of any
defects, including any equipment hired or leased by the Contractor or Sub-Contractor.
Contractor's Equipment excludes equipments belonging to the Company (if any) and
other things intended to form or forming part of the Works.

13. Contractor’s Representative shall be the appointed and authorized person to represent
the Contractor in carrying out and leading the project which duties and authority are
stipulated herein.

14. Date for Operational Handover means the time for achieving Operational Handover
under Article 20B (with any extension under Article 20A), as specified in Special Provision
3.

15. Date of Operational Handover means the date stated in the Operational Handover
Certicate as the date the Works achieved Operational Handover.

16. Day (or Days) shall be calendar days.

17. Defect means any defect in or damage to the Work, arising from any failure by the
Contractor to comply with this Agreement.

18. Design Works means the completion of the design for the Works.

19. Dispute has the meaning given in Article 29.

20. Economic Losses means loss of profit or revenue, loss of use of equipment or associated
equipment, loss of production or down time costs, loss of opportunity, loss of contract,
loss of goodwill, the cost of obtaining any new financing or maintaining any existing
financing (including the making of any scheduled or other repayment or prepayment of
debt and the payment of any interest or other costs, fees or expenses incurred in
connection with the obtaining or maintaining of financing).

21. Extension of Time Groundhas the meaning given in Article 20A.

22. Final Acceptance Certificate means the certificate issued under Article 20B, paragraph
9.

23. Final Termination Account has the meaning given to it in Article 25.

24. Force Majeure has the meaning given in Article 24.

25. Good Industry Practice means all of the following:

a. good engineering practices and other practices, methods, equipment and

procedures usually employed in engineering, design, procurement, construction,
operation and maintenance activities;
 b. the degree of skill, diligence, prudence and foresight which would reasonably be
expected to be observed by a skilled, qualified and experienced turnkey designer,
engineer and contractor engaged in carrying out activities the same as or similar to
the Works under the same or similar circumstances,in this case the construction of
roads for the transportation of coal.

26. IP Documents has the meaning given in Article 15, paragraph 1.

27. Instruction to Comence Work (SuratPerintahMulai Kerja or “SPMK”) shall be a letter of

instruction or order issued by the Company to the Contractor to commence the Work
under the Agreement in accordance with Article 3, paragraph 1.

28. Intellectual Property Rights means intellectual and industrial property rights including,
without limitation, patents, designs, utility models, copyright, database rights, trade
marks, rights in know-how, trade secrets and confidential information and any other
rights of similar or equivalent effect anywhere in the world whether registered or not and
including pending applications to register such rights.

29. Latent Defect means any defect or damage in or to the Work, arising from any failure by
the Contractor to comply with the Agreement, which a reasonable examination by the
Company prior to expiry of the Maintenance Period would not have discovered.

30. Latent Defect Period means the period of 6 (six) months commencing from the expiry of
Maintenance Period.

31. Laws mean all national (or state) legislation, statutes, ordinances and other laws, and
regulations and by-laws of any Authorities.

32. Lien means any mortgage, lien, pledge, claim, charge, lease, easement, security interest
or encumbrance of any kind.

33. Maintenance Period means the period commencing on the Date of Operational
Handover and expiring 6 (six) months thereafter.

34. Management Committee has the meaning given in Special Provision 12.

35. Partial Operational Handover means that the Partial Work have been completed in their
entirety, are completely free from Defects (for the avoidance of doubt including any
minor defects or snagging items), have satisfactorily passed any tests prescribed by this
Agreement and the Company is in receipt of all operating and maintenance manuals,
information for the health and safety file and as built drawings in relation to the Work.

36. Operational Handover Certificate means any certificate issued by the Company under
Article 20B evidencing that the Work have achieved Operational Handover.

37. Performance Bond means an on demand bond in the form set out in Appendix F.

38. Programme means the programme for the Works to be prepared and updated from
 time to time by the Contractor pursuant to Article 7.

39. Project Leader has the meaning given to it in Article 10.

40. Special Provisions shall have the meaning as set out in Section II of this Agreement.

41. Specifications means the specifications for the Works set out in Annexure A.

42. Sub-Contract means any contract between the Contractor and a Sub-Contractor or
between a Sub-Contractor and its Sub-Contractor (as the context requires).

43. Sub-Contractor shall be an individual or entity, including but not limited to the
employees, casual laborer, agents, suppliers and/or contractors employed by the
Contractor to carry out part or all of the Work under the Agreement.

44. Supporting Facilities shall be the buildings and facilities which shall be built by the
Contractor to support the performance of Work as set out herein.

45. Tests means the tests to be carried out, as more particularly described in Article 14A.

46. Work Site, shall be the Company’s Work Site as set forth in the Special Provisions herein.

47. Work under the Agreement means the work which the Contractor is or may be required
to execute under this Agreement and includes variations.

48. Working Days shall be days, other than Saturday, Sunday and national public holidays,
where banks in Jakarta are open to operate its business activities and to carry out
clearing transactions.

49. Works means the whole of the work to be executed in accordance with this Agreement,
including all variations provided for by this Agreement, which by this Agreement is to be
handed over to the Company.

ARTICLE 2
ACCESS

1. Access to Work Site

The Company shall be responsible for acquiring and providing the Contractor with
access to those parts of the Work Site necessary to perform the Works upon the date of
the issuance of the SPMK. Access to the Work Site shall confer on Contractor a right to
only such use and control of the Work Site as is necessary to enable Contractor to carry
out the Work under the Agreement, and shall be subject to any restrictions or other
matters set out in the Agreement. Accordingly, the Contractor acknowledges and
agrees that it shall have non-exclusive access and/or use of the Work Site and shall be
required to share use of the Work Site with others. TheContractor further acknowledges
and agrees that it shall provide the Company with access to the Works and the Work Site
at all times and at the reasonable request of Company and allow inspection of the
 Works and the Work Site by Company and its designated inspectors.

2. Inspection and Use of Samples

a. The Contractor shall give and shall procure that its Sub-Contractors give to the
Company and its representatives and licensees full access to the Works and to the
workshops or other places where design or work is being prepared or goods or
materials are being manufactured for the Works, so that they may test, inspect
and/or examine the same. The Contractor shall do all things necessary to assist any
of them during the course of any visits which they may make to such places.

b. The Company may instruct the Contractor at any time to provide a reasonable
number of samples of the quality of any goods and/or materials or standards of
workmanship to be used in the Works as provided by the Specification. The
Contractor shall not be entitled to make any claim, whether for any loss and/or
expense or any extension of time, in respect of the provision of such samples.

ARTICLE 3
PERFORMANCE OF WORK

1. The Contractor shall not commence the Works prior to the Commencement Date as
notified to it by the Company's SPMK.

2. During the performance of Work under the Agreement by the Contractor, the
Contractor shall ensure that the road accommodates coal hauling trucks with
aggregate capacity of 2.500.000 MT (two million five hundred Metric Ton) per annum.
The Work under the Agreement shall be performed in such way to ensure the coal
hauling road is not disconnected which might cause the coal hauling trucks are unable
to travel.

The Contractor shall notify the Company in writing if the performance of Work is or is likely
to be delayed or disrupted, within 24 (twenty four) hours after such potential delays or
disruptions become known. Such notification shall include: (i) the cause or causes of
such delay; (ii) details of the consequences the delay is likely to have on the Programme;
(iii) details of any extension to the Date for Operational Handover to which the
Contractor may seek resulting from such delay and the extent to which in its opinion
such delay is caused by each Extension of Time Ground; and (iv) details of any measures
which the Contractor proposes to adopt to mitigate the consequences of such delay.

3. The Contractor shall comply with any instructions issued by the Company.

If, after receipt of an instruction from the Company, the Contractor does not comply or
sufficiently begin to comply within a reasonable time therewith, then the Company may
employ and pay other persons to execute any work which may be necessary to give
effect to such instruction and all costs incurred (including, without limitation, any directly
incurred costs plus such additional overhead costs as may be incurred by the Company)
in connection with such employment may be deducted by the Company from any
monies due or to become due to the Contractor under this Agreement or may be
 recoverable from the Contractor by the Company as a debt.

ARTICLE 3A
CONTRACTOR'S EQUIPMENT

1. All the Contractor’s Equipment, temporary building structures and other materials bought
to the Work Site shall be deemed to be intended specifically and exclusively for the
performance of the Work under the Agreement and the Contractor shall not be
permitted to remove (or permit the removal of) any of the Contractor’s Equipment,
temporary building structures and other materials, in whole or in part, without the
Company´s express consent. Such consent is not required for any vehicles utilized to
carry personnel, Contractor’s Equipment, temporary building structures, plant or
materials to or from the Work Site.

2. The Company shall not be liable for the loss or damage of the Contractor’s Equipment,
temporary building structures or other materials.

ARTICLE 3B
SUB-CONTRACTING

1. The Contractor shall not Sub-Contract any part of the Work under the Agreement
without the prior written consent of the Company.

2. The Contractor shall be responsible for the acts, omissions or defaults of any Sub-
Contractor, his agents or employees, as if they were the acts, omissions or defaults of the
Contractor.

3. Unless the Parties agree otherwise, the Contractor shall ensure that the terms of each
Sub-Contract:

a. are consistent with the Contractor's obligations under the Agreement;

b. include terms reasonably satisfactory to the Company which require the Sub-
Contractor, where instructed by the Company, to accept novation of the Sub-
Contract from the Contractor to the Company, or its appointee, and take all
necessary steps to give effect to the novation (including by executing a deed of
novation on terms reasonably required by the Company);

Which includes the supply of plant or materials, includes terms providing that:

c. unencumbered title in the relevant plant or materials passes to the Contractor on or

before the date on which the same is to become the property of the Company
pursuant to Article 5; and

d. the Sub-Contractor waives any Liens or other encumbrances (whether for non-
payment or otherwise) to which the relevant Sub-Contractor would otherwise be
entitled.
4. Where this Agreement provides that certain work or certain goods and/or materials
priced by the Contractor shall be carried out by or obtained from a person or one of a
list of persons named in Special Provision 13 then the Contractor shall sub-let such work to
or obtain such materials and/or goods from the person or one of the persons so named.
No sub-letting by the Contractor and no consent by the Company and no naming of a
person in Special Provision 13, shall in any way relieve the Contractor from its
responsibility for the completion of the Works in accordance with the Contract. The
Contractor shall not be entitled to any extension of time, any addition to the Contract
Price or to make any other claim against the Company by reason of the Contractor's
liability to enter into contracts with any person referred to in Special Provision 13.

ARTICLE 4
CONTRACT PRICE, REQUIREMENTS OF PAYMENT AND METHOD OF PAYMENT

1. The Parties agree that the Contract Price for the performance of Work by the Contractor
shall be as stipulated in the Special Provisions herein.

2. The payment of Contract Price shall be made in the manner and at the stages set forth
in the Special Provisions herein.

3. Payments shall be made to the Contractor’s bank account specified in the Special
Provisions, or in such other manner as agreed by the Parties, in the currency of United
States Dollars.

4. If either Party fails to make any payment of any sum by the date on which payment of
that sum is required by this Agreement, the paying Party shall pay to the recipient interest
on the amount of such delayed payment at the rate(s) and for the period specified in
Special Provision 14 whether before or after judgment or arbitral award.

ARTICLE 5
OWNERSHIP AND LIENS

1. Each item of goods and materials intended for the Works (whether or not delivered to
the Work Site) shall, to the extent consistent with all applicable Laws, become the
property of the Company at whichever is the earlier of the following times, free from
Liens and other encumbrances:

a. when they have been incorporated into the Works; and

b. when the Contractor is entitled to payment for them pursuant to Article 4 and
Special Provision 8.

2. Where the value of any goods and materials not delivered to the Work Site is included in
an interim certificate, the Contractor shall ensure that such goods and materials are not
removed from the place where they are situated at the date of the Contractor's interim
application except for delivery to the Work Site.
3. The Contractor shall not file, claim or register any Lien and shall use its best efforts to
prevent any Lien from being filed, claimed or registered by any Sub-Contractor or by any
employee, servant or agent of the Contractor or Sub-Contractor against the property of
the Company or the Contractor for any Works done or any services rendered or any item
of equipment or materials supplied under the Agreement or any Sub-Contract let by the
Contractor and shall procure that all of its first tier Sub-Contracts contain undertakings to
the like effect.

4. In the event that any such Lien should be filed, claimed or registered, the Contractor
shall immediately notify the Company and shall promptly discharge, by bond or
otherwise, such Lien.

5. The Contractor shall indemnify the Company against any loss, damage, cost or expense
(including legal fees) and the cost and expense of the Company discharging any Lien
as contemplated by this Article 5, to the extent arising out of or in connection with any
Lien being filed, claimed or registered as referred to in this Article 5.

ARTICLE 6
TAXATION

1. Value Added Tax (Pajak Pertambahan Nilai or “PPN”)

The Contract Price is exclusive of PPN. The Contractor warrants that it and its Sub-
Contractors have been registered as a Taxable Entrepreneur (Pengusaha Kena Pajak or
“PKP”) and undertake to provide the Taxable Entrepreneur Registration Letter
(SuratPengukuhanPengusahaKenaPajak or “SPPKP”) at the time of submitting the first
invoice to the Company. The Contractor shall issue tax invoices in accordance with the
prevailing Laws and shall enclose the original tax invoice to the invoice. In the event that
thetaxinvoiceis made not in accordance with the prevailing Laws, the Company shall
not be required to pay the Invoice until a compliant invoice is provided to the Company.

2. Income Tax (Pajak Penghasilan or “PPh”)

a. The Contract Price is inclusive of Income Tax (“PPh”). The Company shall have the
right to withhold PPh at the rate specified by Law from payments made to the
Contractor.

b. Upon the deduction or collectionof such PPh, the Company shall make payment of
the PPH to the applicable public sector activity or no later than the 10 th day of the
following month,evidenced by the delivery of PPh deduction receipt to the
Contractor after the Company has reported such deduction to the Company’s tax
office.

c. The Company shall inform the Contractor in advance on the amount of the PPh tariff
withheld by the Company.

d. In the event that the Contractor seeks an exemption of PPh, then the copy of PPh
exemption statement lettershall be enclosed in every invoice submitted by the
 Contractor to the Company.

3. Other Taxes

a. The Contractor shall pay all other taxes, duties and fees required to be paid by him
under the Contract, and the Contract Price shall not be adjusted for any of these
costs.

b. The Contractor shall indemnify the Company from and against all damages, losses
and expenses (including legal fees and expenses) which arise out of or in
connection with a breach by the Contractor of its obligations under this Article 6.

ARTICLE 7
CONTRACT PERIOD

1. Completion Time Guarantee

The Contractor guarantees that it shall attain Operational Handover by the Date for
Operational Handover.

2. Programme

a. The Contractor shall submit a programme to the Company, for information, within 5
(five) Working Days of the SPMK and in such form and detail as the Company may
reasonably require and shall be compatible with the Contract Documents (the
"Programme"). The Programme shall include the following:

i. the order in which the Contractor proposes to carry out the Work under the
Agreement;
ii. all major events and activities in the production of the Design Works;
iii. all other principal activities to be undertaken by the Contractor under the
Agreement; and
iv. the sequence of all Tests specified in the Agreement.

b. The Contractor shall, whenever required by the Company, provide in writing, for
information, a general description of the arrangements and methods which the
Contractor proposes to adopt for the execution of the Work under the Agreement.
No significant alteration to the Programme, or to such arrangements and methods,
shall be made without informing the Company in writing. If the progress of the Work
under the Agreement does not conform to the Programme, the Company may
instruct the Contractor to revise the Programme.

c. The Programme initially prepared shall be consistent with the Date for Operational
Handover prescribed by this Agreement. Thereafter, the Contractor shall, if
necessary, re-programme its activities so far as possible so that the Date for
Operational Handover (as the same may be extended in accordance with this
Agreement) will be achieved. However, if this becomes impossible the Programme
shall be prepared to depict a realistic timetable for the carrying out of the
 Contractor's activities.

d. The Programme is intended for use as a management and reporting tool.

Preparation of such a Programme and any acceptance or approval thereof by the
Company shall not relieve the Contractor of any obligation or liability under the
Agreement.

