37
D R A F T S U P P L Y C O N T R A C T V - 6730 hereby entered into by and between Purchaser RUPALI POLYSTER Ltd. 241-242, UPPER MALL SCHEME ANAND ROAD, LAHORE – 54000 PAKISTAN (hereinafter referred to as “PURCHASER”) and DEUTZ POWER SYSTEMS GMBH CARL BENZ STRASSE 1 D-68167 MANNHEIM FEDEARL REPUBLIC OF GERMANY (hereinafter referred to as “SUPPLIER”) (PURCHASER and / or SUPPLIER hereinafter jointly or individually referred to as “PARTY(IES)”)

080602 Deutz Supply Systems - Gensets Supply Contract Mnz 1st Draft

Embed Size (px)

DESCRIPTION

legal

Citation preview

2nd Draft dated 21st April 2006

145Page - -

D R A F TS U P P L Y C O N T R A C T V - 6730

hereby entered into by and between

Purchaser

RUPALI POLYSTER Ltd.

241-242, UPPER MALL SCHEMEANAND ROAD, LAHORE 54000 PAKISTAN(hereinafter referred to as PURCHASER)

and

DEUTZ POWER SYSTEMS GMBHCARL BENZ STRASSE 1D-68167 MANNHEIMFEDEARL REPUBLIC OF GERMANY(hereinafter referred to as SUPPLIER)

(PURCHASER and / or SUPPLIER hereinafter jointly or individually referred to as PARTY(IES))

Table of content1.DEFINITIONS... 3 2.Subject of the Contract 63.Terms of delivery and delivery dates... 84.Contract Price... 115.Terms of payment.116.Variations and SUSPENSION... 127.Risk of loss.13 8.Warranty..14 9.Acceptance.1510.Overall limitation of Liability..17 11.TERMINATION OF THE CONTRACT....1812.Force Majeure1913.OFFICIAL APPROVALS.. 2014.REPRESENTATIVES... 2015.Collateral agreements and effectiveness of the Contract.2016.Applicable law and Jurisdiction2117.TAXES. 2118.PATENTS AND USE OF DOCUMENTATION. 2219.ASSIGNMENT AND SUB_LETTING. 2220.EFFECTIVE DATE OF CONTRACT22LIST OF AnnexesAnnex I Scope of Supply of GENSETS and SUPERVISIONAnnex II Technical Description TD | 6730 | i1 | 2008Annex III .Form of Letter of CreditAnnex IV Acceptance ParametersAnnex V..Battery Limit

Annex VIProject Time Schedule

Annex VIIContract Price and Terms of Payment

Annex VIII.Engineering

Annex IX.Commissioning Procedure

Annex XSpare Parts

Annex XI...Performance Bond

Preamble

IWHEREAS the RUPALI POLYESTER LIMITED is a public company limited by shares incorporated and existing under the laws of the Islamic Republic of Pakistan and has its head office at________________________________; andII. WHEREAS the DEUTZ POWER SYSTEMS GMBH is a company incorporated and existing under the laws of the Federal Republic of Germany having its head office at Carl Benz Strasse 1, D-68167 Mannheim, Federal Republic Of Germany; andIII. WHEREAS the PURCHASER intends to purchase from the SUPPLIER GENSETS and SUPERVISION, which are highly developed and tested to each customers specific requirements. SUPPLIERs GENSETS are designed for stationary, continuous duty operation, and are characterized by particularly high efficiencies, low emissions and high durability and reliability; andIV.WHEREAS the PURCHASER has/is going to purchase(d) certain GENSETS, SUPERVISON from the SUPPLIER, so that the PURCHASER will get the plant for generation of electricity, which will work in harmony and in a synchronized manner with the existing power plant of the PURCHASER.NOW THEREFORE, IN CONSIDERATION OF THE PROMISES AND MUTUAL AGREEMENT HEREIN CONTAINED THE PARTIES AGREE AS FOLLOWS:WITNESSETH THAT:1. DEFINITIONS

The following terms with capital letters shall have the meanings defined below unless in any particular instance the CONTRACT expressly indicates otherwise. Words importing persons include corporations and words importing the singular include the plural and vice versa where the context requires.

1.1 Acceptance- Shall mean the event of signing a certificate of the GENSETS; it shall also mean the event on which, according to the stipulations of the CONTRACT, all the GENSETS are deemed to be accepted.1.2 APPLICABLE RULES Shall mean IEC codes, standards and regulations as far as this CONTRACT provides for their application to the performance of the CONTRACT and Laws and Regulations being in force in Pakistan to the extent they are mandatory for the performance of the CONTRACT.

1.3 AMENDMENT Shall mean document signed by the PARTIES, which introduces modifications to the CONTRACT or any CONTRACT element in accordance with Article __.1.4 BATTERY LIMITS- Shall mean as defined in Annex V1.5 CHANGE ORDER Shall mean any request by the PURCHASER to the SUPPLIER for a change, modification, addition or deletion with respect to the GENSETS that affects the CONTRACT PRICE, the PROJECT TIME SCHEDULE (APPENDIX VI), any of the ACCEPTANCE PARAMETERS (Annex IV) or any material right or obligation of either PARTY.

1.6 CONTRACT Shall mean all the terms and provisions appearing in the Articles of this document and Annexes hereto.

1.7 CONTRACT PRICE Shall mean the fixed amount to be paid by PURCHASER to SUPPLIER for the GENSETS as described in CONTRACT PRICE AND TERMS OF PAYMENT SCHEDULE (APPENDIX VII).

1.8 COMMISSIONING Shall mean the operation of the GENSETS until PROVISIONAL TAKE OVER, during which period also the PERFORMANCE and RELIABILITY TESTS will take place. 1.9 DELIVERY Shall mean terms as defined in Article 3.

1.10 GENSETS Shall mean industrial/commercial ___ number of Turbo Charged Engine Generator Sets model ___________ more particulary described in Scope of Supply (Annex I) & Technical Description (Annex II).

1.11 ERECTION Shall mean the installation by PURCHASER, of all GENSETS and materials forming all together the GENSETS, including MECHANICAL TESTS, under the SUPERVISION of the INSTALLTION ADVISOR appointed by the SUPPLIER and in accordance with the written instructions contained in the Technical Description (Annex II);

1.12 FACTORY TEST Shall mean testing of GENSETS as defined in Technical Description (Annex II).

1.13 FINAL ACCEPTANCE Shall mean the time at which the PURCHASER accepts the GENSETS after the expiration of the WARRANTY PERIOD

1.14 MECHANICAL COMPLETION Shall mean the state and/or the date when all GENSETS have been erected and installed. 1.15 MECHANICAL TESTS shall mean the running of individual GENSETS and materials (including the GENSETS), with water, electricity, air, no-load tests, loop tests, and/or whatever else is required to check and to verify the MECHANICAL COMPLETION and the mechanical readiness of all the GENSETS and materials (including the GENSETS) for START-UP under the SUPERVISION of the SUPERVISOR, all as specified in the Commissioning Procedure (Annex IX);

1.16 PERFORMANCE BOND shall mean as defined in Clause 4.5;1.17 PERFORMANCE AND RELIABILITY TESTS - Shall mean test executed according to Clause 9.7 below and Commissioning Procedure (Annex IX).

