Contract Manufacturing Agreement Sample (Purchase this doc, Text: 08118887270 (Whatsapp))

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INDEX
Clause
No.
Heading
Page
No.
1. Definitions and Interpretation
2. Representation and Warranty
3. Conditions Precedent
4. Production, Planning and Forecasts
5. Cross Functional Teams – Governance Mechanism
6. Supply, Inspection and Acceptance of KD Kits and Components
7. Manufacture and Assembly
8. Quality Inspection, Testing, Delivery and Storage of Products
9. Product Warranty and Rectification of Defects
10. Changes to Products and Specification
11. Obligations of ‘ B ‘
12. Obligations of ‘ A ‘
13. Manufacturing Charges
14. ........ Assembly Area
15. Title and Risk
16. Confidentiality
17. Term and Termination
18. Indemnity and Liability
19. Force Majeure
20. Miscellaneous
20.1 Representative
20.2 Notices
20.3 Waiver
20.4 Severability
20.5 Whole Agreement
20.6 Governing Law
20.7 Mediation
20.8 Dispute Resolution
20.9 Independent Contractor
20.10 Non-Assignment
20.11 Costs
20.12 Taxation
20.13 Amendment
20.14 Language
20.15 Counterparts
20.16
Annexure:
I(a) Site Plan of ‘ B ‘ Property
I(b) Site Plan of ........ Assembly Area
II List of ‘ B ‘ Machinery
III List of ‘ A ‘ Machinery
IV Specifications of KD Kits
V List of Common Utilities and Facilities
VI Cost Sheet
VII Manpower Structure

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Clause
No.
Heading
Page
No.
VIII Office Infrastructures
IX List of Consumables
X List of Tools
XI List of Products
XII Workflow Process

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PT............................... .................................
MANUFACTURING CONTRACT
This MANUFACTURING CONTRACT (“Agreement”) is made on the ........... day of ........... 20_,_,
(“Signature Date”),
Between;
(1) PT. _____________________, a limited liability company incorporated under the laws of
Indonesia and having its registered office at ..........................................................................,
Indonesia (hereinafter referred to as “ A ” which expression shall, unless it be repugnant to the
context or meaning thereof, be deemed to mean and include its successors and permitted assigns);
and
(2) PT. _____________________, a limited liability company incorporated under the laws of
Indonesia and having its registered office at ..........................................................................,
Indonesia (hereinafter referred to as “ B ” which expression shall, unless it be repugnant to the
context or meaning thereof, be deemed to mean and include its successors and permitted assigns).
‘ A ‘ and ‘ B ‘ are individually referred to as “Party” and collectively as “Parties”.
WHEREAS:
(A) The Parties have entered into a non-binding Term Sheet on ...................... (hereinafter referred to
as the “Term Sheet”) and arrived at a broad understanding for the manufacture of Products
(hereinafter defined) by ‘ B ‘ for and on behalf of ‘ A ‘.
(B) ‘ B ‘ owns and possesses a piece and parcel of land admeasuring approximately ...... ha (...........
hectares) situate at ................................................................., (hereinafter referred to as “‘ B ‘
Property”) as per the site plan attached as Annexure I(a) out of which ‘ B ‘ has offered to ‘ A ‘
a piece and parcel of land along with structures admeasuring approximately ........ ha
(..............hectares) consisting of exclusive areas A, B & C and the buildings therein which has
been shaded in BLUE color as per the site plan attached as Annexure I(b) (herein after referred
to as “........ Assembly Area”) exclusively to be used for the manufacture and assembly of
Products (hereinafter defined) for and on behalf of ‘ A ‘.
(C) Pursuant to a Technology License Agreement dated .................... executed between the Parties
(hereinafter referred to as the “Technology License Agreement”), ‘ A ‘ has licensed the
Technology (hereinafter defined) to ‘ B ‘ for manufacturing of the Products in accordance with
the terms and conditions set out therein.
(D) ‘ B ‘ has represented that ‘ B ‘ has the required personnel with desired technical skills and
capacity, necessary facilities, equipment and machinery as listed in Annexure II (hereinafter
referred to as “‘ B ‘ Machinery”) reserved exclusively for manufacturing and assembling of the
Products.
(E) ‘ B ‘ has also represented that ‘ B ‘ shall provide ‘ A ‘ with unrestrictive access and use of
utilities, amenities and facilities from and within the ‘ B ‘ Property as listed in Annexure V
(hereinafter referred to as “Common Utilities and Facilities”).

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(F) ‘ A ‘ has represented that ‘ A ‘ shall provide necessary assistance for manufacturing of the
Products and shall provide certain equipments and machineries to ‘ B ‘ to be installed in ........
Assembly Area and to be used exclusively for manufacturing of the Products in accordance with
the terms and conditions of Bailment Agreement dated _____ executed between the Parties
(hereinafter referred to as the “Bailment Agreement”). The list of equipments and machineries
owned by ‘ A ‘ which is to be handed over to ‘ B ‘ for using the same at ........ Assembly Area for
assembly of KD Kits (as defined hereunder) is listed in Annexure III (herein after referred to as
“‘ A ‘ Machinery”).
The Parties intend to record their mutual covenants, understanding and obligations and accordingly are
entering into this Agreement.
1. DEFINITIONS AND INTERPRETATION:
Definitions
In addition to the terms defined in the introduction to, recitals of and the text of this Agreement,
the following words and terms, whenever used in this Agreement, unless repugnant to the
meaning or context thereof, shall have the respective meanings set forth below:
“Affiliate” shall mean any other person that directly or indirectly controls or is controlled by or is
under common control either through same President Director or President Commissioner or such
entities to be consider as an affiliate of each other if such entities have more than fifty percent
(50%) either common directors or common commissioners. For purposes of this definition
“control” of a person means (a) ownership of fifty (50) percent or more of the shares in issued or
other equity interests of such person or (b) the power to direct the management or policies of a
person, whether through the ownership of fifty (50) percent or more of the voting power of such
person, through the power to appoint at least half of the members of the board of directors or
board of commissioners of such person, or through contractual or other arrangements;
“Agreed Capacity” shall mean minimum 40 units of Products (on 2 shifts basis of eight working
hours each) daily, and as amended from time to time and agreed by the Parties in accordance with
the terms of this Agreement;
“Agreement” shall mean this Manufacturing Contract along with all the annexures attached
thereto and shall include any modifications and alterations thereto made in writing after the date
of execution of this Agreement;
“Applicable Laws” shall mean any applicable national, municipal or state or province statutes,
ordinance or other law, regulation or bye-law or any role, code or direction or any license,
consent, permit, authorization or other approval (including any conditions attached thereto) of
Indonesia or any part thereof or of any public body or authority, local or national agency,
department, inspector, ministry, official or public or statutory person (whether autonomous or
not) which has appropriate jurisdiction;
“Assignable Costs” shall mean and includes the following:
(i) Consumables and indirect materials if procured by ‘ B ‘;
(ii) power;
(iii) water;
(iv) air;

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(v) comprehensive insurance costs for insuring ‘ A ‘ Machinery, KD Kits, work in progress
(WIP) and the Products;
(vi) security of ........ Assembly Area;
(vii) Tools, if provided by ‘ B ‘;
(viii) Labor cost (Direct and Indirect) which is subject to review by both the Parties based on
standard man hour rate (SMH) for the assembly and manufacture of Products;
(ix) Utility and maintenance.
“Administrative Costs” shall mean and include the following expenses incurred at actual:
(i) Tax and public utilities for ........ Assembly Area;
(ii) Rents and insurance for ........ Assembly Area;
(iii) Comprehensive costs for insuring ‘ A ‘ Property (as defined hereunder);
(iv) Telecommunication usage by ‘ A ‘;
(v) Property tax attributable to ........ Assembly Area; and
(vi) Other expenses pertaining to stationery, printing, food and transportation expense by ‘ A
‘.
“Costs” shall be calculated on per unit basis and shall mean all Assignable Costs actually
incurred by ‘ B ‘ attributable directly for the manufacture and assembly of Products and agreed
Administrative Costs directly attributable to assembly operations at ........ Assembly Area and
Fixed Costs as agreed by ‘ A ‘ in advance as per the Cost Sheet provided in Annexure VI.
“Commencement Date” means the date of commencement of this Agreement;
“Components” shall mean parts or components other than the KD Kits provided by ‘ A ‘ to ‘ B ‘
to be used for the assembly and manufacture of Products;
“Common Utility and Facilities” means the common utilities and facilities provided by ‘ B ‘ to ‘
A ‘ to be shared for ‘ A ‘ operation as mentioned in Annexure V.
“Confidential Information” shall mean information disclosed or made available directly in
writing, electronically, orally, by visual inspection, or any form or media including, but not
limited to, technical, financial, or business information regarding or relating to strategies, ideas,
inventions, trade secrets, know how, show how, objectives, data, operational processes, software
(and associated documentation), source code, manufacturing formula, processes, instructions,
sampling and testing methods, Quality Standards, customer lists, vendor lists, Products,
customers, advertising, development, design, modification, use, distribution or sale of Products,
pamphlets and other sales materials, loss statistics, formulae, specifications, calculations, research
records and reports, practices, methods, templates, process documents, manuals, training
information, guidelines and circulars, works of authorship, audio, visual, and multimedia works,
terms of contracts and pricing, data, software and reports, including any summaries thereof or
notations thereon, and any such information that is marked “Confidential” and a Party is required
to keep confidential.
“Consumables” shall mean consumables as per Quality Standards recommended by ‘ A ‘ to be
provided by ‘ B ‘ at its own costs and to be used by ‘ B ‘ during the assembly of Products as listed
in Annexure IX;