3. Delay LDs

a. Where the Contractor fails to attain Operational Handover by the Date for
Operational Handover, the Contractor shall pay or allow to the Company, as the
case may be, liquidated damages in respect of such delay in accordance with the
Specific Provisions ("Delay LDs").

b. Delay LDs shall be due and payable or allowed to the Company at the end of each
complete week to which they relate.

c. If, after any deduction or payment of Delay LDs, an extension is made to the Date for
Operational Handover, the Contractor's liability to pay or allow Delay LDs to the
Company shall be abated, as appropriate, in respect of a period equal to any
extension granted and any Delay LDs previously paid or allowed in respect of the
period of such extension shall be refunded.

d. Delay LDs shall be the only damages payable by the Contractor for the Operational
Handover being delayed beyond the Date for Operational Handover, save for, and
subject to, the rights of the Company and Contractor's liabilities pursuant to Article
25. The payment or deduction of Delay LDs shall not relieve the Contractor from its
obligations to carry out and complete the Works, or from any of its other obligations
and liabilities under the Agreement.

ARTICLE 8
JOINT SURVEY, PRE CONSTRUCTION MEETING & SITE HANDOVER

1. The Parties must conduct a joint survey prior to the commencement of Work Site
handover from the Company to the Contractor ("Joint Survey").

2. The Joint Survey shall include the quantity of the actual condition of the Work Site,
including but not limited to the assets, buildings, equipments and other aspect which will
be transferred to the Contractor.

3. The Joint Survey shall be conducted no later than 30 (thirty) Days before the issuance of
SPMK by the Company. If a Party fails to participate in the Joint Survey in accordance
with this clause, a survey conducted by the other Party shall be deemed a Joint Survey.

4. The results of the Joint Survey shall be made into a Minute of Joint Survey executed by
the Parties.

5. The Parties agree to conduct pre construction meeting not later than 7 (seven) Days
 before the issuance of the SPMK by the Company. Pre construction meeting shall discuss
as follows:

a. work management procedure;

b. work execution schedule;
c. schedule of material supply, equipment and personel mobilization;
d. Work Site examination plan;
e. socialization to the community and regional government regarding the working
plan; and
f. quality program.

Pre construction meeting result shall be agreed on a minute of meeting.

6. The Contractor shall be responsible for the true and proper setting out of the Works in
relation to original points, lines and levels of reference specified in the Specification or
notified by the Company in writing and for the correctness of the position, levels,
dimensions and alignment of all parts of the Works and shall entirely at its own cost
amend any errors arising from its own inaccurate setting out. For the avoidance of
doubt, the Contractor shall not be entitled to make any claim, whether for any loss
and/or expense or any extension of time, in respect of any such errors.

7. Work Site Handover shall be conducted not later than 7 (seven) Days prior to the
issuance of SPMK by the Company.

ARTICLE 9
VERIFICATION, SUPERVISION ANDCONTRACTOR MANPOWER

1. Verification by the Contractor

a. Verification of Work Site

The Contractor shall be deemed to haveconducted verification of the conditions of

the Work Site, Supporting Facilities and surrounding area, and therefore by signing
the Agreement, the Contractor accepts total responsibility for having forseen all
difficulties and costs of successfully completing the Work, including (but not limited
to) in relation to:

i. Work Site condition;

ii. hydrology and climate conditions;
iii. scope and nature of Work and the materials required to carry out the Work in
accordance with Good Industry Practice; and
iv. access to the Work Site and the accommodation as required.

b. Adequacy of Contract Price

i. The Contractor shall be deemed to have obtained all required information in

relation to all risks, contingency, may affect the performance of Work and shall
further be deemed to have satisified itself of the accuracy and adequacy of the
 Contract Price and any other prices in relation to the Work.

ii. The Contract Price covers of all Contractor’s obligations under this Agreement
and all matters required for the execution of the Works.

2. Supervision by the Contractor

The Contractor shall always supervise and at all times be responsible for the performance
of Work and without limitation to the above, the Contractor shall assign a competent
supervisor who shall represent or act for and on behalf of the Contractor every day at
the Work Site ("Contractor's Representative"). The Contractor shall, prior to the
Commencement Date, submit to the Company for consent the name and particulars of
the person the Contractor proposes to appoint as Contractor's Representative. The
Contractor's Representative shall be deemed to have the full the authority of the
Contractor under the Agreement and shall be authorized by the Contractor to receive
directions from the Company for and on behalf of the Contractor. All things known by
the Contractor’s Representative shall be deemed to be known by the Contractor as
well.

3. Contractor’s Manpower

a. List of workers

Prior to the commencement of Work under the Agreement on the Work Site, the
Contractor shall obtain written approval from the Company of each and every
employee and Sub-Contractor which will be assigned to the Work under the
Agreement by specifying the names and qualifications of each employee and Sub-
Contractor no later than 3 (three) Working Days prior to that employee or Sub-
Contractor's arrival at Work Site. The Contractor shall submit to the Company the
same data for every new employee and Sub-Contractor proposed to be employed
by the Contractor at the Work Site.

The list of Contractor’s employees shall include at least the following:

i. General Manager;
ii. Project Manager;
iii. Site Operation Manager;
iv. General Superintendent;
v. Site Engineering Manager;
vi. Site Engineer;
vii. Quality, Health and Safety Officer; and
viii. Personin Responsible forDocumentation.

b. Working hours

The working hours shall be set by the Company and may be adjusted only at the
discretion of the Company. If the Contractor intends to apply work shifts or make any
amendments to the working hours of the Contractor, then the Contractor shall seek
the prior written approval of the Company. Generally, the Company operates in 365
 (three hundred sixty five) Days in a year and the Contractor may work for:

i. 7 (seven) hours a Day and 40 (forty) hours a week for 6 (six) Working Days in a
week; or
ii. 8 (eight) hours a day and 40 (forty) hours a week for 5 (five) Working Days.

In the event that the Company approves a deviation in the Contractor’s working
hours, the Contractor shall obtain all required Consents pursuant to all applicable
Laws and shall release, indemnify and hold the Company harmless against and from
all damages, losses and expenses (including legal fees and expenses) to the extent
resulting from any such amendment to working hours.

c. Employment Relationship

i. The Contractor shall be an independent contractor performing the Agreement.

This Agreement does not create any partnership, joint venture or other joint
relationship between the Company on the one hand and the Contractor on the
other hand.

ii. Further, the employment relationship between the Contractor and its employees
is legally, administratively, and exclusively between the Contractor and its
employees. The Contractor shall remain liable for all rights and obligations arising
from the industrial relationship of the employees and Contractor, including but
not limited to: (i) payment of salary; (ii) granting rights for leave; (iii) payment of
religious holiday allowance or tunjanganhariraya (THR); and (iv) the registration to
the Manpower and Health of Workers Social Security Agency (Badan
PenyelenggaraJaminanSosial or BPJS) program. The Contractor warrants, shall
release, indemnify and hold the Company harmless against and from all
damages, losses and expenses (including legal fees and expenses) to the extent
resulting from any claim made by any employee or Sub-Contractor of the
Contractor.

iii. The Contractor shall immediately inform the Company in the event there are any
labor strikes or labor disputes which affect the implementation of this Agreement.
The Contractor is obliged to attend any meeting held by the Company in relation
to any labour issues. The Contractor shall ensure that each labour strike or dispute
shall not result in a delay to the performance of the Work under the Agreement.

d. Utilization of Local Manpower

The Contractor shall in performing the Work under the Agreement, in good faith and
to the fullest extent practicable, employ local manpower originating from the
surrounding area of the Work Site, provided the provision of such manpower meets
the quality and capability requirements of the Agreement. The Contractor must
coordinate directly with the any respective local heads of villages in the surrounding
Work Site area regarding local content requirements.

e. Company’s Right to Objection

 The Company is entitled to remove from the Work Site any employee of the
Contractor or Sub-Contractor which, in the opinion of the Company, does not have
sufficient capability to complete the Work under the Agreement or has neglected
his/her duties or whose existence in the Work Site is deemed unwanted by the
Company, and the employee or Sub-Contractor shall no longer be permitted to be
in the Work Site without obtaining the Company’s permission. The person so removed
shall be replaced by a new employee or Sub-Contractor at the Contractor's cost.
The Contractor shall ensure that such replacement of employee(s) shall not result in
any delay in the performance of the Work under the Agreement.

f. License for Operation

The Contractor shall ensure that any person that operates the Contractor’s
Equipment shall be appropriately qualified and licensed to operate the item of
Contractor's Equipment assigned to them in accordance with all applicable Laws.
The Contractor shall submit the evidence of the said licenses to the Company prior
to commencement of the Work under the Agreement and from time to time as may
be requested by the Company.

ARTICLE 10
REPRESENTATIVES

1. The Company shall appoint a Project Leader to act as the representative of the
Company.

2. The Project Leader is authorized to represent the Company and shall be deemed to
have the full authority of the Company under the Contract, except in respect of Article
15. The Project Leader shall have no authority to vary or waive any term of the
Agreement.

ARTICLE 11
WORK SAFETY SECURITY AND
ENVIRONMENTAL PROTECTION

1. The Contractor shall be responsible for:

a. taking the precautions and measures necessary to ensure the health and safety of all
individuals about the Work Site and any areas that may adjoining those areas
(including the Contractor's personnel) or otherwise affected or potentially
endangered by the Work under the Agreement; and

b. the adequacy, stability and safety of all Work Site, operations and methods of
construction and all Contractor’s Equipment and temporary works and structures.

2. As between the Company and the Contractor, the Contractor shall to the fullest extent
permitted by applicable Laws bear and discharge any health and safety-related
obligations and liabilities arising under applicable Laws and shall issue any notices to
 Authorities as may be required in order to give effect under applicable Laws.

3. The Work Site regulations set out in the Annexure D (if any) will be further developed by
the Company and the Contractor to set out the rules to be observed in the execution of
the Work under the Agreement at the Site, taking into account the activities being
carried out on adjoining sites, which may be affected by the Work under the
Agreement. Each Party shall comply (and the Contractor shall procure compliance by
its Sub-Contractors) with such regulations. The Contractor shall ensure that copies of
such regulations are provided to each Sub-Contractorand any other contractor working
on the Work Site prior to the commencement of their work.

4. During the execution of the Works the Contractor shall keep the Work Site free from all
unnecessary obstructions, shall store or dispose of any equipment or surplus materials,
clear away and remove from the Work Site any wreckage rubbish and temporary works
which are no longer required.

5. Environmental Protection

a. The Contractor must comply with all environmental impact documents (starting from
Environmental Impact Statement or “ANDAL” until Environmental Management Plan
or “RKL” and Environment Monitoring Plan or “RPL”). In performing the Work under the
Agreement, the Contractor must do so in such a way that it does not violate or
infringe the provisions of the ANDAL.

b. The Contractor shall, in the performance of the Works, take all necessary steps:

i. to protect the environment (both on and off the Work Site);

ii. to comply with all Laws, Consents and Good Engineering and Construction
Practices and elements of the Contract Documents regarding the protection of
the environment; and
iii. to prevent any public or private nuisance (including, without limitation, any such
nuisance caused by pollution, noxious fumes, noisy working operations or the
deposit of any material or debris outside the Work Site) arising out of the carrying
out of the Works and shall assist the Company in defending any action or
proceedings which may be instituted in relation thereto,

and the Contractor shall be responsible for and shall indemnify the Company from
and against any and all expenses, liabilities, losses, claims and proceedings
whatsoever resulting from any breach of the Contractor's obligations under this
Article 11.

6. Discovery of Valuable Objects

a. All discoveries in the form of fossils, minerals, coins, artifacts as well as geological
objects or archaeological discovered in the Work Site belong to the Company.
Discovery objects in the form of fossils, minerals, coins, artifacts and the similiar kind
shall not allowed to be moved or tampered in any way. Discovery location must be
marked and the Contractor or the related parties must inform the Company about
the nature and location of the mentioned discovery. The Contractor must take all
 reasonable measures to prevent its employees or other person not to move or
damage the mentioned objects and in immediately after the objects had been
discovered and prior the objects being moved, notify the Company of the the
discovery and also execute all matters which been instructed by the Company in
relation to the handling of the objects. If the Contractor suffers delay or costs as a
result of the instruction, it will be considered as a Suspension of Work by the
Company.

b. All fossils, antiquities, structures, remains and other objects or items with geological,
archaeological or historical value or discovery which according to the Law is under
the control of the State in Work Site shall, as between the Company and the
Contractor, be deemed to be the property of the Company.

c. Upon discoveries of the items referred to in this Article 11, paragraph 6, the
Contractor shall not disturb or damage the same and shall immediately report the
nature and location thereof to the Company. The Contractor shall also report such
discovery the relevant Authorities in accordance with the applicable provisions of
Laws.

ARTICLE 12
GENERAL OBLIGATIONS AND RESPONSIBILITIES

1. Contractor’s General Responsibility

a. The Contractor shall design, execute and complete the Works in accordance with
the Agreement, and shall remedy any defects in the Works. When completed, the
Works shall be fit for the purposes for which the Works are intended as defined in or
reasonably to be inferred from the Agreement.

b. Contractor must perform and complete the Work diligently and in a good,
workmanlike and substantial manner in accordance with this Agreement, Consents,
Good Industry Practices and all applicable Laws and shall comply with and adhere
to any instructions issued to it by the Company relating to the Work.

c. The Contractor shall be responsible for the adequacy, stability and safety of all Work
Site operations, of all methods of construction and of all the Works.

d. The Contractor shall, whenever required by the Company, submit details of the
arrangements and methods which the Contractor proposes to adopt for the
execution of the Works. No significant alteration to these arrangements and methods
shall be made without this having previously been notified to the Company.

2. Design Of The Work

a. The Contractor shall be deemed to have scrutinised, prior to the date of execution of
the Contract, the Specification and other information and data provided by the
Company. The Contractor shall be responsible for the design of the Work and the
accuracy of such documents, information and data as if it had carried out the same
 itself.

b. The Company shall not be responsible for any error, inaccuracy or omission of any
kind in the documents, information or data referred to in Article 12, subparagraph
2(a) and shall not be deemed to have given any representation of accuracy or
completeness of any data or information. Any documents, data or information
received by the Contractor, from the Company or otherwise, shall not, relieve the
Contractor from his responsibility for the design and execution of the Work or entitle
the Contractor to bring any claim against the Company in respect of the Agreement
(including for an extension of time or for an increase in the Contract Price).

c. The Design Works shall comprise:

i. the designs, data, documents and software required to be produced by the

Contractor in accordance with the Specifications;
ii. documents required to satisfy all Consents including for the avoidance of doubt,
those Consents which are the Company's obligation to obtain;
iii. as-built documents and any operation and maintenance manuals for the Works;
iv. any other photographs, models (including physical three dimensional models),
calculations and other information and data of a technical nature created or
supplied by the Contractor under the Contract.

d. Submission

The Contractor shall submit to the Company the Contractor's Documents in the
number and format as set out in the Specification on the dates or on or before the
expiry of the periods shown in the Specification or, if no date or period is shown, on a
date which is prior to and, having regard to the Date for Operational Handover,
proximate to the date on which it is reasonably necessary for the Company to
examine them having regard to its duties under Article 12, subparagraph 2(e).

e. When the Company returns any drawing, detail, document or information under
Article 12, subparagraph 2(f), the Contractor shall immediately take the following
action in relation to such drawing, detail, document or information:

i. if it is stamped or marked "Execute", the Contractor shall execute and complete

the Works in accordance with such drawing, detail, document or information; or

ii. if it is stamped or marked "Incorporate", the Contractor shall execute and

complete the Works in accordance with such drawing, detail, document or
information, provided that the Company's comments are incorporated into such
drawing, detail, document or information and a further reproducible copy of it is
promptly submitted to the Company.

f. If it is stamped or marked "Re-Submit", the Contractor shall take account of the

Company's comments in such drawing, detail, document or information and shall as
soon as reasonably practical (but in any event within 5 (five) Working Days)
re-submit it to the Company for its comment in accordance with the provisions of
Article 12, paragraph 2(e).
 g. Programme Includes Time for Approvals

The Programme shall be deemed to take account of the provisions of Article 12,
paragraph 2(e) to Article 12, paragraph 2(g) and the Contractor shall not be entitled
to any extension of time, other relief or adjustment to the Contract Price or other
additional payment in respect of compliance with them.

h. Without prejudice to any express or implied warranties or conditions, the Contractor

warrants that:

i. in carrying out the Design Works, it has exercised and will continue to exercise all
the proper skill, care and diligence to be expected of a properly qualified and
competent engineering, procurement and construction contractor experienced
in carrying out work for a project of a similar size, scope and complexity to the
Project;
ii. the Design Works comply with and will continue to comply with the Specifications
and all other requirements contained in or referred to in this Agreement;
iii. the Design Works will be fit for the specific purposes stated in or reasonably
inferred from the Agreement and otherwise for their purpose as part of the
Project; and
iv. the Design Work will comply with the Laws.

i. No approval, instruction, comments or advice from the Company in connection with

any drawings, details, documents or information provided by the Contractor shall in
any way relieve the Contractor from its responsibility for the same.

j. If the Contractor or the Company shall find any ambiguity, discrepancy or

divergence between the Laws and the Design Works it shall immediately give to the
other written notice specifying the ambiguity, discrepancy or divergence and the
Contractor shall inform the Company in writing of its proposals in respect of the
ambiguity, discrepancy or divergence. The Company shall issue instructions with
regard to such ambiguity, discrepancy or divergence and the Contractor shall
forthwith comply with the same entirely at its own cost and indemnify the Company
against any expense, loss, cost, claim or proceedings suffered or incurred by it arising
out of or in connection with such ambiguity, discrepancy or divergence.