1.18 PROJECT TIME SCHEDULE (Annex VI) - Shall mean the schedule for delivery performance of the GENSETS.

1.19 PRODUCT(S) Shall mean electrical power as the context may provided, specified and guaranteed in Appendix IV for the industrial/commercial use in the Industry.

1.20 PROVISIONAL TAKE OVER Shall mean the successful completion of the COMMISSIONING, START UP and Test Run.

1.21 PURCHASER Shall mean RUPALI POLEYSTER LIMITED1.22 RISK Shall mean as defined per DELIVERY term and Incoterms 2000.

1.23 SITE Shall mean the actual place where the GENSETS is to be erected.

1.24 SPARE PARTS Shall mean those items which are mutually agreed between the SUPPLIER and the PURCHASER to be the replacement parts of the GENSETS as per Appendix X.

1.25 SUB-SUPPLIER(S) Shall mean all persons and companies and their employees, used by the SUPPLIER in accordance with the CONTRACT to perform the GENSETS supply.

1.26 SUPERVISOR(S) Shall mean person(s) with adequate technical knowledge acting on behalf of SUPPLIER for carrying out the SUPERVISION to fulfill its obligation under this CONTRACT on the SITE in Pakistan as per Article 1.28, Article 2.7 and Annex 1.

1.27 SUPERVISION Shall mean the technical services, direction, instructions, advise, guidance, and supervision for the purposes of ERECTION, MECHANICAL TESTS, MECHANICAL COMPLETION, COMMISSIONING, START-UP, operation and conduct of PERFORMANCE and RELIABILITY TESTS of the GENSETS till PROVISIONAL TAKE OVER as specified in Article 9.7.

1.28 SUPPLIER Shall mean DEUTZ Power Systems Gmbh.

1.29 WARRANTY PERIOD Shall mean the period defined in Article 7.2.

1.30 WORK or WORKS Shall mean all the GENSETS and any services to be supplied by the SUPPLIER under this CONTRACT.

1.31 CFR shall mean Cost and Freight as is further specified as per INCOTERMS 2000;

1.32 CPT shall mean Carriage Paid To as is further specified as per INCOTERMS 2000;

1.33 DDP shall mean Delivered duty paid as is further specified as per INCOTERMS 2000;

1.34 DDU shall mean Delivered duty unpaid as is further specified as per INCOTERMS 2000;

1.35 EXW shall mean Ex Works as is further specified as per INCOTERMS.

2.Subject of the Contract2.1 Subject to the terms and conditions of this Supply Contract, the SUPPLIER agrees to supply to the PURCHASER, the SUPPLIER design, know-how, basic and detail engineering in the form of technical documentation, manufacture and deliver the GENSETS and to perform the SUPERVISION through SUPERVISOR of ERECTION and installation of the GENSETS as specified in Annex I to this Contract and the PURCHASER agrees to purchase and receive the SUPPLIER design, know-how, basic and detail engineering in the form of technical documentation, manufacture and delivery of such GENSETS and SUPERVISION to be performed by the SUPPLIERs SUPERVISOR of the ERCETION and installation of the GENSETS as specified in Annex I to this Contract, including all items tools, spare parts and consumable spare parts, as specified in Annex X, to be used for a PURCHASER power plant in ___________, Pakistan, for the production of electric power as per the requirement of the PURCHASER. 2.2 Any GENSETS or material which is required to construct the GENSETS within BATTERY LIMIT so that it can fulfill the ACCEPTANCE PARAMETERS as specified in Annex IV and which is not specified by the SUPPLIER in ANNEX I shall be provided by the SUPPLIER, free of any costs, to the PURCHASER, and at his own expense, DDU Karachi Port. In case of delivery of such additional GENSETS or material not specified in ANNEX I after delivery of the GENSETS has been completed, the SUPPLIER shall make delivery DDP at the GENSETS SITE and PURCHASER will render all required assistance for customs clearance.

1.1 2.3 The SUPPLIER shall ensure that the GENSETS is designed to meet all the physical conditions at SITE, including, but not limited to the kind of climate and utilities etc. available thereon.

2.4 Unless otherwise provided for in this Contract, the SUPPLIERS obligation to perform according to Clause 1.1 is conditioned upon the PURCHASER ensuring:

a) That the employees of the SUPPLIER have safe and unrestricted access to the site on which the GENSETS are to be installed and operated.

b) That all necessary work to be performed by the PURCHASER or other contractors of PURCHASER prior to the performance of the SERVICES by the SUPPLIER have been successfully and entirely completed.

c) That all tools, GENSETS, materials and manpower, which are necessary for the performance of the SERVICES according to Clause 1.1 that the SUPPLIER does not provide under this Contract are provided free of charge and at the risk of the PURCHASER.d) That the PURCHASER provides suitable and lockable storage rooms for GENSETS and apparatus of the SUPPLIER.

2.5 The SUPPLIER shall, in accordance with this CONTRACT and with due care and diligence, deliver the GENSETS within the PROJECT TIME SCHEDULE (APPENDIX VI).2.6SUPPLIER shall supply the consumables SPARE PARTS for up to ______ hours of plant operation along with COMMISSIONING spares as defined in Appendix X and the purchaser shall rely on the list of such SPARE PARTS supplied by the SUPPLIER. 2.7 SUPPLIER undertakes to provide SUPERVISION through SUPERVISOR for the ERECTION and installation of the GENSETS. SUPERVISION to be perform by the SUPERVISOR shall include the following:2.7.1SUPERVISION of ERECTION, MECHANICAL COMPLETION, START-UP, COMMISSIONING and PERFORMANCE and RELIABILITY TESTS of the GENSETS during up to PROVISIONAL TAKING OVER. Cost of such SUPERVISION is included in the CONTRACT PRICE.

2.7.2SUPERVISION of piping works, including fabrication at the SITE during ERECTION of the GENSETS so as to ensure that the GENSETS can achieve the ACCEPTANCE PARAMETERS as specified in Annex IV.

2.7.3Assistance in working out and updating of the GENSETS START-UP in accordance with Annex IX from the view point of GENSETS PROVISIONAL TAKING OVER.

2.7.4Fine tuning of process control and other instrumentation of the GENSETS.

2.7.5Any other SUPERVISION required to be provided to the PURCHASER in order to accomplish ERECTION and COMMISSIONING of the GENSETS within the BATTERY LIMIT.

2.7.6During the whole period of SUPERVISION the GENSETS shall be under the charge of the SUPERVISOR and the PURCHASER shall not act in any manner contrary to the instructions, guidance and advice issued by the SUPERVISOR in writing

2.7.7The SUPERVISOR shall bring along with them any special tools which are required for the performance of their duties.2.7.8In the event, the advice and instructions of the SUPERVISOR (S) appointed by the SUPPLIERS are not followed or complied with, at the earliest opportunity as soon as the defect is located by the said SUPERVISOR (S), then the SUPERVISOR (S) of the SUPPLIER shall make a report in writing to the PURCHASER and the PURCHASER shall as soon as possible rectify the defect.2,8INFORMATION, DRAWINGS AND DATA

2.8.1The PURCHASER is responsible for providing required information for the SUPPLIER to fulfill his obligations according to Project Time Schedule, as specified in the Annex VI.

