Ashgal-UEM Agreement

DATED THIS DAY OF JUNE 2007

BETWEEN

GOVERNMENT OF THE STATE OF QATAR

AND

UEM GROUP BERHAD (Company No. 698514-U)

************************** **************************************** ************** SUPPLEMENTAL AGREEMENT ************************** **************************************** **************

ASHGHAL - UEM Supplemental Agreement

Salwa Road International Highway – 1 –

This Supplemental Agreement (hereinafter referred to as the “ Agreement”) is made and entered into as of the ……… day of ………………………. 2007

BETWEEN GOVERNMENT OF THE STATE OF QATAR (represented by ASHGHAL and formerly represented by Ministry of Municipal, Affairs and Agriculture) having its registered address xxxxxxxxxxxxxxxxxxxxxx, Doha, Qatar in the Arabian Gulf (hereinafter referred to as “the Client”) “ASHGHAL” or ON THE ONE PART AND UEM GROUP BERHAD (formerly known as United Engineers (Malaysia) Berhad) , a company registered under the laws of Malaysia and having its registered address at Bangunan MCOBA, 42 Jalan Syed Putra, 50460 Kuala Lumpur, Malaysia (hereinafter referred to as “ UEM” or “the Contractor”) ON THE OTHER PART.

ASHGHAL and UEM shall hereinafter be jointly referred to as the “Parties” and individually as a/the “Party” as the case may be.

WHEREAS th

(A)

By a Letter of Award dated 20 July 2003 (hereinafter called the “LOA”) UEM was awarded the contract for the Construction and Completion of the Salwa Road International Highway Phase 1 ERC 0451/C1 (hereinafter the “Project” or the “Works”)

(B)

The Contract for the Works (hereinafter the “Contract”) was executed on 23 rd October st 2003 and the commencement date of the Contract is 1 November 2003 and the completion th date is 30 April 2006.

(C)

Subsequent to the commencement of the Works, the Project suffered various delays due to factors beyond the Contractor’s control, which adversely affected its progress. Consequently, the Contractor duly submitted Extension of Time (EOT) claims pursuant to th the Contract vide letters referenced UEM/PIL/SWR/PM/L-2131/2005-4375 dated 4 th August 2005 (EOT 1) and UEM/PWA/SWR/PM/L/2007-0274 dated 12 February 2007 (EOT 2) respectively. In response to EOT 1, in particular Variation Order No.6, the Client has since granted the Contractor an EOT of forty (40) days.

(D)

Further during the course of the Works in the month of December 2006, the Client discovered that certain sections of the completed pavements had shown early signs of distress and the Client issued a “stop-work” notice / order for pavement related works on th 29 January 2007 vide Site Instruction 90 (SI 90).



(E)

The Contractor presented a proposal to the Client on 20 th March 2007 on the way forward to complete the Project and had, subsequent to such presentation, entered into various discussions and negotiations with the Client on the matter.

(F)

On 21 April 2007, the Contractor submitted to the Client vide letter referenced UEMC/SRPMT/SWR/CD/9.1/L0304-07, an offer for the revised scope of works for completing the balance of works under the Contract (hereinafter the “Revised Scope of Works”) for a sum of QR 441,382,986.81 (Qatar Riyals Four Hundred and Forty One Million, Three Hundred and Eighty Two Thousand, Nine Hundred and Eighty Six nd and Dirhams Eighty One only) and the Client vide their letter dated 22 April 2007 reference no SIRP/CO/C/00132/07 has accepted in principle the Contractor’s offer referenced above to complete the Revised Scope of Works.

(G)

The Client subsequently issued Site Instruction 95 (SI 95) and Site Instruction 96 (SI 96) rd th to the Contractor on 23 April 2007, and SI 90 was rescinded on 28 April 2007 vide letter referenced SCP/KS/SIRP/C/00159/07 thereby effectively instructing the Contractor to commence and complete the Revised Scope of Works.