3. Remedial Work

The Company may instruct the Contractor to:

a. remove from the Work Site and replace any plant or materials which is not in
accordance with the Agreement,
b. remove and re-execute any other work which is not in accordance with the
Agreement, and
c. execute any work which is urgently required for the safety of the Works, whether
because of an accident, unforeseenable event or otherwise.

If the Contractor fails to comply with any such instruction, the Company shall be entitled
 to employ and pay other persons to carry out the work. Except to the extent that the
Contractor would have been entitled to payment for the work, the Contractor shall pay
to the Company all costs arising from this failure.

4. Contractor's Indemnity obligations

The Contractor holds harmless and indemnfies the Company for all damages, losses, and
expenses (including legal fees and expenses) to the extent any claims, losses, damages
and liabilities arises out of:

a. any omissions and/or error of the Contractor and/or its employees or a Sub-
Contractor in performing this Agreement;
b. Claims from any third party arising out of the performance of Work under the
Agreement by the Contractor;

5. Neither Party shall be liable to the other Party whether pursuant to any provision of this
Agreement (including any indemnity), by way of damages for breach of contract, in
tort, for breach of statutory duty, equity, or under any other legal theory, for any
Economic Losses, provided always that this Article 12, paragraph 5 shall not prevent, limit
or exclude:

a. liability for Economic Losses insofar as they form part of the pre-estimated losses for
the purposes of calculation of Delay LDs provisions under the Contract;

b. liability for Economic Losses which the Contractor has recovered or is entitled to
recover from any insurer (including funds received indirectly through the Company or
or third party;

c. liability for Economic Losses which the Contractor would recovered from any insurer,
but for a breach by the Contractor of its obligations under this Agreement in relation
to effecting and maintaining insurance;

d. liability for Economic Losses arising out of fraud, fraudulent misrepresentation, wilful
misconduct or wilful default or violation of any applicable Laws;

e. liability for Economic Losses arising on termination of the Agreement under Article 25;

f. liability for Economic Losses arising in respect of the Contractor's indemnity

obligations set out in Article 4A, Article 5, Article 8, Article 11, Article 12, Article 13,
Article 15, Article 18, Article 19 and Appendix D; or

g. as may be otherwise expressly provided under this Agreement.

ARTICLE 13
TRANSPORTATION AND MAINTENANCE OF WORK SITE

1. Interference towards Traffic and Other Adjacent Objects

 The Contractor shall not interfere unnecessarily or improperly with:

a. the convenience of the public; or

b. access to and use and occupation of all roads and footpaths or other property,
irrespective of whether they are public or in the possession of the Company or of
others

The Contractor holds harmless and indemnifies the Company for all damages, losses and
expenses (including legal fees and expenses) to the extent resulting from any such
unnecessary or improper interference.

2. Avoidance of Road Damages

The Contractor shall be deemed to have been satisfied as to the suitability and
availability of access routes to the Work Site.

The Contractor must take all necessary steps to prevent damage to any road or bridge
facilities from being damaged by the Contractor's traffic or by the Contractor's
Personnel. These efforts shall include the proper use of appropriate vehicles and routes.

The Contractor holds harmless and indemnifies the Company for all damages, losses and
expenses (including legal fees and expenses) to the extent resulting from any such
damage to any road or bridge facilities by the Contractor's traffic or personnel.

3. Traffic Above the Water

If nature of a Work is as such that the Contractor must use water transportation, then the
provisions in this Article which mentioned “road” shall be deemed to include lock, dock,
seawall or other building in relation to water transportation and that the term “vehicle”
shall be deemed to include water vessel, ship, speedboat, as the context requires.

ARTICLE 14
VARIATIONS, ADDITION AND REDUCTION OF WORK

1. Variations

The Company reserves the right to:

a. require the Contractor to undertake work not provided for in, or to be reasonably
inferred from, this Agreement; or

b. require any addition, omission, substitution, alteration or modification of any

performance requirement or of the design, quality or quantity of the Work including
the addition, omission or substitution of any work, the alteration of the kind, standard
or description of any materials or goods to be used in the Work, and the removal
from the Work Site of any work, materials or goods brought thereon by the
Contractor for the purposes of the Work other than work, materials or goods which
 are not in accordance with this Agreement,

and provided that such instruction has not arisen from, and compliance with it does not
reveal, any negligence, error, omission, default or breach of duty of the Contractor, its
servants, agents, Sub-Contractors, suppliers or other persons engaged by the Contractor,
the Contract Price shall be adjusted and the provisions of Article 14, paragraph 2 shall
apply. Otherwise, the Contractor shall not be entitled to any additions to the Contract
Price nor to claim, whether as damages or otherwise, any additional payment in respect
of compliance by the Contractor with any such instruction.

2. Submission of Estimates by Contractor

Where, in the opinion of the Contractor or of the Company, any instruction issued by the
Company requires an adjustment to the Contract Price in accordance with Article 14,
paragraph 1, the Contractor shall not comply with it (subject to Article 14, paragraph 6),
but shall first furnish the Company on or before the expiry of 5 (five) Working Days (or
such other period as may be agreed between the Contractor and the Company) from
receipt of the instruction with estimates of:

a. the value of the adjustment based on prices or rates (if any) included in this
Agreement (providing it with all necessary supporting calculations by reference to
this Agreement or otherwise); and

b. the length of any extension of time to which it may be entitled under Article 20A.

3. Agreement of Contractor's Estimates

The Contractor and the Company shall then take reasonable steps to agree the
Contractor's estimates and any agreement so reached shall be binding upon the
Contractor and the Company. The Contractor shall immediately thereafter comply with
the instruction and the Company shall grant an extension of time under Article 20A of
the agreed length (if any) and the agreed adjustment (if any) shall be made to the
Contract Price.

4. Failure to Agree Contractor's Estimates

If agreement cannot be reached on or before the expiry of 5 (five) Working Days from
receipt by the Company of the Contractor's estimates on all or any of the matters set out
in them, then the Company may instruct the Contractor to comply with the instruction (in
which case the provisions of Article 14, paragraph 6 shall apply, as if the Company had
dispensed with the Contractor's obligation under Article 14, paragraph 2), or the
Company may withdraw the instruction.

5. Withdrawal of Instruction

If the Company withdraws any instruction under Article 14, paragraph 4, the Contractor
shall have no claim arising out of or in connection with such instruction or with any failure
to reach agreement, unless otherwise agreed in writing by the Company prior to
 submission by the Contractor of its estimates under Article 14, paragraph 2.

6. Valuation if no Agreement of Estimates

The Company may, by notice to the Contractor before or after the issue of any
instruction, dispense with the Contractor's obligation under Article 14, paragraph 2, in
which case the Company shall, after consultation with the Contractor and within a
reasonable time after the issue of such instruction, ascertain a fair and reasonable
adjustment to the Contract Price (where appropriate based on prices or rates included
in this Agreement) in respect of compliance by the Contractor with such instruction and
a fair and reasonable extension of time may be granted under Article 20A.

ARTICLE 14A
COMMISSIONING AND TESTING

1. Contractor to Conduct Tests

a. The Contractor shall conduct the Testing and Commissioning of the Works as required
to achieve Operational Handover of the Works in accordance with the Agreement.

b. The Contractor shall perform such Testing and Commissioning of the Works in
accordance with the Specification, the requirements of the Agreement and Good
Industry Practices.

c. When the Works are ready for the Tests to commence in accordance with the
Specification, the Contractor shall notify the Company in writing.

2. Notification of Tests

a. The Contractor shall give to the Company not less than 21 (twenty one) Days' notice
of the date after which the Contractor will be ready to carry out each of the Tests.
Unless otherwise agreed, Tests shall be carried out within 14 (fourteen) Days after this
date, on such day or days as the Company shall instruct.

b. The Contractor shall progressively submit to the Company certified reports of the
results of the Tests as soon as practicable after they are carried out.

3. Delayed Tests

a. If the Tests are being unduly delayed by the Contractor, the Company may by
notice require the Contractor to carry out the Tests within 14 (fourteen) Days after
receiving the notice. The Contractor shall carry out the Tests on such day or days
within that period as the Contractor may fix and of which he shall give notice to the
Company.

b. If the Contractor fails to carry out the Tests within the period of 14 (fourteen) Days, the
Company may proceed with the Tests at the risk and cost of the Contractor. These
Tests shall then be deemed to have been carried out in the presence of the
 Contractor and the results of the Tests shall be accepted as accurate.

4. Retesting of the Work

a. If, following the carrying out of Tests, the Works fail to attain the Tests, the Contractor
shall notify the Company of the failure and the Company may direct the Contractor
to repeat the relevant Tests (including the Tests on any related work) under the same
terms and conditions.

b. The Contractor shall make all appropriate changes, adjustments and modifications
to the Works in order for the Works to pass the Tests with all reasonable speed, at its
own expense and before the repetition of the Tests. If the Contractor fails to do so,
such changes, adjustments and modifications may, at the Company's absolute
discretion, be carried out by the Company or other contractor of the Company and
the costs thereby incurred shall, at the Company's option, be paid to the Company
by the Contractor or shall be deducted from the Contract Price.

5. Completion of Tests

If the relevant Test is not passed following any repetition of a Test, then the process in this
Article 14A shall be repeated and appropriate changes, adjustments and modifications
to the Works shall continue to be carried out until all the Tests have been completed.

6. Failure to Complete Tests

Where, and to the extent that, any failure to complete the Tests is directly attributable to
any breach of the Agreement by the Company the provisions of this Article 14A shall
continue to apply, save that the Company shall (save as stated below) reimburse to the
Contractor the proportion of the cost of making good and re-testing attributable to such
breach.

ARTICLE 15
PROPRIETARY RIGHTS

1. Licences and Confidentiality

The Contractor hereby grants to the Company and its assigns and successors in title an
irrevocable, non-exclusive, royalty-free licence to use and reproduce all drawings, plans,
specifications, records, calculations and other documents and all revisions thereof and
additions thereto, and the designs contained in them, prepared or to be prepared by or
on behalf of the Contractor in respect of the Project (the "IP Documents") for all purposes
relating to the Project and the works to be designed and/or carried out by or on behalf
of the Company in connection therewith, including (without limitation) the alteration,
modification, extension, repair, use, letting and sale of the Project or any part thereof.
The Contractor shall ensure that the Company is provided with copies of such of the IP
Documents as and when required by the Company and, in any event, as are necessary
or desirable to enable the Company to comply with its obligations under any of the
Project Documents. Such licence shall also carry the right to grant sub-licences and shall
 be freely transferrable to third parties.

2. Intellectual Property Rights and Collusion

a. The Contractor shall indemnify the Company against all claims in respect of actual or
alleged infringement of any Intellectual Property Rights, if:

i. the claim or proceedings arise out of the design, construction or use of the IP
Documents or Design Works;

ii. the infringement (or allegation of infringement) was not the result of part (or all)
of the IP Documents or Design Works being used for a purpose other than that
indicated by, or reasonably to be inferred from, this Agreement;

iii. the infringement (or allegation of infringement) was not the result of part (or all)
of the IP Documents or Design Works being used in association or combination
with anything not supplied by the Contractor, unless such association or
combination was disclosed to the Contractor prior to the date of the execution
of this Agreement or is stated in this Agreement; and

iv. the infringement (or allegation of infringement) was not the unavoidable result of
the Contractor's compliance with this Agreement.

b. The Contractor shall be promptly notified of any claim under this Article 15 made
against the Company.

c. The Contractor may, at its cost, conduct negotiations for the settlement of such
claim, and any litigation or arbitration that may arise from it.

d. The Company shall not make any admission which might be prejudicial to the
Contractor, unless the Contractor has failed to take over the conduct of the
negotiations, litigation or arbitration within a reasonable time after having been so
requested.

e. Except to the extent that the Company agrees otherwise, the Contractor shall not
make any admission which might be prejudicial to the Company, until the
Contractor has given the Company such reasonable security as the Company may
require. The security shall be for an amount which is an assessment of the
compensation, damages, charges and costs for which the Company may become
liable, and to which the indemnity under this Article applies.

f. The Company shall, at the request and cost of the Contractor, assist it in contesting
any such claim or action, and shall be repaid all reasonable costs incurred.

g. If the design, construction or use of the IP Documents or other parts of the Design
Works is held by a court of competent jurisdiction to constitute an infringement of
third party Intellectual Property Rights or if the Company is advised by specialist legal
counsel that such design, construction or use is likely to constitute such an
infringement, then the Contractor shall promptly at its own expense and at the
 option of the Company:

i. procure for the Company and the Contractor the right to continue the design,
construction and use of the IP Documents and Design Works and the right for the
Company to continue using and possessing the same; or

ii. modify or replace the applicable parts of the IP Documents and Design Works
(without detracting from their overall functionality or performance) so as to avoid
the infringement, in which event the Contractor shall indemnify the Company
from and against all claims, damages, losses and expenses (including without
limitation consequential loss of use) arising out of or resulting from any inability,
difficulty, delay or hindrance to the Company in the design, construction or use
of the IP Documents or Design Works.

h. If (i) or (ii) cannot be achieved on terms reasonably satisfactory to the Company

within a reasonable period of time, the Company shall have the right (without
prejudice to its other rights) to terminate this Agreement and recover from the
Contractor all monies paid to the Contractor under this Agreement and all direct or
Economic Loss or damage sustained or incurred by the Company under or in
connection with this Agreement. The Parties shall then proceed in accordance with
Article 25. ***

i. The Contractor shall not without prior consent of the Company take, permit or suffer
to be taken any photographs of the Works for use in any publicity or advertising or
publish alone or in conjunction with others any articles, photographs or other
illustrations relating to the Project.

j. The Contractor warrants and undertakes to the Company that it (nor any Affiliate or
any Sub-Contractor) has not and will not perform or become involved in any of the
following practices:

i. any collusion by the Contractor, any Affiliate or any of the Contractor’s Sub-
Contractors and/or suppliers in the fixing or rigging of prices in order to secure
that a particular contractor or supplier secures a particular contract;

ii. the use of "rotation" pricing where a group of contractors and/or suppliers will
collude so as to secure that work that they would normally compete for will be
allocated to each of them in rotation; and

iii. the use of "cover bidding" in which any of the Contractor, any Affiliate or any of
the Contractor’s Sub-Contractors and/or suppliers obtains or seeks to obtain
knowledge of the bids of any other Sub-Contractor or supplier to ensure that its
own bid is higher.

k. For the purposes of this Article 15 "Affiliate" means any holding company, subsidiary or
any subsidiary of any holding company.

ARTICLE 16
 IMPROVEMENTS

The Contractor shall remain involved in the community development programme for the
communities around the Work Site area. Any community development programme
prepared by the Contractor must always be consistent with the community development
programme notified in writing by the Company to the Contractor from time to time.