2.8.2.The SUPPLIER will send Technical Description of the GENSETS in accordance with Project Time Schedule (Annex VI). Any comments the PURCHASER might have to these drawings shall be remitted within fourteen (14) days after receipt, otherwise they are be deemed to be approved.

2.8.3The SUPPLIER shall be responsible for any discrepancies, errors and omissions in his drawings and information, whether the PURCHASER has approved them or not.

2.8.4The PURCHASER shall be responsible for the drawings and information supplied in writing by the PURCHASER.

2.8.5Notwithstanding anything contained hereinabove, any documents, drawings, information etc provided by the PURCHASER to the SELLER in respect of the GENSETS or otherwise in relation to this CONTRACT shall not absolve, exonerate or discharge the SUPPLIER liability and obligations under this CONTRACT and under any other law for the time being in force in respect of such GENSETS.

2.9INSPECTION

2.9.1The PURCHASER is entitled to physically review relevant progress of the manufacture of the GENSETS. For this purpose the PURCHASER having provided reasonable notice to the SUPPLIER shall have access to the said workshop during normal business hours, but without interfering with the progress of the GENSETS manufacture.

2.9.2The SUPPLIER shall give the PURCHASER notice in writing at least two (2) weeks before any FACTORY TEST of the GENSETS that are subject to FACTORY TEST and which must be at least one (1) month before the dispatch EXW.

2.9.3Notwithstanding anything contained hereinabove, PURCHASER inspection or failure to inspect the GENSETS shall not absolve, exonerate or discharge the SUPPLIER liability and obligations under this CONTRACT and under any other law for the time being in force in respect of such GENSETS.3.Terms of delivery and delivery dates

3.1Delivery of the GENSETS will be effected in accordance with and be subject to CFR Sea Port Karachi, Pakistan condition according to INCOTERM.

3.2The following delivery of the are agreed

Ex-Works delivery of the GENSETS according to Annex 1 will be 5-6 months (to be agreed) after Contract effective date.

3.3Compliance with the Project Time Schedule (Annex VI) by the SUPPLIER is conditioned upon PURCHASERS fulfilling its contractual obligations under this Contract.

3.4In the event the SUPPLIER fails to deliver the GENSETS on the delivery dates due to the negligence of the SUPPLIER the PURCHASER shall be entitled to claim liquidated damages for delayed delivery at a rate of 0.50% of the CONTRACT PRICE for every full week of delay. If the delivery of the GENSETS is delayed beyond twelve weeks (12) the PURCHASER shall have the right to terminate the CONTRACT. The payment of liquidated damages shall not absolve the SUPPLIER from its obligations to deliver the delayed portion of the GENSETS (Annex I) and/or Technical Description (Annex I).3.5 The SUPPLIER must ensure that the GENSETS shall be packed to as per export standard sea worthy packing which is fit for the purpose for transport of such like GENSETS. An international inspection company, acceptable to the SUPPLIER will supervise the packaging procedure. A report regarding the quality of the packaging procedure and completeness of the GENSETS will be forwarded to the PURCHASER. All costs arising from these services shall be borne by the SUPPLIER.

3.6 SUPPLIER shall provide the following documentation commercial invoice, packing list, European Certificate of Origin (if required) Bill of Lading and any other documents required by the PURCHASER for the importation of the GENSETS.

3.7 If the SUPPLIER is responsible for any shortages or errors in GENSETS as specified in Annex I, the SUPPLIER shall deliver the missing parts DDP SITE Pakistan.

3.8 The PURCHASER shall inform SUPPLIER in writing two weeks after the signing of CONTRACT of its requirements as regards the format and contents of the packing lists and shipping invoices and on any important matters to be taken into consideration in this respect. SUPPLIER shall prepare the packing lists and shipping invoices accordingly and shall send to the PURCHASER by courier service or telefax the packing lists and shipping invoices prepared by SUPPLIER for shipment actually dispatched as soon as practical, but in any event prior to submission of these documents to the bank.

3.9Delivery of the Technical Description will be effected by courier service CPT to the Head Office of the PURCHASER.3.10All cases shall be opened at the SITE by the PURCHASER upon arrival of the GENSETS at the SITE. PURCHASER will look for visible outside damage which may have occurred to the cases (or other packing, or to the GENSETS as may be visible from the outside) during transportation and report any such damages detected by telefax or by e-mail to SUPPLIER. Such damage shall, if SUPPLIER so requests, be certified henceforth by an authorized insurance agent to be nominated by SUPPLIER, the equipments concerned shall be kept intact as received until such inspection has taken place or has been waived by SUPPLIER.

3.11If SUPPLIER should not reply to any notification of damage within [twenty (20) days] after receipt of PURCHASERs notification, and/or if SUPPLIER does not dispatch its insurance agent or own personnel to inspect the damage within another [twenty (20)] days, PURCHASER may proceed to carry out such checking of the damage to the GENSETS as PURCHASER may deem appropriate and shall issue a material receiving report incorporating the results of such checking to SUPPLIER and the findings of PURCHASER stated in such material receiving report shall be accepted as conclusive by SUPPLIER.

3.12If at the opening of the cases any damage to the GENSETS or any discrepancy between the contents of the case and the description in the relevant documents, or any short shipment, are found, or if any items in the case cannot be identified by PURCHASER, PURCHASER will call the SUPPLIERs SUPERVISOR available at the SITE to be a witness of such findings or to assist PURCHASER to identify the items concerned; in such case the PURCHASER and the SUPPLIERs SUPERVISOR shall prepare and sign the material receiving report jointly.

3.13Should completion of delivery of the GENSETS as per this section be delayed beyond the delivery dates specified in this CONTRACT due to causes not excused by the provisions of this CONTRACT, the PURCHASER is entitled to liquidated damages of specified in Article 19 for each [full week] of delay. If the delivery of the GENSETS is delayed beyond [twelve (12) weeks] the PURCHASER shall have the right to terminate the CONTRACT.

3.14The payment of Liquidated Damages shall not absolve the SUPPLIER from its obligations to deliver the delayed portion of the EQUIPMENT and/or Technical Specification.2.1 3.15INSTALLATION, COMMISSIONING, TEST AND PROVISIONAL TAKE OVER

3.15.1SUPPLIER shall provide a suitably qualified supervisor.

3.15.2SUPPLIER shall provide suitably qualified commissioning engineer(s).

3.15.3Commissioning, Start Up, Test Run, PERFORMANCE AND RELIABILITY TESTS and PROVISIONAL TAKE OVER of the supplied GENSETS shall be executed in accordance with the Commissioning Procedure.