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“Contract Year” means the period commencing on the Commencement Date and ending on
_________; and each consecutive period of twelve (12) months thereafter during the continuance
of this Agreement;
“Delivery Point” with reference to:
a) delivery of KD Kits and Components by ‘ A ‘ to ‘ B ‘ shall mean the warehouse / storage area
located / based within the ........ Assembly Area;
b) delivery of Products by ‘ B ‘ to ‘ A ‘ shall mean the warehouse / storage area located / based
within ........ Assembly Area as is mutually agreed between the Parties from time to time;
“Fixed Costs” shallmeans agreed interest costs and agreed rate of depreciation on investments in
assets made by ‘ B ‘ specifically to be used for assembly operations of the Products, subject to
audit by ‘ A ‘, attributable only to ........ Assembly Area and calculated at the book value of such
assets as shown in Annexure VI;
“Force Majeure” shall mean, in relation to either Party, any act, event or circumstance beyond
the reasonable control of that Party which cannot be foreseen or, if foreseeable, are unavoidable,
which affects, delays and/or prevents the performance of its obligations under this Agreement
including, but not limited to fire, flood, earthquake, explosion, war, riots, strikes or lockouts,
national economic crisis, government action or inaction or request or intervention of government
authority, change in laws and/or regulations, acts of God; or where that Party has acted as a
Reasonable and Prudent Operator (hereinafter defined) inability to obtain, or shortage of, fuel,
power, gas, equipment, containers, transportation or materials, accident to, or breakage of,
machinery or apparatus; or any legal or regulatory safety or emergency overrides;
“Intellectual Property” shall mean all patents, utility models, trade and service marks, rights,
processes, rights in designs, copyrights, moral rights, topography rights, rights in database,
Confidential Information, and any rights or forms of protection of a similar nature and having
equivalent or similar effect to any of them which subsist anywhere in the world and any
improvements made during tenor of this Agreement licensed to ‘ B ‘ under the Technology
License Agreement;
“Joint Investigation Committee” shall mean a joint investigation committee which formed by
the Parties to investigate any failure, defect and/or damages including without limitation to
workmanship failure, negligence, quality issues, process related lapses etc. and such failure,
defects and/or damages becomes a disputable and/or debatable matters between the Parties and/or
in order to obtain advice, decision and/or instruction of corrective action. The Joint Investigation
Committee shall consist of one (1) member from each Party;
“KD Kits” shall mean completely knocked down or semi-knocked down kits as per the
specifications listed in Annexure IV which shall be provided by ‘ A ‘ to ‘ B ‘ at the warehouse /
storage area within the ........ Assembly Area for the assembly and manufacture of Products;
“Long Stop Date” means on or before .........................
“Manufacturing Charges” shall mean Costs plus Service Fee (hereinafter defined);
“Products” shall mean, ........ commercial vehicles and ........ passenger cars duly assembled by ‘
B ‘ from KD Kits, Components and Consumables and as per the Specifications (hereinafter
defined), designs and vehicle parameters as mentioned therein, as listed in Annexure XI;

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“‘ A ‘ Property” shall mean KD Kits, Products, ‘ A ‘ Machinery, Tools, Components,
Confidential Information, Intellectual Property, work in progress (WIP),scrap and wastages and
any other moveable owned by ‘ A ‘ and entrusted to ‘ B ‘ and lying at ‘ B ‘ Property;
“Requirement” shall mean ‘ A ‘’s total requirement of the Products as communicated to ‘ B ‘
from time to time;
“Reasonable and Prudent Operator” shall mean a person seeking to perform its contractual
obligations and in doing so and in the general conduct of its undertaking, exercising that degree
of skill, diligence, prudence and foresight which would reasonably and ordinarily be expected
from a skilled, experienced operator in substantial compliance with all Applicable Laws engaged
in the same type of undertaking in the same locality and under similar circumstances and
conditions and any reference to the standard of a Reasonable and Prudent Operator in this
Agreement shall be a reference to such degree of skill, diligence, prudence and foresight except
insofar as is inconsistent with any Applicable Laws;
“Safety Standards” shall mean minimum safety standards for the manufacturing and assembly of
Products as recommended by ‘ A ‘ and mentioned in the Technology License Agreement;
“Service Fee” shallmean 10% (ten percent) of the Costs payable to ‘ B ‘ by ‘ A ‘, as per the Cost
Sheet in Annexure VI.
“Specification” shall mean the Products specifications as provided by ‘ A ‘ to ‘ B ‘ as specified in
Annexure__;
“Technology” shall have the meaning assigned to the term in the Technology License
Agreement;
“Territory” shall means the territory of Republic of Indonesia;
“Tools” shallmean tools to be provided either by ‘ B ‘ or ‘ A ‘ as the case may be through written
understanding from time to time. For avoidance of doubt, any and all tools which provided by ‘ A
‘ shall be used by ‘ B ‘ exclusively for the assembly of Products as listed in Annexure X;
“Workflow Process” shall mean the broad activities along with timelines that shall take place at ‘
B ‘ Property which shall not only include right from receipt of KD Kits till the delivery of the
Products as well as rectification process for removing assembly defects as broadly listed in
Annexure XIV which is subject to review from time to time and any such change accepted by
the Parties in writing shall form part and parcel of this Agreement;
“Quality Standards” shall mean minimum quality standards for the manufacturing and assembly
of Products as recommended by ‘ A ‘ and mentioned in the Technology License Agreement.
1.1 Interpretation
1.1.1 A reference to the singular includes the plural and vice versa;
1.1.2 A reference to a document (including this Agreement) is a reference to that document (including
any schedules and annexure) as amended, consolidated, supplemented, novated or replaced;

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1.1.3 A reference to an agreement includes any deed, agreement or legally enforceable written
arrangement or understanding;
1.1.4 A reference to Parties means the parties to this Agreement and to a Party means a party to this
Agreement;
1.1.5 A reference of a law includes (i) a reference to any constitutional provision, subordinate
legislation, treaty, decree, convention, statute, regulation, rule, ordinance, proclamation, bye-law,
judgment, rule of common law or equity or rule of any applicable stock exchange; (ii) is a
reference to that law as amended, consolidated, supplemented or replaced;
1.1.6 All references to days, months, years and dates in this Agreement shall be reckoned according to
Gregorian Calendar;
1.1.7 Headings are for convenience only and should not be used to interpret this Agreement;
1.1.8 If a period of time is specified and dates from, after or before, a given day or the day of an act or
event, it is to be calculated exclusive of that day;
1.1.9 Where a word a phrase is defined, its other grammatical forms shall have a corresponding
meaning; and
1.1.10 This Agreement must not be construed adversely to a Party solely because that Party was
responsible for preparing it.
2 REPRESENTATION AND WARRANTY
2.1 ‘ B ‘ warrants, represents and undertakes to ‘ A ‘ that:
2.1.1 ‘ B ‘ has been duly incorporated and established and is a validly existing legal entity under the
laws of its jurisdiction of incorporation and establishment;
2.1.2 ‘ B ‘ has full authority and power to enter into this Agreement and perform its obligations set
forth herein, without requiring the decision, authorization or approval of any governmental
authority (especially with regard to any licenses or registrations or permits required by Applicable
Laws in the Territory for the performance of the obligations under this Agreement) or other third
party, except to the extent described herein, and neither the entering into the Agreement nor the
performance of or compliance with it nor procuring this will breach any other contract or legal
restriction binding on itself or its assets or undertakings of ‘ B ‘;
2.1.3 all necessary steps have been taken in accordance with its articles of association, by-laws,
regulations or other governing instruments, as the case may be, including resolutions of the board
of directors or similar body, to authorize the execution of this Agreement and to authorize the
signatory or signatories to this Agreement to bind ’ B ‘ to the terms and conditions thereof;

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2.1.4 ‘ B ‘ is a lawful owner of ‘ B ‘ Property and is entitled to use, enjoy, occupy and possess the ‘ B ‘
Property and structures thereon;
2.1.5 Except for any legal matters which have been existing and informed and/or provided by ‘ B ‘ to ‘
A ‘ before the Signature Date, there is no other litigation or dispute pending in any of the courts
in Indonesia or before any judicial or quasi-judicial authority in respect of the said property;
2.1.6 there is no litigation or dispute pending in any of the labour courts in Indonesia or before any
judicial or quasi-judicial authority against ‘ B ‘;
2.1.7 this Agreement constitutes valid and legally binding obligations of the ‘ B ‘;
2.1.8 there is no provision of the law, statute, regulation, judgment or administrative decree in the
Territory and no provision of any agreement binding on it or affecting it or its properties which
would prohibit, conflict with or in any way prevent or impair the execution or performance of the
terms of this Agreement;
2.2 ‘ A ‘ warrants, represents and undertakes to ‘ B ‘ that:
2.2.1 ‘ A ‘ has been duly incorporated and established and is a validly existing legal entity under the
laws of its jurisdiction of incorporation and establishment;
2.2.2 ‘ A ‘ has full authority and power to enter into this Agreement and perform its obligations set
forth herein, without requiring the decision, authorization or approval of any governmental
authority (especially with regard to any licenses or registrations or permits required by Applicable
Laws in the Territory for the performance of the obligations under this Agreement) or other third
party, except to the extent described herein, and neither the entering into the Agreement nor the
performance of or compliance with it nor procuring this will breach any other contract or legal
restriction binding on itself or its assets or undertakings of ‘ A ‘;
2.2.3 all necessary steps have been taken in accordance with its articles of association, by-laws,
regulations or other governing instruments, as the case may be, including resolutions of the board
of directors or similar body, to authorize the execution of this Agreement and to authorize the
signatory or signatories to this Agreement to bind ‘ A ‘ to the terms and conditions thereof;
2.2.4 ‘ A ‘ is a lawful owner of ‘ A ‘ Property and/or the Intellectual Property right which attached on it
and is entitled to use, possess and license ‘ A ‘ Property to ‘ B ‘;
2.2.5 There is no litigation or dispute pending in any of the courts in Indonesia or before any judicial or
quasi-judicial authority in respect of the ‘ A ‘ Property and/or the Intellectual Property right
which attached on it;
2.2.6 this Agreement constitutes valid and legally binding obligations of ‘ A ‘;
2.2.7 there is no provision of the law, statute, regulation, judgment or administrative decree in the
Territory and no provision of any agreement binding on it or affecting it or its properties which
would prohibit, conflict with or in any way prevent or impair the execution or performance of the
terms of this Agreement;
2.3 Each Party warrants, represents and undertakes to the other Party that:

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2.3.1 the statements of the Parties contained herein and in any other written document, certificate and
agreement executed and delivered by such Party pursuant to the terms of this Agreement are true,
complete and correct in all material respects;
2.3.2 each Party has always been in compliance with the anti-bribery, anti-corruption and anti-money
laundering laws applicable in the jurisdiction of incorporation and operation and shall continue to
do so in future; and
2.3.3 each Party will conduct and implement this Agreement with good faith.
3 CONDITIONS PRECEDENT
3.1 Save and except as envisaged in Clause 3.4 hereunder, this Agreement shall not be effective
unless each and every conditions precedent mentioned in this clause have been fulfilled as
determined or waived by each respective counterpart Party in writing, in each case in its sole
discretion. Notwithstanding the provision of Clause 4.10 of this Agreement, in the event that the
conditions precedent are not fulfilled or waived by each respective Party in writing on or before
the Long Stop Date or if there is otherwise no Commencement Date (as defined) by such later
date as may be agreed by ‘ A ‘ in writing in its sole discretion, this Agreement shall be of no legal
effect save and except as provided herein. The Conditions Precedents are as follows:
3.1.1 signature of this Agreement, the Technology License Agreement and the Bailment Agreement all
allied / definitive agreements as mentioned in the Term Sheet;
3.1.2 supply and installation of ‘ B ‘ Machinery and Common Utility and Facilities by ‘ B ‘ at no extra
costs to ‘ A ‘ to suit assembly and ready to operate for carrying out manufacturing operations of
Products to the satisfaction of ‘ A ‘ and inspection to that effect shall be conducted and certified
by ‘ A ‘;
3.1.3 modification of ‘ B ‘ Machinery and Common Utility and Facilities by ‘ A ‘ at its own cost to suit
assembly and ready to operate for carrying out manufacturing operations of Products;
3.1.4 supply and installation of ‘ A ‘ Machinery at ........ Assembly Area by ‘ A ‘ as may be required to
suit storage, assembly and manufacturing of KD Kits;
3.1.5 completion of construction work and modification for setting up assembly line for the Products
and ware house facility for KD Kits in the ........ assembly Area on “ready to operate” basis;
3.1.6 the manpower recruitment and training of the balance workforce by ‘ B ‘ as per the manpower
structure agreed with ‘ A ‘ and provided in Annexure VII and is ready to be operational and fully
integrated for the assembly and manufacture of Products to the satisfaction of ‘ A ‘;
3.1.7. the training of ‘ B ‘ team manpower (maximum of 3-5 skilled manpower) for the agreed period in
........ Motors India’s as per Clause 12.3 of this Agreement;
3.1.8 ‘ B ‘ providing a notarized statement stating that the ‘ A ‘ Machinery in the ........ Assembly Area,
belongs exclusively to ‘ A ‘ and ‘ A ‘ shall have exclusive and uninterrupted right to remove the
same whenever it deems fit;

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3.1.9 ‘ B ‘ providing ‘ A ‘ with a corporate guarantee (in the form acceptable to ‘ A ‘) from M/s PT
_____________ (a _______ group company) for securing ‘ A ‘ Machinery installed by ‘ A ‘ in
the ........ Assembly Area;
3.1.10 ‘ B ‘ within fifteen (15) days from the Signature Date has handed-over to ‘ A ‘ on ready to use’
basis office premises and infrastructure as provided in Annexure VIII and allowed use of
Common Utility and Facilities to the representatives of ‘ A ‘; and
3.1.11 any other document, writing as the Parties may agree and deem fit required for securing their
respective rights and necessary for commencing operations.
3.2 ‘ B ‘ with effect from the Signature Date, at no extra cost to ‘ A ‘, provide ‘ A ‘, its authorized
representatives, vendors, consultants, visitors and contractors unrestricted access at all times to
........ Assembly Area and ‘ B ‘ Property as may be required from time to time for the
commissioning and installation of ‘ A ‘ Machinery, site preparation and all other activities
necessary for commissioning the assembly and manufacturing of Products; ‘ A ‘ shall make
payments to ‘ B ‘ for the consumption of power and water at actual during the installation and
commissioning period.
3.3 Either Party shall ensure that the above-mentioned conditions are fulfilled and continue to be
fulfilled during the whole duration of this Agreement; failing of which such non-compliance
would be construed as material breach of this Agreement by such Party.
3.4 Notwithstanding anything contained in this Agreement, the Parties hereby agree that Clauses 2,
3.1.10, 3.2, 4.10, 11.2.20, 11.2.26, 11.5, 11.6, 11.9, 11.10, 15, 16, 18, 19 and 20 of this
Agreement shall come into effect immediately from the Signature Date.
4. PRODUCTION, PLANNING AND FORECASTS
4.1 For the purpose of ensuring satisfactory development of the Agreed Capacity, within thirty (30)
days from the Signature Date, ‘ A ‘ shall prepare and submit to ‘ B ‘ its proposed demand forecast
for the Products for first Contract Year setting out its anticipated demand in each calendar month
of first Contract Year (the “Proposed Annual Forecast”).
4.2 In the month of March of each Contract Year, ‘ A ‘ shall prepare and submit to ‘ B ‘ its Proposed
Annual Forecast for the Products for such Contract Year, setting out its anticipated demand in
each calendar month of such Contract Year. ‘ A ‘ undertakes that at all times it shall use
reasonable endeavors to ensure that the Proposed Annual Forecast represents its best available
estimate of its Requirements for the Products for the Contract Year to which it relates.
4.3 ‘ B ‘ shall arrive with ‘ A ‘, within a period of seven (7) days, on broad understanding on
attainment of Proposed Annual Forecast.
4.4 KHI agrees for employing contractual manpower as per annual proposed forecast provided by ‘ A
‘ & Manpower Annexure Guideline (Annexure IV.). In the event there is a reduction between the
Proposed Annual Forecast submitted in the beginning of the respective Contract Year with the
actual production of the respective Contract Year, ‘ A ‘ shall be responsible and obligated to bear
and to pay to ‘ B ‘ any and all amount of manpower cost which has to be borne by ‘ B ‘ as the
result of the surplus of manpower which resulted from the reduction of the ‘ A ‘’s Requirement in
the latest Proposed Annual Forecast for the reduction in ‘ A ‘ requirement more than 10%.

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4.5 ‘ A ‘ shall prepare and submit to ‘ B ‘ on the fifteenth (15th
) of every month, a forecast, for the
succeeding month mentioning therein an estimate of the volume and type of Products to be
manufactured (“Monthly Forecast”) by ‘ B ‘ for ‘ A ‘. For avoidance of doubt, the total
Requirements of the Monthly Forecast for the respective Contract Year shall not less than the
Proposed Annual Forecast which has been previously submitted by ‘ A ‘ to ‘ B ‘.
4.6 In addition to and notwithstanding the foregoing, ‘ A ‘ shall on every Monday and every
Thursday be entitled to provide a firm and binding three (3) day rolling plan to ‘ B ‘ [subject to
variation of plus or minus five (5) percent of Monthly Forecast, which ‘ B ‘ shall confirm in
writing on the same day to ‘ A ‘ to facilitate sequential rolling of the Products (“Rolling Plan”).
For avoidance of doubt, the total Requirements of the Rolling Plan for the respective Contract
Year shall not less than the Proposed Annual Forecast and shall not less than plus minus five (5)
percent of Monthly Forecast which has been previously submitted by ‘ A ‘ to ‘ B ‘.
4.7 ‘ B ‘ shall be obliged to accept all Rolling Plan submitted by ‘ A ‘ if the same is within the
Agreed Capacity and if the stock of KD Kits and Components are available in hand. ‘ B ‘ shall
deliver all the Products to ‘ A ‘ as per the Quality Standards and in line with Workflow Process.
To the extent that any Rolling Plan exceeds the Agreed Capacity, ‘ B ‘ shall use its best
endeavors to satisfy such excess requirement. In the event that ‘ B ‘ believes that it will not
reasonably be able to satisfy the excess Requirement, ‘ B ‘ shall notify ‘ A ‘ as soon as reasonably
practicable.
4.8 ‘ B ‘ shall respond to ‘ A ‘ on the same day and acknowledge the dispatch instructions received
under Clause 4.7 specifying:
(i) The availability, or otherwise, of the Products; and
(ii) The likelihood of the preferred latest date for delivery of the Products being met and, if
appropriate, any alternative proposed delivery date for delivery of the Products and/or
proposal for delivery of the Products in installments.
4.9 After ‘ B ‘ accepts the Rolling Plan submitted by ‘ A ‘, ‘ B ‘ shall be obliged to assemble and
deliver the Products to ‘ A ‘ as per the agreed Rolling Plan. In the event ‘ B ‘ is unable to
assemble and deliver the Products as per Quality Standards free of assembly defects to ‘ A ‘ as
per the agreed Rolling Plan, ‘ A ‘ shall be entitled to levy a penalty of ___ (___) percent of the
Assignable Cost for the number of Products not delivered to ‘ A ‘.
4.10 In the event:
(a) after thirty (30) calendar days since the Long Stop Date has passed:
(i) the Proposed Annual Forecast, the Monthly Forecast and/or the Rolling Plant has
not been submitted by ‘ A ‘ to ‘ B ‘; and/or
(ii) the production (assembly, manufacture and/or delivery) of the Products has not
been started, delayed and/or postponed due to any reason whatsoever which
attributable to ‘ A ‘; and/or
(b) in the event ‘ A ‘ not able to fulfill any and/or all conditions precedent, which have to be
fulfilled by ‘ A ‘’s as stipulated in Clause 3.1 of this Agreement, in accordance with the
Preparation Schedule as stipulated in Annexure XIII of this Agreement;
then ‘ B ‘ shall be entitled to claim for the reimbursement to ‘ A ‘, and ‘ A ‘ shall be obligated to
reimburse to ‘ B ‘, for the actual cost which has been incurred by ‘ B ‘ for the preparation of the
production, assembly and/or manufacture of the Products, including without limitation to the cost
which arising due to the procurement of: a) labor (whether direct and indirect); b) Consumables
and indirect materials procured by ‘ B ‘; d) power; f) water; g) air; h) insurance for ‘ A ‘
Machinery, KD Kits, work in progress (WIP) and the Products; i) security of ........ Assembly