ARTICLE 17
INSURANCE

1. The Contractor shall from the date of this Agreement and throughout the term of the
Agreement take out and maintain, at its own cost and expense, the following
insurances:

a. Construction All Risks Insurance covering the Works, including any materials and
temporary works (but excluding all construction plant and equipment of the
Contractor or Sub-Contractors), against “all risks” of physical loss or damage
(including the cost of demolition and removal of debris) extended to include cover
against sabotage and civil commotion (to the extent available on commercially
reasonable terms), covering the Company, the Contractor and its Sub-Contractors.

b. Workmen's Compensation and Company's Liability Insurance covering the

Contractor's personnel while engaged in the performance of the Work The
Contractor must be able to show such evidence of insurance to the Company’s
Representative its details of the coverage
c. Public Liability Insurance covering on a worldwide basis loss, injury (including death)
or damage to persons or property, resulting from or occurring in connection with the
carrying out of the Work. The Contractor must be able to show such evidence of
insurance to the Company’s Representative its details of the coverage

2. The Company shall, from time to time upon demand, be entitled to have produced to it
certificates evidencing that the policies of insurance referred to in Article 17, paragraph
1 are in full force and effect. The policy or policies shall provide that the Company is
entitled to not less than 30 (thirty) Days' notice from the insurers prior to cancellation,
termination or alteration of cover. The Contractor shall not, and shall procure that its
personnel, agents and Sub-Contractors shall not, do or omit to do anything whereby the
policy or policies (or any of them) may be or become void or voidable.

3. Deductibles or liabilities in excess of the indemnities provided under the insurance

arranged by the Contractor as required by this Article 17, paragraph 1 shall be for the
account of the Contractor.

4. Each Party shall promptly notify the other Party of any actual or potential claim under
any of the insurances referred to in this Article 17, paragraph 1. Each such notice shall
be accompanied by full details of the incident giving rise to the claims. Each Party shall
afford the other Party all such assistance as may be required for the preparation and
negotiation of any claims under any insurance maintained pursuant to this Agreement.
5. Each insurance policy must be enforceable within the jurisdiction of the Republic of
Indonesia.

6. The Contractor must ensure that the Sub-Contractor it employs is covered by insurance
for any risk and category as referred to in this Article.

ARTICLE 17A
LIABILITY TO INDEMNIFY LOSSES OR DAMAGES

1. The Contractor shall be responsible for the care and custody of the Works (and all parts
thereof) until Operational Handover or the date of expiry of the notice of termination of
the Contractor's engagement under the Agreement and shall make good forthwith at its
own cost any loss or damage that may occur to the Works (or any part thereof) from any
cause other than those identified in Article 17A, subparagraphs (a) to (d) (inclusive)
during such period. The Contractor shall also be so responsible for the care of any
outstanding work being carried out by the Contractor after such period and making
good any defect or damage or loss to such work from any such cause and for making
good any Defect or loss to the Works (or any part thereof) caused by Contractor or any
Sub-Contractor in the course of any such work or any work carried out pursuant to Article
20B.

2. If loss or damage occurs to the Works or any part thereof by reason of:

a. war (whether declared or undeclared), invasion, armed conflict, act of foreign

enemy, rebellion, revolution, insurrection, sabotage, civil war or epidemic;

b. radioactive contamination or ionising radiation originating from a source in the

Republic of Indonesia, except as maybe attributable to the Contractor's use of
munitans, explosives, radiation or radioactivity;

c. pressure waves caused by aircraft or other aerial devices travelling at sonic or

supersonic speeds; or

d. the gross negligence or wilful misconduct of the Company,

the Contractor shall notify the Company of the works it proposes for making good such
loss or damage together with a method statement for their implementation and its
costings for such works (which shall be calculated and agreed or determined in
accordance with Article 17A, paragraph 3 or Article 17A, paragraph 4 as if the
necessary works had been instructed under Article 14, paragraph 1 (provided that
Contractor shall not be entitled to include any profit in its costings and calculations and
no such profit shall be added to the price for making good the loss or damage)) as soon
as reasonably ascertainable.

3. The Company shall within 28 (twenty eight) Days of receipt of a notice under Article 17A,
paragraph 2 notify the Contractor if it requires it to make good such loss or damage, in
which event the Contractor shall carry out the necessary work to make good such loss or
damage forthwith at the Company's expense in accordance with the price so agreed or
 determined. For the avoidance of doubt, the Contractor shall not carry out any works to
make good any such loss or damage until it is so required by the Company in
accordance with this Article 17A, paragraph 2.

4. If the Company does not require the Contractor to make good any loss or damage to
the Works under Article 17A, paragraph 3, the Company shall:

i. issue an instruction under Article 14, paragraph 1 excluding the performance of that
part of the Works thereby lost, destroyed or damaged;

ii. where the loss or damage affects a substantial part of the Works, terminate
Contractor's engagement pursuant to Article 25A, paragraph 1; or

iii. if applicable, terminate the Contract under Article 24.

ARTICLE 18
REPRESENTATIONS AND WARRANTIES

1. Obedience with Law and Regulations

a. The Contractor shall at its own cost and risk obtain and maintain in force such
Consents as it is required by the Laws to hold in order to perform its obligations under
this Agreement.

b. The Contractor shall, at the Company's request and cost, assist the Company in
applying for any Consents which the Company is required by this Agreement to
obtain.

c. The Contractor shall, in performing the Agreement, comply with all applicable Laws,
Consents and with the terms of those permits, licenses and approvals which it holds.

d. The Contractor shall indemnify the Company from and against all losses, damages,
expenses (including legal fees and expenses), fines, penalties, claims and
proceedings (of whatsoever nature) to the extent the same arise from any breach of
this Article 18.

2. Contractors’s Personnel

a. All Contractors’ personnel transportation shall be the responsibility of the Contractor.

If the Company has such transportation available, then the Company may, at its
discretion, allow the Contractor’s personnel to use such transportation.

b. The Contractor warrants that it shall pay the wages of its personnel, as well as other
benefits, regularly and fairly, without any contingency payment upon funds received
by the Contractor from the Company.

c. The Contractor shall indemnify the Company from and against all losses, damages,
expenses (including legal fees and expenses), fines, penalties, claims and
 proceedings (of whatsoever nature) to the extent the same arise from any dispute
which may occur between the Contractor and Contractor’s personnel or Sub-
Contractor of any level and its personnel.

d. The Contractor shall not employ nor attempt to employ any Company employee for
so long as they are still employed by the Company. The Contractor must not give
any entertainment or gifts in any form to the Company’s employee or try in any way
to procure favour under this Agreement.

e. The Contractor shall obtain and provide, at its own costs, all visas, travel permits, work
permits, exit permits and re-entry permits, Letters of Good Conduct or
SuratKeteranganKelakuanBaik (“SKKB”) and any other documentation required by all
applicable Laws, in connection with the entry, presence, or employment and/or
discharge of the Contractor’s personnel from the Work Site.

f. The Contractor shall ensure compliance with all applicable safety Laws, as well as
the Company’s safety procedures included in Annexure D or as otherwise provided
by the Company to the Contractor from time to time. To the extent required by the
nature of Work under the Agreement, the Contractor shall provide its personnel with
all necessary safety equipment, including but not limited to: helmet, safety shoes,
gloves and breathing mask.

g. Only personnel of the Contractor, Sub-Contractor or supplier who are actively

employed in the Work may stay in the Contractor's camp.

3. Contractor’s Equipment

a. All materials, goods and workmanship forming part of the Works shall be of good
quality and shall be of the respective kinds, standards and descriptions specified in
the Specification and/or in any drawings, details, or instructions issued to the
Contractor under this Agreement and/or as specified in any documents properly
prepared by the Contractor and authorised for use by the Company.

b. The Contractor warrants that it has valid rights to use the Contractor's Equipment,
and there is no imposition or restriction upon the Contractor’s Equipment which shall
limit the usage of the Contractor’s Equipment.

c. The Contractor’s Equipment provided and used by the Contractor shall be in good
working condition, and be capable of being operated safely, and efficiently. The
Contractor shall be responsible for conducting all necessary maintenance and repair
so the Contractor’s Equipment remains in good working condition and is able to be
operated safely and efficiently when the Work under the Agreement is being carried
out.

d. The Contractor must provide all equipment, appurtenance, lubricants, spare parts,
material and supplies as required for operation, maintenance and repair of the
Contractor’s Equipment in connection with the performance of the Work under the
Agreement.
 e. The Company reserves the right to examine any part of the Contractor’s Equipment
before and during the performance of Work under the Agreement and request the
Contractor to transfer from the Work Site any Contractor’s Equipment which, in the
Company's opinion has been poorly maintained, is unsafe, or unsuitable for the Work.
Replacement of such Contractor’s Equipment shall be at the Contractor’s cost.

4. Supporting Facility Design, Purchase, Construction and Maintenance

a. The Company shall make available sufficient areas for the Contractor to build
personnel’s housing facility, an office, a garage and a warehouse.

b. The Contractor shall purchase industrial diesel fuel required for the Work under the
Agreement from PT Puma Energy Indonesia. The Company will act as a guarantor
for the purchase of industrial diesel fuel from PT Puma Energy Indonesia, provided
however that where the Company has to pay PT Puma Energy Indonesia for industrial
diesel fuel purchased by the Contractor by reason of its guarantor obligations, then
the Company shall be entitled to deduct the amount of any monies paid to PT Puma
Energy Indonesia from monies due and owing to the Contractor under ths
Agreement.

c. The supply of industrial diesel is included in the Contract Price as a provisional sum of
USD 0.76 (seventy six United States cents) ("Provisional Sum"). Where during the
performance of the Work under the Agreement the price for industrial diesel
fluctuates, such amounts shall be added to the Contract Price, less the original
Provisional Sum.

d. By way of example:

Where the industrial diesel price payable to PT Puma Energy Indonesia is USD 0.80
(eighty United States cents), and the volume purchased is 50,000 litres, (USD 0.8 – USD
0.76) x 50.000L= USD2.000. As a result, $2,000 will be added to the Contract Price.

Where the industrial diesel price payable to PT Puma Energy Indonesia is USD 0.70
(seventy United States cents), and the volume purchased is 50,000 litres, (USD 0.7 –
USD 0.76) x 50.000L= (-)USD3.000. As a result, $3,000 will be deducted from the
Contract Price.

e. The Company shall provide the Base A material which will be purchased from PT
Manggala Usaha Manunggal with the quantity approximately 387,189 m3
(compacted) and deliver it on site spreading location. The Company shall take
responsibility for the availability of this material. The Base A Material shall be tested by
competent institution to fulfill the standard and Specification.

f. The Contractor shall be responsible for the provision of all power, water, gas,
telecommunciations and other services it may require.

g. Any electricity supply procured by the Contractor and its distribution system must be
safe, comply with the applicable Laws and be installed and maintained only by
appropriately qualified persons.
 h. The Contractor shall provide transportation and storage facilities for any fuel
received from the Company on the Work Site. Such fuel is to be used by the
Contractor exclusively in the performance of the Work under the Agreement.

i. The Contractor shall ensure that there are no unprocessed wastes or pollution are
directly or indirectly disposed to the streams, waterways or sewers. The processing of
unprocessed domestic waste must be completed by planting a septic tank and
leachfield in an adequate capacity in anticipation of use. Waste processing
methods must be approved in advance by the Company. It is expected that water
may be obtained from streams, reservoirs or wells made in the Work Site, but the
Company does not guarantee that sufficient or adequate supplies exist and the
Contractor remains responsible for ensuring and procuring sufficient water supplies.

j. The Contractor shall be responsible for:

i. the use, storage and disposal (in accordance with all applicable Laws and the
Specification) of all hazardous or toxic or contaminated materials or substances
generated or used by the Contractor in executing the Works and carrying out its
other obligations under the Agreement; and

ii. rectifying and remedying any contamination of the Works, the Work Site and any
neighbouring areas of land caused by executing the Works and carrying out its
other obligations under the Agreement.

k. The Contractor shall be responsible for and shall indemnify the Company from and
against any and all expenses, liabilities, losses, claims and proceedings whatsoever
resulting from any breach of the Contractor's obligations under this Article 18.

5. Inspection of Works

The Company may issue instructions requiring the Contractor to open up for inspection
any work covered up or to arrange for or carry out any test of any materials or goods
(whether or not already incorporated in the Works) or of any executed work, and the
cost of such opening up or testing and the cost of making good in consequence thereof
shall be added to the Contract Price unless:

a. provided for in the Specification; or

b. the inspection or test shows that the work, materials or goods are not in accordance
with this Agreement; or

c. such other inspections show work, materials or goods of a similar nature are not in
accordance with this Agreement.

ARTICLE 19
COMPENSATION

The Contractor shall indemnify and hold harmless the Company, its affiliates, the
Company'spersonnel, and their respective employees, officers and agents against and from
all claims, damages, losses and expenses (including legal fees and expenses) in respect of:

1. bodily injury, sickness, disease or death, of any person whatsoever; and

2. damage to or loss of any property, real or personal,

arising out of or in the course of or by reason of the execution and completion of the Works.

ARTICLE 20
SUSPENSION OF WORK

1. Suspension by the Company

a. The Company may at any time order the Contractor to suspend the Work under the
Agreement in part or as a whole. During such suspension the Contractor shall
maintain, protect, store and secure such part of the Works against any deterioration,
loss or damage.

b. During any period of suspension, the Contractor shall not remove from the Work Site
any plant, materials, or any Contractor's Equipment without the prior written consent
of the Company.

2. The Continuation of Work Performance

At any time thereafter, the Company may order the Contractor to resume the Work
under the Agreement either in whole or part, and based on that the Contractor must
immediately obey the Company’s order. The Contractor shall make good any
deterioriation or defect in or loss of the Work, plant or material, which has occurred
during the delay.

3. Notification of Cause for Suspension

The Company may also notify the cause for the suspension. If and to the extent that the
cause is notified and is the responsibility of the Contractor, the following Article 20,
paragraphs 3 to 5 shall not apply.

4. Consequences of Suspension

If the Contractor suffers delay and/or incurs additional costfrom complying with the
Company's instructions under Article 20, paragraph 1 and/or from resuming the work, the
Contractor shall give notice to the Companyand the Contractor shall be entitled to:

a. an extension of time for any such delay, if completion is or will be delayed, under
Article 20A; and

b. payment of any such additional costs, idle of equipments, which shall be added to
the Contract Price.
 After receiving this notice, the Company shall proceed in accordance with Article 29 to
agree or determine these matters.

5. Contractor's Default

The Contractor shall not be entitled to an extension of time for, or to payment of the cost
incurred in, making good the consequences of the Contractor's faulty design,
workmanship or materials, or of the Contractor's failure to protect, store or secure in
accordance with this Article 20.

6. Payment for Plant and Materials in Event of Suspension

The Contractor shall be entitled to payment of the value (as at the date of suspension)
of an item of plant and/or materials which have not been delivered to Work Site, if:

a. the work on such item of plant or delivery of such plant and/or materials has been
suspended for more than 28 (twenty eight) Days, and

b. the Contractor has marked the item of plant and/or materials as the Company's
property in accordance with the Company's instructions.

7. Prolonged Suspension

If the suspension under this Article has continued for more than 180 (one hundred and
eighty) Days, the Contractor may request the Company's permission to proceed. If the
Company does not give permission within 28 (twenty eight) Days after being requested
to do so, the Contractor may, by giving notice to the Company, treat the suspension as
an omission under Article 14 of the affected part of the Works. If the suspension affects
the whole of the Works, the Contractor may elect to treat its engagement as having
been terminated by the Company under Article 25B and Article 25, paragraph 11 shall
thereafter apply.

ARTICLE 20A
EXTENSION OF TIME

1. Extension of Time Grounds

Subject to this Article 20A.1, the Contractor shall be entitled to claim an extension of time
if the attainment of Operational Handover is delayed hereunder as a direct result of any
of the following events (the "Extension of Time Grounds"):

a. any delay occasioned by a suspension pursuant to Article 20;

b. a failure by the Company to provide the Contractor with access to those parts of the
Work Site necessary to commence the Work in accordance with Article 3 by the
date of issuance of the SPMK;
 c. the occurrence of an event of Force Majeure as specified in Article 24; or

d. any breach of this Agreement or other act of prevention by the Company, its agents
or employees.

2. Extension of Time Procedures

a. The Contractor shall give notice to the Company as soon as it can reasonably
foresee an Extension of Time Ground arising which will cause delay to the the cause
delay to the attainment of Operational Handover or within 14 (fourteen) days of such
Extension of Time Ground first arising, whichever is the earlier. Thereafter, but in any
event not later than 14 (fourteen) days after such notification, the Contractor shall
give further written details to the Company which shall include:

i. the cause or causes of such delay and details of the contemporary records
which the Contractor will maintain to support and evidence its claim;

ii. details of the consequences whether direct or indirect that such delay may have
on the critical path programme for the attainment of Operational Handover;

iii. details of any extension to the Date for Operational Handover to which the
Contractor may consider itself entitled resulting from such delay and the extent
to which in its opinion such delay is caused by each Extension of Time Ground;
and

iv. details of any measures which the Contractor proposes to adopt to mitigate the
consequences of such delay.

b. Without admitting any liability, the Company may at any time inspect, or request a
copy of, the Contractor's contemporary records and may make reasonable requests
for the Contractor to keep further contemporary records.