3.15.4Until PROVISIONAL TAKE OVER, The PURCHASER shall only operate the GENSETS with written approval from the SUPPLIER. 3.15.5The COMMISSIONING of the GENSETS is limited to [24 working] days ([eight hours] per day). In case of delay for reasons not attributable to SUPPLIER but attributable to PURCHASER, the costs of additional working days are to be borne by the PURCHASER. In the case of delay caused by reasons attributable to SUPPLIER and not attributable to PURCHASER the cost of the additional working days shall be borne by the SUPPLIER. In the case of delay caused by reasons attributable to neither SUPPLIER nor PURCHASER an amicable solution shall be found.. the PURCHASER shall inform the SUPPLIER in writing about the date of readiness s of START UP and COMMISSIONING by giving [thirty (30)] days notice in advance.. [Five (5)] days before START UP and COMMISSIONING, the SUPERVISOR shall send to the SUPPLIER and the PURCHASER the completed installation check list, confirming that the mounting and installation has been finalized according to SUPPLIERS Technical Specifications and project related documentation and that all Site facilities necessary for GENSETS operation are ready for continuous and uninterrupted operation.

3.15.6If and when tested the GENSETS fails on COMMISSIONING, START-UP, tests run or fails to achieve the MACHENICAL COMPLETION the SUPPLIER shall be afforded a period of one month or such other period as otherwise agreed between the PARTIES, during which the SUPPLIER at its own costs and expenses can repair, correct and/or adjust the GENSETS, at its own cost and expense, so the GENSETS achieve the COMMISSIONING, START-UP, tests run or achieve the MACHENICAL COMPLETION. During such period the SUPPLIER shall be liable to pay the PURCHASER liquidated damages of @ 0.50 % of the CONTRACT PRICE for each full week which on aggregate shall not exceed in any event 5% of the CONTRACT PRICE during which the SUPPLIER carried out the repairs. If the SUPPLIER fails to rectify such defects within such time period, the PURCHASER may grant an extension of time to SUPPLIER to rectify such defects and charge liquidated damages at the rate mentioned herein above or the PURCHASER may terminate the CONTRACT and shall be entitled to compensation as mentioned in Article 22.3.16INFORMATION, DRAWINGS AND DATA

3.16.1The PURCHASER is responsible for providing required information for the SUPPLIER to fulfil his obligations according to Project Time Schedule, as specified in the same document.

3.16.2The SUPPLIER will send technical specifications of the main GENSETS in accordance with Project Time Schedule, . Any comments the PURCHASER might have to these drawings shall be remitted within fourteen (14) days after receipt, otherwise they are be deemed to be approved.

3.16.3The PURCHASER is entitled to physically review relevant progress of the manufacture of the GENSETS. For this purpose the PURCHASER having provided reasonable notice to the SUPPLIER shall have access to the said workshop during normal business hours, but without interfering with the progress of the GENSETS manufacture.

3.16.4The SUPPLIER shall give the PURCHASER notice in writing at least two (2) weeks before any factory test of the GENSETS that are subject to factory test and which must be at least one (1) month before the dispatch ex works.

3.16.5The SUPPLIER shall be responsible for any discrepancies, errors and omissions in his drawings and information, whether the PURCHASER has approved them or not.

3.16.6The PURCHASER shall be responsible for the drawings and information supplied in writing by the PURCHASER, and shall pay any additional cost incurred by the SUPPLIER due to alterations of the GENSETS, which result from incorrect or incomplete drawings and information.

3.16.7The PARTIES to the CONTRACT shall use SI-units in documentation and correspondence.4.Contract price4.1 The PURCHASER agrees to buy from the SUPPLIER and the SUPPLIER agrees to supply, sell and render the PURCHASER the GENSETS, SPARE PARTs, SUPERVISION and other required services to be rendered by the SUPPLIER as per the Scope of Supply and Technical Descriptions for the total contract price of EURO xxx.xxx.00 (in words: xxxxxxxxxxxxxxxxxxxxxxxxxx).4.2The CONTRACT PRICE is fixed and not subject to escalation.4.3The prices stipulated in clause 3.1 do not include VAT. In case VAT incurred, it shall be added in the amount according to legal regulations.

4.4The CONTRACT PRICE excludes any duties, taxes or levies except those withholding taxes which the PURCHASER is bound by law of Pakistan to deduct.4.5The SUPPLIER shall arrange a PERFORMANCE BOND, in favour of the PURCHASER as follows:

A PERFORMANCE BOND equal to 10% (ten percent) of the CONTRACT PRICE to be issued to the PURCHASER within 30 days of signing the CONTRACT, the wording as per PERFORMANCE BOND (Appendix XII).The PERFORMANCE BOND shall be valid to the end of the WARRANTY period.5.Terms of payment5.1Payment of the CONTRACT PRICE shall be effected by the PURCHASER as set out below.100% of the CONTRACT PRICE shall be paid out of an irrevocable and confirmed documentary sight letter of credit.5.2For the payments specified in this clause 4.1 an irrevocable and confirmed documentary sight letter of credit, acceptable to the SUPPLIER and according to the Annex III, shall be prepared by the PURCHASER and handed over to the SUPPLIER within 20 calendar days after the effective date of this CONTRACT. The letter of credit shall be confirmed by a first class Pakistani bank and shall be valid at least 3 month after the date of delivery according to Clause 3.

5.All L/C charges outside the country of SUPPLIER shall be on PURCHASER account except for confirmation charges, which are on SUPPLIER account. 6.Variations and SUSPENSION

6.1The SUPPLIER may undertake minor variations in the form of technical modifications of the GENSETS and shall inform the PURCHASER thereof, provided these modifications do not result in additional costs to the PURCHASER or in a delay of the GENSETS supply or affect the intended performance of the GENSETS. For major variations the PURCHASERS approval shall be obtained.

6.2

The PURCHASER may place CHANGE ORDER (S) at any time, provided such changes are technically feasible and acceptable to the SUPPLIER. No CHANGE ORDER shall, together with any change/modification already ordered, involve a net addition to or reduction from the CONTRACT PRICE of more than 15% unless the SUPPLIER and PURCHASER agree in writing.

6.3A CHANGE ORDER shall define in writing explicitly the changes required.

6.4Within three (3) weeks after receipt of such CHANGE ORDER the SUPPLIER shall offer in writing an AMENDMENT to this CONTRACT, defining the necessary changes to the GENSETS, the PROJECT TIME SCHEDULE (APPENDIX VI) and any other terms of this CONTRACT and the additional price for such changes, if any.

6.5Within further two (2) weeks the PARTIES shall agree in writing upon an AMENDMENT incorporating the changes.

6.6Until an AMENDMENT is agreed upon, the SUPPLIER shall proceed with the GENSETS supply as if no changes were implied.

6.7When it is necessary to change the GENSETS due to a change in the APPLICABLE RULES becoming effective or taking place after the formal signing of the CONTRACT the PURCHASER is required to raise a CHANGE ORDER in accordance with Article 6.2 above.

6.8SUSPENSION

6.8.1

The PURCHASER may for its convenience or for any other reason whatsoever suspend the carrying out of the manufacture of the GENSETS by the SUPPLIER in whole or in part, at any time, by giving written notice thereof to the SUPPLIER specifying the nature, effective date and anticipated duration of such suspension and the SUPPLIER shall without undue delay give full effect to and comply with such notice of suspension.

6.8.2

The SUPPLIER shall be entitled to suspend the carrying out of the manufacture of the GENSETS in whole or in part by giving written notice thereof to the PURCHASER in the event any payments to the SUPPLIER are not effected within 30 days of the due date as per Article 4. Upon receipt of the amount(s) due from the PURCHASER, the SUPPLIER shall resume the carrying out of the manufacture of the GENSETS forthwith.

