Form of Heads of Agreement of Consortium (Purchase this doc, Text: 08118887270 (Whatsapp))

1. 1
Heads of Agreement
Between
PT. _________________ (“ ABC ”), PT. ___________________ (“ X ”),
PT. ___________________ (“ Y ”) and PT. ___________________ (“ Z ”)
(collectively referred as “‘ ABC ‘ Group”),
AND
The Consortium of ‘K ‘ and Korea ‘ R ‘ ( “Investor”)
This Heads of Agreement (hereinafter referred as “HOA”) sets out the general terms and
conditions of the upcoming transaction for the acquisition of up to 90% shareholding in the ‘
ABC ‘ Group located in ............... District, ............................., Republic of Indonesia (the
“Project”). This HOA serves as the basis for negotiating and executing the Conditional Sales and
Purchase Agreement (“CSPA”) between the Promoters and the Investor
WHEREAS:
A. ‘ ABC ‘ Group is a group of companies established and incorporated in the Republic of
Indonesia.
B. ‘ ABC ‘ Group holds all mineral interests, real property and permits issued and under
process in respect to the project.
C. The Project is contemplated to produce thermal coal.
D. The Project is under detailed exploration stage and reserve shall be evaluated by
following Due Diligence mutually agreed by the Parties.
E. All necessary permits to enable construction of the Project are being processed and
subject to be granted.
This HOA sets out mutual understanding of the principal terms and conditions. Forthwith after
execution of this HOA, the Parties will proceed Due Diligence and negotiation with good faith
and in timely manner and make all reasonable efforts to sign and enter into the CSPA no later
than 1 month following the ending of the due diligence . Except for the legally binding provisions
set forth in this HOA, there will be no legally binding agreement between ‘ ABC ‘ Group and
Investors.
I. THE TRANSACTION
‘ ABC ‘ Group PT. _________________ (“ ABC ”), PT. ___________________ (“ X
”), PT. ___________________ (“ Y ”) and PT. ___________________
(“ Z ”) (collectively referred as “ ABC Group”), companies made and
established under the laws and regulations Republic of Indonesia
INVESTOR ‘ K ‘ and ‘ R ‘ and/or their affiliates, hereinafter the “Investor”.

2. 2
PROMOTERS The shareholders of ‘ ABC ‘ Group, hereinafter the “Promoters”
TRANSACTION The Investor shall acquire 90% of the Promoters’ existing shares, with all
related rights on no liability and no encumbrance basis, in the ‘ ABC
‘ Group (the “Transaction”).
The Investor shall have the authority for appointing Board of Directors
of the ‘ ABC ‘ Group
Upon closing of the Transaction, The Investor shall have the exclusive
rights to sell 90% of the ‘ ABC ‘ Group’s saleable coal to the domestic
and overseas market, in accordance to the prevailing regulation such as
the domestic market obligation (DMO) based upon Indonesian New
Mining Regulation, etc.
Condition of Transaction shall be specified on the CSPA.
The minimum mineable reserves of the ‘ ABC ‘ Group for the
continuation of the Transaction shall be at 50 million ton (the “Cut Off
Reserves”). Following the Due Diligence the mineable reserves of
‘ ABC ‘ Group is less than the Cut Off Reserves, provided that both
‘ ABC ‘ Group and the Investor confirm, the Transaction shall be
automatically cancelled and no claims or penalty shall be imposed on
any of the party.
However, If the mineable reserves of ‘ ABC ‘ Group found during the
Due Diligence is higher than the Cut Off Reserves, both the Promoters
and the Investor shall continue the Transaction up to closing stage using
the mutually agreed single unit price on a per ton mineable reserves
basis .
STRUCTURE Both the Investor and the Promoters agree that the Transaction structure
to be adopted for implementation of this Transaction shall be such as
may be mutually agreed between both Parties, which shall be tax
efficient and in compliance with all statutory and/or regulatory laws rules
and/or regulations applicable to both Parties.
VALUATION The Transaction price shall be based on the mutually agreed Mineable
Reserves measured and verified by representative competent technical
person from each party through Due Diligence.
The Parties agree that the initial unit price used in the Transaction shall
be within the range of US$...... to ........per ton mineable reserves. Both
the Promoter and the Investor shall negotiate and agree on the final
single unit price used in the Transaction after completing the Due
Diligence. The valuation shall be based on a single unit price for each
tonnage of its mineable reserves.