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Area; j) Tools which provided by ‘ B ‘; k) utility and maintenance for ........ Assembly Area, ‘ A ‘
Machinery, KD Kits, work in progress (WIP) and the Products; l) Tax and public utilities for
........ Assembly Area; m) rents and insurance for ........ Assembly Area; n) insurance of ‘ A ‘
Property; o) telecommunication; p) Property tax attributable to ........ Assembly Area; and/or q)
other expenses pertaining to stationery, printing, food and transportation expense by ‘ A ‘
(hereinafter referred to as the “Pre-Production Actual Cost”). For avoidance of doubt, the Pre-
Production Actual Cost shall be paid by ‘ A ‘ to ‘ B ‘ within thirty (30) days after the
reimbursement request letter has been issued and sent by ‘ B ‘ to ‘ A ‘.
5 CROSS FUNCTIONAL TEAMS – GOVERNANCE MECHANISM
The Parties shall constitute a cross functional team consisting of two executives from each Party
for the review and implementation of the production, planning, processes, safety, quality,
inspection, forecasts and implementation. Such cross functional teams shall meet on weekly basis
to review and monitor each process as defined under this Agreement. These cross functional
teams shall also conduct inspection and audits for the inventory of KD Kits, Components and
review Costs as provided in this Agreement.
6 SUPPLY, INSPECTION AND ACCEPTANCE OF KD KITS & COMPONENTS
6.1 ‘ A ‘ shall provide ‘ B ‘, KD Kits and Components on regular basis as per the Monthly Forecast
and Rolling Plan mentioned in Clauses 4.4, 4.5 and 4.6.
6.2 ‘ A ‘ shall ensure that ‘ B ‘ has sufficient stock of KD Kits and Components at the warehouse
situated in the ........ Assembly Area to meet ‘ A ‘’s Requirement of the Products as per the
Monthly Forecast and Rolling Plan.
6.3 Towards this end, ‘ B ‘ shall confirm acceptance of the delivery of KD Kits and Components at
the Delivery Point in the ........ Assembly Area after conducting inspection of KD Kits and
Components within two (2) working days from the date of receipt of KD Kits and Components
and shall provide a confirmation to ‘ A ‘ about the stock in hand of KD Kits and Components
before tenth (10th
) day of every month. ‘ B ‘ shall undertake inspection of the KD Kits and
Components provided by ‘ A ‘ at the warehouse situated in the ........ Assembly Area and
acknowledge the receipt of KD Kits and Components.
6.4 ‘ B ‘ shall be obliged to use the KD Kits and Components provided by ‘ A ‘ only for the
manufacture and assembly of Products as required by ‘ A ‘.
7 MANUFACTURE AND ASSEMBLY
7.1 Throughout the tenure of this Agreement, and in consideration of ‘ A ‘ complying with its
obligations under this Agreement, ‘ A ‘ engages ‘ B ‘ on a non-exclusive basis whereby ‘ B ‘
shall:
7.1.1 manufacture Products (up to the Agreed Capacity) and deliver them to the Delivery Point to ‘ A ‘
in accordance with the terms and conditions of this Agreement and as per the Quality Standards
and within the timeline as mentioned in Workflow Process.
7.1.2 manufacture Products in accordance with the relevant Specification with the ‘ B ‘ Machinery and
‘ A ‘ Machinery at ............ Assembly Area with its own manpower and personnel;

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8 QUALITY INSPECTION, TESTING, DELIVERY AND STORAGE OF PRODUCTS
8.1 ‘ A ‘ shall be entitled to carry out necessary quality inspection of the Products and processes at
the ........ Assembly Area.
8.2 ‘ B ‘ shall provide continuous and uninterrupted access to ‘ A ‘ of test track situated in its facility
for testing of the Products. The Parties shall jointly conduct the testing on the test track provided
by ‘ B ‘ in accordance with the timelines and flow chart as mentioned in Annexure XIV.
8.3 ‘ B ‘ shall conduct the pre-delivery inspection (PDI) of the Products in presence of ‘ A ‘
representative as per the standard PDI procedure communicated by ‘ A ‘.
8.4 Post quality clearance, testing and PDI as envisaged above, ‘ B ‘ shall deliver the manufactured
Products to ‘ A ‘ storage area marked as area “A” in the ........ Assembly Area after the final
buyoff. The assembly and delivery of Products shall be deemed to have been completed only after
‘ A ‘ issues an acceptance note for the delivery of Products to ‘ B ‘.
8.5 Unless otherwise agreed in writing in this Agreement, ‘ B ‘ shall deliver the Products to ‘ A ‘ as
per dispatch instructions under the term of “Ex-Works ‘ B ‘ facility”. ‘ A ‘ shall be entitled to
store the Products and the vehicles and parts owned by ‘ A ‘ and/or its Affiliates in the storage
area marked as area “A” in the ........ Assembly Area and may transfer the same to its dealership
locations as and when required by ‘ A ‘.
8.6 ‘ B ‘ shall be entitled to use the word “........” or ........ logo in particular manner acceptable to ‘ A
‘ while assembling the Products. Upon becoming aware of any infringement in the Intellectual
Property rights in ........ trademark or ........ logo, ‘ B ‘ shall promptly inform ‘ A ‘ of any such
infringement and ‘ B ‘ may co-operate with ‘ A ‘ in taking necessary action and legal proceedings
in relation thereto at the cost of ‘ A ‘.
9 PRODUCT WARRANTY & RECTIFICATION OF DEFECTS
9.1 ‘ B ‘ expressly warrants and confirms that all Products shall be assembled and manufactured with
good workmanship, free from defect in workmanship, assembly and manufacture process (which
solely caused by ‘ B ‘ based on findings and/or decisions of the Joint Investigation Committee)
and in accordance with the Specifications, the Quality Standards and safety standards as approved
and furnished to ‘ B ‘ by ‘ A ‘. .
9.2 ‘ B ‘ agrees and acknowledges that it is aware of ‘ A ‘’s intended use and expressly warrants that
all Products which are manufactured, or assembled by ‘ B ‘ will be fit and sufficient for the
particular purpose intended by ‘ A ‘.
9.3 In any event of finding and/or claiming of any failure including without limitation to defects,
damages, quality issues, workmanship failure, negligence, process related lapses etc. and/or in
order to obtain advice, decision and/or instruction of corrective action, the Parties shall form Joint
Investigation Committee to investigate such issues. The Joint Investigation Committee shall be
formed by the Parties within ___ (____) days since the date of first written notification from a
Party which finds and/or claims for any failure of the Products to the other Party.
9.4 ‘ B ‘ shall only obligated to rectify and/or replace the defects or damages in the workmanship,
and/or the assembly and/or manufacture process, which based on the findings and/or decisions of
Joint Investigation Committee is solely caused by ‘ B ‘, which is found in the Products. The

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rectification and/or replacement of the damages and/or defects (if any) shall be conducted within
___ days after the receipt of instruction from Joint Investigation Committee.
9.5 Products which are delivered to ‘ A ‘ but which are thereafter, within fourteen (14) days since the
date of the issuance of an acceptance note for the delivery of Products by ‘ A ‘ as stipulated in
Clause 8.4, reported, found and decided by Joint Investigation Committee to be defective or do
not conform to the Specifications due to ‘ B ‘’s fault or negligence shall be rectified by ‘ B ‘. In
any such event, ‘ B ‘ shall forthwith rectify/replace the non-conforming Products at the sole
option of Joint Investigation Committee. The costs of all such replacement of non-confirming
Products shall be borne by ‘ B ‘.
9.6 ‘ B ‘ shall rectify the other damages (that are not covered in this Clause 9) within [1] day of the
receipt of instructions from Joint Investigation Committee (which are not directly attributable to
the negligence and fault of ‘ B ‘) which do not require any extra cost, other than the Costs agreed
by the Parties as per the Annexure VI. In case of any additional costs incurred by ‘ B ‘, to rectify
the damages (which are not directly attributable to the negligence and fault of ‘ B ‘), ‘ B ‘ may
charge the attributable Assignable Cost plus a Service Fee of ten (10) percent for rectifying such
damages within agreed timelines. Such cost shall be agreed in advance with ‘ A ‘ before
commencement of rectification process.
9.7 In the event ‘ A ‘ or the Joint Investigation Committee found any defects and/or damages of the
Products which arising due to ‘ A ‘’s fault and/or negligence and/or which arising due to defects
and/or damages in ‘ A ‘ Machinery and/or design and/or wrong or late supply of any of the
Components and/or KD Kits, ‘ A ‘, on it is own discretion, shall:
a) obligated to rectify and/or replace any defects and/or damages of the Products, at its own
costs and within __ days since the receipt of instruction from Joint Investigation
Committee; or
b) accept, pay to and/or buy the Products from ‘ B ‘ as it is.
9.8 ‘ B ‘ shall be responsible and liable for the Products failures, which found and decided by Joint
Investigation Committee solely caused by ‘ B ‘’s fault and/or negligence and/or arising due to any
assembly defects, faulty workmanship or use of substandard Consumables by ‘ B ‘ for the
Products which found and/or claimed not more than 18 (eighteen) months since the date of the
issuance of an acceptance note for the delivery of the respective Products by ‘ A ‘ as stipulated in
Clause 8.4. In any such event, ‘ B ‘ agrees to indemnify ‘ A ‘ and hold ‘ A ‘, its Affiliates,
assignees and each of its and their directors, officers, employees and agents harmless from and
against any and all suits, claims and proceedings by third parties resulting in liabilities, damages,
costs, losses and expenses, including court costs and reasonable attorneys’ fees, which arise out
of the Products failures due to faulty workmanship or manufacturing or assembly defects or use
of sub-standard Consumables as abovementioned.
9.9 ‘ B ‘ undertakes and covenants that it shall comply with and achieve the quality improvement
targets within the timeline as may be agreed by the Parties from time to time.
9.10 ‘ B ‘ agrees that only quality Tools and Consumables will be used in the assembly and
manufacture process of the Products. ‘ A ‘ shall have the right to review ‘ B ‘’s quality control
procedures and practices.
9.11 ‘ A ‘ agrees, undertakes and warrants that only quality Components and KD Kits, manufactured
according to the Specifications, Quality Standards and in accordance with sound quality control

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procedures will be provided and/or supplied by ‘ A ‘ to ‘ B ‘ in the assembly and manufacture
process of the Products.
9.12 ‘ B ‘ shall be responsible, as a part of the assembly process, for painting and denting of the
damaged and/or defective Products which reported, found and decided by Joint Investigation
Committee solely caused due to mishandling of the Products by ‘ B ‘. In any such event, the cost
of which would be exclusively borne by ‘ B ‘.
9.13 ‘ B ‘ shall bear costs pertaining to rejection of Products, materials, parts and subsequent cost,
which includes but not restricted to expenses and costs for logistics, duties, taxes etc., of
rectifications due to workmanships errors or mishandling of Components and KD Kits of ‘ B ‘
including warranty repairs due to workmanship failure issues and consequential damages which
any of it is reported, found and decided by Joint Investigation Committee arising solely due to ‘ B
‘’s fault and/or negligence.
9.14 Except for ageing, ‘ B ‘ shall exclusively bear any damage in the storage area to the KD Kits
and/or Components supplied which reported, found and decided by Joint Investigation Committee
solely arising due to ’ B ‘’s fault and/or negligence.
9.15 The Parties agree to pursue a mutual continuous improvement and competitive best practice
strategy to seek ways of improving the manufacturing performance at ‘ B ‘’s facilities and
reducing the manufacturing and materials costs. In this regard, the Parties shall meet to discuss on
a quarterly basis for quality review.
10 CHANGES TO PRODUCTS AND SPECIFICATION
10.1 In accordance with the provisions of this Clause 10, ‘ A ‘ may from time to time propose changes
in the Products or Specifications (“Change Order”). Any such Change Order shall be in writing
and shall be sufficiently definite and detailed to give ‘ B ‘ an adequate basis and reasonable time
on which to consider the same.
10.2 Within fifteen (15) working days of receipt of ‘ A ‘’s Change Order in accordance with Clause
10.1, ‘ B ‘ shall prepare and furnish to ‘ A ‘ a written Change Order report, detailing the effect of
such proposed change, including ‘ B ‘’s good faith estimate of:
10.2.1 Any adjustments to the Costs and Service Fees which are reasonably likely to arise as a result of
the proposed change;
10.2.2 The technical changes or changes in process required of implementing the proposed change;
10.2.3 The impact, if any, upon the Agreed Capacity, whether arising whilst the change is being
implemented or as a result of the proposed change.
10.3 ‘ B ‘ shall not be required to act upon any Change Order unless the Parties execute written
Change Order incorporating the requested changes and providing for any adjustment to the Costs
and Service Fees, any expected change in the Agreed Capacity (temporary or permanent), any
change in the Products in each case resulting from the relevant change and a time schedule for
implementing such Change Order.