6.8.3

In the event of suspension as per Articles 6.8.1 and 6.8.2 above, the PURCHASER shall pay to the SUPPLIER all additional costs and expenses demonstrably accruing to the SUPPLIER as consequence of the cessation and resumption of the manufacture of the GENSETS including costs for proper protection and maintenance of the GENSETS. The PURCHASER shall pay such costs and expenses monthly against invoices provided by the SUPPLIER.

6.8.4In the event of suspension as per Articles 6.8.1 and 6.8.2 above liquidated damages for late delivery shall not be due and payable for the period of the suspension.7.Risk of loss

7.1Risk of loss and damage to the GENSETS shall be transferred to the PURCHASER when the GENSETS is delivered at Site.

7.2Title to the GENSETS shall be transferred to the PURCHASER when the delivered at SITE.

7.3In case of any damage to the GENSETS or any part thereof the SUPPLIER shall up to FINAL ACCEPTANCE arrange for the repair of the GENSETS or part concerned, or deliver replacement for such GENSETS or part thereof DDP SITE at its own cost and expense as specified in the CONTRACT. In case of any shortage or discrepancy the SUPPLIER shall clarify the same. In case of any short shipment or wrong shipment of the GENSETS or any part thereof SUPPLIER shall deliver such short shipped or wrongly shipped GENSETS or part thereof up to acceptance DDP SITE at its own cost and expense as specified in the CONTRACT. However, SUPPLIER may include any such short shipped or wrongly shipped GENSETS or part thereof in the next scheduled shipment (DDU) Karachi if this does not have any adverse effect on the ERECTION schedules.

7.4PURCHASER will accept the repair of the GENSETS only under the following conditions:

a)The repair does not effect the overall life time of the GENSETS.

b)The repair does not reduce the efficiency of the GENSETS.

7.5 In case of any loss of GENSETS or part thereof in the absence of which any SUPERVISOR(S) present at the SITE cannot perform, or continue to perform, his services, the SUPERVISOR(S) shall immediately be sent back to [____________] (or to his other usual place of residence) until such time when their services are required after the replacement of the lost GENSETS or part thereof, provided that the decision to send the SUPERVISOR(S) back shall be made by mutual consultation between SUPPLIER and PURCHASER and only if the replacement cannot be made readily available within such short time that sending back the SUPERVISOR(S) would not be justified economically.

7.6The SUPPLIER shall continue to perform its obligations under the CONTRACT during the time required for replacement of the lost relevant GENSETS or part thereof.

By way of clarification it is agreed that the transfer of risk and ownership of the GENSETS shall not in any manner, absolve the SUPPLIER of its other obligations and liabilities under the CONTRACT.

8.WARRANTY8.1The SUPPLIER warrants that the GENSETS is new and in compliance with the Scope of Supply (Annex I) and Technical Description (Annex II) of the CONTRACT and is free from any defects in design, materials or workmanship and is of satisfactory quality and fit for the purpose.

8.2The SUPPLIER shall at its own expenses shall exchange, replace or repair such parts of the GENSETS which have failed or which have essential impact on their usability during a period of 24 months after the date of commissioning of the GENSETS or and 36 months after the transfer of perils to the PURCHASER, whichever period expires first. 8.3The PURCHASER must promptly notify the SUPPLIER in writing of obvious defects or deficiencies after detection thereof. Replaced parts shall become the property of the SUPPLIER.

8.4The SUPPLIER is not liable for defects or deficiencies which are resulting from the following reasons, as long as they are not resulting from a default of the SUPPLIER; Importer, unsuitable or negligent use, handling and/or operation of the GENSETS by the PURCHASER or third parties; improper or faulty installation respectively commissioning by the PURCHASER or third parties; use of spare parts other than Genuine DEUTZ Power Systems Parts; normal wear and tear; use of unsuitable consumables (such as, fuel, oil, cooling liquid or any other consumables), particularly the use of consumables not conciliated in the operation manuals; improper building ground; chemical; electro-chemical or electric influences.8.5The SUPPLIER shall at its own costs and expense rectify defects for which the SUPPLIER is responsible according to this Article, within one month or other such time to be agreed in advance between the SUPPLIER and the PURCHASER. During such period the SUPPLIER shall be liable to pay the PURCHASER liquidated damages of @ 0.50 % of the CONTRACT PRICE for each full week which on aggregate shall not exceed in any event 5% of the CONTRACT PRICE during which the SUPPLIER carried out the repairs. If the SUPPLIER fails to rectify such defects within such time period, the PURCHASER may grant an extension of time to SUPPLIER to rectify such defects and charge liquidated damages at the rate mentioned herein above or the PURCHASER may terminate the CONTRACT and shall be entitled to compensation as mentioned in Article 10.7. The costs for the rectifying the defects shall be born by the SUPPLIER. If the SUPPLIER neglects to rectify such defects within the agreed time, the PURCHASER is entitled to execute the work necessary to rectify the defect at cost and risk to the SUPPLIER, by giving fourteen (14) days written notice to that effect and charge liquidated damages at the rate mentioned herein during the rectification period. 8.5The PURCHASE shall be entitled to remove any defects or deficiencies by himself or third parties and to claim from the SUPPLIER compensation or necessary costs only in urgent case of threat of operational reliability and for defence of out of scale of damages, in which cases the SUPPLIER shall be informed immediately, respectively if the SUPPLIER is behind the schedule with rectification of deficiencies.8.7During the WARRANTY PERIOD, the SUPPLIER shall have the rights of access to the GENSETS, provided that he has informed the PURCHASER duly in advance.8.8If, during the WARRANTY PERIOD, any part of the GENSETS, is replaced or repaired, the guarantee period as above for that part is extended by six (6) months.8.9The SUPPLIER warrants that:

8.9.1the SUPERVISION will be provided by the SUPPLIERs SUPERVISOR with all due skill, experience, knowledge and expertise and in accordance with sound practices and procedures;

8.9.2To the extent that breach of the warranty as per sub clause 8.8.1 above has led to damage to the GENSETS, SUPPLIER shall be liable to rectify the damage and/or replace the damaged portion, DDP SITE.

8.10LUBE OIL CONSUMPTION

8.10.1

If the Lube oil consumption of the GENSETS is not attainable as guaranteed in APPENDIX 11, measured during the test run at SITE and calculated on the mechanical continuous rated output of the GENSETS and this is due to reasons solely attributable to the SUPPLIER and SUPPLIER has failed to repair the GENSETS at his own cost to achieve the guaranteed figures within [90 days], the SUPPLIER shall be liable to pay Liquidated Damages for each [0.1 g/kWh] of average excess lube oil consumption, a sum equivalent to cost of lubricating oil for one (1) full year per [0.1 g/kWh]. The total liability of SUPPLIER in this account shall not exceed [1%] of the CONTRACT PRICE.8.10.2

Conditions of measurement for average lube oil.

Start of measurement > 1000 operating hours after COMMISSIONING

Measurement must be carried out over a period of min. 500oh (min. 12 hours after each start) at a constant performance and of the GENSETS between 75%-100%.