(H)

The parties are now desirous to enter into this Agreement in order to formally set out the consensus reached in Recital (F) and (G) above to revise and modify the Scope of Works and the Terms and Conditions of the Contract in the manner detailed hereunder to facilitate the commencement of the Revised Scope of Works:

st

NOW THEREFORE IT IS HEREBY AGREED AS FOLLOWS: -

1.

The arrangement in Recital (F) above and the clauses herein below shall be considered as a package and its execution shall be interdependent on each other to the extent that if the Client breaches any of the agreed Clauses, the Contractor shall have the right to suspend all works or terminate this Agreement and Contract forthwith. Thereafter, the Client shall not have any claims against the Contractor for damages or any related costs thereto.

2.

st The payment to the Contractor for all works under the Contract completed up to 21 April 2007 (hereinafter the “Completed Works”) shall be assessed based on the actual quantity of work done on a re-measured basis.

3.

The completion date under the Contract for the Completed Works shall be revised to 21 April 2007. The Client shall not under any circumstances impose on the Contractor, any penalties pursuant to Clause 47 of the original Conditions of Contract or any other damages, costs if so incurred by the Client in respect of the said Completed Works.

4.

All Completed Works that have been inspected and approved by the Engineer shall be considered as taken over by the Client and shall be deemed to be completed in accordance with the provisions of Clause 48 of the original Conditions of Contract. The hand over / take over shall be formalized by way of Joint Measurements between the Client and Contractor. The parties further agree that this Joint Measurement shall form the actual scope and limit of the Completed Works.

st



5.

The Contractor shall not be held liable for the integrity of the materials and workmanship used and any defects, imperfections, shrinkages, cracking or any other fault whatsoever that may appear for any works that are not within our Revised Scope of Works.

6.

The Client shall duly approve and pay for the Contractor’s uncertified claims and variations st for the Completed Works that have been submitted to the Client prior to 21 April 2007 nd within six (6) months from 22 April 2007 notwithstanding any resubmission or st clarifications requested by the Client. For submissions after 21 April 2007, the Client shall duly approve and pay for such claims and variations within three (3) months of the date of such submissions by the Contractor. The parties agree that the Contractor shall be entitled to suspend any works being carried out on the Revised Scope of Works from the date payment is due until the full settlement of the aforesaid claims and variations should the Client fail to carry out any of their payment obligations pursuant to this clause. Any action taken by the Contractor in this respect shall not prejudice any of his rights and remedies pursuant to the original Conditions of Contract.

7.

Without derogating from the requirements of Clause 6 above and without prejudice to the rights and entitlements of the Contractor under the original Conditions of Contract, the parties agree that the Client shall pay to the Contractor within three (3) months from 22nd April 2007, a sum of QR 3,000,000.00 (Qatar Riyals Three Million only) being an additional payment for Variation Orders for Completed Works. For the avoidance of doubt, this payment shall be over and above any payments made pursuant to Clause 6 above.

8.

Any losses incurred by the Contractor in respect of the Completed Works shall be shared between the parties on a 30% (the Contractor) and 70% (Client) basis and the Client undertakes to pay the Contractor the Client’s share of the losses, as advised by the Contractor, on or before 12 th May 2008.

9.

The Client shall release forthwith the Retention Sum amounting to QR 51,585,535.44 (Qatar Riyals Fifty One Million, Five Hundred and Eighty Five Thousand, Five Hundred and Thirty Five and Dirhams Forty Four only) (hereinafter the “Retention Sum”) held in respect of the Completed Works upon the Contractor providing the Client a Bank Guarantee in lieu of such Retention Sum to be valid for a period of twelve (12) months from the commencement date set out in Clause 13 herein below.

10.

The Client shall forthwith reimburse the Contractor within three (3) months from 22 April 2007, the sum of QR 18,000,000.00 (Qatar Riyals Eighteen Million only) being the discount previously granted to the Client prior to the co mmencement of the Project.

11.

