Model EPC Agreement

8/10/2019 Model EPC Agreement

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Revised draft for discussion

MODELEPC AGREEMENT

FOR

HIGHWAYS

National Council of Applied Economic Research

New Delhi


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Contents

PART I

PRELIMINARY

Recitals

1 Definitions and Interpretation

1.1 Definitions1.2 Interpretation1.3 Measurements and Arithmetic Conventions1.4 Priority of Agreements and Errors/Discrepancies

PART II

SCOPE OF PROJECT AND OBLIGATIONS OF THE PARTIES

2 Scope of the Project

2.1 Scope of the Project

3 Obligations of the Contractor

3.1 Obligations of the Contractor3.2 Obligations relating to Sub-contracts and any other Agreements3.3 Employment of foreign nationals3.4 Employment and Removal of Contractors personnel3.5 Advertisement on Project Highway3.6 Contractor's Care of the Construction Work

3.7 Electricity, Water and Gas3.8 Unforeseeable Difficulties3.9 Obligations relating to Change in Ownership

4 Obligations of the Authority

4.1 Obligations of the Authority4.2 Maintenance obligations prior to Signing of Agreement

5 Representations and Warranties

5.1 Representations and Warranties of the Contractor5.2 Representations and Warranties of the Authority

5.3 Disclosure

6 Disclaimer

6.1 Disclaimer

PART III

DESIGN, CONSTRUCTION AND MAINTENANCE


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7 Performance Security

7.1 Performance Security7.2 Extension of Performance Security7.3 Appropriation of Performance Security7.4 Release of Performance Security

8 Right of Way

8.1 The Site8.2 Compensation for delay in handing over the Site8.3 Procurement of the Site8.4 Site to be free from Encumbrances8.5 Protection of Site from encroachments8.6 Special/temporary right of way8.7 Access to Authority and Engineer8.8 Geological and archaeological finds

9 Utilities, Obstructions and Trees

9.1 Existing utilities and roads9.2 Shifting of utilities and removal of obstructions9.3 New utilities9.4 Felling of Trees

10 Design and Construction of the Project Highway

10.1 Obligations prior to commencement of Construction Works10.2 Design and Drawings10.3 Construction of the Project Highway10.4 Maintenance during Construction Period10.5 Extension of Time for Completion

11 Quality Assurance, Monitoring and Supervision

11.1 Quality of Materials and Workmanship11.2 Quality control system11.3 Methodology11.4 Inspection and technical audit by the Authority11.5 External Audit11.6 Audit11.7 Monthly progress reports11.8 Inspection11.9 Samples11.10 Tests11.11 Examination of Works before covering up11.12 Rejection11.13 Remedial of Work11.14 Delays during construction11.15 Quality control records and documents11.16 Video recording


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12 Completion Certificate

12.1 Tests on Completion12.2 Completion Certificate12.3 Rescheduling of Tests12.4 Taking Over Certificate

12.5 Certificate of Performance12.6 Clearance of Site

13 Change of Scope

13.1 Change of Scope13.2 Procedure for Change of Scope13.3 Payment for Change of Scope13.4 Restrictions on Change of Scope13.5 Change of Scope during Maintenance Period13.6 Power of the Authority to undertake works

14 Maintenance

14.1 Maintenance obligations of the Contractor14.2 Maintenance Requirements14.3 Maintenance Manual14.4 Maintenance Programme14.5 Safety, vehicle breakdowns and accidents14.6 Lane closure14.7 Reduction of payment for non-performance of maintenance obligations14.8 Authoritys right to take remedial measures14.9 Restoration of loss or damage to Project Highway14.10 Advertising on the Site

15 Safety Requirements

15.1 Safety Requirements15.2 Use of Explosives15.3 Accident Prevention Officer15.4 Expenditure on Safety Requirements

16 Supervision and Monitoring of during Maintenance Period

16.1 Inspection by the Contractor16.2 Inspection and Payments16.3 Tests16.4 Remedial measures16.5 Reports of unusual occurrence

17 Traffic Regulation

17.1 Traffic regulation by the Contractor17.2 Highway Patrolling System

18 Defects Liability


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18.1 Defects Liability18.2 Remedying Defects18.3 Cost of Remedying Defects18.4 Contractors failure to rectify Defects18.5 Contractor to Search18.6 Performance Warranty

18.7 Clearance of Site

19 Engineer

19.1 Appointment of Engineer19.2 Duties and authority of the Engineer19.3 Delegation by the Engineer19.4 Instructions19.5 Remuneration19.6 Replacement of the Engineer19.7 Determination

PART IV

FINANCIAL MATTERS

20 Payments

20.1 Contract Price20.2 Advance Payment20.3 Procedure for estimating the monthly payment for the Project Highway20.4 Monthly Statement for Construction Works20.5 Monthly Payment for Construction Works20.6 Monthly Statement for Maintenance of the Project Highway during the

Maintenance Period20.7 Monthly Payment for Maintenance of Works the Project Highway during the

Maintenance Period20.8 Payment of Damages20.9 Time of Payment and Interest20.10. Price Adjustment for the Construction Works20.11 Price Adjustment for Maintenance of Project Highway20.12 Base, Current and Provisional Indices20.13 Limit of Price Adjustment20.14 Final Statement for Construction Works20.15 Discharge

20.16 Final Payment Certificate20.17 Annual Statement for Maintenance20.18 Change in law20.19 Correction of Certificates

21 Insurance

21.1 Insurance during Agreement Period21.2 Notice to the Authority


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21.3 Evidence of Insurance Cover21.4 Remedy for failure to insure21.5 Waiver of subrogation21.6 Contractors waiver21.7 Cross Liabilities21.8 Accident or injury to Workmen

21.9 Insurance against Accident to Workmen21.10 Insurance against Accident to Workmen21.11 Responsibility for Amounts not recovered21.12 Application of insurance proceeds21.13 Compliance with Policy Conditions

PART V

FORCE MAJEURE, SUSPENSION, TERMINATION

22 Force Majeure

22.1 Force Majeure22.2 Non-Political Event22.3 Indirect Political Event22.4 Political Event22.5 Duty to report Force Majeure Event22.6 Effect of Force Majeure Event on the Agreement22.7 Termination Notice for Force Majeure Event22.8 Termination Payment for Force Majeure Event22.9 Dispute Resolution22.10 Excuse from performance of obligations

23 Suspension

23.1 Suspension of Construction Work for Contractors failure23.2 Extension of Time on account of Suspension23.3 Authority to act on behalf of Contractor

24 Termination

24.1 Termination for Contractor Default24.2 Termination for Authority Default24.3 Termination for Authoritys Convenience24.4 Requirements after Termination24.5 Termination Payment

24.6 Property24.7 Survival of rights

PA RT VIOTHER PROVISIONS

25 Assignment and Charges

25.1 Restrictions on assignment and charges


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26 Liability and Indemnity

26.1 General indemnity26.2 Indemnity by the Contractor26.3 Notice and contest of claims26.4 Defence of claims

26.5 No consequential claims26.6 Survival on Termination

27 Dispute Resolution

27.1 Dispute Review Board27.2 Recommendation of Dispute Review Board27.3 Disbanding the Dispute Review Board27.4 Arbitration27.5 Adjudication by Regulatory Authority or Commission

28 Miscellaneous

28.1 Governing law and jurisdiction28.2 Waiver of immunity28.3 Delayed payments28.4 Waiver28.5 Liability for review of Documents and Drawings28.6 Exclusion of implied warranties etc.28.7 Survival28.8 Entire Agreement28.9 Severability28.10 No partnership28.11 Third Parties

28.12 Successors and Assigns28.13 Notices28.14 Language28.15 Counterparts28.16 Confidentiality28.17 Copyright and Intellectual Property Rights

29 Definitions

29.1 Definitions

Schedules

A Site of the Project

1.

