KD Production and Technology Assistance Agreement (Purchase this doc, Text: 08118887270 (Whatsapp))

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KD Production and Technical Assistance Agreement
Among
__________________ Ltd.;
PT __________________
and
[PT__________ ] [Official Name]

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Contents
Article 1 Definition
Article 2 Scheme of Transaction
Article 3 Prior Assessment and Acceptance
Article 4 Technical Assistance
Article 5 Localization
Article 6 Quality Control
Article 7 Product Liability and Intellectual Property Rights
Article 8 Inspection and Claims
Article 9 Termination
Article 10 Force Majeure
Article 11 Ethical Dealings
Article 12 Confidentiality
Article 13 Governing law & Arbitration
Article 14 Notice
Article 15 Version
Article 16 Assignability
Article 17 Severability
Article 18 No Implied Waiver
Article 19 Entire Agreement
Article 20 Heading
Article 21 Effectiveness of Agreement

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This KD Production and Technical Assistance Agreement (this “Agreement”) is
agreed and entered into at ....... place ......... on ........ date ............ by and
among:
1. __________________ Ltd., a company duly incorporated and existing under
the laws of People’s Republic of ..... with its legal address
at ...................................................... (Zip Code: 102206) (“Supplier”);
2. [ New JV (Official Name) ], a company duly incorporated and existing under
the laws of ................ and having its legal address
at .....................................(“Distributor”); and
3. PT __________________, a company duly incorporated and existing under
the laws of Indonesia and having its legal address
at ............................................... .................. (“Assembler”).
Supplier, Distributor and Assembler shall hereinafter be referred to individually
as a “Party” and collectively as the “Parties”.
WITNESSETH
A. WHEREAS, Supplier, as a leading automobile manufacturer in the People’s
Republic of ........, wishes to expand and enlarge its business of promoting
Supplier’s Vehicles (as hereinafter defined) in the Republic of Indonesia
(“Territory”); and
B. WHEREAS, Distributor desires to be Supplier’s exclusive distributor
(“Exclusive Distributor”) for certain Supplier’s Vehicles to promote such
Products (as hereinafter defined) in Territory directly and/or through its
Authorized Wholesalers and/or Retailers (as hereinafter defined) under the
certain assistance and support by Supplier and Supplier is willing to authorize
Distributor as its Exclusive Distributor in Territory pursuant to Distribution

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Agreement (“DA”) dated ............................. to be executed between Supplier
and Distributor; and;
C. WHEREAS, Assembler desires to provide its service for assembling KD
Parts (as hereinafter defined) of Supplier’s Vehicles into Products (as
hereinafter defined) in Territory under certain technical assistance from
Supplier and;
.
D. WHEREAS, Supplier is also willing to entrust Assembler to assemble
Products in Territory.
NOW, THEREFORE, after friendly discussions conducted in accordance with
the principles of equality and mutual benefit, the Parties hereto agree as follows:
Article 1 Definition
1. Definitions
In this Agreement, the following words and expressions have, except where
the context otherwise requires or unless otherwise defined herein, the
following meanings:
1.1 ”KD Parts” means the knock-down parts of Supplier’s Vehicles (as
hereinafter defined) purchased from Supplier by Distributor for the
purpose of assembling it into Supplier’s Vehicles in Territory.
1.2 “Products” means Supplier’s Vehicles locally assembled by
Assembler under this Agreement through assembling KD Parts and/or
Localized Parts (as hereinafter defined).
1.3 “Localized Parts” means the parts sourced by Assembler and
purchased by Distributor from local manufacturers or suppliers for the
purpose of assembling Products in Territory, subject to approval by

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Supplier.
1.4 ”Sample“ means (i) the parts or assemblages of units confirmed by
the Parties for the purpose of the reference to the quality standard of
Localized Parts; or (ii) the vehicle in the form of complete-built unit
(“CBU”) confirmed by the Parties and supplied by Supplier for the
purpose of making it a sample to Products.
1.5 “Quality Control Criteria” means the Product’s quality control criteria
provided by Supplier and implemented by Assembler.
1.6 “Quality Assurance System” means that the organization, procedure,
process and resources applied during the assembly of Products by
Assembler which shall be managed pursuant to the relevant
provisions of Article [8] hereinafter.
1.7 “Quality Appraisal Report” means the appraisal report issued by
Supplier, after Supplier’s completion of the annual quality appraisal on
the quality control process at Assembler pursuant to the Article [8]
hereinafter.
1.8 “Ex-factory Examination and Acceptance Standard” means the
quality standard that Products shall meet at the examination and final
acceptance by Supplier when Products is rolled out of Assembler.
Such standard shall be provided to Assembler by Supplier, or decided
and confirmed by the discussion of Supplier and Assembler. The
standard of one Sample vehicle (which have been defined by both
Parties) may also be applied as Ex-factory Examination and
Acceptance Standard, in the event that Supplier and Assembler
expressly agrees in writing.
1.9 “Territory” means the Republic of Indonesia.
1.10 “Calendar Year” means Gregorian calendar year, beginning
on ............... and ending on ..........................
1.11 “Supplier’s Vehicles” means the automobiles designed and