For the above the SUPPLIER shall have three attempts to set right any deficiency.

Costs arising out of the Lube Oil measurement will be not covered by the SUPPLIER, If the SUPPLIER requires its personnel during the test run then SUPPLIER may do so at its own costs and expenses.9.Acceptance

9.1SUPPLIER shall provide a suitably qualified supervisor and commissioning engineer(s) for the purposes of carrying out the COMMISSIONING, START-UP, test run and PERFORMANCE and RELIABILITY TESTS. COMMISSIONING, START UP, Test Run and PROVISIONAL TAKE OVER of the supplied GENSETS shall be executed in accordance with the Commissioning Procedure (Annex IX).

9.2The COMMISSIONING of the GENSETS is limited to 24 working days (eight hours per day). In the case of delay caused by reasons attributable to SUPPLIER and not attributable to PURCHASER the cost of the additional working days shall be borne by the SUPPLIER. In the case of delay caused by reasons attributable to neither SUPPLIER nor PURCHASER an amicable solution shall be found. The PURCHASER shall inform the SUPPLIER in writing about the date of readiness of START UP and COMMISSING by giving thirty days notice in advance. Five days before STARTUP and COMMISSIONING the PURCHASER shall send to the SUPPLIER the completed installation check list, confirming that the mounting and installation of the GENSETS has been finalized according to SUPPLIERS Technical Description (Annex II) and project related documentation and that all SITE facilities necessary for GENSETS operation are ready for continuous and uninterrupted operation.

9.3The COMMISSIONING of the GENSETS shall be carried out by the SUPPLIER in accordance with the Commissioning procedures contained in Annex IX.

9.4SUPPLIER guarantees that if tested in accordance with APPENDIX IX the GENSETS shall achieve the Parameters set-forth in APPENDIX IV of this CONTRACT.9.5The PARTIES agree that directly after the commissioning a performance test shall be executed. For the execution of a performance test the following applies;

a)The PURCHASER has to inform the SUPPLIER about the execution of the performance test in such due time, at least two weeks before the test should be executed, that the SUPPLIER or his representative are able to participate.b) Regarding the performance test a protocol will be furnished and signed by PURCHASER and SUPPLIER or their representatives. This protocol will specify the PROVISIONALTAKE OVER of the GENSETS. The GENSETS will be considered PROVISIONAL TAKE OVER by the PURCHASER if the ACCEPTANCE PARAMETERS (Annex IV) are achieved during the PERFORMANCE and RELIABILITY TEST. The GENSETS will be considered as PROVISIONAL TAKE OVER, if the ACCEPTANCE PARAMETERS are achieved during the PERFORMANCE and RELIABILITY TEST. c) If and when tested the GENSETS fails to achieve the ACCEPTANCE PARAMETERS as per APPNDIX IV the SUPPLIER shall be afforded a period of one month or such other period as otherwise agreed between the PARTIES, during which the SUPPLIER at its own costs and expenses can repair, correct and/or adjust the GENSETS, at its own cost and expense, so the GENSETS achieve the ACCEPTANCE PARAMETERS as per APPENDIX IV. During such period the SUPPLIER shall be liable to pay the PURCHASER liquidated damages of @ 0.50 % of the CONTRACT PRICE for each full week which on aggregate shall not exceed in any event 5% of the CONTRACT PRICE during which the SUPPLIER carried out the repairs. If the SUPPLIER fails to rectify such defects within such time period, the PURCHASER may grant an extension of time to SUPPLIER to rectify such defects and charge liquidated damages at the rate mentioned herein above or the PURCHASER may terminate the CONTRACT and shall be entitled to compensation as mentioned in Article 11.7. The costs for the rectifying the defects shall be born by the SUPPLIER. If on retesting the GENSETS again fails to meet the ACCEPTANCE PARAMETERS as per Annex IV but achieves the MINIMUM PERFORMANCE values as specified in Article 9.5 (d) and Annex IV, the Supplier shall be liable to pay liquidated damages of 0.1% for each 1% shortage in the PRODUCT which in aggregate shall not exceed, in any circumstances 7.5% of the CONTRACT PRICE.

d) e) MINIMUM PERFORMANCE shall be achieved, if the ACCEPTANCE PARAMETERS set-forth in Appendix IV are met by 90% of the ACCEPTANCE PARAMETERS. If the SUPPLIER fails to achieve the MINIMUM PERFORMANCE, the SUPPLIER shall have failed to perform and PURCHASER shall be entitled to terminate the CONTRACT, in which case, the PURCHASER shall be entitled to terminate the CONTRACT and shall be entitled to compensation as mentioned in Article 11.7. if the EQUIPMENT achieves the MINIMUM PERFORMANCE then the SUPPLIER shall be liable to pay to PURCHASER a liquidated damages. The PURCHASER against the liquidated damages @1% of the CONTRACT PRICE for each 1% reduction in the PRODUCT(s) will PROVISIONALLY TAKE OVER the EQUIPMENT.f) g)

h) If the PURCHASER is suffering losses due to non-compliance of ACCEPTANCE PARAMETERS, which is taking place to SUPPLIER fault, the PURCHASER shall be entitles to claim liquidated damages. The amount of liquidated damages shall be calculated as follows:

a) electrical output0.25% of contract price of deficient gensets per 1% power deficiency; maximum 2.5% of the contract price of deficient gensets

b) fuel consumption 0.25% of contract price of deficient gensets per 1% consumption increase; maximum 2.5% of the contract price of deficient gensetsThe total of all liquidated damages is limited to a total of 5% of the contract price of deficient gensets.

9.5 The liability of the SUPPLIER for meeting the ACCEPTANCE PARAMETERS expires;a)on successful performance of ACCEPTANCE PARAMETERS during the performance test; or

b)on the date of payment by the SUPPLIER of liquidated damages pertaining to the MINIMUM PERFORMANCE of the GENSETS pursuant to Clause 9.5 (d); or

c)After the expiry of WARRANTY PERIOD, unless the SUPPLIER is responsible for the delay of the PERFORMANCE and RELIABILITY TEST, in which case said period shall be accordingly extended.

9.6 The PURCHASER shall without delay give his FINAL ACCEPTANCE of the GENSETS after the expiration of the WARRANTY PERIOD, after which all obligations of the PARTIES under this CONTRACT will come to an end.9.7 PERFORMANCE AND RELIABILITY TESTS\

9.7.1 Precondition:

During all test runs SUPPLIERs GENSETS will run parallel with existing generators of the PURCHASER. Test run in speed mode: with all GENSETS, PURCHASER provides load sharing signal according to interface list and electrical overview from SUPPLIER. In case of a mechanical governor on the PURCHASERS engines, test run with droop cooperation (lower frequency on full load).

Test run in power mode: with all GENSETS of SUPPLIERs (All SUPPLIERS GENSETS are set to a fixed value of 90-100% of nominal power) and fluctuation will be covered with existing engines of PURCHASER.

In case less electrical load or natural gas is available, the PERFORMANCE TEST(S) should be accomplished on a unit by unit basis. Time for testing must be notified by SUPPLIER to PURCHASER at least two (2) weeks in advance.