The SiteAnnex-I: SiteAnnex-II: Dates of Handing over Possession of Right of WayAnnex-III: Environment Clearances

B Development of the Project Highway


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1 Development of the Project Highway2 Construction

Annex-I: Description of Project Highway

C Project Facilities

1 Project Facilities2 Description of Project Facilities

D Specifications and Standards

1 ConstructionAnnex-I: Specifications and Standards for Construction and Maintenance

E Maintenance Requirements

1 Maintenance Requirements2 Repair/rectification of defects and deficiencies3 Other defects and deficiencies4 Extension of time limit5 Emergency repairs/restoration6 Daily Inspection by the Contractor7. Pre-monsoon Inspection

Annex I Repair/ Rectification of Defects and Deficiencies

F Applicable Permits

1 Applicable Permits

G Safety and Welfare Provisions for Labour

1 Guiding principles of Safety Requirements2. Obligations of the Contractor for Safety Requirements3 Appointment of Safety Auditor4 Safety measures during Design Period5. Safety measures during Construction Period6 Safety Audit7 Costs and Expenses8 Safety & Welfare Provisions for labour to be employed by the Contractor

Annex I Safety & Welfare Provisions for labour

H Performance Security

I Contract Price Weightages

J Contract Price

K Shifting of Utilities and Obstructions

L Project Completion Schedule

1 Project Completion Schedule


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2 Project Milestone-I3 Project Milestone-II4 Project Milestone-III5 Scheduled Completion Date6 Extension of period

M Drawings1 Drawings2 Additional drawings

Annex-I: List of Drawings

N Tests

1 Schedule for Tests2 Tests3 Agency for conducting Tests4 Completion/Provisional Certificate

O Completion Certificate

1 Completion Certificate2 Provisional Certificate

P Payment Reductions for Non-compliance

1 Payment reduction for non-compliance with the Maintenance Requirements2 Percentage reductions in lump sum payments

Q Indemnity Bond

R Selection of Engineer

1 Selection of Engineer2 Fee and expenses3 Appointment of government entity as Engineer

S Officers of the Authority

T Forms for payments to the Contractor

1 Monthly Statement for Construction Works2 Monthly Statement for Maintenance of the Project Highway3 Contractors Claim for Damages for delay in providing the Right of Way.

U Insurance

1 Insurance of Works and Contractor's Equipment during Construction Period2 Insurance for Contractor's Defect Liability Period3 Insurance during the Maintenance Period4 Third Party Insurance (including Authority's Property)5 Insurance for Indirect Political Event

V Disputes Review Boards Rules and Procedures


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Part I

Preliminary


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ENGINEERING, PROCUREMENT, CONSTRUCTION AND MAINTENANCE

AGREEMENT

THIS AGREEMENT1is entered into on this the .. day of , 20..

BETWEEN

THE NATIONAL HIGHWAYS AUTHORITY OF INDIA, establishedunder the National Highways Authority of India Act 1988, represented by itsChairman and having its principal offices at G-5 & 6, Sector 10, Dwarka,

New Delhi-110075 (hereinafter referred to as the Authority whichexpression shall, unless repugnant to the context or meaning thereof, includeits administrators, successors and assigns) of One Part;

AND

2 {.. LIMITED}$, a company incorporated under the provisions ofthe Companies Act, 1956 and having its registered office at ,(hereinafter referred to as the Contractor which expression shall, unless

repugnant to the context or meaning thereof, include its successors andpermitted assigns and substitutes) of the Other Part.

WHEREAS:

(A) The Government of India had entrusted to the Authority [the development,maintenance and management of National Highway No. **

2 including the

section from km ** to km ** (approx. *** km)]3.

(B) The Authority had resolved to [augment the existing road from km ** to km** (approximately *** km) on the *** section of National Highway No.**(hereinafter called the NH-**) in ***** by Four-Laning and subsequent

Six-Laning thereof] on Engineering, Procurement, Construction andMaintenance (EPC) basis in accordance with the terms and conditions to

be set forth in an agreement to be entered into.

(C) The Authority had accordingly invited proposals by its [Notice/ Request forQualification No. *** dated ***] (the Request for Qualification orRFQ) for short listing of bidders for Engineering, Procurement,Construction and Maintenance of the above referred section of NH -** onEPC basis and had shortlisted certain bidders including, inter alia, the {theselected bidder/ consortium comprising .,. and (collectively the

1

Serially numbered footnotes in this Agreement are for guidance of the Authority and shouldbe omitted from the draft Agreement forming part of Bid Documents. Footnotes marked $shall be retained in the draft Agreement.

$ The provisions in curly parenthesis and the blank spaces in the draft Agreement shall besuitably modified/ filled after completion of the bid process to reflect the particulars relatingto the selected bidder.

2 All asterisks in this Model Agreement should be substituted by project-specific particulars inthe draft Agreement forming part of Bid Documents.

3 All project-specific provisions in this Model Agreement have been enclosed in squareparenthesis and may be modified, as necessary, before issuing the draft Agreement formingpart of Bid Documents.


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Consortium) with ..as its Lead Member}.

(D) The Authority had prescribed the technical and commercial terms andconditions, and invited bids (the Request for Proposals or RFP) fromthe bidders shortlisted pursuant to the RFQ for undertaking the Project.

(E) After evaluation of the bids received, the Authority had accepted the bid ofthe {selected bidder/ Consortium} and issued its Letter of Acceptance No... dated .. (hereinafter called the LOA) to the {selected

bidder/ Consortium} for Engineering, Procurement, Construction andMaintenance of the above section of NH ** at contract price (the ContractPrice) of Rs [***] requiring the selected bidder/Consortium to inter alia:.

(a) provide to the Authority an irrevocable and unconditional guarantee from aBank for a sum equivalent to Rs. ***** crore (Rupees ***** crore)4in theform set forth in Schedule H, within 21 days of the date of issue of LOA;

(b) deliver to the Authority a legal opinion from the legal counsel of the selectedbidder/ Consortium with respect to the authority of the selected bidder/

Consortium to enter into this Agreement and the enforceability of theprovisions thereof, within 21 days of the date of issue of LOA;

{(c) provide a guarantee for a sum equivalent to Rs. ***** crore (Rupees *****crore)

5 from the Lead Member of the selected Consortium in the form set

forth in Appendix VII of the RFP accepting the responsibility to pay to theAuthority in the event of default of the Contractor in the payment of anyamount due or recoverable from him in accordance with the provisions ofthe Agreement, within 21 days of the date of issue of LOA;}; and

(d) execute this Agreement within 28 (twenty eight) days of the date of issue ofLOA.

(F) {The selected Consortium has since promoted and incorporated the

Contractor as a limited liability company under the Companies Act 1956,and has requested the Authority to accept the Contractor as the entity whichshall undertake and perform the obligations and exercise the rights of theselected Consortium under the LOA,} including the obligation to enter intothis Agreement pursuant to the LOA for executing the Project.}

(G) {By its letter dated ., the Contractor has also joined in the saidrequest of the selected Consortium to the Authority to accept it as the entitywhich shall undertake and perform the obligations and exercise the rights ofthe selected Consortium including the obligation to enter into this Agreement

pursuant to the LOA. It has further represented to the effect that it has beenpromoted by the selected Consortium for the purposes hereof.}

(H) {The Authority has agreed to the said request of the selected Consortium andthe Contractor, and has accordingly agreed to enter into this Agreement withthe Contractor for execution of the Project on EPC basis, subject to and onthe terms and conditions set forth hereinafter.}

4Calculated @ 5% (five per cent) of the Contract Price specified in the LOA.5Calculated @ 15% (fifteen per cent) of the Contract Price specified in the LOA


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(I) The Contractor has fulfilled the requirements specified in Recital (E) above;

NOW THEREFORE in consideration of the foregoing the Authority herebycovenants to pay the Contractor, in consideration of the Engineering,Procurement, Construction and Maintenance of the Project Highway, theContract Price or such other sum as may become payable under the

provisions of the Agreement at the times and in the manner prescribed by theAgreement and the respective covenants and agreements set forth in thisAgreement, the sufficiency and adequacy of which is hereby acknowledged,and intending to be legally bound hereby, the Parties agree as follows:


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ARTICLE 1

DEFINITIONS AND INTERPRETATION

1.1 Definitions

The words and expressions beginning with capital letters and defined in thisAgreement (including those in Article 29) shall, unless the context otherwiserequires, have the meaning ascribed thereto herein, and the words andexpressions defined in the Schedules and used therein shall have the meaningascribed thereto in the Schedules.