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10.4 Save as provided in Change Order, or unless otherwise agreed by the Parties in writing, the
manufacture of Products as per the Change Order shall be on the terms and conditions set out in
this Agreement.
11 OBLIGATIONS OF ‘ B ‘
11.1 ‘ B ‘ shall act as a Reasonable and Prudent Operator in performing its obligations under this
Agreement.
11.2 In addition to the obligations of ‘ B ‘ set out in this Agreement, ‘ B ‘ shall:
11.2.1 ensure uninterrupted continuation of assembly and operational activities as per the requirement of
‘ A ‘;
11.2.2 provide ‘ A ‘, its authorized representatives unrestricted access to ........ Assembly Area through ‘
B ‘’s Property and for the vendors, consultants, visitors and contractors (with advance intimation
to ‘ B ‘) as may be required from time to time in order to oversee and/or to conduct the
commissioning and installation of ‘ A ‘ Machinery, site preparation and manufacturing activities
in relation to the Products;
11.2.3 not restrict ‘ A ‘’s representative to enter the ........ Assembly Area through ‘ B ‘ Property to
conduct surprise checks and inspections, inventory audits and verifications;
11.2.4 ensure that the ‘ B ‘ Machinery as per Annexure II is always in proper and working condition
and remains in ........ Assembly Area for exclusive use for assembly of Products;
11.2.5 provide unrestricted access to and from the Delivery Point to the exit point of ‘ B ‘ Property as
and when required by ‘ A ‘ to receive and accept the Products and ‘ A ‘ Property at the Delivery
Point;
11.2.6 not remove, transfer, or place any lien, charge, mortgage or any additional encumbrances (other
than those existing) over ‘ B ‘ Property or ‘ B ‘ Machinery without obtaining the prior written
consent of ‘ A ‘;
11.2.7 not remove, transfer, or place any lien, charge, mortgage or any encumbrances over ‘ A ‘
Machinery;
11.2.8 co-operate with Joint Investigation Committee in investigating complaints by ‘ A ‘ or its
customers that the Products supplied by ‘ B ‘ are not in accordance with the Specifications;
11.2.9 always maintain internal operating and financial controls in accordance with reasonable standards
to be agreed between the Parties in relation to the manufacturing of Products under this
Agreement;
11.2.10 adhere to the agreed standard, in particular any applicable local laws and regulations relating to
industrial, safety and environmental for the manufacturing of the Products;
11.2.11 provide as a part of assembly operation, Common Utility and Facilities at no extra cost to ‘ A ‘ as
listed in Annexure V;

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11.2.12 provide separate electricity meter and if not separate water meter but at least put in place proper
and satisfactory mechanism for recording use of water for assembly of Products of ‘ A ‘ and
ensure continuous and uninterrupted supply of water and electricity for the manufacturing of the
Products;
11.2.13 ensure to make available ‘ B ‘ employees for internal training to other workers / employees at
regular interval or as and when required by ‘ A ‘;
11.2.14 ensure that subsequent entire training (in Indonesia or in India as may be required) cost due to
trained employee attrition is on account of ‘ B ‘;
11.2.15 keep audit and checks of wastages, pilferage and timely handover all scraps, wastages and non-
confirming Products to ‘ A ‘ for disposal of the same;
11.2.16 not to mix up rejected or wastages with other Components and KD Kits and store rejected or
wastage material separately and ensure its safe custody;
11.2.17 keep ‘ A ‘ Property under proper security and compensate at actual to ‘ A ‘ for any pilferage of
any of ‘ A ‘ Property;
11.2.18 carry out “final touch up” denting, painting of KD Kits and/or Products as may be deemed
necessary by ‘ B ‘ and PDI in timely manner as per the Quality Standards.;
11.2.19 always adhere to Workflow Process;
11.2.20 always adhere to Quality Standards and Safety Standards and shall always ensure the safety and
security of ‘ A ‘ employees operating within ‘ B ‘ Property;
11.2.21 always act as a bailee whilst handling and in possession of ‘ A ‘ Property and hold ‘ A ‘
Property in trust and handle and maintain the same with utmost care;
11.2.22 take timely delivery and stock position of KD Kits and Components as provided in the
Agreement to enable to implement Rolling Plan;
11.2.23 intimate ‘ A ‘ on actual information from the relevant authorized body of any labour unrest,
stoppage of electricity power, water or any other utilities in the ‘ B ‘ Property with beyond the
control of ‘ B ‘;
11.2.24 continue to provide office infrastructure exclusively for ‘ A ‘ (as provided in Annexure VIII)
admeasuring approximately 374 M2
(three hundred seventy four square meters) in ........
Assembly Area to enable ‘ A ‘ representatives to supervise assembly operations of the Products;
11.2.25 provide necessary Tools and Consumables as per the requirement for assembly and manufacture
of Products. However, ‘ A ‘ reserves rights to procure the Tools and Consumables itself and in
such event, the Parties shall make necessary adjustments in the Assignable Costs and deduct or
delete the cost of Tools and Consumables from the Assignable Costs;
11.2.26 provide necessary security arrangement to the ........ Assembly Area for the safety and security of
the ‘ A ‘ Property to avoid any theft, pilferage or mishandling of the ‘ A ‘ Property;

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11.2.27 shall maintain proper records of entry and exit of Components, Products and KD Kits and make
the same available for inspection to ‘ A ‘ any time on demand; and
11.2.28 at the request of ‘ A ‘, package the Products in accordance with the packaging instructions issued
by ‘ A ‘ from time to time. The cost of packaging and packaging material and transportation costs
shall be exclusively borne by ‘ A ‘.
11.3 ‘ B ‘ warrants to ‘ A ‘ that any services provided in relation to the manufacture of the Products
shall be performed by appropriately qualified and trained personnel, with due care and diligence
and of such high standard of quality as it is reasonable for ‘ A ‘ to expect in all the circumstances
and as a Reasonable and Prudent Operator. The Parties have mutually agreed on the qualified and
trained manpower for the various levels of capacity utilization for the manufacture and assembly
of Products as per Annexure VII;
11.4 Where in ‘ A ‘’s reasonable opinion its requirement for a particular product cannot be met by ‘ B
‘ or that the) does not meet the required parameters or the Quality Standards , ‘ B ‘ shall have the
opportunity to demonstrate the availability of sufficient capacity & assembly process (Skilled
manpower, tools & consumables if provided by ‘ B ‘) or the fact that the does in fact meet the
requisite Specifications within ninety (90) days from the date of receipt of a written notice from ‘
A ‘ requesting ‘ B ‘ to demonstrate such capacity. If ‘ B ‘ is unable to reasonably demonstrate to
the satisfaction of ‘ A ‘ the assembly process (skilled manpower, tools & consumables if provided
by ‘ B ‘) within the aforesaid ninety (90) days period, then and only for such time as ‘ B ‘ cannot
do so, ‘ A ‘ shall be permitted to produce itself or procure from a third party.
11.5 ‘ B ‘ shall at its own cost be responsible for complying with all Applicable Laws and statutory
obligations, obtaining and maintaining all required approvals, licenses, permits, and regulatory
permissions. ‘ B ‘ shall be responsible for timely payment of wages, salaries and all statutory dues
to ‘ B ‘ employees and shall comply with all applicable labour and employee related laws. ‘ B ‘
agrees to indemnify ‘ A ‘ and hold ‘ A ‘, its Affiliates, assignees and its directors, officers,
employees and agents harmless from and against any and all suits, claims and proceedings by
third parties resulting in liabilities, damages, costs, losses and expenses, including court costs and
reasonable attorneys’ fees, which arise due to any non-compliance or any inaction or wrong
action that would lead to labour unrest or otherwise which would result in stoppage or slow
down in assembly process and timely delivery of the Products.
11.6 ‘ B ‘ shall take proper care and be responsible for storage and security of ‘ A ‘ Machinery, KD
Kits, work in progress (WIP) and the Products stored or situated in the ........ Assembly Area or in
‘ B ‘ Property, whilst ‘ A ‘ Machinery, KD Kits, work in progress (WIP) and the Products is in
custody and control of ‘ B ‘. ‘ B ‘ shall take appropriate insurance to mitigate its risks. For
avoidance of doubt, the insurance fee which arising to take such insurance shall be calculated in
the Assignable Cost. The insurance policies shall be endorsed in favour of ‘ A ‘ and copies shall
be provided to ‘ A ‘.
11.7 ‘ B ‘ shall responsible to any damage of ‘ A ‘ Machinery stored or situated in the ........ Assembly
Area or in ‘ B ‘ Property during the assembly and/or manufacture operations which solely caused
by ‘ B ‘’s failure, negligence and/or fault as founded and decided by Joint Investigation
Committee. ‘ B ‘ may, at its sole discretion, take appropriate insurance at its own cost to mitigate
its risks.
11.8 ‘ B ‘ shall obtain all statutory and necessary insurance for ‘ B ‘’s labour and employees deployed
or engaged by ‘ B ‘ including third party liability comprehensive insurance at its own costs to