3. 3
The mutually agreed Technical method and parameters (physical and
chemical parameters) to measure the ‘ ABC ‘ Group’s mineable reserve
shall be based on the Agreement of Reserve Estimation Method signed
and executed by the Investor and the Promoters on ........................ as
attached together with this HOA.
The ‘ ABC ‘ Group and the Investor shall agree on the payment method
or terms payment of the Transaction price within maximum of 30 (thirty)
working days from the signing date of this HOA. If the payment method
or terms payment could not be mutually agreed by both Parties within the
above period, both Parties shall extend the period to maximum of 14
(fourteen) working days. If until the end of the extension period, both
Parties still could not reach mutual agreement on the payment method or
the terms payment, The HOA shall be terminated upon mutual consent
by both parties. The payment method or terms payment shall be specified
in detail in the CSPA.
COMMITMENT Upon signing of this HOA, the Investor shall put up a Commitment
Money of US$ ................... (..................... United States Dollars) to a
Promoters’ appointed escrow account within 5 (five) working days from
the signing date of this HOA.
Upon placement of such money in the account, Investor shall have the
Exclusivity on the Transaction. This amount shall form part of the total
Transaction value to be paid to Promoters.
DUE DILIGENCE Upon signing of this HOA and the placement of Commitment Money,
Investor shall carry out legal, financial, tax and technical due diligence
on the ‘ ABC ‘ Group within the period of 3 (three) months from the
signing date of this HOA.
The ‘ ABC ‘ Group shall provide all necessary data pertaining to legal,
financial and technical review to Investors in good faith and timely
manner so as to conduct fruitful Due Diligence.
The ‘ ABC ‘ Group shall provide reasonable cooperation, timely and
efficient access during normal business hours to ‘ ABC ‘ Group to
Investor and its respective Representatives with respect to Due Diligence
CONDITIONAL Both Investor and Promoters shall agree in good faith to negotiate
SALE AND Conditional Sale and Purchase Agreement (the “CSPA”) to carry out
PURCHASE the transaction reflected in this HOA. The CSPA shall be signed and
AGREEMENT executed by the Promoters and the Investor no later than 1 month
following the ending period of financial, legal, and technical Due
Diligence. Required conditions and transaction method shall be
discussed before signing of CSPA.
SALE AND Both the Investor and Promoters shall sign the Sale and Purchase
PURCHASE Agreement (“SPA”) after fulfillment of all necessary prerequisite
AGREEMENT specified on CSPA.

4. 4
TERMINATION Unless otherwise agreed in writing by both Parties, this HOA shall
automatically terminated if :
(i) The mutually agreed mineable reserves found during the Due
Diligence is less than the Cut Off Reserves.
(ii) The ‘ ABC ‘ Group does not provide necessary data or access to the
site with regards to Due Diligence due to legal issues or internal
dispute.
(iii) Investor does not carry out legal, financial, tax and technical due
diligence within the agreed time period set forth in this HOA without
any reasonable reasons, or
(iv) Investor does not continue the Transaction and/or sign the CSPA
within the agreed time period set forth in this HOA without any
reasonable reasons.
(v) Both the Investor and the Promoters sign the CSPA. The signing of
the CSPA shall replace the HOA in setting out the terms and
conditions of the Transaction.
Provided that if this HOA is terminated due to the condition as set out in
point (i) and (ii) above, the Investor shall be eligible to draw the entire
Commitment Money from escrow account with the consent of Promoters
within five working days from the date of termination.
If this HOA is terminated due to the condition as set out in point (iii) and
(iv) above, the Promoters shall be eligible to draw the Commitment
Money at the amount of US$ ................ (................. ........ US Dollars)
with their own discretions from the escrow account. The remaining
Commitment Money shall be returned to the Investor.
Provided that if unavoidable situation such as Force Majeure or
catastrophic coal price drop in market, greater than 20% from current
international thermal coal reference price, measured based on the
Newcastle Coal Index as of the signing date of this HOA, which disturbs
Investor’s Due Diligence, the HOA shall be automatically terminated and
the Promoters shall not be eligible to draw the Commitment Money. The
Commitment Money shall be returned in full to the Investor.
II.OTHERS
CONDITION No material adverse change since the date of this HOA up to the signing
PRECEDENTS of the Sales and Purchase Agreement.
The granting and/or processing of required appropriate governmental,
regulatory, and other necessary third party consents, waivers approvals
and clearances, including from the lenders of the ‘ ABC ‘ Group and the
Promoters .