1.2 Interpretation

1.2.1 In this Agreement, unless the context otherwise requires,

(a) references to any legislation or any provision thereof shall includeamendment or re-enactment or consolidation of such legislation or anyprovision thereof so far as such amendment or re-enactment or consolidationapplies or is capable of applying to any transaction entered into hereunder;

(b) references to laws of India or Indian law or regulation having the force oflaw shall include the laws, acts, ordinances, rules, regulations, bye laws ornotifications which have the force of law in the territory of India and as fromtime to time may be amended, modified, supplemented, extended or re-enacted;

(c) references to a person and words denoting a natural person shall be

construed as a reference to any individual, firm, company, corporation,society, trust, government, state or agency of a state or any association orpartnership (whether or not having separate legal personality) of two or moreof the above and shall include successors and assigns;

(d) the table of contents, headings or sub-headings in this Agreement are forconvenience of reference only and shall not be used in, and shall not affect,the construction or interpretation of this Agreement;

(e) the words include and including are to be construed without limitationand shall be deemed to be followed by without limitation or but notlimited to whether or not they are followed by such phrases;

(f) references to construction or building include, unless the contextotherwise requires, survey and investigation, design, developing,engineering, procurement, supply of Plant, Materials, Equipment, labour,delivery, transportation, installation, processing, fabrication, testing,commissioning and maintenance of the Project Highway, includingremoving of Defects, if any, and other activities incidental to theconstruction and construct or build shall be construed accordingly;


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(g) references to development include, unless the context otherwise requires,construction, renovation, refurbishing, augmentation, up-gradation and otheractivities incidental thereto, and develop shall be construed accordingly;

(h) any reference to any period of time shall mean a reference to that accordingto Indian Standard Time;

(i) any reference to day shall mean a reference to a calendar day;

(j) references to a business day shall be construed as a reference to a day(other than a Sunday) on which banks in [Delhi] are generally open for

business;

(k) any reference to month shall mean a reference to a calendar month as per theGregorian calendar;

(l) references to any date, period or Project Milestone shall mean and includesuch date, period or Project Milestone as may be extended pursuant to this

Agreement;

(m) any reference to any period commencing from a specified day or date andtill or until a specified day or date shall include both such days or dates;

provided that if the last day of any period computed under this Agreement isnot a business day, then the period shall run until the end of the next businessday;

(n) the words importing singular shall include plural and vice versa;

(o) references to any gender shall include the other and the neutral gender;

(p) lakh means a hundred thousand (100,000) and crore means ten million

(10,000,000);

(q) indebtedness shall be construed so as to include any obligation (whetherincurred as principal or surety) for the payment or repayment of money,whether present or future, actual or contingent;

(r) references to the winding-up, dissolution, insolvency, orreorganisation of a company or corporation shall be construed so as toinclude any equivalent or analogous proceedings under the law of the

jurisdiction in which such company or corporation is incorporated or anyjurisdiction in which such company or corporation carries on businessincluding the seeking of liquidation, winding-up, reorganisation, dissolution,

arrangement, protection or relief of debtors;

(s) save and except as otherwise provided in this Agreement, any reference, atany time, to any agreement, deed, instrument, licence or document of anydescription shall be construed as reference to that agreement, deed,instrument, licence or other document as amended, varied, supplemented,modified or suspended at the time of such reference; provided that this Sub-clause shall not operate so as to increase liabilities or obligations of theAuthority hereunder or pursuant hereto in any manner whatsoever;


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(t) any agreement, consent, approval, authorisation, notice, communication,information or report required under or pursuant to this Agreement from or

by any Party or the Engineer shall be valid and effective only if it is inwriting under the hand of a duly authorised representative of such Party orthe Engineer, as the case may be, in this behalf and not otherwise;

(u) the Schedules and Recitals to this Agreement form an integral part of thisAgreement and will be in full force and effect as though they were expresslyset out in the body of this Agreement;

(v) references to Recitals, Articles, Clauses, Sub-clauses or Schedules in thisAgreement shall, except where the context otherwise requires, meanreferences to Recitals, Articles, Clauses, Sub-clauses and Schedules of or tothis Agreement, and references to a Paragraph shall, subject to any contraryindication, be construed as a reference to a Paragraph of this Agreement or ofthe Schedule in which such reference appears; and

(w) the damages payable by either Party to the other of them, as set forth in this

Agreement, whether on per diem basis or otherwise, are mutually agreedgenuine pre-estimated loss and damage likely to be suffered and incurred bythe Party entitled to receive the same and are not by way of penalty (theDamages).

(x) time shall be of the essence in the performance of the Parties respectiveobligations. If any time period specified herein is extended, such extendedtime shall also be of the essence.

1.2.2 Unless expressly provided otherwise in this Agreement, any Documentationrequired to be provided or furnished by the Contractor to the Authority shall

be provided free of cost and in three copies, and if the Authority is required

to return any such Documentation with their comments and/or approval, theyshall be entitled to retain two copies thereof.

1.2.3 The rule of construction, if any, that a contract should be interpreted againstthe parties responsible for the drafting and preparation thereof, shall notapply.

1.2.4 Any word or expression used in this Agreement shall, unless otherwisedefined or construed in this Agreement, bear its ordinary English meaningand, for these purposes, the General Clauses Act 1897 shall not apply.

1.3 Measurements and arithmetic conventions

All measurements and calculations shall be in the metric system andcalculations done to 2 (two) decimal places, with the third digit of 5 (five) orabove being rounded up and below 5 (five) being rounded down.

1.4 Priority of agreements and errors/discrepancies

1.4.1 This Agreement, and all other agreements and documents forming part of orreferred to in this Agreement are to be taken as mutually explanatory and,


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unless otherwise expressly provided elsewhere in this Agreement, thepriority of this Agreement and other documents and agreements forming parthereof or referred to herein shall, in the event of any conflict between them,

be in the following order:

(a) this Agreement; and

(b) all other agreements and documents forming part hereof or referred toherein; i.e. the Agreement at (a) above shall prevail over the agreements anddocuments at (b) above.

1.4.2 Subject to the provisions of Sub-clause 1.4.1, in case of ambiguities ordiscrepancies within this Agreement, the following shall apply:

(a) between two or more Clauses of this Agreement, the provisions of a specificClause relevant to the issue under consideration shall prevail over those inother Clauses;

(b) between the Clauses of this Agreement and the Schedules, the Clauses shallprevail and between Schedules and Annexes, the Schedules shall prevail;

(c) between any two Schedules, the Schedule relevant to the issue shall prevail;

(d) between the written description on the Drawings and the Specifications andStandards, the latter shall prevail;

(e) between the dimension scaled from the Drawing and its specific writtendimension, the latter shall prevail; and

(f) between any value written in numerals and that in words, the latter shallprevail.


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Part II

Scope of Project and Obligations of theParties


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ARTICLE 2

SCOPE OF THE PROJECT

2.1 Scope of the Project

Under this Agreement the scope of the Project (the Scope of the Project)shall mean and include:

(a) construction of the Project Highway on the Site set forth in Schedule-A and as specified in Schedule-B together with provision of ProjectFacilities as specified in Schedule-C, and in conformity with theSpecifications and Standards set forth in Schedule-D;

(b) maintenance of the Project Highway in accordance with theprovisions of this Agreement and in conformity with therequirements set forth in Schedule E; and

(c) performance and fulfilment of all other obligations of the Contractorin accordance with the provisions of this Agreement and mattersincidental thereto or necessary for the performance of any or all ofthe obligations of the Contractor under this Agreement.


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ARTICLE 3

OBLIGATIONS OF THE CONTRACTOR

3.1 Obligations of the Contractor

3.1.1 Subject to and on the terms and conditions of this Agreement, the Contractorshall, at its own cost and expense, undertake the survey, investigation,design, engineering, procurement, construction, and maintenance of theProject Highway and observe, fulfil, comply with and perform all itsobligations set out in this Agreement or arising hereunder.

3.1.2 The Contractor shall comply with all Applicable Laws and ApplicablePermits (including renewals as required) in the performance of its obligationsunder this Agreement.

3.1.3 Subject to the provisions of Sub-clauses 3.1.1 and 3.1.2, the Contractor shalldischarge its obligations in accordance with Good Industry Practice and as a

reasonable and prudent person.

3.1.4 The Contractor shall remedy any and all loss or damage to the ProjectHighway or Materials to be incorporated in the Project Highway from theStart Date till the end of the Defects Liability Period at the Contractors costif such loss or damage is attributable to the Contractors acts or omissions.

3.1.5 The Contractor shall, at its own cost and expense, in addition to and not inderogation of its obligations elsewhere set out in this Agreement:

(a) make, or cause to be made, necessary applications to the relevantGovernment Instrumentalities with such particulars and details asmay be required for obtaining Applicable Permits set forth inSchedule F, and obtain and keep in force and effect such ApplicablePermits in conformity with the Applicable Laws;

(b) procure, as required, the appropriate proprietary rights, licences,agreements and permissions for Materials, methods, processes andsystems used or incorporated into the Project Highway;

(c) make reasonable efforts to maintain harmony and good industrialrelations among the personnel employed by it or its Sub-contractorsin connection with the performance of its obligations under thisAgreement;

(d) ensure and procure that its Sub-contractors comply with allApplicable Permits and Applicable Laws in the performance by themof any of the Contractors obligations under this Agreement;

(e) not do or omit to do any act, deed or thing which may in any mannerbe violative of any of the provisions of this Agreement;

(f) support, cooperate with and facilitate the Authority in theimplementation and operation of the Project in accordance with the


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provisions of this Agreement; and

(g) ensure that the Contractor and its Sub-contractors comply with thesafety and welfare measure for labour set forth in Schedule G; and

(h) The Contractor shall keep, on the Site, a copy of the Agreement, publicationsnamed in the Agreement, the Drawings, Documents relating to the Project, andChange of Scope Orders and other communications given under the Agreement.The Engineer and his authorised personnel shall have the right of access to all thesedocuments at all reasonable times.