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developed by Supplier which are being or will be sold in various
markets with certain brand name(s).
1.12 “Spare Parts” means the spare parts and accessories in bulk for
maintenance which are assembled and/or manufactured by Supplier
or the commissioner authorized by Supplier and sold to Distributor by
Supplier.
1.13 “Authorized Wholesalers and/or Retailers” means the wholesalers
and/or retailers authorized by Distributor with the prior approval of
Supplier in writing, who shall purchase Products and Spare Parts from
Distributor for the purpose of selling Products to end users as well as
providing after-sales service to Products in Territory.
1.14 “Technical Information” means the technical information and
documents which are necessary for assembly of Products, to be
provided by Supplier to Distributor pursuant to Article 4. The details of
such Technical Information shall be referred to Annex [1].
1.15 “Engineering, Technical Assistance Personnel(s)” means
Supplier’s personnel who shall be proficient in engineering, production
technology and quality control technology of Products, and also be
capable of instructing Assembler’s technicians on assembling and
engineering Products.
1.16 “Distributor’s Engineer(s)” means Supplier’s engineer(s) seconded
to Distributor by Supplier as Technical and Engineering Senior
Coordinator at Distributor on stationed basis, who shall have the same
technical competency and function as Engineering, Technical
Assistance Personnel(s).
2. Headings
All headings and captions used in this Agreement are only for convenience of

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reference and shall not affect the meaning or interpretation of this
Agreement.
Article 2 Scheme of Transaction
2.1 Pursuant to DA and Individual Sales Contract (as hereinafter defined) to be
executed between Supplier and Distributor, Supplier authorizes
(“Authorization”) Distributor as its Exclusive Distributor of Products in
Territory and agrees to supply Distributor, and/or cause Distributor to be
supplied KD Parts in the form of Complete Knock Down (“CKD”) parts on
CIF Indonesian port basis (Incoterms 2010).
2.2 Distributor shall be responsible for customs clearance at Indonesian port
and inland transportation of KD Parts onto Assembler with the coverage of
appropriate insurance and deliver KD Parts to Assembler. Distributor shall,
within 3 (three) days after KD Parts’ delivery date at Assembler, inform
Supplier of the information on the time of delivery at Assembler.
Assembler shall assemble such KD Parts into Products (with Localized
Parts, as the case may be) subject to the terms and conditions in this
Agreement. The terms and conditions for such transaction for assembly
service of Products shall be discussed and decided by the Parties in detail
to form an assembling service contract (“Assembling Contract”) among
the Parties and the principle terms and conditions of Assembling Contract
shall be provided in Annex [........], unless otherwise agreed separately by
the Parties in writing. After the completion of assembly of Products, with
verification and confirmation by Distributor’s Engineer(s) that the
assembled Products should meet Ex-factory Examination and Acceptance
Standard, Assembler shall deliver Product (in the form of CBU) back to
Distributor at the premises of Assembler. Distributor shall pay the cost for

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such assembly to Assembler pursuant to Assembling Contract.
Subject to Article 7, Supplier shall be responsible for product liability in all
respect of Products after Products are confirmed by Distributor’s
Engineer(s) that Products meets Ex-factory Examination and Acceptance
Standard.
2.3 After the delivery of the KD Parts from the Supplier to the Distributor
pursuant to Article 2.1, title to the KD Parts and the Products shall at all
times be and remain in the Distributor. The Assembler shall bear all risks
relating to the KD Parts from the time of delivery by the Distributor of the
KD Parts pursuant to Article 2.2 and all risks relating to the Products until
the time of delivery of the Products to the Distributor pursuant to Article 2.2
hereof. The KD Parts and the Products shall be segregated from other
products and marked clearly as the Distributor's property by the Assembler
in a manner satisfactory to the Distributor, and with the date of delivery
from the Distributor of such KD Parts. The Assembler shall indemnify and
hold the Distributor harmless from all claims arising from or in connection
with the KD Parts and the Products during the time when the same shall be
at the Assembler's risk. In the event of any loss or damage to the KD Parts
or the Products during the time at which the same shall be at the
Assembler's risk, the Assembler shall, on Distributor's direction and within
the shortest practicable time, either: (a) replace the KD Parts or the
Products so lost or damaged; or (b) pay to the Distributor the then cost of
replacing the same.
2.4 In the event that certain manufacturing equipment (“Equipment”), such as
welding jigs and fixtures are necessary for Assembler to assemble
Products, Distributor may purchase or lease Equipment from Supplier (as
the case may be) and lease Equipment to Assembler. The terms and