Note: Only possible if PURCHASERs engines are able to run with load sharing line, power mode.

(According to the precondition in the Technical Descriptions)

9.7.2 Performance Test Run

Testing of the GENSETS shall include a SUPPLIERs guided [72] hours non-stop test run (excluding oil consumption), operated by PURCHASERs personnel in order to show performance mentioned in item ________ of this CONTRACT. COMMISSIONING engineer of the SUPPLIER is only obliged to stay [8 hours] per day at SITE, which is up to him when he will be available. If the engine fails to perform at the test run, COMMISSIONING engineer has [6] hours time to solve the problem, without that the test period counts from zero again. If COMMISSIONING engineer needs more than [6] hours, then the test run will be started again. If any of the GENSETS are not able to fulfil the test run due to any other reason, which is not caused by the SUPPLIER, COMMISSIONING engineer is not obliged to wait until the test run can be carried out. If test run should be carried out at later stage, PURCHASER bears cost for travel to the SITE and the accommodation costs in advance unless postponement is caused due SUPPLIERs fault. After successful test run the SUPPLIER and PURCHASER will sign the Form of GENSETS Acceptance Report.

9.7.3 RELIABILITY TEST Run:

This RELIABILITY TEST run will last [15 days] and will take place immediately after the [72] hours PERFORMANCE TEST run. This RELIABILITY TEST Run will be supervised by the SUPPLIER. During the last (3) three days of this RELIABILITY TEST Run GENSETS data can be collected.

10.Overall limitation of liability

10.1The SUPPLIER shall be liable to the PURCHASER for any physical loss of or damage to the GENSETS or property of the PURCHASER caused directly or indirectly by the fault of the SUPPLIER during the performance of the SUPPLIERS obligations under the CONTRACT.

10.2The SUPPLIERS liability shall not, in any circumstances, exceed 30% of the CONTRACT PRICE. If the SUPPLIER incurs liability exceeding the said amount, the PURCHASER shall indemnify, defend and hold the SUPPLIER harmless.

10.3The limit as specified section 10.2 above shall not include SUPPLIERs liability

a)under article 2 for the Scope of Supply in accordance with Annex I and for the Technical Description in accordance with Annex II.

b)under Article 8, Article 9 and Annex IV (Warranties and Performance)

c) in case of willful acts and willful negligence.

d) to achieve the Minimum Performance as per Article 9.5 (d).

10.4Any liability of the SUPPLIER shall cease at the end of the respective WARRANTY PERIOD, applicable for the part of works due to which the damage was caused.

10.5The limitations and exclusions stated under this Article shall apply for any liability of the SUPPLIER under the CONTRACT, in tort, under any theory of strict liability or otherwise. The limitations and exclusions stated under this Article do, however, not apply to damages or loss caused by wilful act on the part of the SUPPLIER. Nor do the limitations and exclusions stated under this Article apply to damages or loss caused by wilful act on the part of the PURCHASER.

10.6Neither PARTY shall, in any event or under any circumstances, be liable to the other PARTY for any loss of use or production, unavailability of the GENSETS, loss of profit, cost of capital, loss of interest or revenues, cost of purchased or replacement power or for any direct, indirect or consequential damages or losses whatsoever.11.TERMINATION OF THE CONTRACT

11.1The PURCHASER shall at any time until delivery be entitled to terminate the CONTRACT for its convenience with immediate effect upon notice thereof to the SUPPLIER, whereupon the SUPPLIER shall take all steps to cease all further work and performance under the CONTRACT, on the date of termination specified by the PURCHASER in his notice and to terminate all SUBSUPPLIERS, orders or contracts with Suppliers on the best terms possible.Following such termination by the PURCHASER, the PURCHASER shall become liable to pay to the SUPPLIER all incurred and committed costs.

11.2The PURCHASER shall have the right to terminate the CONTRACT for any material breach by the SUPPLIER by giving thirty (30) days prior written notice to the SUPPLIER of its intention to terminate the CONTRACT in order to allow the PARTIES to reach a mutually beneficial solution thereof, if one of the following conditions has occurred due to reasons other than Force Majeure:

11.3The delivery of the GENSETS according to the PROJECT TIME SCHEDULE (APPENDIX VI), is delayed due to reasons for which the SUPPLIER is liable to pay liquidated damages, when the maximum liquidated damages payable limit is reached.

11.4If, for the reasons attributable to SUPPLIER GENSETS fails to achieve the Minimum Performance as per Article 9.5 (d) then the PURCHASER shall be entitled to terminate the CONTRACT.

11.5If, for the reasons attributable to SUPPLIER, SUPPLIER fails to perform any or all of the PERFORMANCE and RELIABILITY TESTS within a maximum period of [01 months] in respect of the GENSETS in order to meet the PRODUCT ACCEPTANCE PARAMETERS as specified in Annex IV including Minimum Performance as per Article 9.5 (d) and Annex IV then the PURCHASER shall be entitled to terminate the CONTRACT.

11.6Notwithstanding anything contained in this CONTRACT and in particularly Article 10, if the PURCHASER terminate the CONTRACT in pursuance of the Article 11.3, 11.4 and 11.5, in such an event(s) the SUPPLIER shall refund the full amount of CONTRACT PRICE and in addition 30% of CONTRACT PRICE to the PURCHASER. Upon termination under this article SUPPLIER shall dismantle, remove and transport the GENSETS to [_________] at SUPPLIER own risk, cost and expense.

11.7If the SUPPLIER becomes bankrupt or insolvent, has a receiving order against him, compounds with his creditors, or carries on business under a receiver, trustee or manager for the benefit of his creditors, or goes into liquidation.

11.8The carrying out of the CONTRACT has been suspended by the SUPPLIER for more than three (3) months and the payments have not been effected by the PURCHASER during the said period; or

11.9The PURCHASER has issued a suspension order and the GENSETS suspended are not reinstated within six (6) months after receipt by the SUPPLIER of the suspension order; orPRIVATE

11.10The PURCHASER becomes bankrupt or insolvent, has a receiving order against him, compounds with his creditors, or carries on business under a receiver, trustee or manager for the benefit of his creditors or goes into liquidation.

11.11Each of the PARTIES shall be entitled to terminate the CONTRACT by submitting thirty (30) days prior written notice to the other PARTY in the event that one or more events of FORCE MAJEURE in accordance with Article 22 have occurred for a period of six (6) months or more.12.Force Majeure

12.1Any delay in or failure of performance of either party hereto shall not constitute default hereunder, or give rise to any claim in damage, if and to the extent such delay in or failure of performance is caused by an event of Force Majeure.

12.2"Force Majeure" for the purpose of this Article 12 shall mean the actual happening and not mere therat or apprehension of happening in Paksitan near relevant GENSETSs SITE of any and all events or fortuitous circumstances which directly affect SUPPLIER and/or its subcontractors, or PURCHASER's and/or his contractors in their implementation of their respective obligations under or in connection with the CONTRACT and completion of the relevant GENSETS as per the Project Time Schedules in respect of the GENSETS _ and shipment schedule and which are beyond their respective control, such as but not limited to, strike, lockout, labour disputes, fire, explosion, nuclear catastrophes, transportation accidents, natural disaster, earthquake, riot, rebellion, war, government seizures, laws, or other regulations of any authority.