Upon the fulfilment of all the provisions and requirements in relation to the Completed Works under this Agreement, neither party shall have any claims whatsoever against the other in relation thereto.

12.

The Revised Scope of Works of the Contractor for the balance of works shall be limited to SI 95 (for the balance of works to be carried out under the Contract) and SI 96 (for the deletion of works from the Contract) annexed hereto as Appendix 1 to this Agreement. This Revised Scope of Works shall form an addendum to the Contract and shall be subject to the provisions of Clause 15 of this Agreement. Payments to the Contractor in respect of the Revised Scope of Works shall be made within sixty (60) days from the submission of

nd



claims by the Contractor and made in accordance with the New Agreed Rates annexed hereto as Appendix 2 to this Agreement based on a re-measurement basis. 13.

The commencement date for the Revised Scope of Works shall be 22 nd April 2007 and the th completion date shall be 12 May 2008 or any extended date that is computed based on a completion period of twelve (12) months from the approval of design and trial mixes and receipt of the approved revised construction drawings for the rehabilitation of damaged Type 5 pavement. Notwithstanding, the parties acknowledge that the pavement works under SI 95 are on the critical path of the construction program and therefore the parties agree that in addition to the other grounds of entitlement in the Conditions of Contract, any delay in either the approval of the design and trial mixes by the Client, or receipt of the revised construction drawings for the rehabilitation of the damaged Type 5 pavements by the Contractor shall automatically entitle the Contractor for an Extension of Time and any related costs thereto for the full duration of any such delay.

14.

The parties recognize that the Contractor has in his possession Materials on Site which have been procured and partially paid for by the Client during the course of the Contract. It is therefore agreed that if the Contractor has in his possession any surplus materials that he does not require for his own use, the Client may with the Contractor’s expressed consent, instruct that these materials are released to third parties for their use provided always that the Client has paid the Contractor in full for such materials based on the suppliers’ invoices. Such payment shall be inclusive of an additional 15% Administration Charge on the invoiced price.

15.

In respect of the Revised Scope of Works and for the avoidance of doubt, the parties agree that in addition to the requirements of Clauses 12 to 14 above, the following points of clarification as detailed hereunder shall apply mutatis mutandis the provisions of SI 95: 15.1 Site Instruction 95 The following items (a) to (g) detail the works that are to be carried out by the Contractor that are outside the Revised Scope of Works and are thus to be measured and paid to the Contractor based on rates to be agreed between the parties: a)

Revised Scope of Work in Package 2 and Package 3. The limit of works is extended from KM30+000 to KM94+806 instead of KM92+380 to accommodate the proposed introduction of a small roundabout. The parties acknowledge that this would have time and cost implications, the full impact of which can only be determined upon receipt of the Revised Construction Drawings.

b)

Earthworks The surplus Fill materials that the Contractor had stockpiled on site could be sold to other contractors with the Contractor’s prior consent and the Contractor shall be reimbursed accordingly in accordance with the provisions of Clause 14 above.



c)

Civil Works The access roads to all the substations.

d)

30 metre High Mast and 14 metre Street Lighting Pole The Parties agree that the Client shall pay to the Contractor in full the balance outstanding on this account in accordance with the provisions of Clause 14 above before any issuance of the said materials can be authorized by the Client. Any issuance of materials to any party to this Agreement or any third party must be authorized by the Engineer vide a standard form. A Standard Hand-Over and Authorization form agreed between the parties is annexed to this Agreement as Appendix 3.

e)

Ducts & Associated Civil Works for Street Lighting & Electrical Works (along the mainline of Package 2 & 3 only) All Ducts & Associated Civil Works for Street Lighting & Electrical Works along the mainline of Package 2 and Package 3.

f)