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conditions for such supply, purchase and lease of Equipment shall be
discussed and decided among the relevant Parties to separately form an
individual contract for sale and purchase or lease of Equipment between
Supplier and Distributor, and another individual contract for lease of
Equipment between Distributor and Assembler. Assembler shall return
Equipment leased from Distributor at any time should Distributor request to
do so.
Article 3 Prior Assessment and Acceptance
3.1 Supplier and Distributor shall jointly conduct the assessment and
acceptance check to the conditions of Assembler’s production operations,
including, but not limited to facility of factory, workers, manufacturing
equipment, materials, manufacturing techniques, work procedure, to
confirm that such conditions should meet the requirements to assemble
Products, and such assessment and acceptance check shall include the
verification of production process and/or tools at Assembler.
3.2 The Parties shall confirm the list of the wearing parts (including standard
parts) and Spare Parts for assembly of Products. Distributor shall purchase
such wearing parts in proportion to the volume of KD Parts to be purchased,
of which condition shall be agreed in an individual sales and purchase
contract (“Individual Sales Contract”) to be executed between Supplier
and Distributor.
Article 4 Technical Assistance
4.1 In order for Assembler to start assembling Products, subject to the work
plan approved by Supplier and Distributor, Supplier shall provide

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Assembler with Technical Information set out in the Annex [1]. Engineering,
Technical Assistance Personnel(s) or Distributor’s Engineer(s) (depending
on the situation) shall be dispatched to Assembler to provide Assembler
with technical assistance, quality control and quality assurance for
assembly of Products. In the event that Technical Information should need
to be transformed or modified for the purpose of assembling Products in
Territory, Assembler shall advise such situation to Supplier, and Supplier
shall provide Assembler with the necessary technical assistance so that
Assembler is able to assemble Products applying such transformation or
modification to Technical Information. Furthermore, Assembler shall not
modify Products at its own discretion without prior approval in writing by
Supplier.
4.2 Assembler shall use Technical Information only for the purpose of
assembling Products (or manufacturing Localized Parts, as the case may
be) pursuant to the terms and conditions under this Agreement. Technical
Information shall fall under Confidential Information as provided in Article
12.4 and shall be treated by the Parties pursuant to Article 12 and other
relevant provisions in this Agreement.
4.3 In the event that any false or improper data should be found in Technical
Information, Assembler shall immediately inform to Supplier of such
situation as to false or improper data in Technical Information. Should there
be any problematic part(s) of Products which Assembler already completed
assembly, cause of which is attributable to such false or improper data,
Supplier and Assembler shall discuss to rectify or repair such problematic
part(s) of Products. Supplier shall responsible for and bear any cost which
may arise in relation with the rectification and/or repairment of such
problematic part(s) of Products.
4.4 Before the mass assembly (“Mass Assembly”) of Product starts, pursuant

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to the work scope confirmed among the Parties, Supplier shall design,
develop, test, validate and improve the production engineering and quality
control process in either of i) People’s Republic of ........, ii) any other
location designated by Distributor and Assembler and iii) the premise of
Assembler, depending on the case and subject to consent by the Parties.
4.5 Engineering, Technical Assistance Personnel(s) or Distributor’s
Engineer(s) shall be dispatched to Assembler to provide necessary
direction on assembly of KD Parts, tests, examination, operation theory
and so forth, and to train Assembler’s personnel(s) at the location
designated by Assembler. Subject to prior discussion between Supplier
and Assembler, Supplier agrees to permit Assembler’s personnel(s)
involved in assembly of Products to receive guidance and training at the
related workshops and/or departments in Supplier’s factory in the People’s
Republic of .........
4.6 Supplier and Distributor shall procure life and medical insurances on their
own accounts for Engineering, Technical Assistance Personnel(s) and
Distributor’s Engineer(s) during the period of providing assistance to
Assembler in Territory.
4.7 The expenses of technical assistance provided by Engineering, Technical
Assistance Personnel(s) under this Article 4 shall be United States Dollars
one hundred fifty (US$ 150) per man-day, which shall include the cost for
round-trip transportation, meal and accommodation of Engineering,
Technical Assistance Personnel(s), provided that the maximum amount of
such expenses in one Calendar Year to be paid by Assembler to Supplier
shall not exceed United States Dollars fifty thousand (US$........... )
(“Threshold Amount”), notwithstanding the actual aggregated amount of