3.2 Obligations relating to Sub-contracts andany other agreements

3.2.1 The Contractor shall obtain prior written approval of the Authority for all Sub-contracts.Further, the Contractor shall not sub-contract exceeding [30] [thirty] percent of the ContractPrice.

3.2.2 It is expressly agreed that the Contractor shall, at all times, be responsibleand liable for all its obligations under this Agreement notwithstandinganything contained in the agreements with its Sub-contractors or any otheragreement that may be entered into by the Contractor, and no default underany such agreement shall excuse the Contractor from its obligations orliability hereunder.

3.3 Employment of foreign nationals

The Contractor acknowledges, agrees and undertakes that employment offoreign personnel by the Contractor and/or its Sub-contractors and their sub-contractors shall be subject to grant of requisite regulatory permits andapprovals including employment/residential visas and work permits, if anyrequired, and the obligation to apply for and obtain the same shall and willalways be of the Contractor. Notwithstanding anything to the contrarycontained in this Agreement, refusal of or inability to obtain any such

permits and approvals by the Contractor or any of its Sub-contractors or theirsub-contractors shall not constitute Force Majeure Event, and shall not in anymanner excuse the Contractor from the performance and discharge of itsobligations and liabilities under this Agreement.

3.4 Employment and Removal of Contractorspersonnel

3.4.1 The Contractor shall ensure that the personnel engaged by it in theperformance of its obligations under this Agreement are at all times properlytrained for their respective functions.

3.4.2 The Engineer may direct the Contractor to remove any member of theContractors personnel. Provided that, any such direction issued by theEngineer shall contain in detail the reasons for the removal of such person.

3.4.3 The Contractor shall on receiving such a direction from the Engineer orderfor the removal of such person or persons with immediate effect. It shall bethe duty of the Contractor to ensure that such persons are evicted from theSite within 7 [seven] days of any such direction being issued in pursuance of


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Clause 3.4.2. The Contractor shall further ensure that such persons have nofurther connection with the Construction Works under the Agreement.

3.5 Advertisement on Project Highway

The Project Highway or any part thereof shall not be used in any manner to

advertise any commercial product or services. It is agreed that the Contractormay display citizen information boards with its contents and locationsapproved by the Engineer.

3.6 Contractor's Care of the Construction Works

Subject to the insurance obligations of the Parties, the Contractor shall bearfull risk in and take full responsibility for the care of the Construction Worksand Materials, goods and equipment for incorporation therein from the StartDate until the Taking-Over Certificate is issued, except and to the extent thatany loss of or damage to the same shall arise out of any default or neglect ofthe Authority.

3.7 Electricity, Water and Gas

The Contractor shall be responsible for the provision of all power, water andother services he may require.

3.8 Unforeseeable Difficulties

Except as otherwise stated in the Contract:

(a) the Contractor accepts total responsibility for having foreseen alldifficulties and costs of successfully completing the ConstructionWorks; and

(b) the Contract Price shall not be adjusted to take account of anyunforeseen difficulties or costs.

{3.9 Obligations relating to Change in Ownership

3.9.1 In the event the Contractor is a company incorporated under the IndianCompanies Act promoted and formed by the Consortium referred to inRecitals (F), (G) and (H), the Contractor shall not undertake or permit anyChange in Ownership, except with the prior approval of the Authority.

3.9.2 Notwithstanding anything to the contrary contained in this Agreement, theContractor agrees and acknowledges that:

(a) all acquisitions of Equity by an acquirer, either by himself or withany person acting in concert, directly or indirectly, including bytransfer of the direct or indirect legal or beneficial ownership orcontrol of any Equity, in aggregate of not less than 15% (fifteen percent) of the total Equity of the Contractor; or

(b) acquisition of any control directly or indirectly of the Board ofDirectors of the Contractor by any person either by himself or


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together with any person or persons acting in concert with him shallconstitute a Change in Ownership requiring prior approval of theAuthority from national security and public interest perspective, thedecision of the Authority in this behalf being final, conclusive and

binding on the Contractor, and undertakes that it shall not give effectto any such acquisition of Equity or control of the Board of Directors

of the Contractor without such prior approval of the Authority. Forthe avoidance of doubt, it is expressly agreed that approval of theAuthority hereunder shall be limited to national security and publicinterest perspective, and the Authority shall endeavour to convey itsdecision thereon expeditiously. It is also agreed that the Authorityshall not be liable in any manner on account of grant or otherwise ofsuch approval and that such approval or denial thereof shall not inany manner absolve the Contractor from any liability or obligationunder this Agreement.

For the purposes of this Sub-clause 3.9.2:

(i) the expression acquirer, control and person acting in concertshall have the meaning ascribed thereto in the Securities andExchange Board of India (Substantial Acquisition of Shares andTakeover) Regulations, 1997 or any statutory re-enactment thereof asin force as on the date of acquisition of Equity, or the control of theBoard of Directors, as the case may be, of the Contractor;

(ii) the indirect transfer or control of legal or beneficial ownership ofEquity shall mean transfer of the direct or indirect beneficialownership or control of any company or companies whether in Indiaor abroad which results in the acquirer acquiring control over theshares or voting rights of shares of the Contractor; and

(iii) power to appoint, whether by contract or by virtue of control oracquisition of shares of any company holding directly or through oneor more companies (whether situate in India or abroad) the Equity ofthe Contractor, not less than half of the directors on the Board ofDirectors of the Contractor or of any company, directly or indirectlywhether situate in India or abroad, having ultimate control of not lessthan 15% (fifteen per cent) of the Equity of the Contractor shallconstitute acquisition of control, directly or indirectly, of the Board ofDirectors of the Contractor.}


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ARTICLE 4

OBLIGATIONS OF THE AUTHORITY

4.1 Obligations of the Authority

4.1.1 The Authority shall, at its own cost and expense, undertake, comply with andperform all its obligations set out in this Agreement or arising hereunder.

4.1.2 The Authority shall be responsible for the correctness and completeness ofthe Schedules A, B, C, D and E relating to the Scope of the Project.

4.1.3 The Authority shall provide to the Contractor:

(a) the Right of Way in accordance with the provisions of Clauses 8.2and 8.3;

(b) approval of the Railway authorities in the form of a generalarrangement drawing that would enable the Contractor to construct

road over-bridges/ under-bridges at level crossings on the ProjectHighway in accordance with the Specifications and Standards andsubject to the terms and conditions specified in such approval withina period of [90] days from the Start Date; and

(c) all Applicable Permits relating to environmental protection andconservation of the Site as set forth in Sub-clause 8.2.7.

[Provided that the Authority may from time to time by notice extend,for up to an aggregate of 3 (three) months, the period for procuringthe approval set forth in Sub-clause (b) and/ or Sub-clause (c) aboveand in that event the land to be covered by over-bridges or the

affected sections of the Project Highway, as the case may be, shall beincluded in the Appendix referred to in Clause 8.3 and dealt with inaccordance with the provisions thereof; and provided further thatupon procurement of such approval, the Contractor shall be entitledto a period of 12 (twelve) months therefrom for completion of theover-bridges.]

4.1.4 The Authority agrees to provide support to the Contractor and undertakes toobserve, comply with and perform, subject to and in accordance with the

provisions of this Agreement and the Applicable Laws, the following:

(a) upon written request from the Contractor, and subject to the

Contractor complying with Applicable Laws, provide reasonablesupport and assistance to the Contractor in procuring ApplicablePermits required from any Government Instrumentality forimplementation and operation of the Project;

(b) upon written request from the Contractor, provide reasonableassistance to the Contractor in obtaining access to all necessaryinfrastructure facilities and utilities, including water and electricity atrates and on terms no less favourable to the Contractor than those


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generally available to commercial customers receiving substantiallyequivalent services;

(c) procure that no barriers are erected or placed on or about the ProjectHighway by any Government Instrumentality or persons claimingthrough or under it, except for reasons of Emergency, national

security, law and order or collection of inter-state taxes;

(d) not do or omit to do any act, deed or thing which may in any mannerbe violative of any of the provisions of this Agreement;

(e) support, cooperate with and facilitate the Contractor in theimplementation and operation of the Project in accordance with the

provisions of this Agreement; and

(f) upon written request from the Contractor and subject to theprovisions of Clause 3.3, provide reasonable assistance to theContractor and any expatriate personnel of the Contractor or its Sub-

contractors to obtain applicable visas and work permits for thepurposes of discharge by the Contractor or its Sub-contractors theirobligations under this Agreement and the agreements with the Sub-contractors.

4.2 Maintenance obligations prior to the Appointed Date

The Authority shall maintain the Project Highway, at its own cost andexpense, so that its traffic worthiness and safety are at no time materiallyinferior as compared to its condition 7 (seven) days prior to the last date forsubmission of the Bid, and in the event of any material deterioration ordamage other than normal wear and tear, undertake repair thereof, or pay to

the Contractor the cost and expense, as determined by the Engineer, forundertaking such repair after the Start Date. For the avoidance of doubt, theAuthority shall undertake only routine maintenance prior to the signing ofthe Agreement, and it shall undertake special repairs only for ensuring safeoperation of the Project Highway, or in the event of excessive deteriorationor damage caused due to unforeseen events such as floods or torrential rain.