12.3The aggrieved party will notify the other party in writing of any event of Force Majeure within [fourteen (14)] days of its occurrence (or if this cannot be done for reason of Force Majeure, as soon as possible thereafter), and as soon as possible of the consequences of such an event. Thereupon, both parties will discuss and agree in good faith how to overcome the consequences of the Force Majeure occurred.

12.4If Force Majeure should continue for a period in excess of [six (6)] months, both parties shall consult and agree whether to terminate the CONTRACT or how to adapt the CONTRACT taking into consideration the effects of Force Majeure on the Project Time Schedule. If no agreement can be reached between the parties, each party may give notice of termination of the CONTRACT to the other party. In such case, if the parties cannot settle the remaining mutual claims and obligations as a consequence of the termination, the matter shall be decided by Arbitration.

13.OFFICIAL APPROVALS

13.1The GENSETS shall comply with applicable regulations and requirements of the authorities within the country of construction of the GENSETS, valid on the effective date of this CONTRACT.

13.2The SUPPLIER shall provide the applicable documentation related to the GENSETS in accordance with Project Time Schedule (Annex VI). The PURCHASER is responsible for obtaining all necessary approvals, permits, licences within the country of construction of the GENSETS.

14.REPRESENTATIVES

14.1For the GENSETS supply phase of the project the SUPPLIER and PURCHASER shall name Project Managers for the project co-ordination.15.Collateral agreements and effectiveness of the Contract15.1This Contract shall become effective from the date of signature thereof by both PARTIES.15.2Collateral agreements and changes of the Contract shall be valid only when executed In writing.

15.3Previous agreements on the subject matter of this Contract shall become invalid upon signature of the Contract.

15.4in the event that individual provisions of the Contract have become or become invalid upon conclusion or during the term of this Agreement, the remaining provisions shall, nevertheless remain valid. The PARTY will make efforts to agree on new provisions instead of the invalid ones which will be legally effective, correspond to the tenor of this Contract and approach the purpose of the invalid provision as much as possible.

15.5In the event the down payment or payments guarantees according to Clause 4 are not executed within 12 months after the date of effectiveness of the contract, the Contract will be automatically cancelled.10.6 In the event of any inconsistency or conflict between the terms and conditions of this Contract and the annexes to this Contract, the documents should prevail each other in the following order.

a) the Contract itself

b) the Annexes in order of their numbering

10.7 If one or several provisions of this Contract should be legally invalid for any reason whatsoever, the validity of the remaining provisions shall not be affected thereby. In such case, the PARTIES shall replace the invalid contractual provision by such other provision coming as close as possible to the legal and economic purpose of the Contract. The same shall apply mutatis mutandis to any nuclear provision contained in this Contract..

16.Applicable law and Jurisdiction

16.1All dispute and differences which may arise out of or in connection wit the present CONTRACT, or the breach thereof, which cannot be settled amicably between the PARTIES shall be finally settled, excluding any other jurisdiction but for enforcement of the arbitral award, by arbitration under the Pakistan Arbitration Act 1940 by an arbitration committee of three arbitrators.

16.2The place of arbitration proceedings shall be Lahore, Pakistan. The language of arbitration shall be the English language.16.3The arbitration award shall be final and binding on both Parties and subject to no appeal and shall deal with the question of the costs of arbitration and all matters relating thereto.16.4

The CONTRACT shall be construed and interpreted in all respects in accordance with its own provisions and all agreements concluded between the PARTIES in connection therewith, and, subsidiary, in accordance with Pakistani law and the exclusive jurisdiction of the Pakistani Courts.17.TAXES

17.1Any taxes, duties, fees, and other fiscal charges, including customs duties, directly or indirectly levied by any authority or country outside Pakistan in connection with the CONTRACT, its conclusion or its execution shall be borne and directly paid by SUPPLIER.

17.2Except as specifically otherwise agreed in the CONTRACT , any taxes, duties, fees, and other fiscal charges, including customs duties, directly or indirectly levied by the authorities of Pakistan, including government appointed surveyors, in connection with the CONTRACT, its conclusion or its execution (hereinafter collectively referred to as "Impositions") shall be borne and directly paid by PURCHASER over and above the agreed prices stated or referred to in the CONTRACT.

17.3The all or any income tax due towards the SUPPLIER in relation to this CONTRACT whether in Pakistan or outside Pakistan shall be sole responsibility of the SUPPLIER.17.4If SUPPLIER shall effectively obtain a credit against any German taxes payable on the basis of taxes paid by PURCHASER on behalf of SUPPLIE in Pakistan, which are evidenced by tax receipts, in the English language, handed over to SUPPLIER, then SUPPLIER shall pass on to PURCHASER the net benefit of such tax credit and reimburse to PURCHASER the corresponding amount of such tax credit.17.5Both Parties agree to co-operate to eliminate or reduce any applicable taxes, duties, interests, penalties or similar charges which may be payable by either Party, including, where applicable, providing or issuing the necessary documentation to support or secure exemptions or recoveries. Furthermore, if as a result of a change in law or a change in the tax practice of any tax authority, either Party becomes subject to additional taxes, duties or similar charges which increases their financial liability during the term of this CONTRACT, both Parties will negotiate in good faith to attempt to reduce or eliminate such additional taxes, duties and similar charges. This is provided that neither Party need take any steps, which in its reasonable opinion and acting in good faith would increase its obligations or would be prejudicial or adverse to it (whether in respect of tax affairs or otherwise).18.PATENTS AND USE OF DOCUMENTATION

18.1All drawings and technical documents relating to the GENSETS or its manufacture submitted by one PARTY to the other, prior or subsequent to the formation of the CONTRACT shall remain the property of the submitting PARTY. Drawings, technical documents or other technical information received by one PARTY shall not, without the consent of the other PARTY, be used for any other purpose than erection, Commissioning, operation or maintenance of the GENSETS. They may not, without the consent of the submitting PARTY, otherwise be used or copied, reproduced, transmitted or communicated to a third PARTY.

18.2The SUPPLIER agrees to indemnify the PURCHASER against any losses, expenses, responsibilities and claims arising from the GENSETS dealt with in this CONTRACT, which constitute an infringement of the patent rights of a third party.19.ASSIGNMENT AND SUB-LETTING

19.1Either PARTY shall not assign the CONTRACT unless mutually agreed between the Parties. The SUPPLIER shall be responsible for all GENSETS supplied by all SUB-SUPPLIERS.

20.EFFECTIVE DATE OF CONTRACT

20.1The CONTRACT shall become valid upon the formal execution (signing) by duly authorised officers of the PARTIES.

IN WITNESS WHEREOF, the parties hereto have caused this document to be executed and signed as follows on the day and date first above written.

___________________________________________________________________

Place

Date

____________________________________________________________________

for Rupali Polyester Ltd.

___________________________________________________________________

Place

Date

____________________________________________________________________

for DEUTZ Power Systems Gmbh

Witness:

Witness:

__________________________

_________________________

Name: ____________

Name: ____________

please insert country name

14