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such expense in one Calendar Year calculated pursuant to precedent
paragraph should exceed Threshold Amount. For avoidance of doubt, the
technical assistance provided by Distributor’s Engineer(s) shall be at free
of charge, unless otherwise expressly agreed by the Parties.
Article 5 Localization
5.1 Within ninety (90) days after this Agreement becomes effective, Assembler
shall provide Supplier with appropriate, complete and then valid laws and
regulations (collectively “Local Rules”) in Territory for localization of
vehicles and the Parties shall discuss and decide the categories, quantity
and timetable of Localized Parts in the form provided in Annex-[2] subject
to Local Rules.
5.2 Assembler shall propose its recommendation on Localized Parts to
Supplier, provided that Supplier shall have the final right to decide whether
or not to accept such recommended Localized Parts, subject to Local
Rules.
Article 6 Quality Control
6.1 Supplier shall guarantee the quality of KD Parts to Distributor as provided
in DA and/or Individual Sales Contract. Assembler shall obtain Supplier’s
prior consent in writing for any modification to KD Parts.
6.2 For the purpose of securing the quality of Products, Assembler shall have
the capacity to assemble KD Parts into Products and the meaning of such
capacity shall include, but not be limited to the equipment, relevant

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technicians, facilities and storehouse, and so forth.
6.3 The KD Parts shall be used only for assembling Products. Other than the
purpose of assembling Products, Assembler shall not transfer or sell the
KD Parts or Localized Parts (if they are produced using Supplier’s
Technical Information) to any third party without Supplier and Distributor’s
consent in writing. In the event that Assembler breach this provision,
Assembler shall be liable for compensating any loss or damage which
Supplier and/or Distributor suffered as a result of such breach. For
avoidance of doubt, this provision shall survive termination of this
Agreement.
6.4 Quality Control Criteria
6.4.1 Assembler shall establish Quality Assurance System pursuant to
the relevant quality standard to be provided by Supplier before
commencement of Mass Assembly of Products. Assembler shall
not commence Mass Assembly of Products before it obtains
Supplier’s confirmation of Quality Assurance System in writing to
be made after Supplier’s appraisal on Assembler’s Quality
Assurance System.
6.4.2 Quality Control.
Engineering, Technical Assistance Personnel(s) or Distributor’s
Engineer(s) shall conduct quality inspection and quality assurance
in respect of quality, assembling line, equipment, personnel training
and quality appraisal (collectively “Elements”) at Assembler. Any
modification to Products shall require Supplier’s verification and
confirmation in writing. Assembler shall commence Mass Assembly
only after Supplier completed verification and acceptance of all of
Elements during the period between the assembly of sample

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vehicles and the pilot production.
6.5 Annual Quality Appraisal
6.5.1 A quality appraisal (“Annual Quality Appraisal”) to Assembler
shall be conducted annually by Supplier after the commencement
of Mass Assembly.
In Annual Quality Appraisal, an appraisal to Quality Assurance
System shall be conducted pursuant to Supplier’s appraisal
requirements on the date agreed by the Parties. Assembler shall
propose to Supplier the schedule and program for Annual Quality
Appraisal in writing and obtain Supplier’s consent in writing before
Annual Quality Appraisal is conducted.
6.5.2 After the Annual Quality Appraisal is made, Supplier shall provide
Assembler with Quality Appraisal Report and Assembler shall
correct and rectify the problems pointed out in such Quality
Appraisal Report at the request of Supplier and the result of such
correction and rectification shall be finally confirmed by Supplier.
6.5.3 All expenses in respect of Annual Quality Appraisal shall be borne
by Supplier.
Article 7 Product Liability and Intellectual Property Rights
7.1 Supplier shall indemnify, protect, defend and hold Distributor and
Assembler harmless from and against any claim on liability from any third
party(ies) whether in Territory or otherwise with regard to (i) any product
liability (“Product Liability”) of Products, and (ii) any infringement of
intellectual property rights (“Intellectual Property Rights”), including, but
not limited to patents, trademarks, brands, utility models, designs, patterns,
copyrights.
7.2 In the event that any dispute and/or claim is brought to Distributor and/or
Assembler from any third party(ies) in connection with such Product