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ARTICLE 5

REPRESENTATIONS AND WARRANTIES

5.1 Representations and Warranties of the Contractor

The Contractor represents and warrants to the Authority that:

(a) it is duly organised and validly existing under the laws of India, andhas full power and authority to execute and perform its obligationsunder this Agreement and to carry out the transactions contemplatedhereby;

(b) it has taken all necessary corporate and/or other actions underApplicable Laws to authorise the execution and delivery of thisAgreement and to validly exercise its rights and perform itsobligations under this Agreement;

(c) this Agreement constitutes its legal, valid and binding obligation,enforceable against it in accordance with the terms hereof, and itsobligations under this Agreement will be legally valid, binding andenforceable obligations against it in accordance with the termshereof;

(d) it is subject to the laws of India, and hereby expressly and irrevocablywaives any immunity in any jurisdiction in respect of this Agreementor matters arising thereunder including any obligation, liability orresponsibility hereunder;

(e) the information furnished in the Bid and as updated on or before thedate of this Agreement is true and accurate in all respects as on thedate of this Agreement;

(f) the execution, delivery and performance of this Agreement will notconflict with, result in the breach of, constitute a default under, oraccelerate performance required by any of the terms of itsMemorandum and Articles of Association or any Applicable Laws orany covenant, contract, agreement, arrangement, understanding,decree or order to which it is a party or by which it or any of its

properties or assets is bound or affected;

(g) there are no actions, suits, proceedings, or investigations pending or,to its knowledge, threatened against it at law or in equity before anycourt or before any other judicial, quasi-judicial or other Authority,the outcome of which may result in the breach of this Agreement orwhich individually or in the aggregate may result in any materialimpairment of its ability to perform any of its obligations under thisAgreement;

(h) it has no knowledge of any violation or default with respect to anyorder, writ, injunction or decree of any court or any legally binding


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order of any Government Instrumentality which may result in anymaterial adverse effect on its ability to perform its obligations underthis Agreement and no fact or circumstance exists which may giverise to such proceedings that would adversely affect the performanceof its obligations under this Agreement;

(i) it has complied with Applicable Laws in all material respects and hasnot been subject to any fines, penalties, injunctive relief or any othercivil or criminal liabilities which in the aggregate have or may have amaterial adverse effect on its ability to perform its obligations underthis Agreement;

(j) no representation or warranty by it contained herein or in any otherdocument furnished by it to the Authority or to any GovernmentInstrumentality in relation to Applicable Permits contains or willcontain any untrue or misleading statement of material fact or omitsor will omit to state a material fact necessary to make suchrepresentation or warranty;

(k) no sums, in cash or kind, have been paid or will be paid, by it or onits behalf, to any person by way of fees, commission or otherwise forsecuring the Contract or entering into this Agreement or forinfluencing or attempting to influence any officer or employee of theAuthority in connection therewith;

(l) all information provided by the [selected bidder/ ConsortiumMembers of which the selected bidder was the Lead Partner] inresponse to the Request for Qualification and Request for Proposalsor otherwise, is to the best of its knowledge and belief, true andaccurate in all material respects;and

(m) nothing contained in the Agreement shall create any contractualrelationship or obligation between any Contractors designers /design consultants and the Authority.

5.2 Representations and Warranties of the Authority

The Authority represents and warrants to the Contractor that:

(a) it has full power and authority to execute, deliver and perform itsobligations under this Agreement and to carry out the transactionscontemplated herein and that it has taken all actions necessary to

execute this Agreement, exercise its rights and perform itsobligations, under this Agreement;

(b) it has taken all necessary actions under the Applicable Laws toauthorise the execution, delivery and performance of this Agreement;

(c) it has the financial standing and capacity to perform its obligationsunder this Agreement;


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ARTICLE 6

DISCLAIMER

6.1 Disclaimer

6.1.1 The Contractor acknowledges that prior to the execution of this Agreement,the Contractor has, after a complete and careful examination, made anindependent evaluation of the Request for Qualification, Request forProposals, Scope of the Project, Specifications and Standards of design,construction and maintenance, Site, local conditions, physical qualities ofground, subsoil and geology, traffic volumes, suitability and availability ofaccess routes to the Site and all information provided by the Authority orobtained procured or gathered otherwise, and has determined to itssatisfaction the accuracy or otherwise thereof and the nature and extent ofdifficulties, risks and hazards as are likely to arise or may be faced by it inthe course of performance of its obligations hereunder. Save as provided inClause 5.2, the Authority makes no representation whatsoever, express,

implicit or otherwise, regarding the accuracy, adequacy, correctness,reliability and/or completeness of any assessment, assumptions, statement orinformation provided by it and the Contractor confirms that it shall have noclaim whatsoever against the Authority in this regard.

6.1.2 The Contractor acknowledges and hereby accepts to have satisfied itself as tothe correctness and sufficiency of the Contract Price.

6.1.3 The Contractor acknowledges and hereby accepts the risk of inadequacy,mistake or error in or relating to any of the matters set forth in Sub-clause6.1.1 above and hereby acknowledges and agrees that the Authority shall not

be liable for the same in any manner whatsoever to the Contractor, or any

person claiming through or under any of them.

6.1.4 The Parties agree that any mistake or error in or relating to any of the mattersset forth in Sub-clause 6.1.1 above shall not vitiate this Agreement.

6.1.5 In the event that either Party becomes aware of any mistake or error relatingto any of the matters set forth in Sub-clause 6.1.1 above, that Party shallimmediately notify the other Party, specifying the mistake or error.

6.1.6 Except as otherwise provided in this Agreement, all risks relating to theProject shall be borne by the Contractor and the Authority shall not be liablein any manner for such risks or the consequences thereof.


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Part III

Design, Construction and Maintenance


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ARTICLE 7

PERFORMANCE SECURITY

7.1 Performance Security

7.1.1 The Contractor shall, for the performance of its obligations hereunder duringthe Construction Period and Maintenance Period, provide to the Authority anirrevocable and unconditional guarantee from a Bank in the form set forth inSchedule-H (the Performance Security) for the periods and amountsspecified in Sub-clause 7.1.3.

7.1.2 The Contract Price of (a) Design, road works, culverts, minor bridges andother works, (b) major bridges and structures, and (c) Maintenanceshall beestimated on the basis of weightage of different items of design andconstruction stated in Schedule I. The the Contract Price is also stated inSchedule I.

7.1.3 The Performance Security shall be furnished separately for (a) road worksand other works and (b) major bridges and structures pursuant to Sub-clause7.1.1 in the amounts and at the times specified below:


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SerialNo.

Percentage ofthe ContractPrice separatelyfor (a) and (b)

as defined inSub-clause7.1.2.

Amount ofPerformance Securityfor

(a) and (b)as definedin Sub-clause7.1.2.(Rs.)

Specified time forfurnishingPerformance Securityto the Authority

Validity Period Cumulative Total ofthe BankGuarantee

aspercentageof theContractPrice

(1) (2) (3) (4) (5) (6)

1 2.5 (a):

(b):

Within twenty-one(21) days of the Issueof LOA

(a): See Note(1) below.(b):See Note(2) below.

2.5

2. 2.5 (a):

(b):

Along with the claimfor interim paymentwhen the cumulative

payment due to theContractor exceeds15 (fifteen) percent ofContract Price for

Design andConstruction Works


5.0


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SerialNo.

Percentage ofthe ContractPrice separately

for (a) and (b)as defined inSub-clause7.1.2.

Amount ofPerformance Security

for(a) and (b)as definedin Sub-clause7.1.2.(Rs.)

Specified time forfurnishingPerformance Security

to the Authority

Validity Period CumulativeTotal of theBank

Guaranteeaspercentageof theContractPrice

(1) (2) (3) (4) (5) (6)

3. 2.5 (a):

(b):


payment due to the

Contractor exceeds30 (thirty) percent ofContract Price forDesign andConstruction Works


7.5

4. 2.5 (a):

(b):


payment due to theContractor exceeds45 (forty-five)

percent of Contract

Price for Design andConstruction Works


10.0


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SerialNo.

Percentage ofthe ContractPrice separately

for (a) and (b)as defined inSub-clause7.1.2.

Amount ofPerformance Security

for(a) and (b)as definedin Sub-clause7.1.2.(Rs.)

Specified time forfurnishingPerformance Security

to the Authority

Validity Period CumulativeTotal of theBank

Guarantee aspercentage ofthe ContractPrice

(1) (2) (3) (4) (5) (6)

5. 2.5 (a):

(b):


payment due to the

Contractor exceeds60 (sixty) percent ofContract Price forDesign andConstruction

(a): See Note(5) below.(b):See Note (6

below.