3. Award of Extensions

a. Subject to due compliance by Contractor with the provision in Article 20A,

paragraph 2, the Company shall as soon as reasonably practicable from time to
time grant to the Contractor either prospectively or retrospectively such extension of
time to the Date for Operational Handover as shall be reasonable, provided that:

i. the Contractor shall not be entitled to any extension of time to the extent that
any delay is due to any act, neglect, omission or default of the Contractor or any
person for whom the Contractor is responsible;

ii. the Contractor shall use its best endeavours consistent with Good Industry
Practice to eliminate or minimise any delay in attaining Operational Handover
beyond the Date for Operational Handover;

iii. in determining any extension of time, the Company may take into account, inter
alia:
 a) any omission of any work permitted or instructed under the Agreement; and

b) whether (and if so to what extent) as a consequence of the failure of the

Contractor to execute the Work under the Agreement at all times prior to the
occurrence of the delaying event or events on which the Contractor has
based its claim for an extension of time in accordance with the Agreement,
the impact of such delaying event or events on the ability of Contractor to to
attain Operational Handover beyond the Date for Operational Handover is
greater than it otherwise would have been; and

iv. the Contractor shall be entitled to claim and the Company shall be entitled to
grant an extension of time to the Date for Operational Handover whether or not
the delay occurs before or after the Date for Operational Handover.

b. The Company may in its sole discretion and notwithstanding any other provision of
this Agreement to the contrary, where the Operational Handover has passed, but
Operational Handover has not been attained by notice to Contractor unilaterally
extend the Date for Operational Handover.

c. If the Company declines to grant an extension of time and fix a revised Date for
Operational Handover then either party shall be entitled to refer the matter for
determination in accordance with the procedures set out in Article 29.

d. The Contractor shall have no claim for any extension of time or in respect of delay
save as and to the extent set out in this Article 20A.

ARTICLE 20B
OPERATIONAL HANDOVER

1. Operational Handover

When, in the opinion of the Company, Operational Handover has been achieved, it shall
issue an Operational Handover Certificate and Operational Handover shall occur on the
day named in such Operational Handover Certificate. Such Operational Handover
Certificate may be accompanied (at the Company's absolute discretion) by a list of
items of work which are, in the Company's opinion, required to render the Works entirely
completed.The Contractor may apply for partial hand over of the Work to the Company
not later than 14 (fourteen) Days prior to the estimated completion date of the Work
section. After the Contractor completes the Works or remedial Works (if any), then the
maintenance period shall begin after the Work completion of such section.

2. Outstanding Work

To the intent that the Works shall as soon as may be possible after Operational Handover
be in the condition required by this Agreement, the Contractor shall with all due
diligence complete any items of work outstanding at the date of the certificate issued
under Article 20B, paragraph 1 and which are detailed in the list issued pursuant to
 Article 20B, paragraph 1.

3. Defects

a. In order that the Works shall be in the condition required by the Agreement (fair wear
and tear excepted) by the expiry date of the relevant Maintenance Period or as
soon as practicable thereafter, the Contractor shall:

i. complete any work which is outstanding on the date stated in an Operational

Handover Certificate, within such reasonable time as is instructed by the
Company, and

ii. execute all work and/or take steps required to remedy any Defect, as may be
notified by the Company on or before the expiry date of the Maintenance
Period.

b. If a Defect appears, the Company shall notify the Contractor accordingly.

c. Subject to Article 20B, paragraph 4, all work referred to in Article 20B, paragraph 3
shall fully be executed at the risk and cost of the Contractor.

4. Cost of Remedying Defects

a. For the avoidance of doubt, the Contractor shall not be liable to rectify (under
Article 20B, paragraph 3) any Defect arising from:

i. the Company's failure to operate the Works in accordance with the manuals
prepared by the Contractor (provided these are prepared in accordance with
this Agreement); or

ii. the occurrence of accidental loss or damage.

b. If the Contractor rectifies a Defect pursuant to the Company's request and it is

discovered that the Defect is not one which the Contractor was liable to rectify at its
own expense under Article 20B, paragraph 3 then the Company shall reimburse the
Contractor for its costs incurred in carrying out the rectification.

5. Latent Defects

a. Notwithstanding the issue of a Final Acceptance Certificate (and without prejudice

to the Company's rights in law), the Contractor shall be responsible for carrying out
all necessary remedial work expeditiously and at its cost and expense in respect of
any Latent Defect in the Works as well as any damage to the Works caused by such
Latent Defect which appears or occurs at any time during a Latent Defect Period.

b. The Contractor shall submit to the Company for its approval details of the remedial
work which it proposes to make pursuant to this Article 20B, paragraph 5, the
estimated duration of such remedial work, details of such parts of the Works as it may
be necessary to shut down and the proposed dates for such remedial work. The
 Company shall afford the Contractor such access to the Works as may be
reasonable in all the circumstances for such purposes. If the remedial work can be
carried out without shutting down the Works, the Contractor shall carry out such
remedial work as soon as reasonably practicable. If the remedial work necessitates
the shutting down of the Works, the remedial work shall be carried out at a time and
for periods agreed with the Company.

6. Maintenance Period and Extension of Maintenance Period

(SLR requesting PP to change the warranty periods:

3. Warranty periods from 6 to 12 months

Our response:
3. As we informed yesterday, we would like to accept the request,under this condition:
It could only extend from 6 months to the maximum of 12 months if defects found during
maintenance period. Also, we need to specify that the Contractor will not take the
responsibility to extend the maintenance period if the defects caused by Company.)

a. If repetitive Defects occur or are discovered during the Maintenance Period on the
same element of the Works provided by the Contractor, the Contractor shall
determine the root cause and its solution.

b. The Maintenance Period for the Works shall be extended if and to the extent that the
Works or a major item of plant within the same (as the case may be) cannot be used
for the purposes for which they are intended by reason of a Defect.

c. However, a Maintenance Period shall not be extended by more than 12 (twelve)

months.

7. Failure to Remedy Defects

a. If the Contractor fails to remedy any Defect within a reasonable time after the
Company's notice under Article 20B, paragraph 1, the Company may fix a date on
or by which to remedy the Defect, and give the Contractor reasonable notice of
such date.

b. If the Contractor fails to remedy the Defect by such date, the Company may (at its
sole discretion):

i. carry out the work itself or by others, in a reasonable manner and at the
Contractor's risk and expense and the costs properly incurred by the Company in
remedying the defect or damage shall be recoverable from the Contractor by
the Company;

ii. determine and certify a reasonable reduction in the Contract Price (without
prejudice to the Company's rights at law); or

iii. if the Defect is such that the Company has been deprived of substantially the
whole of the benefit of the Works or any part thereof, terminate this Agreement in
 respect of such parts of the Works as cannot be put to the intended use, the
Company shall then be entitled to recover all sums paid for such parts of the
Works together with the cost of dismantling the same, clearing the Work Site and
returning any equipment and materials to the Contractor and any other
damages or liability incurred as a result of such failure on the part of the
Contractor, and Article 25, paragraph 1 shall not apply.

8. Removal of Defective Work

If the Defect is such that it cannot be remedied expeditiously on the Work Site, the
Contractor may, with the consent of the Company, remove from the Work Site for the
purposes of repair at the Contractor's cost the Work or any part thereof which is
defective or damaged.

9. Final Acceptance

a. Performance of the Contractor's obligations shall not be considered to have been

completed until the Company has issued the Final Acceptance Certificate to the
Contractor, stating the date on which the Contractor completed its obligations
under this Agreement.

b. The Company shall issue the Final Acceptance Certificate within 28 (twenty eight)
days after the expiry of the Latent Defect Period, or as soon thereafter as the
Contractor has completed the performance of the Work under the Agreement,
including remedying any Defects. To the extent that the Contractor has received the
benefit of any warranties from any Sub-Contractor or manufacturer or supplier of any
item of equipment and materials which extends beyond the Maintenance Period,
the Contractor shall, to the extent that the Contractor is legally able to do so, assign
the benefit of all such warranties to the Company when requested to do so by the
Company.

ARTICLE 21
ASSIGNMENT AND SUB-CONTRACTING

1. Assignment by the Contractor

The Contractor shall not assign, transfer and/or charge the benefit of this Agreement
and/or any of its present or future rights, interests and/or benefit hereunder to any other
person, without the prior written consent of the Company.

2. Assignment by the Company

The Company shall be entitled to assign, transfer and/or charge the benefit to the
Company of this Agreement and/or any of its present or future rights, interests and/or
benefits hereunder to any other person upon giving written notice thereof to the
Contractor.
 ARTICLE 22
PERFORMANCE BOND

1. The Contractor shall give a duly executed Performance Bond and Advance Payment
Bond, each issued by a state owned national Commercial Bank acceptable to the
Company, within 10 (ten) days of the date of this Agreement. Notwithstanding any
other provision of this Agreement, compliance with this Article 22 is a condition
precedent to the entitlement of the Contractor to receive any payment from the
Company under the Agreement (including the Advance Payment) and no payment
shall be due or payable until this Article is satisfied.

2. The Performance Bond shall be for the amount of 5% (five percent) of the Contract Price,
in the form of the Performance Bond in Annexure F. The Advance Payment Bond shall
be for the amount of the Advance Payment.

3. If in accordance with this Agreement the Contract Price is increased by:

a. more than 5% (five percent) of the initial Contract Price, or

b. if an increased Performance Bond has previously been provided under this Article 22,
more than five (5) per cent of the Contract Price by reference to which that
increased Performance Bond was calculated,

then the Contractor shall deliver to the Company a duly executed Performance Bond
for the amount of 5% (five percent) of the Contract Price as so increased, and otherwise
satisfying the requirements of Article 22, paragraph 4.

4. The Performance Bond and the Advance Payment Bond shall be valid from the date of
the Agreement up to the issue of the Operational Handover Certificate or (in the case of
the Advance Payment Bond only) if earlier, such time as the amount of the Advance
Payment Bond has reduced to zero in accordance with its terms by reason of the value
of the Work under the Agreement which have been performed.

5. If a Bond will in accordance with its terms expire at a time when Article 22, paragraph 6
requires the Contractor to ensure that that Bond remains valid and enforceable, the
Contractor shall not less than 28 (twenty eight) Days before the expiry of that Bond
deliver to the Company a duly executed Performance Bond or Advance Payment Bond
(as the case may be) for the same amount as the Bond being replaced, and otherwise
satisfying the requirements of Article 22, paragraph 6.

6. Each Bond shall be returned to the Contractor immediately after it expires in

accordance with its terms, save where there are pending claims (including previously
notified claims) at such date, in which case it shall be returned following final
determination and (if applicable) payment of such claims.

ARTICLE 23
REPORT
1. Progress Reports

a. Monthly progress reports shall be prepared by the Contractor and submitted to the
Company in 3 (three) hard copies and one electronic copy. The first progress report
shall cover the period up to the end of the first calendar month following the date of
this Agreement. Reports shall be submitted monthly thereafter, each within 7 (seven)
days after the last day of the period to which it relates.

b. Reporting shall continue until the Contractor has completed all work which is known
to be outstanding at the completion date stated in the Operational Handover
Certificate for the Works.

c. Each report shall include:

i. an executive summary;
ii. charts and detailed descriptions of progress, including each stage of design,
Contractor's documents, procurement, manufacture, delivery to Work Site,
construction, commissioning, start-up and testing;
iii. photographs showing the status of manufacture and of progress on the Work Site;
iv. for the manufacture of each main item of plant and materials, the name of the
manufacturer, manufacture location, percentage progress, and the actual or
expected dates of commencement of manufacture, Contractor's inspections,
tests, and shipment and arrival at the Work Site;
v. copies of quality assurance documents, test results and certificates of materials;
vi. list of variations;
vii. safety statistics, including details of any hazardous incidents and activities relating
to environmental aspects and public relations;
viii. comparisons of actual and planned progress, with details of any events or
circumstances which may jeopardize the completion in accordance with this
Agreement, and the measures being (or to be) adopted to overcome delays;
and
ix. such other matters as are provided for in this Agreement or may reasonably be
required from time to time by the Company.

ARTICLE 24
FORCE MAJEURE

1. "Force Majeure" means an event or circumstance which: (i) is beyond a Party's control;
(ii) such Party could not reasonably have provided against before entering into the
Agreement; (iii) having arisen, such Party could not reasonably have avoided or
overcome; and (iv) was not caused by the omission of such Party, which affects the
performance of obligations under this Agreement.

2. Force Majeure includes:

a. natural catastrophes, including but not limited to: earthquakes, hurricane, extreme
weather condition, typhoon and floods, provided that for a flood to deemed Force
Majeure the water level must be that of the average water level of Lematang River
 for the past decade plus 20% (twenty percent);

b. an epidemic of diseases;

c. wars, hostilities (whether war be declared or not), invasion, act of foreign enemies;
and

d. rebellion, act of terrorism, revolution, insurrection, military or usurped power, or civil

war.

3. Neither the Company nor the Contractor shall be liable for failure to comply with its
obligations under the Agreement to the extent, and for so long as it is prevented from
complying with those obligations as a result of an event of Force Majeure.

4. No Party shall be excused from the performance of obligations solely as a result of the
increase in costs upon the performance of such obligations.

5. The Parties shall not be excused from obligations that were required to be fulfilled prior to
the occurrence of Force Majeure.

6. The Party alleging Force Majeure shall immediately inform the other Party in writing at the
earliest opportunity, but in any event within 7 (seven) days of the date upon which the
Party learns of the occurrence of Force Majeure, detailing the event of Force Majeure
and the steps that it intends to take to overcome it.

7. The Party claiming the Force Majeure relief shall use its best efforts, including the
expenditure of reasonable sums, to cure, mitigate or remedy the effects of Force
Majeure. The Party alleging Force Majeure shall give a written statement at the time they
are able to resume the performance of their obligations.

8. If an event of Force Majeure continues for a period of 1 (one) month, the Parties shall
conduct a meeting to discuss and overcome such condition. If there is no agreed
solution, the Company shall have the right to terminate the Agreement. If the
Agreement is terminated by the Company in accordance with this Article 24, paragraph
8, the rights and obligations of the Company and the Contractor shall be specified in
Article 25, paragraph 11 and Article 25A, paragraph 2.

9. The following events may not be categorized as Force Maejure:

a. the obligation to pay money under the Agreement;

b. labor upheaval, strikes, lock-outs and other industrial disturbances that involves the
employees of the Contractor or its Sub-Contractor or the employees of the
Company;
c. weather conditions;
d. shortage of Sub-Contractors, labour or materials, unless itself caused by an event of
Force Majeure; and
e. risks which are expressly assumed by the Contractor pursuant to this Contract.
 ARTICLE 25
TERMINATION OF AGREEMENT

1. Termination by the Company

a. The Company reserves the right to terminate this Agreement upon the occurrence of
one of the following:

i. the Contractor failing to commence the Work under the Agreement within 14
(fourteen) Days since the Commencement Date;

ii. the Contractor failing to proceed regularly and diligently with the performance
of its obligations hereunder;

iii. the Contractor assigns, charges or otherwise parting with, or purports to assign,
charge, or otherwise part the benefit of the Agreement in violation of Article 21,
paragraph 1, without prior written consent from the Company;

iv. the Work under the Agreement performed by the Contractor is not in
accordance with the terms agreed by the Parties in this Agreement;

v. the Contractor violates the regulations of any Laws;

vi. any warranty, covenantorrepresentationprovided by the Contractor herein is

untrue or misleading;

vii. the Contractor abandons or is otherwise unable to continue the performance of

Work;

viii. a failure or refusal by the Contractor to perform its obligations under this
Agreement;

ix. the Contractor becomes bankrupt or insolvent, goes into liquidation, has a
receiving or administration order made against it, compounds with his creditors,
or carries on business under a receiver, trustee or manager for the benefit of his
creditors, or if any act is done or event occurs which (under applicable Laws) has
a similar effect to any of these acts or events;

x. the Contractor fails to comply with its obligations under Article 15, paragraph 1;

xi. the Contractor fails to comply with its obligations under Article 3B; and

xii. the Contractor fails to comply with its obligations under Article 26.

b. The Company shall be entitled to, in case of the events referred to:

i. at Article 25, subparagraph (1)(a)(i) to Article 25, subparagraph (1)(a)(ix) above,

 terminate this Agreement, without the need for the consent of the Contractor, by
30 (thirty) Days prior written notice to the Contractor; and

ii. in the case of other events listed at Article 25, paragraph 1(a)(xii) above,
terminate this Agreement without the need for the consent of the Contractor
immediately on written notice to the Contractor.