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Liability or Intellectual Property Rights, Distributor and/or Assembler,
without prejudice to any rights available to it under this Agreement and/or
applicable law, reserves the right to unconditionally terminate this
Agreement or any part hereof at its own discretion and Supplier shall be
responsible for compensating all loss and/or damage caused thereby or
resulting therefrom.
7.3 Without limiting or mitigating Supplier’s liabilities, obligations or indemnities
under this Agreement, Supplier shall maintain a product liability insurance
with limit of liability not less than [............] per occurrence in connection
with Products with an insurance company acceptable to Distributor and
Assembler at Supplier’s sole cost and expense. Such product liability
insurance shall name Distributor and Assembler as additional insured, and
Supplier shall provide Distributor and Assembler with copies of insurance
certificate(s) at the request of Distributor and Assembler.
7.4 Assembler and Distributor shall not infringe any rights owned or enjoyed by
Supplier on Technical Information, nor shall apply any patent registration or
enable such registration by using such Technical Information without
Supplier’s consent in writing.
7.5 For avoidance of doubt, these provisions of Article 7 shall survive
termination of this Agreement.
Article 8 Inspection and Claims
8.1 Container Opening Inspection and Unpacking Inspection
8.1.1 Container Opening Inspection at Assembler
Within a reasonable time after KD Parts are delivered to Assembler,
the container opening inspection (“Container Opening
Inspection”) shall be jointly conducted by Distributor’s Engineer(s)
and the representative(s) of Assembler.
At Container Opening Inspection, whether the condition inside

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container is in proper status, or not, in accordance with DA and/or
Individual Sales Contract shall be inspected and after Container
Opening Inspection is done, Distributor’s Engineer(s) and the
representative(s) of Assembler shall jointly complete and sign off a
written inspection report (“Container Opening Inspection
Report”), which shall be used as evidence for any improper status
(“Improper Status”) inside the container. In the event that any
Improper Status should be found at Container Opening Inspection,
such Improper Status shall be immediately notified to Supplier to
request its instruction or direction on the treatment of such
Improper Status. And simultaneously, the packing inside the
container shall be unpacked to inspect whether there should be
any defect (“Defect”) on KD Parts, or not, regardless of the
provision in Article 8.1.2.
8.1.2 Unpacking Inspection at Assembler
Save for the case provided in Article 8.1.1, the unpacking
inspection (“Unpacking Inspection”) of KD Parts inside the
container shall be conducted just before such KD Parts will be put
into assembly at Assembler. Unpacking Inspection shall be jointly
done by Distributor’s Engineer(s) and the representative of
Assembler and such representatives shall jointly complete and sign
off a written inspection report (“Unpacking Inspection Report”)
after Unpacking Inspection is completed, which shall be used as
evidence for any Defect found on KD Parts at Unpacking
Inspection, such as but not limited to the quality, quantity and
specification, and so forth.
8.2 Claims at Inspection

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In the event that any KD Parts with Defect (“Defective Parts”) should be
found at either Container Opening Inspection or Unpacking Inspection,
1) If such Defect is attributable to Supplier; Supplier shall deliver the
replacement part(s) (“Replacement Parts”) for Defective Parts solely
at its own cost and expense until Replacement Parts reach Assembler.
In addition to the precedent provision, Distributor shall be entitled to file
its claim(s) against Supplier based on Container Opening Inspection
Report or Unpacking Inspection Report (depending on the case)
pursuant to any specific provision in Individual Sales Contract, should
there be any loss or damage suffered by Distributor as a result of
Improper Status or Defect attributable to Supplier.
2) If such Defect is attributable to Distributor, Distributor shall purchase
Replacement Parts from Supplier and deliver such Replacement Parts
to Assembler solely at its own cost and expense, unless such Improper
Status or Defective Parts is authorized by Supplier to be used for
assembly of Products.
3) If such Defect is attributable to Assembler, Assembler shall
compensate to Distributor all the cost and related expense for
Defective Parts and any loss or damage suffered by Distributor as a
result of Improper Status or Defect in cash upon demand by Distributor
unless such Improper Status or Defective Parts is finally authorized by
Supplier to be used for assembly of Products.
8.3 Any claim on Improper Status or Defect shall be submitted in writing within
a reasonable period from the date of completion of Container Opening
Inspection or Unpacking Inspection, whichever is applicable.
8.4 Treatment of Defective Parts
Defective Parts shall be returned to Supplier in the event that Supplier so