12.5

6. 2.5 (a):

(b):


payment due to theContractor exceeds75 (seventy-five)

percent of the

Contract Price forDesign andConstruction

(a): See Note(5) below.(b):See Note (6

below.

15.0

Note (1). From Start Date till [90] days after the end of the Defect Liability Periodof roads and other works.

Note (2). From Start Date till [90] days after the end of the Defect Liability Periodfor major bridges and structures.

Note (3). From the date of the claim till [90] days after the end of the DefectLiability Period of roads and other works.

Note (4). From the date of the claim till [90] days after the end of the DefectLiability Period for major bridges and structures.

Note (5). From the date of the claim till [90] days after the issue of last CompletionCertificate for roads and other works.


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Note (6). From the date of the claim till [90] days after the issue of the lastCompletion Certificate for major bridges and structures.

7.2 Extension of Performance Security

Notwithstanding anything to the contrary stated above, the Contractor shall

ensure that each Performance Security is valid and enforceable until theContractor has completed the Project Highway and remedied any Defects inaccordance with the Agreement. The terms of the Performance Securityspecify its expiry date, and if the Contractor has not become entitled toreceive the Performance Certificate for items at serial nos. 1 to 4 of Sub-clause 7.1.3, or has not become entitled to receive the Completion Certificatefor items at serial nos. 5 and 6 Sub-clause 7.1.3, as the case may be, by thedate 28 days prior to the expiry date of the Performance Security, theContractor shall extend the validity of the Performance Security until theProject Highway have been completed and any Defects have been remedied.

7.3 Appropriation of Performance Security

The Authority shall not make a claim under the Performance Security, exceptfor amounts to which the Authority is entitled under the Agreement in theevent of:

(a) failure by the Contractor to extend the validity of the PerformanceSecurity as described in Clause 7.2, in which event the Authority mayclaim the full amount of the Performance Security,

(b) failure by the Contractor to pay the Authority an amount due, aseither agreed by the Contractor or determined under Sub-clause 21.4or Article 27 (Dispute Resolution), within 42 days after the

agreement, determination, date of coming into effect therecommendation of the Board, or the Award.

(c) failure by the Contractor to remedy a default within 42 days afterreceiving the Authority's notice requiring the default to be remedied,or

(d) circumstances which entitle the Authority to termination of theAgreement under Sub-clause 24.1 (Termination for ContractorDefault), irrespective of whether notice of termination has beengiven.

The Authority shall indemnify and hold the Contractor harmless against andfrom all damages, losses and expenses (including legal fees and expenses)resulting from a claim under the Performance Security to the extent to whichthe Authority was not entitled to make the claim,

7.4 Release of Performance Security

7.4.1 The Authority shall return the Performance Security:

(a) submitted under serial nos. 1 to 4 of Sub-clause 7.1.3 to the


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Contractor within 42 (forty two) days of the issue of the PerformanceCertificate issued under Clause 12.5 (Certificate of Performance);and

(b) submitted under serial nos. 5 to 6 of Sub-clause 7.1.3 to theContractor within 42 after the issue of Completion Certificate under

Article 12.

7.4.2 No claim shall be made against such security after the issue of thePerformance Certificate or the Completion Certificate, as the case may be.


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ARTICLE 8

RIGHT OF WAY

8.1 The Site

8.1.1 The site of the Project Highway (the Site) shall comprise the real estatedescribed in Schedule-A in respect of which the Right of Way shall be

provided by the Authority to the Contractor. The Authority shall beresponsible to the Contractor for:

(a) acquiring and providing physical possession of the Site free from allencroachments and encumbrances, and free access thereto for theexecution of the Agreement; and

(b) obtaining licences and permits for environment clearance for theProject Highway.

8.2 Compensation for delay in handing over the Site

8.2.1 The Authority shall provide the Right of Way to the Contractor:

(i) on the date(s) stated in Schedule-A; and

(ii) In the event Schedule-A does not specify any time schedule forproviding the Right of Way for any part of the Site , the Authorityshall provide to the Contractor the Right of Way to such part(s)within 30 (thirty) days of the Start Date.

8.2.2 If Right of Way of a part of the Site is not given within fourteen days of thedate specified in Sub-clause 8.2.1 for any reason other than Force Majeure or

breach of this Agreement by the Contractor, the Authority shall payDamages to the Contractor in accordance with the provision of Sub-clause8.2.3.

8.2.3 For any period of delay in giving the Right of Way to the Contractorexceeding 14 (fourteen) days but not exceeding ten percent of theConstruction Period of the Project, the Contractor shall be entitled toDamages in a sum calculated in accordance with the following formula:

Amount of Damages Rs. per day = 0.05 (RW + BS) x 1/30

Where

RW means cost of Road Works in the part of the Site for which handing overthe possession was delayed.

RW =(Crw /Lrw ) x LA rw

Crw = Total cost of Road Works in accordance with Clause 20.1

Lrw = Total length of the Project Highway in kilometres.


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LArw = Length in kilometres of the affected part of the Site for whichhanding over the possession was delayed.

BS means cost of major bridges and structures in the part of the Site forwhich handing over the possession was delayed.

BS = (Cbs/Lbs ) x LAbs

Cbs =Total cost of bridges and structures in accordance with Clause 20.1

Lbs = Length of the major bridges and structures in the Project Highway inrunning metres, listed in the Schedule-A

LAbs =length of major bridges and structures in running metres of theaffected part of the Site for which handing over the possession was delayed.

8.2.4 For the period of the delay in handing over the Right of Way beyond tenpercent of Construction Period, the Contractor shall be entitled to theDamages in a sum calculated at the rate of one and a half times the Damagesdetermined on the basis of the formula stated in Sub-clause 8.2.3.

8.2.5 In all cases covered by Sub-clauses 8.2.3 and 8.2.4, the Contractor shall beentitled to extension of Construction Period in that particular stretch in whichthe handing over the Right of Way of the part of the Site was delayed. The

period of extension shall be equal to the period of delay in handing over thepossession of the Site; provided that if delays involve time overlaps, theoverlaps shall not be additive.

8.2.6 Notwithstanding the provisions of Sub-clause 8.2.3 to 8.2.5, the Authoritymay withdraw such affected works for which the Right of Way has not beenacquired and handed over to the Contractor subject to the condition that theaggregate value of the works withdrawn, as determined by the Engineer,does not exceed 5 (five) per cent of the Contract Price for the Design andConstruction of the Project Highway. The Contract Price shall be reduced bythe value of the work withdrawn and the Contractor shall not be entitled toany Damages or compensation for the reduction in the scope of the ProjectHighway.

Provided the Authority exercises this right not later than two months after theScheduled date of handing over the Right of Way has expired.

8.2.7 The Schedule-A states the present status of the environment clearancesobtained or awaited, as the case may be, indicating the expected dates ofobtaining clearances.

8.2.8 The Contractor shall allow access to and use of the Site and/or theConstruction Works for laying/installing telegraph lines, electric lines or forsuch other public purposes as the Authority may require.

Provided that if such access or use results in material adverse effect, theContractor shall use its best endeavor to ensure that the impact thereof uponthe Construction Works is minimized. In the event of any physical damage to


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the Site and/or the Construction Works on account thereof, the Contractorshall provide all information and assistance as the Authority may reasonablyrequire for seeking compensation or damages from such user of the Site inaccordance with applicable Laws.

8.2.9 It is expressly agreed that trees on the Site are property of the Authority.

8.3 Procurement of the Site

8.3.1 After the signing of the Agreement, the Authority Representative and theContractor shall, on a mutually agreed date and time, inspect the Site and

prepare a memorandum containing an inventory of the Site including thevacant and unencumbered land, buildings, structures, road works, trees andany other immovable property on or attached to the Site. Such memorandumshall have appended thereto an appendix (the Appendix) specifying inreasonable detail those parts of the Site to which vacant access and Right ofWay has not been given to the Contractor. Signing of the memorandum, intwo counterparts (each of which shall constitute an original), by the

authorised representatives of the Parties shall be deemed to constitute a validevidence of giving the Right of Way to the Contractor during theConstruction Period under and in accordance with the provisions of thisAgreement and for no other purpose whatsoever.

8.3.2 On and after signing the memorandum referred to in Sub-clause 8.3.1, anduntil the issue of the Taking Over Certificate, the Contractor shall maintain around-the-clock vigil over the Site and shall ensure and procure that noencroachment thereon takes place,

8.3.3 The Authority shall make best efforts to provide the Right of Way to theContractor in respect of all land included in the Appendix, and in the event

of delay for any reason other than Force Majeure or breach of thisAgreement by the Contractor, it shall pay to the Contractor Damages in asum calculated in accordance with Clause 8.2

8.4 Site to be free from Encumbrances

Subject to the provisions of Clause 8.3, the Site shall be made available bythe Authority to the Contractor pursuant hereto free from all Encumbrancesand occupations and without the Contractor being required to make any

payment to the Authority on account of any costs, compensation, expensesand charges for the acquisition and use of such Site for the duration of theConstruction Period. For the avoidance of doubt, it is agreed that existing

rights of way, easements, privileges, liberties and appurtenances to the Siteshall not be deemed to be Encumbrances.