2. Upon receipt of a notice of termination under Article 25, subparagraph (1)(b), the
Contractor shall either immediately, or upon such date as is specified in the notice of
termination, comply with the provisions of Article 25, paragraph 3.

3. Upon a notice of termination under Article Article 25, paragraph 2 the Company may
immediately or upon such date as is specified in the notice of termination:

a. enter upon the Work Site and expel the Contractor therefrom;

b. complete the Work or any part thereof itself and/or by employing any third party;

c. provided that the notice of termination specifies that the Contractor's Equipment,
temporary works and materials which are owned by the Contractor and are on the
Work Site in connection with the Work under the Agreement are to be left on the
Work Site, take over and use without payment to the Contractor any such
Contractor's Equipment, temporary works and materials for such reasonable period
as the Company considers expedient for the execution and completion of the Works
and rectification of Defects; and/or

d. in its sole discretion and without any obligation to do so, pay Sub-Contractors
amounts payable in accordance with their Sub-Contracts in respect of any materials
delivered or works or services carried out for the purposes of the Work under the
Agreement whether before or after the date of termination insofar as the price for
the same has not already been discharged by the Contractor, and any payments so
made may be deducted from any sum due or to become due to the Contractor
under the Agreement or may be recovered from the Contractor as a debt.

4. Where the Company elects not to have the Work completed under Article 25,
paragraph 3 the Company may, in addition to exercising the rights set out in Articles 25,
subparagraph 3(a) and/or Article 25, subparagraph 3(d), accept the Works as having
attained Operational Handover subject to a fair and reasonable reduction in the
Contract Price, such reduction to be agreed or, in default of agreement within 30 (thirty)
Days of termination, provisionally determined by the Company (subject to dispute
resolution in accordance with Article 29), such reduction to be fair and reasonable with
reference to the condition and performance of the Work under the Agreement and the
effect on the Project of the termination of the Contractor's engagement under the
Agreement, and the Contractor shall pay or allow to the Company such reduction
forthwith upon such agreement or provisional determination together with all those losses
and expenses set out at Article 25, subparagraphs 8(b) and (c).

5. Where Articles 25, subparagraphs 3(b) and 3(c) apply, upon completion of the Works or
at such earlier date as the Company thinks appropriate, the Company shall give notice
 to the Contractor that the Contractor's Equipment shall be returned to the Contractor at
or near the Work Site and shall return such Contractor's Equipment to the Contractor in
accordance with such notice. The Contractor shall thereafter without delay and at its
risk and cost remove or arrange removal of the same from the Work Site. If the
Contractor has not done so within 20 (twenty) Days after notice from the Company, the
Company may (without being responsible for any losses arising) remove and sell such
Contractor's Equipment and shall hold the proceeds, less its reasonable costs and
expenses incurred in the removal and sale, to the credit of the Contractor.

6. If the Company terminates the Contractor's engagement pursuant to Article 25,

subparagraph (1)(b), the Contractor shall not be entitled to any compensation and all
obligations (other than as set out in this Article 25 for the Company to make payments to
the Contractor shall cease.

7. If, following termination pursuant to this Article 25, the Company intends to complete
the Works or any part thereof, then the Company shall provide to the Contractor a
provisional statement of its fair and reasonable estimate of the amount which will be
payable in accordance with the Final Termination Account. Any amount so estimated
shall be due and payable forthwith by the Contractor to the Company or vice versa.

8. Within 120(one hundred and twenty)Days of completion of the Works, or the respective
part(s) thereof, the Company shall draw up an account (the "Final Termination Account")
setting out:

a. any additional costs to the Company of carrying out the Works or part thereof (being
costs and expenses incurred by the Company in carrying out the Works or part
thereof, less the unpaid balance of the Contract Price payable to the Contractor as
at the date of termination together with any other sums payable by the Company to
the Contractor as at such date), or any shortfall, as the case may be; and

b. the costs of rectification of any defects; and

c. all loss and/or expenses incurred by the Company as a result of the termination
(including any financing costs and costs or losses arising from delay or performance
shortfalls).

9. The resulting balance shall be payable by the Company to the Contractor or by the
Contractor to the Company as the case may be, after making due allowance for any
payment made by the Contractor under the estimate pursuant to Article 25, paragraph
7.

10. Termination of the Contractor's engagement by the Company shall not limit and shall
not prejudice any other rights or remedies of the Company under the Agreement, at
law, in equity or otherwise.

11. Upon receipt of the notice of termination under Article 25, Article 25A or Article 25B, the
Contractor shall either immediately or upon the date specified in the notice of
termination:
 a. cease all further work in connection with the Works and vacate the Work Site, except
for such work as may be necessary for the purpose of protecting that part of the
Works already executed or any work required to leave the Work Site in a clean and
safe condition;

b. unless otherwise specified by the Company in the notice of termination, remove all
Contractor's Equipment from the Work Site;

c. repatriate Contractor's and Sub-Contractors' personnel from the Work Site, remove
from the Work Site any wreckage, rubbish and debris of any kind and leave the
whole of the Work Site in a clean and safe condition;

d. terminate or cause to be terminated all Sub-Contracts, except those to be assigned

to the Company;

e. deliver to the Company parts of the Works executed by Contractor or any Sub-
Contractor up to the date of termination together with any manuals (including as-
built drawings) or drafts of them in existence at the date of termination;

f. to the extent legally possible, procure the assignment to the Company or such
person as the Company may direct of all rights, title and benefit of Contractor to the
Works as at the date of termination, and, as may be required by the Company, in
any Sub-Contracts between Contractor and its Sub-Contractors;

g. procure that any Consents obtained in connection with the Contract are transferred
into the name of the Company or such person as the Company may direct; and

h. deliver to the Company all documents prepared by the Contractor or any Sub-
Contractors as at the date of termination in connection with the Works.

ARTICLE 25A
TERMINATION BY THE CONTRACTOR

1. The Contractor may terminate this Agreement without consent of the Company where:

a. the Company has failed pay the Contractor for a period greater than or equal to 60
(sixty) Days (except where such payment is the subject of a bona fide dispute in
accordance with Article 29); and/or

(SLR requesting to set a perimeter for this clause:

1. Termination for any payment failure – Perhaps there are some perimeters we can
set for this? We don’t want to be in a situation where PP can terminate the contract of
miner short payments or errors made in payment.

our response:
1. For Termination by Contractor clause by PP regarding default by Company, the
perimeter of time should also be set. According to FIDIC, if the Company fails to pay
within 56 days, PP entitled to terminate the contract.
 However, in order to maintain our good collaboration, we are open to negotiate the
amount of days we could agree on before PP entitled to terminate the contract, under
the condition we could also set up Contractor's right to suspend or slow down the work.)

b. the Company commits a repudiatory breach of the Agreement.

c. the Work was postponed for 60 days subsequently due to force majeur / the
Company’s negligence to fulfill its obligation.

(SLR requesting to change the 60 days to 180 days:

2. 180 days’ force majeure – We would like to extend the time period from 60 days as
indicated in the contract?

our response:
2. According to FIDIC, 60 days are enough to indicate whether the event categorized
as force majeure or not. However, if it is related to Article 25 and 25B in which para
(a) refers to late payment of 60 days, we could not accept 180 days, because it
means the period for payment is almost 50% of the Contract Period.)

3. If this Agreement is terminated by the Contractor in accordance with Article 25A,

paragraph 1 then the Company shall pay to the Contractor:

a. that part of the Contract Price properly attributable to the parts of the Works
executed by the Contractor as at the date of termination which is unpaid on the
date of termination;

b. the costs reasonably incurred by Contractor in (i) removing the Contractor's

Equipment from the Work Site, (ii) repatriating Contractor's and Sub-Contractors'
personnel, and (iii) protecting the Works and leaving the Work Site in a clean and
safe condition; and

c. any amounts to be paid by Contractor to its Sub-Contractors in connection with the

termination of any Sub-Contracts, including any cancellation charges.

ARTICLE 25B
TERMINATION FOR CONVENIENCE

The Company may at any time terminate the Contractor's engagement immediately for
any reason by giving Contractor a notice of termination which refers to this Article 25B.

If this Agreement is terminated in accordance with this Article 25B, the Company shall pay
to the Contractor those amounts specified in Article 25A, paragraph 2.

The Parties waive the provision of Article 1266 of the Indonesian Civil Code to the extent that
the termination of Agreement requires judge’s decision.
 ARTICLE 26
ETHICS

The Contractor shall, and shall procure that its employees, Sub-Contractors, suppliers and
agents:

1. at all times act ethically;

2. be prohibited from using its position for personal interest or for the interest of another
person or party which may be detrimental to the interests of the Company;

3. be prohibited from performing actions against morals, ethics, religion, laws or regulations
and applicable norms in the society; and

4. do not give or offer to give (directly or indirectly) to any person any bribe, gift, gratuity,
commission or other thing of value, as an inducement or reward:

i. for doing or forbearing to do any action in relation to this Agreement; or

ii. for showing or forbearing to show favour or disfavour to any person in relation to this
Agreement,

or if any of the Contractor's personnel, agents or Sub-Contractors gives or offers to give

(directly or indirectly) to any person any such inducement or reward as is described in
this Article 26, paragraph 4. However, lawful inducements and rewards to Contractor's
personnel shall not entitle termination.

The Contractor shall promptly notify the Company upon discovering any brach of this Article
26.

ARTICLE 27
CONFIDENTIALITY

1. All data/information, either verbal or written, in relation to the terms and conditions of
the Agreement, the Work and also other information in relation to the performance of
Work under the Agreement which is identified in writing at the time of such disclosure as
being confidential or proprietary must be kept confidential and shall not, without the
written consent of the other Party, be divulged to any third party. The Parties agree that
this obligation to keep confidentiality shall continue to apply even though the
Agreement has ceased to exist. Each Party shall obtain the written consent from the
other Party if they will deliver or give data/information in relation to the Work under the
Agreement to a third party.

2. This obligation to keep confidentiality will always apply unless it is disclosed in good faith:

a. to the extent required by prevailing Laws;

 b. to the extent required by the rules of a relevant and recognised stock exchange;

c. to any insurer under a policy of insurance issued pursuant to this Agreement;

d. to its directors, employees and officers;

e. to any Sub-Contractor, for the furtherance of the performance of that Party's

obligations under the Agreement;

f. to outside consultants or advisers engaged by or on behalf of the disclosing Party

and acting in that capacity in connection with the project (including insurance, tax
and legal advisers);

g. to the funders and to any agent, trustee or representative of the funders.

provided that in the case of the persons mentioned in paragraphs (d) to (g) the disclosing
Party shall have first obtained the person's agreement in writing to be bound by the same
obligations of confidence, mutatis mutandis, as are created by the terms of this Article 27.
To the extent disclosure is required in paragraphs (a) to (c) above, the disclosing Party shall
prior to such disclosure use reasonable efforts to provide the other Party with advance
notice of the information to be disclosed and make every effort to secure confidential
treatment and minimization of the confidential or proprietary information to be provided.

ARTICLE 28
NOTICE/CORRECEPONDENCES

1. Wherever this Agreement provides for the giving or issuing of approvals, certificates,
consents, determinations, notices and requests, these communications shall be:

a. in writing and delivered by hand (against receipt), sent by mail or courier, or

transmitted using email, facisimile or letter;

b. delivered, sent or transmitted to the address for the recipient's communications as

set out in the Special Provisions. However:

i. if the recipient gives notice of another address, communications shall thereafter

be delivered accordingly; and

ii. if the recipient has not stated otherwise when requesting an approval or consent,
it may be sent to the address from which the request was issued.

2. Except where the context requires otherwise, approvals, certificates, consents and
determinations shall not be unreasonably withheld or delayed.

ARTICLE 29
DISPUTE SETTLEMENT
1. The Parties agree that if there is a disagreement, dispute, conflict or controversy
(hereinafter referred to as “Dispute”), arising in relation to the Agreement or its
performance, including but not limited to disputes regarding the existence, validity,
termination of rights and obligations of a Party, the Parties shall settle the Dispute as
stipulated in the Special Provisions of this Agreement.

2. The Contractor must still perform the Work and its obligations pursuant to this Agreement,
unless it is otherwise agreed by the Company and the Contractor.

ARTICLE 30
AGREEMENT DOCUMENTS, LANGUAGE AND APPLICABLE LAW

1. This Agreement is executed and signed in English. The English text of this Agreement shall
prevail over any translation thereof. In respect of this Agreement that are not made in
Bahasa Indonesia and in so far Law No. 24 of 2009 concerning Flag, Language, and
National Emblem and National Anthem (“Law No. 24/2009”) shall impose the
requirement that memoranda of agreements or agreements involving, among others,
Indonesian private institutions, be set out in Indonesian language, the Parties hereby
undertake that, at their own costs and expenses, to conduct all necessary actions in
order to comply with Law No. 24/2009 including but not limited to translate this
Agreement that are not made in Bahasa Indonesia to be also set out in Bahasa
Indonesia, with the aid or assistance of a sworn translator (if necessary).

2. The language for all correspondence and communications of the Parties and all other
documentation to be prepared or supplied under the Agreement shall be English.

3. This Agreement is governed and construed according to the prevailing laws of the
Republic of Indonesia.

4. The documents forming this Agreement are taken to be mutually explainatory of one
another. In the event that there is an inconsistency of terms between the documents in
this Agreement, then the following order of precedence shall be used:

a. The Formal Instrument of Agreement;

b. Special Provisions;
c. General Provisions;
d. Annexes.

In the event of different provisions imposing different standards of performance, the

highest standards will prevail.

ARTICLE 31
MISCELLANEOUS

1. Severability
 In the event that the enforcement or operation of terms in this Agreement is prohibited
by the prevailing laws or if any provision of this Agreement is by the prevailing law
rendered void, invalid or unenforceable, such prohibition, voidness, invalidity or
unenforceability shall not affect the validity or enforceability of any other provisions and
conditions of the Agreement.

If any provision requiring the payment of Delay LDs is for any reason found to be void,
invalid, a penalty or otherwise unenforceable, such that the Company is unable to
enforce its entitlement to payment of the same, then the Company shall be entitled to
claim unliquidated damages in lieu of Delay LDs, provided that the Company's
entitlement to claim monetary compensation shall not exceed the amount the
Company would have been entitled to claim in respect of that breach or failure of
performance had the Delay LDs been valid or enforceable taking into account the limits
applicable to the recovery of such Delay LDs, pursuant to Article 5 and Special Provision
9.

2. Representations

The Parties acknowledge that:

a. neither Party has entered into this Agreement in reliance upon any representation,
warranty or undertaking of any Party which is not expressly set out or referred to in
this Agreement;

b. no Party shall have any remedy in respect of misrepresentation or untrue statement

made by any other Party which is not contained in this Agreement nor for breach of
warranty which is not contained in this Agreement; and

c. this provision shall not exclude any liability for, or remedy in respect of, fraud or
fraudulent misrepresentation.

3. Both Parties have enjoyed the benefit of legal advice and no implied terms are intended
to be included in this Agreement.

4. Privity

No provision of the Agreement is intended to or does confer upon any third party
(including any Sub-Contractor) any implied benefit or right enforceable at the option of
the third party against a Party to this Agreement. Any person who is not a party to this
Agreement has no right under any applicable Laws to enforce or enjoy the benefit of
any term of this Agreement.

5. Severability

If the enforcement or operation of any provision of the Agreement is prohibited by

Lawsor if any provision of the Agreement is by Laws rendered void, invalid or
unenforceable, such prohibition, voidness, invalidity or unenforceability shall not affect
the validity or enforceability of any other provisions and conditions of the Agreement.
6. Counterparts

The Agreement may be executed in any number of counterparts, all of which when
taken together shall constitute the one and the same instrument.