5. 5
No pending or in effect any law, order or legal proceeding challenging
the Transaction or that may have the effect of prohibiting, delaying,
making illegal or otherwise interfering with the Transaction
Approval of the Transaction by the Board of Director of each Investor as
required by the prevailing laws and regulations of the domicile of each
Investor.
The fulfillment of Due Diligence results covering all aspects of the ‘
ABC ‘ Group
Both the Investor and the Promoters have entered into a Shareholders
Agreement on terms and conditions as agreed mutually by the Parties.
On the signing date of the SPA, the Investor and the ‘ ABC ‘ Group
shall enter into an Off-take Agreement in accordance to the prevailing
regulation such as the domestic market obligation (DMO), etc.
EXCLUSIVITY In consideration of the substantial expenditure of time, effort and
expenses to be undertaken by the Investor, upon the execution of this
HOA and the placement of Commitment Money into Promoters’
appointed account, the ‘ ABC ‘ Group and the Promoters hereby
undertake that for the period from the date hereof until the signing of the
CSPA, the ‘ ABC ‘ Group and the Promoters will not, and will procure
that their respective affiliates do not directly or indirectly take, any action
to initiate, assist, solicit, receive, negotiate, encourage or accept any offer
or inquiry from any person in respect of any of the following, unless
otherwise subject to be waived in writing by the Investor, such as:
(a) investment in the ‘ ABC ‘ Group,
(b) any agreement or understanding (whether or not such agreement or
understanding is absolute, revocable, contingent or conditional) for,
or otherwise attempt to consummate, any investment in the ‘ ABC ‘
Group,
(c) furnishing or causing to be furnished any information with respect to
the ‘ ABC ‘ Group or its affiliates to any person (other than to
representatives of the Investor, for the purpose of a due diligence
exercise, which the Investor shall be allowed to carry out, or
otherwise) who the ‘ ABC ‘ Group or the Promoters or their
respective affiliates or representatives know/s or has/have reason to
believe is in the process of considering any investment in the ‘ ABC
‘ Group.
If the ‘ ABC ‘ Group or the Promoters or their respective affiliates or
representatives receives from any person, an offer, inquiry or information
request referred to above, the ‘ ABC ‘ Group will promptly advise such
person, by written notice, of the terms of this paragraph and will
promptly, orally and in writing, advise the Investor of such offer, inquiry
or request and deliver a copy of the foregoing notice to the Investor.

6. 6
CONFIDENTIALITY This HOA is submitted on a confidential basis and with the
understanding that, except as specifically provided hereinabove, neither
the ‘ ABC ‘ Group, the Promoters nor its advisors will disclose the terms
of this HOA to any third party without the Investor’s prior written
consent.
This confidentiality clause will be contractually binding on the ‘ ABC ‘
Group and the Promoters. Similarly, the Investor agrees that all
information provided by the ‘ ABC ‘ Group or the Promoters to the
Investor or its consultants and advisors in connection with the
Transactions contemplated herein shall be considered confidential and
that no such party shall disclose any such confidential information to any
third party without the prior written consent of the ‘ ABC ‘ Group and
the Promoters.
GOVERNING LAW This HOA shall be governed by the laws of the Republic of Indonesia.
AND JURISDICTION A binding agreement between the Promoters and the Investor will not
occur until the execution of this HOA. Until the execution of this HOA,
each Party shall have the absolute right to terminate all negotiations .
CONFIRMED AND AGREED
This _______day of __________,20_,_,
For and on behalf
The Investor
‘ K ‘
Per: ___________________
Name : ...................................
Title : ...................................
‘ R ‘
Per: ___________________
Name : ...................................
Title : ...................................

7. 7
The ‘ ABC ‘ Group
Representative ofthe ‘ ABC ‘ Group
Per : ___________________
Name : ...................................
Title : ___________________