8.5 Protection of Site from encroachments

8.5.1 During the Construction Period, the Contractor shall protect the Site fromany and all occupations, encroachments or Encumbrances, and shall not

place or create nor permit any Sub-contractor or other person claimingthrough or under the Contractor to place or create any Encumbrance or


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security interest over all or any part of the Site or the Project Assets, or onany rights of the Contractor therein or under this Agreement, save and exceptas otherwise expressly set forth in this Agreement. In the event of anyencroachment or occupation on any part of the Site, the Contractor shallreport such encroachment or occupation forthwith to the Authority andundertake its removal at its cost and expenses.

8.5.2 During the Maintenance Period, the Contractor shall keep a vigil over theSite and shall ensure that no occupations or encroachments thereon take

place; and in the event of any encroachment or occupation on any part of theSite, the Contractor shall report such encroachment or occupation forthwithto the Authority.

8.6 Special/temporary right of way

The Contractor shall bear all costs and charges for any special or temporaryright of way required by it in connection with access to the Site. TheContractor shall obtain at its cost such facilities on or outside the Site as may

be required by it for the purposes of the Project Highway and theperformance of its obligations under this Agreement.

8.7 Access to the Authority and Engineer

8.7.1 The Right of Way given to the Contractor hereunder shall always be subjectto the right of access of the Authority and the Engineer and their employeesand agents for inspection, viewing and exercise of their rights and

performance of their obligations under this Agreement.

8.7.2 The Contractor shall ensure, subject to all relevant safety procedures, that theAuthority has un-restricted access to the Site during any emergency

situation, as decided by the Engineer.

8.8 Geological and archaeological finds

It is expressly agreed that mining, geological or archaeological rights do notform part of the Agreement with the Contractor for the Construction Works,and the Contractor hereby acknowledges that it shall not have any miningrights or interest in the underlying minerals, fossils, antiquities, structures orother remnants or things either of particular geological or archaeologicalinterest and that such rights, interest and property on or under the Site shallvest in and belong to the Authority or the concerned GovernmentInstrumentality. The Contractor shall take all reasonable precautions to

prevent its workmen or any other person from removing or damaging suchinterest or property and shall inform the Authority forthwith of the discoverythereof and comply with such instructions as the concerned GovernmentInstrumentality may reasonably give for the removal of such property. Forthe avoidance of doubt, it is agreed that any reasonable expenses incurred bythe Contractor hereunder shall be reimbursed by the Authority. It is alsoagreed that the Authority shall procure that the instructions hereunder areissued by the concerned Government Instrumentality within a reasonable

period.


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ARTICLE 9

UTILITIES, OBSTRUCTIONS AND TREES

9.1 Existing utilities and roads

Notwithstanding anything to the contrary contained herein, the Contractorshall ensure that the respective entities owning the existing roads, right ofway or utilities on, under or above the Site are enabled by it to keep suchutilities in continuous satisfactory use, if necessary, by providing suitabletemporary diversions with the authority of the controlling body of that road,right of way or utility.

9.2 Shifting of utilities and removal of obstructions

9.2.1 The Contractor shall carry out the shifting of underground or over-groundutilities, and remove the obstructions listed in Schedule J to the specifiedlocations within or outside the Site, after the Authority has obtained

clearances from the owners of utilities or the obstruction by the dates statedin the Schedule J. Contractor shall not be responsible for the delays andconsequential loss/damages in case the Authority does not get clearances forshifting of underground or over-ground utilities or removal of obstructions inaccordance with the dates stated in the Schedule J. In such cases, theEngineer shall determine the extension of time and the amount payable to theContractor.

9.2.2 The Contractor shall be responsible for shifting any underground utility notforeseen and included in Schedule J. The cost of such shifting shall be borne

by the Authority or by the entity owning such utility. However, the Authorityshall obtain, at its own cost, permission for shifting of such utilities. The

Contractor shall be granted extension of time to be determined by theEngineer.

9.3 New utilities

9.3.1 The Contractor shall allow, subject to such conditions as the Authority mayspecify, access to, and use of the Site for laying telephone lines, water pipes,electric cables or other public utilities. For the avoidance of doubt, it isagreed that use of the Site under this Clause 9.3 shall not in any mannerrelieve the Contractor of its obligation to construct and maintain the ProjectHighway in accordance with this Agreement and any damage caused by suchuse shall be restored forthwith at the cost of the Authority.

9.3.2 The Authority may, by notice, require the Contractor to connect anyadjoining road to the Project Highway, and the connecting portion thereoffalling within the Site shall be constructed by the Contractor at theAuthoritys cost in accordance with Article 10.

9.3.3 The Authority may by notice require the Contractor to connect, through apaved road, any adjoining service station, hotel, motel or any other publicfacility or amenity to the Project Highway, whereupon the connecting


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portion thereof that falls within the Site shall be constructed by theContractor on payment of the cost. The cost to be paid by the Authority tothe Contractor shall be determined by the Engineer.

9.4 Felling of trees

The Authority shall obtain the Applicable Permits for felling of trees to beidentified by the Authority for this purpose if and only if such trees cause amaterial adverse effect on the construction or maintenance of the ProjectHighway. The cost of such felling shall be borne by the Authority, and in theevent of any delay in felling thereof for reasons beyond the control of theContractor, the Contractor shall be excused for failure to perform any of itsobligations hereunder if such failure is a direct consequence of delay in thefelling of trees. For the avoidance of doubt, the Parties hereto agree that thefelled trees shall be deemed to be owned by the Authority and shall bedisposed in such manner and subject to such conditions as the Authority mayin its sole discretion deem appropriate.


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ARTICLE 10

DESIGN AND CONSTRUCTION OF THE PROJECT HIGHWAY

10.1 Obligations prior to commencement of Construction Works

10.1.1 Prior to commencement of Construction Works, the Contractor shall:

(a) appoint its representative (the Project Manager) duly authorisedto deal with the Authority in respect of all matters under or arisingout of or relating to this Agreement, for the Construction Period andone year thereafter;

(b) undertake, do and perform all such acts, deeds and things as may benecessary or required before commencement of Construction Worksunder and in accordance with this Agreement, the Applicable Laws

and Applicable Permits; and

(c) make its own arrangements for quarrying of materials needed for theProject Highway under and in accordance with the Applicable Lawsand Applicable Permits.

10.1.2 The Authority shall appoint an engineer (the Engineer), in accordancewith the provisions of Article 19, as its representative for the ProjectHighway within 15 days of the signing of the Agreement by both the Parties.The Authority shall notify the Contractor the name, address and the date ofappointment of the Engineer.

10.1.3 Within 14 days of the Start Date, the Contractor shall submit to the Authorityand the Engineer a programme (the Programme) for the ConstructionWorks, developed using networking techniques giving the following details:

Part I Contractors organisation for the Project, the general methods andarrangements for design and construction, environmentalmanagement plan, quality assurance plan including Design QualityPlan (the DQP), safety during construction, Contractors personneland Equipment.

Part II Programme for completion of all major stages and Project Milestonesof the Construction Works as specified in Project Completion

Schedule set forth in Schedule K.

Part III Monthly cash flow forecast.

10.1.4 The Contractor shall appoint a design director (the Design Director) tohead the Contractors Units, responsible for surveys, investigations,collection of data, and preparation of preliminary and detailed designs.

10.1.5 Design shall be developed in conformity with the specifications andstandards set forth in Schedule D. In case any relaxation in design standards


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is required due to restricted Right of Way in certain reaches, especially inbuilt up areas, the alternative design criteria for such reaches may be workedout for review of the Engineer.

10.1.6 The Contractor shall appoint an independent design quality manager (theDesign Quality Manager) who shall not be associated with the

preparation of the design or construction of the Project Highway. The DesignQuality Manager shall certify the fulfillment of design quality requirements.

10.1.7 The Contractor shall appoint proof check consultant (the Proof CheckConsultant) with the consent of the Authority. The Proof CheckConsultants shall:

(i) proof check the detailed designs, approved and signed by the DesignDirector, supported with calculations, drawings and certificate fromthe Contractors Design Quality Manager in accordance with the

provisions of this Sub-clause 10.1.7; and

(ii) evolve a system approach with the Design Director so as to minimizethe time required for final designs and construction drawings.

10.1.8 The Contractor shall submit design, duly certified by Proof CheckConsultant, to the Authority in three distinct stages as indicated below:

Stage I Preliminary Design;

Stage II Final Design; and

Stage III Working Drawings.