7. Company's Approvals

No approval, comment, instruction or consent given or made by the Company (or

others acting on its behalf), and no failure to make any comment or instruction, in
relation to the Design Works, upon inspection of the Works or otherwise, shall relieve the
Contractor of any obligation or liability under the Agreement.

8. Prior Work

Any design, services, supplies or works performed by the Contractor in respect of the
Works prior to the Commencement Date, shall be deemed to have been carried out
pursuant to, and shall be subject to the requirements of, this Agreement and the
warranties and undertakings set out in this Agreement shall apply to such activities.
 BAGIAN II/ SECTION II

KETENTUAN KHUSUS/
SPECIAL PROVISIONS

1. Specification : as described in Appendix A and B.

2. Work Site : Special roads for the transportation of coal owned by the
Company which is located in the Regency of Pali, the
Regency of MuaraEnim and the Regency of Lahat, South
Sumatera Province, with approximate length of 111.10 KM
(one hundred sixteen kilometer, as evidenced in Appendix
C.

3. Date for Operational : 485 (four hundred and eighty five) Days from the issue of
Handover the SPMK.

4. Contract Price : a. Pursuant to the performance and completion of the

Works by the Contractor under this Agreement, the
Company shall pay the Contractor in the amount of
USD $30,457,000 (thirty million and four hundred fifty
seven thousand United States Dollars) according to the
provisions regarding payment stages.

b. The Contract Price is a combination of lump sum basis

and unit prices, provided however that the Contract
Price shall be unaffected by the change in labor costs,
material costs, currency exchange rates, price of fuel oil
and etc.

i. Contract Price with Unit Price shall be applied for

the Work in section A of Bill of Quantity at KM 0 – 30
(Kilometer zero to thirty). The Contract Price for KM
0 – 30 shall be calculated and determined subject
to:
- The amount of required material by the
Contractor to complete the Work at KM 0 – 30
shall be approved in written by the Company
and these Special Provisions.
ii. Contract Price with lumpsum basis shall be applied
for the Work in section A, C, D of Bill of Quantity at
KM 30 – 111.10 (kilometer thirty to one hundred
eleven point ten).
iii. The Company will undertake for additional
geotechnical investigation along KM 0 to KM 30
which requires further geotechnical investigation.
The investigation will conduct an estimated 10 drill
holes of 8.50 to 10.00 meters deep together with
 associated soil testing. Any remedial works required
as a result of this investigations to be quantified
and valued the amount derived to be added to
the contract lumpsum.
iv. For the Work of Sub Base (Section B of Bill of
Quantity) at KM 30 – 111 (kilometer thirty to one
hundred eleven) shall be calculated in Unit Price.

1. Works to be Measured

Where the Works shall be measured, and valued for

payment, the below provisions shall apply to such Works.

(a) Whenever the Company requires any part of the

Works to be measured, reasonable notice shall be
given to the Contractor's Representative, who
shall:

(i) promptly attend or send another qualified

representative to assist the Company in making
the measurement, and

(ii) supply any particulars requested by the

Company.

(b) If the Contractor fails to attend or send a

representative, the measurement made by (or on
behalf of) the Company shall be accepted as
accurate.

2. Method of Measurement

(a) Measurement shall be made of the net actual

quantity of each item of the Works, and

(b) the method of measurement shall be in

accordance with the Bill of Quantities.

3. Evaluation

(a) the Company shall proceed to agree or determine

the Contract Price by evaluating each item of
work, applying the measurement agreed or
determined in accordance with the above and
the appropriate rate or price for the item.

(b) For each item of work, the appropriate rate or

price for the item shall be the rate or price
specified for such item in the Contract or, if there is
 no such item, specified for similar work.

5. Retention Value : The Company shall be entitled to deduct 5% retention

from interim payments due to the Contractor, until the
amount so retained by the Company reaches 5% of the
Contract Price ("Retention Money").

When the Operational Handover Certificate has been

issued for the Works, and the Works have passed all tests in
the Specification, the first half of the Retention Money shall
be paid to the Contractor.

Promptly after the expiry date of the Maintenance Period,

the outstanding balance of the Retention Money shall be
paid to the Contractor.

However, if any work remains to be executed under Article

20B, the Company shall be entitled to withhold the
estimated cost of this work until it has been executed.

6. Advance Payment : The payment of Advance Payment of USD $6,091,400 (six

million ninety one thousand and four hundred United
States Dollars) shall be paid within 14 (fourteen) Days after
satisfaction of the following conditions precedent:

i. execution of this Agreement;

ii. receipt by the Company of a valid tax invoice for
the Advance Payment;
iii. receipt by the Company of the duly executed
Advance Payment Bond;
iv. receipt by the Company of the duly executed
Performance Bond;
v. receipt by the Company of the certicate to the
Manpower and Health of Workers Social Security
Agency (Badan PenyelenggaraJaminanSosial or
BPJS) program.

The Advance Payment shall be repaid through

proportional deductions in interim payments. Deductions
shall be made by deducting 10% of the amount otherwise
due (excluding the Advance Payment and other
permitted deductions from amounts otherwise payable to
the Contractor), until such time as the Advance Payment
has been repaid.

If the Advance Payment has not been repaid prior to the

issue of the Operation Handover Certificate, or prior to
termination under Articles 24 and 25 (as the case may be),
 the whole of the balance then outstanding shall
immediately become due and payable by the Contractor
to the Company.

7. Basis for the : per work progress that has been installed each month,
Calculation of excluding for the onsite material.
Contract Price per
month

8. Payment : 1. Interim Applications

Within 2 (two) days of the end of each month, the

Contractor shall present to the Company an interim
application stating the total amount due to the
Contractor calculated in accordance with the
provisions of Special Provisions 8, paragraph 2, with
such supporting documents as may be required by
the Company.

2. Interim Certificates

On or before the expiry of twenty eight (28) days from

receipt by the Company of the interim application for
payment (including the period of verification by CMT
and approval by project leader), the Company shall
issue an interim certificate, stating the amount due to
the Contractor from the Company, which shall be:

a. the total value of work properly executed and

completed;

b. the total value of any goods and materials

intended and ready for but not yet incorporated
into the Works, which are delivered to the Work
Site (excluding the value of any goods and
materials in respect of which the Company is not
satisfied on the basis of the documents referred to
in Special Provision 8, paragraph 1 that property in
such goods and materials is vested in the
Contractor and excluding the value of any goods
and materials which, in the Company's opinion,
have been prematurely delivered to the Work Site,
are not properly protected or are otherwise not in
accordance with this Agreement); and

c. at the discretion of the Company, the total value

of any goods and materials intended and ready
for incorporation into the Works, which are not
delivered to the Work Site, provided that:
 i. the Company is satisfied on the basis of the
documents referred to in Special Provision 8,
paragraph 1 that property in such goods and
materials is vested in the Contractor;

ii. such goods and materials have been and are

set apart at the premises where they are
stored and have been clearly, visibly and
indelibly marked, so as to identify the
Company and the Project; and

iii. nothing remains to be done to such goods or

materials to complete the same up to the
point of their incorporation in the Works;

d. the amount of any additions to the Contract Price

ascertained under this Agreement up to and
including the valuation date, less all amounts
previously stated as due in any certificate issued
under this Special Provision 8 and less any amount
which may become due to the Company from
the Contractor, whether by deduction from the
Contract Price or under the provisions of this
Agreement.

3. Interim Statement of Account

The Company may from time to time issue to the

Contractor interim statements of account which will
detail instructions issued to the Contractor entitling the
Contractor to an adjustment to the Contract Price
under the terms of this Agreement. The Contractor
and the Company shall take steps to agree such
interim statements of account, and, following such
agreement, the Contractor shall be required to signify
its agreement and acceptance of the final valuation
of the interim statements of account.

4. Payment

Provided that the Contractor shall have complied

with its obligations under Special Provision 8,
paragraph 1 and submitted a valid tax invoice to the
Company within five (5) Working Days of receipt of an
interim certificate, the Company shall pay to the
Contractor the amount stated as due on any interim
certificate on or before the expiry of 28 (twenty eight)
Days from the date of such interim
 certificate(including the period of verification by CMT
and approval by project leader).
No later than five (5) days after the date of an interim
certificate, the Company shall give written notice to
the Contractor which shall specify the amount of the
payment proposed to be made in respect of the
amount stated as due in such interim certificate and
the basis on which that amount was calculated.

5. Set-Off

Nothing contained in this Agreement shall in any way

limit or exclude any of the Company's rights to deduct
or to set-off (whether under this Agreement or
otherwise) any sums to which it is or may become
entitled, whether as damages or otherwise, from or
against the Contract Price or from or against any
monies otherwise due to the Contractor under this
Agreement.

6. Final Account and Final Statement

The Contractor shall submit to the Company within 30

(thirty)) Working Days after Operational Handover of
the Works or within such other period as may be
agreed by the Company in writing, all documents
and other information necessary to enable the
Company to prepare the final account and final
statement for the Works. The final account shall set
out the details required under Special Condition 8,
paragraph 7, and the final statement shall set out the
amount resulting from the operation of Special
Condition 8, paragraph 9, the balance payable being
expressed as a balance due to the Contractor from
the Company or to the Company from the Contractor
as the case may be.

7. Agreement of Final Account and Final Statement

A final account for the Works and final statement shall

be provided for agreement to the Contractor by the
Company.

8. No Dispute

If nothing in the Company's final account or final

statement provided to the Contractor is disputed by
the Contractor within twenty (20) Working Days from
the date of the Final Acceptance Certificate the
 Company's final account and final statement so
provided shall be conclusive as to the balance due
between the parties.

9. Details of Final Account

The final account shall detail, as appropriate:

(a) the Contract Price and any adjustments
required pursuant to the provisions of this
Agreement;
(b) less all amounts previously stated as due in
any certificate issued under this Special
Condition 8; and
(c) less any amount which may become due
to the Company from the Contractor,
whether by deduction from the Contract
Price or under the provisions of this
Agreement.

10. Final Application

The Contractor shall, on its next application under this

Special Condition 8, following the date of agreement
of the final account and statement, or the date they
become conclusive pursuant to Special Condition 8,
paragraph 8, or the date of issue of the Operational
Handover Certificate, or the date it shall have
submitted all operation and maintenance manuals
and as-built drawings relating to the Works as may be
specified in the Specification or as the Company may
in writing require, whichever is the later, include in that
final application the balance, if any, stated as being
due to it in the final statement.

11. Payment of Balance of Contract Price

The Company shall pay to the Contractor the

amounts properly claimed by the Contractor pursuant
to Special Condition 8, paragraph 10 not later than 30
(thirty) Working Days following receipt of the
Contractor's application under Special Condition 8,
paragraph 10. The Company shall, when giving an
instruction for payment, issue a final certificate in
respect of any such amounts.

12. Effect of Certificates

No certificate issued by the Company under this

Agreement shall relieve the Contractor from any
 liability arising out of or in connection with this
Agreement. The Company may, by any certificate
delete, correct or modify any sum previously certified
by it.

9. Delay LDs : Delay LDs shall accrue at the rate of 1‰ (one permil) of
the remaining work value for each day of delay.

The total aggregate liability of the Contractor to the

Company for Delay LDs shall not exceed five percent (5%)
of the Contract Price.

10. Conditions : The Company shall not be required to issue the SPMK until
precedent satisfaction or waiver by the Company of the following
conditions precedent:

a. Receipt by the Company of a copy of Construction

Service Business License;

b. Receipt by the Company of a copy of the Tax Payer

Registration Number (NomorPokokWajibPokok or
NPWP) and Taxable Entrepreneur
(PengusahaKenaPajak or PKP) of the Contractor and
its Sub-Contractors;

c. Receipt by the Company of the duly executed

Advance Payment Bond;

d. Receipt by the Company of the duly executed

Performance Bond; and

e. Approval by the Company of the detailed

engineering design of the Work.

11. Notice Address : A noticefromtheContractor to the Company shall be

addressed to the Company:

PT. SRIWIJAYA LINTAS

RAYA
Graha BIP, Lantai 5
Jl. Jend.
GatotSubrotoKav. 23
JakartaSelatan
Telp. 021-5223688
Fax. 021-5223686

UP: Director
 TheNoticefromthe Company to theContractorshall be
addressed to theContractor:

PT. PP (PERSERO), Tbk.

Jl. Adam Malik No. 103,
Medan, SumateraUtara
Telp. 061-6615199
Fax. 061-6618499

UP:
KepalaDivisiOperasi I

12. Dispute Settlement : 1. Amicable Settlement

a. The Parties agree to seek to resolve any Dispute

arising between them by mutual consultation, to
be commenced by the delivery of a written notice
by one Party to the other that a Dispute has arisen.

b. If the Parties thereto are unable to settle a Dispute

through mutual consultation within 7 (seven) Days
of delivery of the written notice of dispute pursuant
to the the preceding paragraph, then any Party to
the Dispute may refer the Dispute in writing to a
committee comprising one director/senior
manager of each of the Parties to the Dispute,
which directors/senior managers shall not be
involved in the day to day running and/or
management of this Agreement ("Management
Committee") with a copy of the notice of referral
to the other Party. The Management Committee
shall convene at a mutually agreed venue within 7
(seven) Days of the notice of referral to consider
the information available in order to provide a
written opinion on the Dispute within 21 (twenty
one) Days of the notice of referral. The Parties
may agree to longer periods for convening the
Management Committee and for it to form an
opinion.

c. If, within such twenty-one (21) Day or longer period

as aforesaid, a unanimous written decision is
reached by the Management Committee, signed
by all members of the Management Committee
and expressly stating that the decision resolves the
 Dispute, such decision shall be final and binding
on the Parties. No other kind of decision, opinion,
award or findings by the Management Committee
or any of its members shall be binding on the
Parties.

2. DIspute Settlement

a. Any Dispute that cannot be resolved by the Parties

under Special Provision 12, paragraph 1 (including
where the Management Committee does not reach
an unanimous decision), shall (on the basis that a Party
wishes to pursue the Dispute) be referred to and finally
resolved by arbitration in accordance with this Special
Provision.

b. If in such 30 (thirty) Days the deliberation to reach a

consensus fails to reach a mutual agreement, the
Parties agree to settle such dispute through District
Court in Jakarta.

(SLR requesting to change the location into Singapore:

4. Dispute resolution done in Singapore rather than in
Indonesia
Our response:
4. Our headquarters also want PT. SLR to reconsider the
possibility to settle the dispute in Indonesia. If we really have
to agree to do the dispute settlement in Singapore, it should
have limited to the Singapore arbitration only, not the
Singapore court neither the Singapore law. However, we
believe on this project, we do not expect disagreements to go
so far before a mutual solution is found.)

13. Named Sub- Names Sub-Contractors referred to in Article 3B,

Contractors paragraph 4 are as follows:
 PT Manggala Usaha Manunggal as a Base A Material
supplier.

14. Penalty for late The Company shall pay a delay penalty of 1‰ (one per
payment mille) of the late payment for each day of delay.
Appendix A - Specifications
Appendix B – [INSERT]
Appendix C - Site
 Appendix D - Health, Safety and the Environment

The use or existence of fire-arms or weapons including, but not limited to, long knives, guns,
rifles, cross-bows, bow and arrows, snare trap with toxic bait, and others are forbidden. Any
person found to be in possession of such weapons on the Work Site shall be removed
immediately.

The consumption of alcohol or drugs in the Work Site is prohibited. Any person suspected to
be under the influence of alcohol or drugs shall be immediately dismissed and the
applicable Authority shall be informed.

Food shops or places of entertainment shall not be established in any area around the Work
Site or along the access roads. The Contractor is permitted to hold reasonable dining
facilities for the exclusive use of its employees and Sub-Contractors with the prior written
approval of the Company.

The Contractor must provide safe access facilities to all places where the Contractor's
employees or agents and the Sub-Contractors and their employees and agents from time to
time carry out all the Work under the Agreement.

The Contractor must ensure that all tackles, tools, gear, scaffolds, staging, ladders,
hydraulics, machines, explosives, mechanic and electric equipments, plant, machines and
other Contractor's Equipment shall always be safe and well-maintained and shall be used
and stored in safe manner and so that they do not block any road or disrupt any vehicle or
foot traffic.

The Contractor shall not leave the work items or Work under the Agreement that in an
unsafe condition or condition which may cause personal injury or damage to other existing
works, plant, machine or equipment.