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mitigate its risks which shall remain valid and enforceable till such time ‘ B ‘ holds ‘ A ‘
Machinery in its custody. The insurance policies shall be endorsed in favour of ‘ A ‘ and copies
shall be provided to ‘ A ‘.
11.9 During the term of this Agreement, ‘ B ‘ either by itself or through Affiliate shall not engage into
any transactions or operations within ‘ B ‘ Property with any third party which may have a direct
competition with ‘ A ‘ Products in terms of usage, weight and engine capacity.
11.10 ‘ B ‘ shall ensure regular maintenance and upkeep of its facilities, ‘ B ‘ Machinery, ‘ A ‘
Machinery; ensure inventory control management, decontainerization, storage, material supply to
line etc. as per the Workflow Process.
12 OBLIGATIONS OF ‘ A ‘
‘ A ‘ shall:
12.1 provide ‘ B ‘ with technical assistance reasonably required by ‘ B ‘ to manufacture and assembly
the Products (as supplemented or amended from time to time) in accordance with the
Specifications;
12.2 provide and supply to ‘ B ‘ quality Components and KD Kits which manufactured according to
the Specifications, Quality Standards and in accordance with sound quality control procedures for
the purpose of the assembly and manufacture process of the Products;
12.3 train the selected initial batch of ‘ B ‘ employee (maximum of 3-5 skilled manpower) for the
agreed period at ........ Motors India’s plant at the expense of ‘ A ‘ at the start of the
manufacturing and assembly operations. For avoidance of doubt, the expenses of ‘ B ‘ employee
that shall be borne by ‘ A ‘ are limited to the lodging, boarding and traveling expenses.
12.4 provide at its own cost to ‘ B ‘ ‘ A ‘ Machinery, Tools (which shall be procured by ‘ A ‘), KD
Kits and Components necessary to enable ‘ B ‘ to comply with its obligations under this
Agreement (including without limitation, ensuring that ‘ B ‘ has sufficient stock of KD Kits to
meet ‘ A ‘’s Requirement;
12.5 install at its own cost ‘ A ‘ Machinery which stored or situated in the ........ Assembly Area or in ‘
B ‘ Property for carrying out manufacturing and/or assembling operations of the Products;
12.6 modify at its own cost ‘ B ‘ Machinery and Common Utility and Facilities to suit assembly and
ready to operate for carrying out manufacturing and/or assembling operations of the Products.
12.7 where requested to do so by ‘ B ‘ provide ‘ B ‘ with such documentation as is reasonably required
by ‘ B ‘ to fulfill its obligations under the Applicable Laws;
12.8 provide ‘ B ‘ with such assistance and support implementation of changes to Specifications as
reasonably required by ‘ B ‘;
12.9 co-operate with ‘ B ‘ in good faith in relation to the operation of ‘ B ‘’s manufacturing facility
and the manufacture of the Products pursuant to this Agreement;
12.10 conduct additional process audits and checks at ........ Assembly Area; and

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12.11 pay in time Manufacturing Charges as provided in this Agreement.
12.12 co-operate with the Joint Investigation Committee in investigating complaints which submitted by
‘ B ‘ that the failure, defects and/or damages of the Products is arising due to ‘ A ‘’s fault and/or
negligence and/or which arising due to failure, defects and/or damages in ‘ A ‘ Machinery and/or
design and/or wrong or late supply of any of the Components and/or KD Kits
13 MANUFACTURING CHARGES
13.1 In consideration of Products' manufacturing and delivery by ‘ B ‘ to ‘ A ‘, ‘ A ‘ shall pay ‘ B ‘
Manufacturing Charges as outlined below:
13.1.1 ‘ B ‘ shall be entitled to receive Manufacturing Charges (subject to withholding taxes, if any) on
per unit basis for the manufacture and deliver of Products to ‘ A ‘;
13.1.2 The Costs calculated on per unit basis as per Annexure VI shall be subject to review on quarterly
basis. Any revision in the Costs shall be in effect only upon mutual agreement of the Parties. The
Parties have arrived at maximum Costs to be reimbursed to ‘ B ‘ for manufacture and assembly of
Products at five (5) best scenarios based on capacity utilization as per the Cost Sheet in
Annexure VI, which shall be subject to quarterly review. The escalation in Costs may be
reviewed only on annual basis keeping in mind movement in consumer price index in Indonesia.
In the event the Parties cannot arrive to a conclusion for revision of the Costs, the Parties shall
jointly appoint an independent automotive industry expert to resolve and conclude on the
escalation and revision of the Costs. The decision of the automotive industry expert shall be
binding on the Parties.
13.2 ‘ B ‘ shall raise the invoice for the manufacturing and assembly operations of a month on the fifth
(5th
) of the following month for the assembly done in the previous month, which shall become
payable at the end of the following month.
13.3 ‘ A ‘ shall make the payment to ‘ B ‘ for the Manufacturing Charges on a monthly basis. Payment
by ‘ A ‘ pursuant to this clause shall be effected by transfer of funds to the bank account of ‘ B ‘
as notified by ‘ B ‘ to ‘ A ‘ in writing. ‘ A ‘ shall have the right to adjust from the payments, the
charges and penalties for Products which found and decided by Joint Investigation Committee as
defective and/or do not confirm to the Specifications or meet the parameters.
13.4 In the event of a dispute over any invoice or other request for payment pursuant to this
Agreement, the Party from whom the payment is claimed shall notify the other Party in writing as
soon as reasonably practicable of the nature of the dispute and shall be entitled to withhold the
amount which is subject to dispute, pending resolution of the same (but shall pay any amount not
disputed) in accordance with the provisions of this Agreement. The Parties shall attempt promptly
and in good faith to resolve any dispute regarding such amounts owed.
13.5 ‘ A ‘ shall be entitled to deduct all applicable withholding taxes on payments to ‘ B ‘ under or in
connection with this Agreement.
14 ........ ASSEMBLY AREA
14.1 ‘ B ‘ shall only manufacture and store the Products in the ........ Assembly Area unless the prior
written consent of ‘ A ‘ is obtained.

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14.2 ‘ B ‘ shall not, without the prior consent of ‘ A ‘, market,offer,sell,transfer or otherwise dispose of
the ........ Assembly Area or permit mortgages,charges,pledges, claims or demands of any nature or
otherwise encumber any of the ........ Assembly Area except for interestsgranted in favor of ‘ A ‘. For
avoidance of doubt, the provision of Clause 14.2 shall cease to apply for any legal and/or financial
transactions, which related to ........ Assembly Area, which have been conducted by ‘ B ‘ and/or
have been existing, informed and/or provided by ‘ B ‘ to ‘ A ‘ before the Signature Date.
15 TITLE AND RISK
15.1 Title of the Products, KD Kits, Components, ‘ A ‘ Machinery and the non-conforming Products
and the scrap / wastages shall always remain with ‘ A ‘.
15.2. The risk in the ‘ A ‘ Property shall always remain with ‘ B ‘ whilst in its custody and ‘ B ‘ shall
be obliged to take necessary security and safety as per Clause 11.6 of the Agreement.
15.3 ‘ B ‘ shall immediately upon receipt of ‘ A ‘ Machinery provide to ‘ A ‘ a notarized statement
stating that the ‘ A ‘ Machinery which stored and/or installed in the ........ Assembly Area, belongs
exclusively to ‘ A ‘ and ‘ A ‘ shall have exclusive and uninterrupted right to remove the same
whenever ‘ A ‘ deems fit.
16 CONFIDENTIALITY
16.1 This Agreement shall be kept confidential and none of its terms and conditions (or parts thereof)
shall be communicated, divulged or disclosed by either Party to any third party without the prior
written consent of the other Party. However,the Parties hereby agree that it may be necessary for
either Party to file this Agreement with relevant government authority to enable such Party to get
necessary license and/or permit. In such event, the Parties agree to co-operate with each other in
complying with such requirement of the Parties. The Parties is further agreed that:
16.1.1 Each Party shall, during the Term of this Agreement and ..... (.........) years after the expiration or
termination of this Agreement (the “Confidentiality Period”), keep strictly confidential all
Products related information as well as all other Confidential Information that is provided to a
Party before or during the Term of this Agreement, irrespective of the form and/or nature of the
information.
16.1.2 The receiving Party shall only disclose the Confidential Information to its directors, officers,
employees and/or sub-contractor on a ‘need to know’ basis for the purpose of this Agreement,
and shall ensure that such directors, officers, employees and/or any sub-contractor are aware of
and undertake to maintain the confidential nature of such Confidential Information;
16.1.3 The receiving Party shall not duplicate or reproduce Confidential Information, except as may be
necessary for circulation thereof to such directors, officers, employees and/or any sub-contractor
on a ‘need to know’ basis.
16.2 For the avoidance of doubt, each Party may disclose Confidential Information to any of its
Affiliates to the sole extent necessary to advance the performance and observance of the
obligations contained in this Agreement and the receiving Party shall ensure that such Affiliates
are aware and undertake to maintain the confidential nature of such Confidential Information.
16.3 Nothing contained in Clause 16.1 above shall be deemed to prevent communication by the
receiving Party of any Confidential Information to its professional advisers including outside

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PT............................... .................................
counsel, tax experts,audit firms to the extent necessary for the purpose of this Agreement, subject
to such professional advisers being bound by the same obligations of confidentiality under this
Agreement.
16.4 Each Party shall use Confidential Information exclusively in accordance with the terms of this
Agreement. Any other use including reproduction shall require the prior authorization of the
disclosing Party.
16.5 Any Confidential Information disclosed by one Party to the other Party shall be treated as
confidential except for information, which is:
16.5.1 already known to the receiving Party at the date of disclosure, which shall be supported by
written evidence;
16.5.2 in the public domain at the date hereof or which becomes public knowledge during the Term
through no act of the receiving Party in breach of this Agreement;
16.5.3 disclosed to the receiving Party by a third party in good faith and without restriction or notice of
any restriction; and/or
16.5.4 legally required to be provided to any judicial, administrative or governmental authority having
such jurisdiction, provided however that the disclosing Party shall promptly notify the other Party
in writing of such disclosure, so that such other Party may seek an appropriate remedy with the
confidentiality provisions of this Agreement.
16.6 The Confidentiality Period shall commence as of the Signature Date and shall survive until .........
(...........) years after the expiration or termination of this Agreement. The breach of this Clause 16
shall be construed as a material breach and the Party not in default may terminate this Agreement
forthwith in case of breach on the part of the defaulting Party.
17 TERM AND TERMINATION
17.1 This Agreement shall be valid and subsisting for a period of three (3) years from the
Commencement Date (“Term”). This Agreement may be renewed for a further period as may be
agreed between the Parties in writing. .
17.2 This Agreement may be terminated forthwith by written notice upon the occurrence of any or
more of the following events:
17.2.1 By the other Party, if a Party hereto commits a material breach of any of its obligations under this
Agreement and fails to remedy the same within sixty (60) days after receipt of written notice from
the other Party requiring the breach to be remedied; notice of termination shall not be less than
thirty (30) days and shall not be given unless and until a notice requiring the defaulting Party to
remedy the default within the aforesaid sixty (60) days period has been given by the non-
defaulting Party;
17.2.2 By either Party, if a Party hereto becomes incapable for a period of more than sixty (60) days of
performing any of its material obligations under this Agreement because of Force Majeure; notice
of termination shall not be less than thirty (30) days;
17.2.3 By the other Party, if either Party hereto should become insolvent, have a receiver or