These stages shall form the basis for releasing stage payments and for review

of the progress.

10.2 Design and Drawings

10.2.1 In respect of the Contractors obligations with respect to the Design andDrawings of the Project Highway as set forth in Schedule-L, the followingshall apply:

(a) The Contractor shall prepare and submit, with reasonable promptnessand in such sequence as is consistent with the Project CompletionSchedule, three copies each of all Drawings, to the Engineer forreview;

(b) The Contractor shall compute, and supply to the Engineer, thequantities of various items of works and stages stated in Sub-clause20.3.1. The total estimated quantities will form the basis forestimating the monthly payments for the Construction Works inaccordance with Clause 20.3.

(c) By submitting the Drawings for review to the Engineer, theContractor shall be deemed to have represented that it has determined


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and verified that the design and engineering, including fieldconstruction criteria related thereto, are in conformity with the Scopeof the Project, the Specifications and Standards and the ApplicableLaws;

(d) Within 15 (fifteen) days of the receipt of the Drawings, the Engineer

shall review the same and convey its observations to the Contractorwith particular reference to their conformity or otherwise with theScope of the Project and the Specifications and Standards. TheContractor shall not be obliged to await the observations of theEngineer on the Drawings submitted pursuant hereto beyond the said15 (fifteen) days period and may begin or continue ConstructionWorks at its own discretion and risk;

(e) If the aforesaid observations of the Engineer indicate that theDrawings are not in conformity with the Scope of the Project or theSpecifications and Standards, such Drawings shall be revised by theContractor and resubmitted to the Engineer for review. The Engineer

shall give its observations, if any, within 7 (seven) days of receipt ofthe revised Drawings;

(f) No review and/or observation of the Engineer and/or its failure toreview and/or convey its observations on any Drawings shall relievethe Contractor of its obligations and liabilities under this Agreementin any manner nor shall the Engineer or the Authority be liable forthe same in any manner; and if errors, omissions, ambiguities,inconsistencies, inadequacies or other Defects are found in theDrawings, they and the construction works shall be corrected at theContractor's cost, notwithstanding any review under this Article 10;

(g) Without prejudice to the foregoing provisions of this Clause 10.2, theContractor shall submit to the Authority for review and comments itsDrawings relating to alignment of the Project Highway, finished roadlevel, [location and layout of the Toll Plaza[s]] and generalarrangement drawings of major bridges, flyovers and gradeseparators, and the Authority shall have the right but not theobligation to undertake such review and provide its comments, if any,within 30 (thirty) days of the receipt of such Drawings. The

provisions of this Clause 10.2 shall apply mutatis mutandis to thereview and comments hereunder;

(h) The Contractor shall be responsible for delays in submitting the

Drawing as set forth in Schedule L caused by reason of delays insurveys and field investigations, and shall not be entitled to seek anyrelief in that regard from the Authority.

(i) Within 90 (ninety) days of the Project Completion Date, theContractor shall furnish to the Authority and the Engineer a completeset of as-built Drawings, in 2 (two) hard copies and in micro filmform or in such other medium as may be acceptable to the Authority,reflecting the Project Highway as actually designed, engineered and


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constructed, including an as-built survey illustrating the layout of theProject Highway and setback lines, if any, of the buildings andstructures forming part of Project Facilities.

10.2.2 The Contractors time and cost impacts of revisions arising from Authoritysreview of designs caused by the Contractors non-compliance with the

requirements of the Agreement shall be borne by the Contractor, unless thereis a Change in the Scope of the Construction Works.

10.2.3 The Construction Works shall be executed in accordance with the Designreviewed by the Engineer in accordance with the provisions of this Clause10.2, and shall not be thereafter amended or altered without the prior writtenapproval of the Authority.

10.3 Construction of the Project Highway

10.3.1 The Contractor shall set out and undertake construction of the ProjectHighway as specified in Schedule-B and Schedule-C, and in conformity with

the Specifications and Standards set forth in Schedule-D. The Contractor shall beresponsible for the correct positioning of all parts of the Construction Works, and shallrectify any error in the positions, levels, dimensions or alignment of the Construction

Works.The [650th (six hundred and fiftieth) day] from the Start Date shall bethe Construction Period and the Contractor agrees and undertakes that theconstruction shall be completed within the Construction Period and anyextension of time granted according to the provisions of the Agreement.

10.3.2 The Contractor shall construct the Project Highway in accordance with theProject Completion Schedule set forth in Schedule-K. In the event that theContractor fails to achieve any Project Milestone within a period of 30(thirty) days from the date set forth for such Milestone in Schedule K, unlesssuch failure has occurred due to Force Majeure or for reasons solelyattributable to the Authority, it shall pay Damages to the Authority in a sumcalculated at the rate of 0.05% (zero point zero five per cent) of the ContractPrice for Design and Construction for delay of each day until such Milestone isachieved; provided that if the Construction Period for any or all ProjectMilestones is extended in accordance with the provisions of this Agreement,the dates set forth in Schedule K shall be deemed to be modified accordinglyand the provisions of this Agreement shall apply as if Schedule K has beenamended as above; provided further that in the event Project is completedwithin the Construction Period, the Damages paid under this Sub-clause10.3.2 shall be refunded by the Authority to the Contractor, but without anyinterest thereon. For the avoidance of doubt, it is agreed that recovery of

Damages under this Sub-clause 10.3.2 shall be without prejudice to the rightsof the Authority under this Agreement including the right of Terminationthereof.

10.3.3 The Parties hereby accept that delays cause loss to the public and thenational economy for whose benefit the Project is meant, and that the loss isnot susceptible to precise measurement. The Parties hereby agree that therate of Damages agreed in this Clause 10.3 is a reasonable pre-determinedamount, and that the Damages are not by way of penalty.


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10.3.4 The Authority shall notify the Contractor of its decision to impose Damagesin pursuance with the provisions of this Clause 10.3. Provided that nodeduction on account of Liquidated Damages shall be effected by theAuthority without notifying the Contractor its decision to impose theDamages. Further, the total amount of of Damages under Sub-clause 10.3.2shall not exceed ten percent of the Contract Price.

10.3.5 In the event that construction of the Project Highway is not completed within180 ( one hundred and eighty) days after the Construction Period, unless thedelay is on account of reasons solely attributable to the Authority or due toForce Majeure, the Authority shall be entitled to terminate this Agreement.

10.4 Maintenance during Construction Period

During the Construction Period, the Contractor shall maintain, at its cost, theexisting lane(s) of the Project Highway so that the traffic worthiness andsafety thereof are at no time materially inferior as compared to theircondition 7 (seven) days prior to the date of this Agreement, and shall

undertake the necessary repair and maintenance works for this purpose;provided that the Contractor may, at its cost, interrupt and divert the flow oftraffic if such interruption and diversion is necessary for the efficient

progress of Construction Works and conforms to Good Industry Practice;provided further that such interruption and diversion shall be undertaken bythe Contractor only with the prior written approval of the Engineer whichapproval shall not be unreasonably withheld. For the avoidance of doubt, it isagreed that the Contractor shall at all times be responsible for ensuring safeoperation of the Project Highway.

10.5 Extension of Time for Completion

10.5.1 In the event the Contractor is entitled to any extension of time (the EOT)for Completion if and to the extent that completion for the purposes of -Clause 10.3 is or will be delayed by any of the following causes:

(a) Change of Scope (unless an adjustment to the Time forCompletionhas been agreed under Sub-clause 13.3 [Change of Scope];

(b) a cause of delay giving an entitlement to EOT under the Agreement;or

(c) any delay, impediment or prevention caused by or attributable to theAuthority, the Authority's Personnel, or the Authority's other

contractors on the Site; .

the Contractor shall, no later than 28 days from the occurrence of such anevent or circumstance, inform the Engineer by notice in writing stating inreasonable detail the event or circumstances giving rise to the claim.Provided that, the period of 28 days shall be calculated from the date onwhich the Contractor became aware, or should have become aware, of theoccurrence of such an event or circumstance.


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10.5.2 In the event of the failure of the Contractor to submit to the Engineer thenotice in accordance with the provisions of Sub-clause 10.5.1 within the timespecified therein, the Contractor shall not be entitled to any EOT in Time forCompletion and shall forfeit its right for any such claims in future. For theavoidance of doubt, in the event of failure of the Contractor as mentionedabove, the Authority shall be discharged from all liability in connection with

the claim.

10.5.3 The Engineer shall, on the receipt of claim notice in accordance with theprovisions of Sub-clause 10.5.1, examine the claim and make hisdetermination of Extension of Time within 90 (ninety) of the date of receiptof the claim notice. In the event the Engineer requires any clarifications toexamine th

Model EPC Agreement

Documents

Transcript of Model EPC Agreement