Storage of Materials purchased under this Agreement for free issue to the Client. The Parties therefore agree that persons authorized by the Engineer shall collect the materials from the Contractor’s store with the agreed hand-over procedure but this shall be expressly subject to the Client paying the Contractor in full the balance outstanding on this account in accordance with the provisions of Clause 14 above before any such issue of the materials is made. Any issuance of materials to any party to this Agreement or any third party must be authorized by the Engineer vide a standard form annexed herewith as Appendix 3.

g)

To maintain the Traffic Diversion / management of equipment outside Package 2 and Package 3 The Contractor agrees to retain the existing safety & traffic equipment placed in nd Package 1 for a period of up to three (3) months from 22 April 2007 within which the Engineer shall instruct to handover the same to other contractors for their retention. A full listing of all the equipment will be provided to the Client and at the nd end of the three (3) months period from 22 April 2007 the Client shall return such equipment to the Contractor in good working condition failing which the Contractor shall be reimbursed based on the prevailing market rate for such equipment.

h)

Flexible Surfacing The Contractor has priced for this item on the existing Design Mix specification. Any future variance to the Design Mix shall be deemed a variation pursuant to the Conditions of Contract.



i)

QP Culvert (Package 2 & 3 only) All QP culverts in Package 2 and Package 3 shall be under the Contractor’s Scope of works and any work done in relation to this will be measured accordingly and paid to the Contractor based on the New Agreed Rates in Appendix 3. However, QP Culverts in Package 1 shall be excluded completely from the Contractor’s Revised Scope of Works.

j)

CBM Mainline Any work done in relation to the CBM Mainline shall be measured accordingly and paid to the Contractor based on the New Agreed Rates in Appendix 2.

k)

Maintenance of Engineer’s Facilities The parties hereby agree that these works shall be confined only to the Engineer’s facilities at KM 38, KM 17 and KM 72.

l)

Interchange 15 Notwithstanding the provisions of Clause 2 above, the completion date for st Completed Works under Interchange 15 shall be on 31 January 2007. Works done st on Interchange 15 from 1 February 2007 onwards shall be measured accordingly and paid to the Contractor based on the New Agreed Rates in Appendix 2.

16.

No party shall be deemed to have waived any provision of this Agreement unless such waiver shall be in writing and signed by both parties hereto. No waiver shall be deemed to be a continuing waiver unless so stated in writing.

17.

Unless there is something in the context or subject matter inconsistent therewith, words importing the singular shall include the plural and vice versa and words importing the masculine gender shall include the feminine and neuter genders and vice versa, and references to a natural person shall include a body of persons corporate or unincorporated.

18.

If the whole or part of any provision of this Agreement cannot be enforced by reason of any law or public policy, all other provisions of this Agreement, including the remaining portion of such provision, shall nevertheless remain in full force and effect. The unenforceable provision shall however be replaced by enforceable provisions having the same economic effect.

19.

This Agreement and the Contract shall constitute the entire agreement and understanding between the parties in respect of the matters dealt with in it and supersedes any previous agreement, whether verbally or in writing, or correspondences between the parties, relating to such matters notwithstanding the terms of any previous agreement or arrangement expressed to survive termination.

20.

Any additions, amendments and/or variations to this Agreement and the Contract shall be binding upon the parties only if made in writing and signed by the duly authorized representatives of each party.



21.

Unless expressly provided to the contrary in this Agreement, all other terms and conditions of the Contract shall remain in full force and effect and form part of this Agreement.

22.

This Agreement is supplemental to and is an integral part of the Contract. In the event of any inconsistencies between the provisions of this Agreement and the Contract, the provisions of this Agreement shall prevail to the extent of such inconsistency in relation to the subject matter dealt with under this Agreement.

IN WITNESS THEREOF , the Parties have signed this Supplemental Agreement in two (2) originals on the date first above written.

ASHGHAL

By : ____________________________

________________________________ Name (please print)

WITNESS


By : _______________________

________________________________

_________________________________ Name (please print)

UEM GROUP BERHAD

__________________________ Name (please print)

WITNESS

__________________________

__________________________ Name (please print)


Ashgal-UEM Agreement

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