Every person being under the responsibility of the Contractor who does not comply the
regulations and directions as referred to above shall be highly prohibited from entering the
Work Site. Such prohibition shall not prejudice the Contractor’s responsibility in relation to the
performance of Work and the fulfillment of his obligations under this Agreement.

The Contractor must provide first aid training to each employee within the first 7 (seven)
Days of their employment and thereafter provide further first aid training annually.

In collaboration with local health authorities, the Contractor shall ensure that medical staff,
first aid facilities, sick bay and ambulance service are available at all times at the Site and at
any accommodation for Contractor's and Employer's Personnel, and that suitable
arrangements are made for all necessary welfare and hygiene requirements and for the
prevention of epidemics.

The Contractor shall appoint an accident prevention officer at the Work Site, responsible for
maintaining safety and protection against accidents. This person shall be qualified for this
responsibility, and shall have the authority to issue instructions and take protective measures
to prevent accidents. Throughout the execution of the Works, the Contractor shall provide
whatever is required by this person to exercise this responsibility and authority.

The Contractor shall send, to the Company, details of any accident as soon as practicable
after its occurrence. The Contractor shall maintain records and make reports concerning
health, safety and welfare of persons, and damage to property, as the Company may
reasonably require.

All garbage shall be properly disposed of by the Contractor in accordance with all Laws
and Approvals.

All construction waste shall be sanitized at the Work Site by the Contractor and disposed of
to an area designated by the Company. The Contractor shall be responsible for covering
the area with landfill.

All tools and materials shall be kept in good and tidycondition. The Contractor shall at all
times maintain the cleanliness of the Work Site.

Only defined roads and access ways can be used for the entrance to and exit from the
Work Site. Vehicles and pedestrians are not allowed to use shortcuts through the woods or
other unmarked areas.

It is not permitted to keep pets within the Work Site.

The Contractor and its Sub-Contractors shall not bring plants, grass or land materials onto the
Work Site without the prior written approval of the Company.

The Contractor shall not construct any building for personal purposes within the Work Site.
Temporary buildings such as any offices in the Work Site must have a suitable lock. The
location of any offices on the Work Site shall be agreed by the Company in advance.

Contractor must develop comprehensive fire fighting and protection plan.

The Contractor must seek written permission from the Company prior to cutting down any
trees on the Work Site or removal of any other plants, flora or fauna. The Contractor shall be
responsible for and shall indemnify the Company from and against any and all expenses,
liabilities, losses, claims and proceedings whatsoever resulting from the imposition of any
fines or sanctions resulting from the cutting down of trees or removal of plants, flora or fauna
without the permission of the Company.

The Contractor should ensure the protection of all wildlife on and around the Work Site.

The Contractor should take all necessary steps to protect the privacy and quiet enjoyment
of all local residents. The Contractor’s personnel and Sub-Contractors must not trespass on
any other property or interfere with livestock of the any local residents.
Appendix E – Advance Payment Bond

ADVANCE PAYMENT BOND

DATED [•]

[•]
AND
PT. SRIWIJAYA LINTAS RAYA

ADVANCE PAYMENT BOND

THIS BOND is dated [•]
PARTIES
(1) [•] whose principal office is at [•] (the "Bank"); and
(2) PT. SRIWIJAYA LINTAS RAYA,a company organized and existing under the laws of [•]
and having its registered office at [•] (the"Beneficiary") which expression shall include
its successors in title, transferees and assigns.
(A) By a contract entered into or to be entered into between (1) the Beneficiary and (2)
[•] (the "Contractor"), the particulars of which are set out in Annexure 1 (the
"Contract"), the Contractor has agreed with the Beneficiary to carry out and
complete certain works (the "Works") upon and subject to the terms and conditions
therein contained.
(B) The Bank has agreed, at the request of the Contractor, to enter into this on-demand
Bond in favour of the Beneficiary.
OPERATIVE PROVISIONS
1. In this Bond words and expressions, if not otherwise defined, shall have the meanings
(if any) given to them in the Contract and:
"Bond Amount" means the amount specified in Annexure 1.
"Business Day" means a day other than Saturday or Sunday on which banks generally
are open for inter-bank business in Indonesia/or a public holiday in Indonesia.
"Expiry Date" means the expiry date specified in Annexure 1.
"Maximum Bond Amount" means the amount specified in Annexure 1.
2. The Bank hereby irrevocably and unconditionally undertakes to pay to the
Beneficiary upon the Business Day immediately following the Business Day on which it
receives a written demand from the Beneficiary in accordance with clause 4 below
an amount equal to the lesser of:
(a) the amount specified in such demand; and
(b) the Bond Amount less the aggregate of all previous payments made under
this Bond.
3. The Bank's obligation to make payments under this Bond shall arise on receipt of a
demand made in accordance with provisions of this Bond without any further proof
or condition and without any right of deduction, set-off or counterclaim, and the
Bank shall not be required or permitted to make any other investigation or enquiry.
4. The Beneficiary may make one or more demands hereunder. Each demand shall be:
(a) substantially in the form set out in Annexure 2; and
(b) delivered to the Bank on a Business Day and during normal banking hours at
its offices specified in clause 10 below (or such other office of the Bank in [•]
as the Bank may from time to time notify to the Beneficiary).
5. The maximum aggregate liability of the Bank under this Bond shall not exceed the
Maximum Bond Amount.
6. This Bond is irrevocable. It will take effect on the date hereof and (unless previously
cancelled by the written agreement of the Bank and the Beneficiary) will expire on
the earliest of:
(a) the Expiry Date; and
(b) the date on which all payments made under this Bond shall equal the Bond
Amount.
The expiry of the Bond under clause 6(a) above shall not affect or discharge the
liability of the Bank to make payment of any demand made or any potential
demand notified in accordance with the provisions of clauses 2 and 4 on or before
the Expiry Date.
7. All payments to be made by the Bank under this Bond shall be made to the account
specified in the relevant demand and within one (1) Business Day immediately
following the date of each demand becoming effective in accordance with clause
4, failing which interest shall accrue daily on the unpaid balance at a rate of five
percent (5%) above the base lending rate from time to time of the Bank of [•] until
payment is made in full by the Bank.
8. The Beneficiary may assign, charge or transfer its rights and benefits under this Bond,
without the consent of the Bank, to any party whatsoever. The Bank shall be notified
of any such assignment or transfer in writing. Until any such notice has been delivered
to the Bank, the Bank shall not be required to recognise any such assignee as entitled
to issue a demand under this Bond.
The Bank may not assign, charge or transfer its rights or benefits under this Bond.
9. Subject to this Bond, a notice under or in connection with this Bond (a "Notice") (other
than demands made under clauses 2 and 4):
(a) shall be in writing;
(b) shall be in the English language; and
(c) shall be delivered personally or sent by first class post (and air mail if overseas)
or by facsimile transmission to the party due to receive the notice to the
address specified in clause 10 or to another address specified by that party by
not less than seven (7) days' written notice to the other party received before
the notice was despatched.
10. The address referred to in clause 9 is:
(a) In the case of the Bank:
Address: [•]
Fax: [•]
Marked for the attention of [•]
and a copy to
Address: [•]
Fax: [•]
Marked for the attention of [•]
(b) In the case of the Beneficiary:
Address: [•]
Fax: [•]
Marked for the attention of: [•]
With a copy to:
[•]
Marked for the attention of: [•]

11. All payments under this Bond shall be made free and clear of any withholding or
deduction on account of tax or otherwise.
12. This Bond and all non-contractual obligations arising from or connected with it are
governed by the law of the Republic of Indonesia.
13. The courts of Indonesia have exclusive jurisdiction to settle any dispute arising from or
connected with this Bond (a "Dispute") (including a dispute regarding the existence,
validity or termination of this Bond or the consequences of its nullity).
14. The parties agree that the courts of Indonesia are the most appropriate and
convenient courts to settle any Dispute and that they will not argue to the contrary.
15. This clause is for the benefit of the Beneficiary only. Notwithstanding clause 13, the
Beneficiary is not prevented from taking proceedings relating to a Dispute in any
other court with jurisdiction. To the extent allowed by law, the Beneficiary may take
concurrent proceedings in any number of jurisdictions.
16. Except as provided in this Bond, a person who is not a party to this Bond has no right
under the Contracts (Rights of Third Parties) Act (Ch 53B) (or any re-enactment or
remaking thereof) to enforce any term of this Bond.
17. This Bond is delivered as a deed on the date written at the start of this Bond.
 ANNEXURE 1

Contract Particulars
Date: [•]
Between: The Beneficiary and the Contractor

Subject: [•]
Contract Price: USD [•]
Bond Particulars
Expiry Date: The date on which the Contractor becomes
entitled to receive the Operational
Handover Certificate pursuant to the
Contract.
Bond Amount: On the date of this Bond [•].
Maximum Bond Amount: [•].
 ANNEXURE 2
FORM OF DEMAND

To: [insert details of the Bank]

Dear Sirs
Re: the Advance Payment Bond dated [•] issued by [•] Bank in favour of PT. SRIWIJAYA
LINTAS RAYA ("the Bond")
We hereby demand the amount of USD [•] under the Bond.
Payment should be made to Account Number [•] Sort Code [•], designated or named [•] at
[•] Bank [address].
Yours faithfully

for and on behalf of

PT. SRIWIJAYA LINTAS RAYA

EXECUTED AND DELIVERED AS A DEED: )

[BANK] acting by )
……………………………………………… who, in
accordance with the laws of [•], is acting
under the authority of [BANK]

Signature of Authorised Signatory

Witness

EXECUTED AND DELIVERED AS A DEED: )

PT. SRIWIJAYA LINTAS RAYA acting by )

……………………………………………… who, in
accordance with the laws of [•], is acting
under the authority of PT. SRIWIJAYA LINTAS
RAYA

Signature of Authorised Signatory

Witness
Appendix F – Performance Bond

DATED [•]

[•]
AND
PT. SRIWIJAYA LINTAS RAYA

ON DEMAND PERFORMANCE BOND

THIS BOND is dated [•]
PARTIES
(1) [•] whose principal office is at [•] (the "Bank"); and
(2) PT. SRIWIJAYA LINTAS RAYA, a company organized and existing under the laws of [•]
and having its registered office at [•] (the"Beneficiary") which expression shall include
its successors in title, transferees and assigns.
(A) By a contract entered into or to be entered into between (1) the Beneficiary and (2)
[•] (the "Contractor"), the particulars of which are set out in Annexure 1 (the
"Contract"), the Contractor has agreed with the Beneficiary to carry out and
complete certain works (the "Works") upon and subject to the terms and conditions
therein contained.
(B) The Bank has agreed, at the request of the Contractor, to enter into this on-demand
Bond in favour of the Beneficiary.
OPERATIVE PROVISIONS
1. In this Bond words and expressions, if not otherwise defined, shall have the meanings
(if any) given to them in the Contract and:
"Bond Amount" means the amount specified in Annexure 1.
"Business Day" means a day other than Saturday or Sunday on which banks generally
are open for inter-bank business in Indonesia/or a public holiday in Indonesia.
"Expiry Date" means the expiry date specified in Annexure 1.
2. The Bank hereby irrevocably and unconditionally undertakes to pay to the
Beneficiary upon the Business Day immediately following the Business Day on which it
receives a written demand from the Beneficiary in accordance with clause 4 below
an amount equal to the lesser of:
(a) the amount specified in such demand; and
(b) the Bond Amount less the aggregate of all previous payments made under
this Bond.
3. The Bank's obligation to make payments under this Bond shall arise on receipt of a
demand made in accordance with provisions of this Bond without any further proof
or condition and without any right of deduction, set-off or counterclaim, and the
Bank shall not be required or permitted to make any other investigation or enquiry.
4. The Beneficiary may make one or more demands hereunder. Each demand shall be:
(a) substantially in the form set out in Annexure 2; and
(b) delivered to the Bank on a Business Day and during normal banking hours at
its offices specified in clause 10 below (or such other office of the Bank in [•]
as the Bank may from time to time notify to the Beneficiary).
5. The maximum aggregate liability of the Bank under this Bond shall not exceed the
Bond Amount.
6. This Bond is irrevocable. It will take effect on the date hereof and (unless previously
cancelled by the written agreement of the Bank and the Beneficiary) will expire on
the earliest of:
(a) the Expiry Date; and
(b) the date on which all payments made under this Bond shall equal the Bond
Amount.
The expiry of the Bond under clause 6(a) above shall not affect or discharge the
liability of the Bank to make payment of any demand made or any potential
 demand notified in accordance with the provisions of clauses 2 and 4 on or before
the Expiry Date.
7. All payments to be made by the Bank under this Bond shall be made to the account
specified in the relevant demand and within one (1) Business Day immediately
following the date of each demand becoming effective in accordance with clause
4, failing which interest shall accrue daily on the unpaid balance at a rate of five
percent (5%) above the base lending rate from time to time of the Bank of [•] until
payment is made in full by the Bank.
8. The Beneficiary may assign, charge or transfer its rights and benefits under this Bond,
without the consent of the Bank, to any party whatsoever. The Bank shall be notified
of any such assignment or transfer in writing. Until any such notice has been delivered
to the Bank, the Bank shall not be required to recognise any such assignee as entitled
to issue a demand under this Bond.
The Bank may not assign, charge or transfer its rights or benefits under this Bond.
9. Subject to this Bond, a notice under or in connection with this Bond (a "Notice") (other
than demands made under clauses 2 and 4):
(a) shall be in writing;
(b) shall be in the English language; and
(c) shall be delivered personally or sent by first class post (and air mail if overseas)
or by facsimile transmission to the party due to receive the notice to the
address specified in clause 10 or to another address specified by that party by
not less than seven (7) days' written notice to the other party received before
the Notice was despatched.
10. The address referred to in clause 9 is:
(a) In the case of the Bank:
Address: [•]
Fax: [•]
Marked for the attention of [•]
and a copy to
Address: [•]
Fax: [•]
Marked for the attention of [•]
(b) In the case of the Beneficiary:
Address: [•]
Fax: [•]
Marked for the attention of: [•]
With a copy to:
[•]
Marked for the attention of: [•]
11. All payments under this Bond shall be made free and clear of any withholding or
deduction on account of tax or otherwise.
12. This Bond and all non-contractual obligations arising from or connected with it are
governed by the law of the Republic of Indonesia.
13. The courts of Indonesia have exclusive jurisdiction to settle any dispute arising from or
connected with this Bond (a "Dispute") (including a dispute regarding the existence,
validity or termination of this Bond or the consequences of its nullity).
14. The parties agree that the courts of Indonesia are the most appropriate and
convenient courts to settle any Dispute and that they will not argue to the contrary.
15. This clause is for the benefit of the Beneficiary only. Notwithstanding clause 13, the
Beneficiary is not prevented from taking proceedings relating to a Dispute in any
other court with jurisdiction. To the extent allowed by law, the Beneficiary may take
concurrent proceedings in any number of jurisdictions.
16. Except as provided in this Bond, a person who is not a party to this Bond has no right
under the Contracts (Rights of Third Parties) Act (Ch 53B) (or any re-enactment or
remaking thereof) to enforce any term of this Bond.
17. This Bond is delivered as a deed on the date written at the start of this Bond.
 ANNEXURE 1

Contract Particulars
Date: [•]
Between: The Beneficiary and the Contractor

Subject: [•]
Contract Price: USD $[•]
Bond Particulars
Expiry Date: The date on which the Contractor becomes
entitled to receive the Operational
Handover Certificate pursuant to the
Contract.
Bond Amount: On the date of this Bond [•].
 ANNEXURE 2
FORM OF DEMAND

To: [insert details of the Bank]

Dear Sirs
Re: the Performance Bond dated [•] issued by [•] Bank in favour of [•]("the Bond")
We hereby demand the amount of USD [•] under the Bond.
Payment should be made to Account Number [•] Sort Code [•], designated or named [•] at
[•] Bank [address].
Yours faithfully

for and on behalf of

[•]
EXECUTED AND DELIVERED AS A DEED: )

[BANK] acting )
by……………………………………………… who, in
accordance with the laws of [•], is acting
under the authority of [BANK]

Signature of Authorised Signatory

Witness

EXECUTED AND DELIVERED AS A DEED: )

PT. SRIWIJAYA LINTAS RAYA acting by )

……………………………………………… who, in
accordance with the laws of [•], is acting
under the authority of PT. SRIWIJAYA LINTAS
RAYA

Signature of Authorised Signatory

Witness