______ _______
PT............................... .................................
administrator appointed of its assets, or if a petition for bankruptcy is filed by the Party itself or if
other bankruptcy proceedings are commenced; notice of termination may be immediate.
17.3 Termination of this Agreement shall be without prejudice to the accrued rights and liabilities of
the Parties on the date of termination, unless expressly waived in writing by the Parties.
17.4 Upon the expiration or termination of this Agreement,:
17.4.1 ‘ B ‘ shall cause ‘ A ‘ to take immediate physical inspection of ‘ A ‘ Property and agree on the
missing, damaged item and workout the action plan with ‘ A ‘ for compensation of the missing
and damaged item as well as safe removal of ‘ A ‘ Property and ensure safety of ‘ A ‘ Property till
‘ A ‘ removes ‘ A ‘ Property from ‘ B ‘ Property. Till such time, ‘ B ‘ remains in the possession of
‘ A ‘ Property, ‘ B ‘ shall be obliged to keep insurance policy covering value of the ‘ A ‘ Property
valid and shall continue to act as bailee for keeping the ‘ A ‘ Property its possession. For
avoidance of doubt, the insurance fee which arising to take such insurance shall be calculated in
the Assignable Cost. The insurance policies shall be endorsed in favour of ‘ A ‘ and copies shall
be provided to ‘ A ‘;
17.4.2 ‘ B ‘ shall promptly cease to use and refrain from using any ‘ A ‘ Machinery, Tools (which
belong to and/or provided by ‘ A ‘), equipments (which belong to and/or provided by ‘ A ‘), KD
Kits, Products or part thereof at ‘ B ‘'s premises, the technical information and the Confidential
Information provided to ‘ B ‘;
17.4.3 ‘ B ‘ shall allow ‘ A ‘’s representative unrestricted rights any time to enter the ........ Assembly
Area and ‘ B ‘ Property to dismantle and remove ‘ A ‘ Machinery, Tools (which belong to and/or
provided by ‘ A ‘), equipment (which belong to and/or provided by ‘ A ‘), Components, KD Kits,
Products or parts thereof at ‘ B ‘’s Property, provided that ‘ A ‘ shall make prior written notice to
‘ B ‘ before the dismantling and removing process is conducted;
17.4.4 ‘ B ‘ shall promptly return to ’ A ‘ all documents containing Confidential Information of ‘ A ‘
(including, but not limited to, any reproduction, notes and summaries, print-outs or copies of
information stored in electronic or computerized systems) and any other items put at ‘ B ‘’s
disposal by ‘ A ‘;
17.4.5 ‘ B ‘ shall ensure that no third party shall obstruct or delay ‘ A ‘ or its contractors in the removal
of ‘ A ‘ Machinery, Tools (which belong to and/or provided by ‘ A ‘), equipments (which belong
to and/or provided by ‘ A ‘), KD Kits, Products from the ‘ B ‘'s Property;
17.4.6 ‘ B ‘ shall not to create any third party rights or any charge, mortgage, or lien on the ‘ A ‘
Machinery, Tools (which belong to and/or provided by ‘ A ‘), equipments (which belong to
and/or provided by ‘ A ‘), KD Kits, Products or obtain any injunction from any court or statutory
authority restricting ‘ A ‘ to enter the ‘ B ‘ Property and remove the ‘ A ‘ Machinery, Tools
(which belong to and/or provided by ‘ A ‘), equipments (which belong to and/or provided by ‘ A
‘), KD Kits, Products;
17.4.7 ‘ A ‘ shall promptly return to ‘ B ‘ all documents and/or information containing Confidential
Information of ‘ B ‘ (including, but not limited to, any reproduction, notes and summaries, print-
outs or copies of information stored in electronic or computerized systems) and any other items
put at ‘ A ‘’s disposal by ‘ B ‘;

______ _______
PT............................... .................................
17.4.8 ‘ A ‘ shall pay to ‘ B ‘ any and all outstanding amount of the Manufacturing Charges and/or any
other fee or payment which due and payable until the effective date of the expiration or
termination of this Agreement.
17.5 It is agreed between the Parties that in case of delay, which based on finding and decision of Joint
Investigation Committee, is solely caused by ‘ B ‘ for ‘ A ‘ or its contractors or representatives to
remove ‘ A ‘ Property which are lying at ‘ B ‘ Property or any damage is caused to any of the ‘ A
‘ Property whilst lying at ‘ B ‘ Property, which based on finding and decision of Joint
Investigation Committee, is solely cause by ‘ B ‘, then, if decided and ordered by the Joint
Investigation Committee to do so, ‘ B ‘ shall be liable to pay for damages to ‘ A ‘ at actual and
shall also be liable to pay as and by way penalty of ............... per day for delay caused due to not
handing over ‘ A ‘ Property to ‘ A ‘ as per directive of ‘ A ‘.
17.6 The Parties agree to waive the provisions of Article 1266 of the Indonesian Civil Code to the
extent that a court approval or a court order is required to terminate this Agreement.
18 INDEMNITY AND LIABILITY
18.1 ’ B ‘ agrees to indemnify and hold ’ A ‘, its Affiliates, assignees and each of its and their
directors, officers, employees and agents (collectively, the “Indemnified Parties”) harmless from
and against any and all suits, claims and proceedings by third parties resulting in liabilities,
damages, costs, losses and expenses, including court costs and reasonable attorneys’ fees
consequential losses (collectively “Losses”), which arise out of the performance or non-
performance by ’ B ‘ of its obligations contemplated by this Agreement or out of the breach of
any representation or warranty of ‘ B ‘ given pursuant to this Agreement, including without
limitation Losses arising from and relating to (i) any personal injury or property damage
occurring in or about the premises of ’ B ‘ or, ........ Assembly Area where such accident, injury or
damage results from an act, omission or negligence of ‘ B ‘ or its contractors, licensees, agents,
servants, subcontractors, employees, or any person acting on its behalf; (ii) the breach by ’ B ‘ of
any covenant, warranty or condition of this Agreement; (iii) any infringement of any Intellectual
Property or proprietary right of any third party arising out of the performance of the obligations of
’ B ‘ pursuant to or in connection with this Agreement; and (iv) any taxes, penalties, interest
and/or fines assessed by any governmental unit against of the Indemnified Parties in connection
with this Agreement.
18.2 ’ A ‘ shall promptly provide ’ B ‘ with written notice of any claim which ’ A ‘ believes falls
within the scope of this Clause 18, but failure to give such notice shall not relieve ‘ A ‘ of its
obligations described in this Clause 18. ’ B ‘ hereby acknowledges that its indemnity pursuant to
this Clause 18 shall include all amounts which may become payable by ’ A ‘ to any indemnity or
liability of ’ A ‘, to indemnify and hold harmless the Indemnified Parties for any Losses suffered
by it, resulting from the performance or non-performance by ’ B ‘ of its obligations contemplated
by this Agreement. This indemnification shall survive termination or expiry of this Agreement.
18.3 ‘ A ‘ shall not be liable to ‘ B ‘ or any of the ‘ B ‘’s employees, officers, agents or representatives,
under or in connection with this Agreement (or any collateral contract thereto) for any loss of income,
loss of actual or anticipated profits, loss of business, loss of contracts, loss of goodwill or reputation, loss
of anticipated savings, loss of or damage to or corruption of data, or special, indirect or consequential loss
or damage of any kind, in each case howsoever arising, whether such loss or damage was foreseeable or
in the contemplation of the Parties and whether arising in or caused by breach of contract, breach of
statutory duty or otherwise.

______ _______
PT............................... .................................
18.4 Parties agree that in any event, the total liability of ‘ A ‘ in any Contract Year under this
Agreement shall not exceed the Manufacturing Charges payable by ‘ A ‘ for such Contract Year.
18.5 ‘ B ‘ shall when it becomes aware of a matter which may result in a product liability of KD Kits
and/or warranty claims and / or defects in the KD Kits themselves (a "Product Liability Claim"):
18.5.1 immediately notify ‘ A ‘ of the details of the matter;
18.5.2 give and procure that ‘ B ‘ gives ‘ A ‘ any information, materials, records or documents as ‘ A ‘
may request;
18.5.3 allow ‘ A ‘ to support ‘ B ‘ in any Product Liability Claim without any assumption of liability by ‘
A ‘ or to have the exclusive conduct of any proceedings and/or take whatever action as ‘ A ‘ shall direct
to defend or resist the matter, including the use of professional advisers nominated by ‘ A ‘; and
18.5.4 not admit any liability or settle the matter without the prior written consent of ‘ A ‘.
18.6. Subject to Clause18.5, ‘ A ‘ shall indemnify ‘ B ‘ and keep ‘ B ‘ fully and effectively indemnified
from and against final judgments for monetary damages awarded against ‘ B ‘ (less any amounts payable
by any third party to ‘ B ‘ in relation to such judgment) to the extent that such final judgment holds that ‘
A ‘ is legally liable for the failure that is the subject of the Product Liability Claims in the Territory.
19 FORCE MAJEURE
19.1 Each Party shall for the time of the Force Majeure be excused performance under this Agreement
and neither shall be liable to the other for any losses or damages resulting from any delay in or
prevention of the performance of its obligations hereunder, caused by Force Majeure, provided,
however that such Party having knowledge of such cause shall notify the other Party at the latest
seven (7) days after the existence of the Force Majeure, and take all reasonable steps to mitigate
losses or damages suffered by the other Party from such cause, and that the Parties shall consult
each other, on mutually co-operative basis, regarding the solutions of losses, expenses, costs,
charges or damages incurred by either of the Parties. Failure by the Party having knowledge of
Force Majeure to notify the other Party in accordance with this Clause 19.1 shall result such Party
is losing its right to rely upon (or to continue to rely upon) the event of Force Majeure to which
the non-performance of its obligation relates and such Party shall conduct its obligation as if the
Force Majeure condition has been passed and/or never occurs.
19.2 During the continuance of the Force Majeure, it is hereby mutually agreed that at any time
subsequent to the occurrence of Force Majeure, either Party may, upon its request, discuss
amicably with the other Party in order to set the provisional arrangements to be adopted by the
Parties for the purpose of minimizing or avoiding any losses, damages or expenses which may
arise and incur by such Party due to the occurrence of Force Majeure..
19.3. The other Party may terminate this Agreement with prior written notification if the Force Majeure
continues for sixty (60) days or longer, being understood that such termination, unless otherwise
agreed upon between the Parties, shall not be conducted and/or effective before the
abovementioned continuous sixty (60) days or longer has elapsed. For avoidance of doubt, notice
of termination shall not be less than thirty (30) days.