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directs, otherwise, Defective Parts shall be disposed in Territory. The Party
attributable to Defect shall arrange to return Defective Parts to Supplier and
bear all the cost and expense for such return of Defective Parts to Supplier.
8.5 Notwithstanding the provision inArticle 8.4, Distributor shall keep Defective
Parts for certain period until Supplier direct the treatment of Defective Parts
to Distributor, provided that unless Supplier fails to give such direction to
Distributor within three (3) months after such Defective Parts are found at
Container Opening Inspection or Unpacking Inspection, Distributor is
entitled to dispose such Defective Parts at its own discretion.
8.6 In the event that any Defective Parts should be found, regardless of to
whom the cause of Defect is attributable, such Defective Parts shall not be
used for assembly of Products unless Supplier authorizes in writing,
provided that Supplier shall be responsible for any liabilities in respect of
Products which is caused by its authorization to use Defective Parts for
assembly of Products.
Article 9 Termination
9.1 In the event that any Party fails to perform any of its responsibility or
obligation under this Agreement, the other Party(ies) shall notify such
non-performance in writing to such non-performing Party
(“Non-Performing Party”) and request it to correct its non-performance
within a period of sixty (60) days from the date of such notice. In the event
that such non-performance is not corrected or rectified in such sixty (60)
days period, the other Party(ies) shall be entitled to terminate this
Agreement by sending ninety (90) days prior notice of termination in writing
to Non-Performing Party.

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9.2 In the event that one or more circumstances as provided below take place
to any Party (“Defaulting Party”) or the Party as specified, the other
Party(ies) shall be entitled, at its sole direction, to terminate this Agreement
by sending ninety (90) days prior notice of termination in writing to
Defaulting Party:
(1) any Party (except for Supplier) fails to obtain or hold necessary
license to perform this Agreement, or such license is seized or
withdrawn;
(2) Without prior consent of the other Party(ies) in writing, Assembler has
transferred, assigned or donated any right(s) under this Agreement,
or either Party has assigned, transferred or entrusted any
obligation(s) under this Agreement;
(3) Any dispute or controversy between the major shareholders and
senior management of any Party adversely affects the operation and
profits of the other Party(ies) or the other Party(ies)’s goodwill;
(4) Either Assembler’s or Distributor’s deteriorated financial position
substantially affects the performance or enforcement of this
Agreement, or either Assembler or Distributor becomes bankrupt,
applies for bankruptcy, or creditors or other legal entities apply for
legal reorganization or bankruptcy of such Party;
(5) Either Assembler or Distributor goes into receivership or has a receiver,
trustee, manager or similar administrator (including a statutory
manager) appointed in respect of all or any of its property;
(6) Any Party offers false information to the other Party(ies), in the
process of execution or operation of this Agreement;
(7) Either Assembler or Distributor changes the legal organization of
corporation, the geological location of the commercial premises,
management rights, reduces the investment shares, merges with or

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acquires other entity, or terminates its business, which substantially
affects the performance or enforcement of this Agreement.
9.3 In the event that any termination as a result of the events provided in this
Agreement, all of the Parties’ rights and obligations under this Agreement
shall be terminated simultaneously, subject to other terms and conditions in
this Agreement, provided that:
(1) Individual Sales Contract and/or Assembly Contract concluded or
confirmed before the termination but not yet been accomplished or
performed shall continue to be effective;
(2) In the event that Distributor needs to continue purchasing KD Parts
from Supplier for the purpose of performing any obligation under the
Territory’s applicable law and/or contracts entered into between
Distributor and a third party before the termination of this Agreement,
Supplier shall continue to sell KD Parts to Distributor and Assembler
shall continue to perform Assembly Contract which have been
executed prior to the termination of this Agreement, provided that
such continuance of purchase of KD Parts and assembly of Products
shall not be construed as re-execution of this Agreement or as
cancellation of the termination of this Agreement.
(3) Termination of this Agreement shall not exempt Supplier from any
obligation on quality warranty, after-sale service of Products or any
other obligations which Supplier shall undertake under this
Agreement.
(4) Defaulting Party shall continue to be responsible for any loss or
damage suffered by the other Party(ies) due to the cause of or as a
result of such termination of this Agreement.
9.4 In the event of revocation of any registration is required by any law, or