______ _______
PT............................... .................................
19.4. The occurrence of Force Majeure shall not entitle either Party to any additional compensation
whatsoever unless otherwise agreed between both Parties.
20 MISCELLANEOUS
20.1 Representative:
Throughout the contract team, each of the Parties shall nominate and maintain a contact person
(with authority to take decisions with regard to the operation of this Agreement) as their
respective first point of contact in connection with matters arising in connection with the
operation of this Agreement and shall notify the other in writing of the name, address, telephone,
fax and e-mail contact details of such person. Each Party shall be permitted from time to time to
appoint a replacement of such nominee. Each Party shall promptly notify the other of any change
in the identity or contact details of such contact person.
20.2 Notices:
Any notice or written communication provided for in this Agreement by either Party to the other,
including but not limited to any and all offers, writings, or notices to be given hereunder, shall be
made in English by facsimile or by letter delivered by courier service. The date of receipt of a
notice or communication hereunder shall be deemed to be five (5) days after the letter is given to
the courier service in the case of a letter delivered by courier service and two (2) working days
after dispatch of a facsimile if evidenced by a transmission report. All notices and
communications shall be sent to the appropriate address set forth below, until the same is changed
by notice given in writing to the other Party:
‘ A ‘:
Attention: The President Director
PT _____________________
........................................................
........................................................
........................................................
........................................................
Telephone: ...............................
Facsimile: .............................
E-mail: ...........................
‘ B ‘:
Attention: The President Director
PT _____________________
..........................................................
..........................................................
.........................................................
Telephone: ................................
Facsimile: ............................
E-mail: ..........................
20.3 Waiver:

______ _______
PT............................... .................................
Failure or delay on the part of either Party to exercise any right, power or privilege under this
Agreement shall not operate as a waiver thereof; nor shall any single or partial non-exercise of
any right, power or privilege preclude any other future exercise thereof.
20.4 Severability:
This Agreement is severable in that if any provision hereof is determined to be illegal or
unenforceable, the offending provision shall be stricken without affecting the remaining
provisions of this Agreement, in which case, if appropriate and necessary, the Parties shall
immediately consult with each other in order to find an equitable solution.
20.5 Whole Agreement:
This Agreement and all annexure and attachments set forth herein and hereto constitutes the
entire agreement of the Parties with respect to the subject matter of this Agreement and supersede
all prior agreements, understandings and representations, written and oral, as of the date hereof.
20.6 Governing Law:
The validity, interpretation, implementation and resolution of disputes of this Agreement shall be
governed by the laws of Indonesia without regard to the conflicts of laws rules thereof.
20.7 Mediation:
20.7.1 In the event of any dispute, controversy, claim and/or difference arising out of or relating to this
Agreement, or the performance, breach, termination, or invalidity hereof (a “Dispute”), such
Dispute shall be the subject of an attempt at an amicable solution binding on the Parties. The
Parties shall adhere to the following process in case of early termination of this Agreement for
cause on account of the Dispute which may arise between the Parties.
20.7.2 In case any Dispute, the Parties shall hold a maximum of two (2) meetings where the Parties will
try to resolve the Dispute. The first level meeting will be confirmed by ............. of ‘ A ‘ and .........
of ‘ B ‘ (the “Senior Managers”) (the “First Level Meeting”). The First Level Meeting shall be
called by either Party through a notice to the other Party, giving a concise description of the
matter in question and the position of such Party in respect thereof. In the event that the First
Level Meeting is called, the meeting shall take place within ten (10) days of being requested
(unless otherwise agreed by the Parties in writing by mutual consent to hold such meeting beyond
ten [10] days). If no solution is adopted at the First Level Meeting, the Parties must hold a second
level meeting which will be confirmed by ......... of ‘ A ‘ and ............ of ‘ B ‘ (the “Senior
Management”) (the “Second Level Meeting”). This Second Level Meeting will take place
within ten (10) days after the First Level Meeting (unless otherwise agreed by the Parties in
writing by mutual consent to hold such meeting beyond ten [10] days). If the Dispute is not
resolved after the Second Level Meeting, then each Party is hereby expressly authorized to
initiate its own actions and refer the Dispute for resolution to arbitration as provided in Clause
20.8.
20.8 Dispute Resolution:
20.8.1 In case Parties fails to resolve the Dispute, arises out of or in connection with this Agreement or
its performance, including without limitation any Dispute regarding its existence, validity,
termination of rights or obligations of any Party, then either Party may submit the Dispute to a

______ _______
PT............................... .................................
Board of Arbitration under the applicable rules of the Singapore International Arbitration Centre
(SIAC) (the “Rules”). The arbitration shall be conducted before three (3) arbitrators, each of the
Party shall appointed one arbitrator and the third arbitrator which also will act as the presiding
arbitrator shall be appointed by the Chairman of SIAC in accordance with the said Rules. The
language of such arbitrationshall be English, venue and seat of arbitration being at Singapore.
Any notice of arbitration, response or other communication given to or by a Party to the Board of
Arbitration must be given and deemed received as provided in the Rules. The arbitration award
shall be final and binding the Parties.
20.8.2 For the purpose of enforcing any arbitration awards,the Parties choose the general permanent and
non-exclusive domicile of the office of the Registrar of the Central Jakarta District Court (Kantor
Panitera Pengadilan Negeri Jakarta Pusat) without prejudice to the Parties' right to enforce any
arbitration award in any court having jurisdiction over the other Party or its assets.
20.8.3 Each Party agrees that it will not institute any legal proceedings arising out of or in connection
with this Agreement, except only as provided in this clause, and to enforce in any court having
jurisdiction any award rendered by the arbitrators. If any legal proceedings are instituted in any
court to enforce any arbitration award, the Party against whom enforcement of that arbitration
awards is sought must pay all costs, including without limitation the costs of legal counsel and
translation fees, of the Party seeking to enforce the arbitration award.
20.9 Independent Contractor:
Each Party hereto is an independent contractor and nothing contained in this Agreement shall be
construed to be inconsistent with this relationship or status. Nothing in this Agreement shall be in
any way construed to constitute either Party as the agent, employee or representative of the other.
As an independent contractor, each Party has relied on its own expertise or the expertise of its
legal, financial, technical or other advisors. Neither Party shall have any authority nor power to
make any statements, representations pr commitments of any kind, or to take any action which is
binding on the other Party, except as be explicitly provided for herein or authorized by the other
Party in writing. The Parties hereby agree that, unless otherwise agreed in writing, neither Party
shall engage either directly or indirectly the personnel employed by other Party at least for a
period of twelve (12) months from the date of cessation of employment of such personnel from
other Party.
20.10 Non-Assignment:
Neither Party may assign, cede or transfer this Agreement nor any of its right and obligation
herein to any third party without the prior written consent from the other Party.
20.11 Costs:
Each Party hereto will bear the legal, accounting and other expenses incurred by such Party in
connection with the negotiation, preparation and execution of this Agreement and the documents
and transactions contemplated hereby.
20.12 Taxation:
Each Party must comply with the prevailing tax laws and regulations, especially but not limited to
tax obligation of the company and its employees. Except if stipulated otherwise in this
Agreement, each Party shall bear its own tax liability which ought to be borne by such Party as
per prevailing laws of .......................

______ _______
PT............................... .................................
20.13 Amendment:
This Agreement may be amended only by an instrument in writing signed by duly authorized
representatives of each of the Parties.
20.14 Language:
The Parties acknowledge that this Agreement is prepared, negotiated and agreed by the Parties in
the English language and that the Indonesian text of this Agreement will be prepared to comply
with Law No. 24 of 2009 on The Flag, the Language, the National Emblem, and the National
Anthem if requested by a Party. If requested by a Party, the Parties will sign an Indonesian
version of this Agreement. In the absence of an Indonesian version, the Parties hereby disclaim
any benefit from, or any right to cancel or declare this Agreement null and void because of, the
absence of an Indonesian version pursuant to the Indonesian Law No. 24 of 2009. In the event of
any inconsistency between the Indonesian and English language versions, to the maximum extent
permitted by law, the English language version shall prevail to the extent of such inconsistency.
20.15 Counterpart:
This Agreement shall be executed in two (2) counterparts, each of which shall constitute an
original but all of which together shall constitute one and the same instrument.
20.16 The Parties hereby agree that:
20.16.1 this Agreement shall bind ‘ A ‘ only when it bears the signatures of the President Director of ‘ A
‘;
20.16.2 no one except the President Director of ‘ A ‘ is authorized on behalf of ‘ A ‘ (unless previously
authorized by ‘ A ‘ in writing) to make or execute this Agreement or in any manner to modify the
terms hereof or to terminate this Agreement, and then only by a written instrument any consent or
approval granted by anyone else shall not have effect and
20.16.3 ‘ B ‘ agrees that it shall be represented by its President Director entitled to represent and bind ‘ B
‘ (or a person previously authorized by the President Director) in respect of any acts, actions,
amendments and modifications or renewal of this Agreement.
IN WITNESS WHEREOF, Parties have caused this Agreement to be executed by their respective officers
or other representatives thereunto duly authorized, as of the date first above written.
Signed and delivered on behalf of PT.
_____________________ by Mr. ............., ..............,
in the presence of Mr. ..........., ..............
)
)
)
)
)
)
)
Signed and delivered on behalf of PT.
_____________________,by Mr. ...............,..............,
in the presence of Mr. ............., ..............
)
)
)

______ _______
PT............................... .................................
)
)
)

______ _______
PT............................... .................................
Annexure I(a)
Site Plan of ‘ B ‘ Property

______ _______
PT............................... .................................
Annexure I(b)
Site Plan of ........ Assembly Area

______ _______
PT............................... .................................
Annexure II
List of ‘ B ‘ Machinery

______ _______
PT............................... .................................
Annexure III
List of ‘ A ‘ Machinery

______ _______
PT............................... .................................
Annexure IV
Specification of KD Kits

______ _______
PT............................... .................................
Annexure V
List of Common Utilities and Facilities

______ _______
PT............................... .................................
Annexure VI
Cost Sheet

______ _______
PT............................... .................................
Annexure VII
Manpower Structure

______ _______
PT............................... .................................
Annexure VIII
Office Infrastructure exclusively for ‘ A ‘

______ _______
PT............................... .................................
Annexure IX
List of Consumables

______ _______
PT............................... .................................
Annexure X
List of Tools

______ _______
PT............................... .................................
Annexure XI
List of Products

______ _______
PT............................... .................................
Annexure XII
Workflow Process

______ _______
PT............................... .................................
Annexure XIII
Preparation Schedule

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