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regulation in Territory as a result of termination of this Agreement,
Distributor and/or Assembler (depending on who is being affected thereby)
shall proceed such de-registration at its own expense with the cooperation
of Supplier.
9.5 To give full effect to the rights to earlier terminate this Agreement as
provided herein, the Parties hereby waive the provision of Article 1266 of
the Indonesian Civil Code which requires judicial determination for the
termination of an agreement to the extent such provision is deemed
applicable by any forum having jurisdiction.
Article 10 Force Majeure
10.1 In the event that any performance of this Agreement is prevented,
restricted or interfered with by the event of Force Majeure (as defined in
Article 10.2), the Party so affected (“Affected Party”) shall be exempted
from its performance of this Agreement to the extent of such prevention,
restriction or interference, provided that:
(1) Affected Party shall give prompt notice of Force Majeure to the other
Parties and send certificates of the event issued by the relevant
authority to the other Parties within fifteen (15) days after such
event’s occurrence to the extent such certificate can be obtained;
(2) Affected Party shall use all reasonable endeavors to minimize and
mitigate the losses and/or damages caused by the event of Force
Majeure;
(3) Affected Party shall resume its performance of this Agreement as
soon as such event of Force Majeure is removed;
(4) If the event that Force Majeure is permanent, or if temporary, latest
uninterruptedly for a continuous period for more than [.......] days,

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the Parties shall discuss whether or not the Parties shall continue
the performance of or shall terminate this Agreement.
10.2 The Force Majeure provided in this Article shall refer to the following
events which could not be predicted, reasonably controlled, avoided or
overcome by the Party or the Parties affected:
Fire, flood, act of God, strike, civil commotion, war, civil war, natural
disaster, rebellion, civil riot, governmental conduct or regulation, including,
but not limited to such governmental conducts or regulations to limit the
export or import of KD Parts and/or Products, and other events beyond
the affected Party’s reasonable control.
Article 11 Ethical Dealings
The Parties shall be familiar and strictly comply with all the laws and regulations
to prohibit bribery, corruption, and prohibited business practices, and the Parties
shall not offer, promise, make or agree to make any payments or gifts (of money
or anything of value) directly or indirectly to anyone for the purpose of influencing
or inducing anyone to influence decisions in favor of themselves.
Article 12 Confidentiality
12.1 From time to time prior to and during the term of this Agreement, any
Party (“Disclosing Party”) has disclosed or may disclose confidential
information (“Confidential Information”) to the other Party or Parties
(“Receiving Party or Parties”), including, but not limited to patent
technology, management know-how, business model, or any other
business secret. The Receiving Party or Parties shall, during the term of

23. 23
this Agreement and for one (1) year after the termination of this
Agreement:
(1) maintain the confidentiality of Confidential Information;
(2) not use Confidential Information for any other purpose than those
specially provided in this Agreement; and ;
(3) not disclose any such Confidential Information to any person or entity,
except for its employees or employees of its affiliates, its agents,
attorneys, accountants and other advisors who need to know such
Confidential Information to perform their responsibilities and who
have signed confidentiality agreements in writing, in which contains
the terms and conditions no less stringent than those for
confidentiality provided in this Article.
12.2 Exception of Confidentiality
The provisions of this Article 12 shall not apply to the information that:
(1) can be shown that the Receiving Party or Parties have known with
records or evidences in writing made prior to disclosure by Disclosing
Party.
(2) is or becomes public knowledge other than through the Receiving
Party’s or Parties’ breach of the confidentiality provision herein; or
(3) was obtained by the Receiving Party or Parties from a third party
having no obligation of confidentiality with respect to such
information.
12.3 Subject to Article 9, termination of this Agreement shall not exempt the
liabilities of the Parties for confidentiality provided in this Article 12.
12.4 Confidential Information shall include Technical Information provided by
Supplier.

24. 24
Article 13 Governing law & Arbitration
13.1 This Agreement shall be governed, interpreted and construed in
accordance with the laws of the Republic of Indonesia.
13.2 Any dispute arising out of or in connection with this Agreement, including,
but not limited to any question regarding its existence, validity or
termination, which is unable to be solved through amicable discussion by
the relevant Parties, shall be brought to and finally resolved by the
arbitration in Singapore in accordance with the Arbitration Rules of the
Singapore International Arbitration Centre ("SIAC Rules") then in force.
The tribunal of arbitration shall consist of three (3) arbitrators and the
English language shall be used in all aspect. The award of the arbitration
shall be final and binding on the Parties, provided that enforcement of the
award may be brought to any court which has a jurisdiction over the case.
Article 14 Notice
14.1 Any notice by a Party to the other Party(ies) shall be made in writing and
delivered either;
(a) by hand;
(b) by courier service;
(c) by facsimile; or
(d) by e-mail.
14.2 Notices shall be deemed to have been delivered at either of the following
occasion:
(a) in case of by hand, on reaching the designated address with return

25. 25
receipt or other proof of delivery;
(b) in case of by courier, the fifth (5th) business day after the date of
dispatch;
(c) in case of by fax, on the next business day following the date of
transmission report generated by the sender’s fax machine, which
indicates the successful transmission without interference to the
recipient’s facsimile number; or
(d) in case of by e-mail, upon the entrance of the e-mail into the e-mail
receiving system of the recipient(s).
14.3 During the effective term of this Agreement, each Party may change its
particulars for receipt of notices at any time by giving a notice for such
change to the other Parties pursuant to this Article.
・Supplier: __________________ Ltd.
Mailing Address: ........................................................, ........ (Zip
Code: ..............)
Facsimile No: .................................
Attention: ..................................
・Distributor: ...................................
Mailing Address: ......................................
Facsimile No: ..................................
Attention: ......................................
・Assembler: ......................................
Mailing Address: ....................................
Facsimile No: ...................................
Attention: ..................................

26. 26
Article 15 Version
This Agreement is executed in English language and may be executed in one or
more counterparts, each of which shall be deemed as original, but all of which
shall constitute one and the same instrument.
To the extent that Law No. 24 of 2009 of the Republic of Indonesia on the Flag,
Language, State Emblem and National Anthem applies to this Agreement (an
agreement to which Indonesian entities are parties), the Parties hereto shall, if
required by any party or by any enabling regulations under Law No. 24 of 2009,
translate this Agreement into Bahasa Indonesia and ratify the Bahasa Indonesia
translation by executing the Bahasa Indonesia translated version. If this
Agreement is translated into Bahasa Indonesia, in the event of any
inconsistency between the Bahasa Indonesia and English language versions, to
the maximum extent permitted by law, the English language version shall prevail
to the extent of such inconsistency.
Article 16 Assignment
No Party shall transfer or assign, totally or partially, the rights or obligations
under this Agreement to any third party without the consent of the other Parties
in writing.
Article 17 Severability
Should any provision of this Agreement be or become unenforceable or invalid
under the relevant laws and regulations in relevant jurisdiction, such
unenforceability or invalidity shall not affect the validity of the remaining

27. 27
provisions of this Agreement and in such case, the Parties shall be obliged to
discuss the alternative provision which shall be valid and enforceable to replace
such unenforceable or invalid provision to accomplish the intended purposes of
such unenforceable or invalid provision.
Article 18 No Implied Waiver
18.1 No failure of either Party hereto at any time in requiring the performance
by the other Party(ies) hereto of any provision hereof shall prejudice the
right to require full performance of the same provision at any time
thereafter. No waiver by either Party hereto of a breach of any provision
hereof shall constitute or be deemed as a waiver of any succeeding
breach of the same or any other provision or constitute a waiver of the
provision itself.
18.2 No waiver of any provision hereof shall be effective unless the same shall
be made explicitly in writing and signed by the Party(ies) hereto against
the Party(ies) to whom such waiver is sought to be enforced.
Article 19 Entire Agreement
Unless otherwise expressly provided in this Agreement, this Agreement and its
annexes shall be the only and entire agreement between the Parties and
substitute all relevant previous agreements, understandings or negotiation
reached by the Parties no matter whether those are made orally or in writing.
Any modification to this Agreement shall be made in writing and respectively
signed by the duly authorized representatives of the Parties.

28. 28
Article 20 Effectiveness of Agreement
This Agreement shall become effective upon the seal (where applicable) and
signature by the duly authorized representatives of the Parties to this Agreement
and valid for one (1) year thereafter in full force, and unless sooner terminated
as provided in this Agreement, this Agreement shall be automatically extended
for a period of succeeding one (1) year each.
IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be
executed in triplicate by their duly authorized representative as of the date
written below.
Supplier : Distributor：
By _____________ By ______________
Name: ........................... Name：.............................
Title: .............................. Title: ..................................
Assembler
By _____________
Name: ...........................
Title : .............................