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THIS IS A SAMPLE ONLY

[Note to Users: In the absence of existing local indices, drafters will have to
rely on documentary evidence of actual changes as an alternative to the
sample approach in this Appendix. This sample approach presumes the
existence of reasonable local indices. This Appendix is relevant only if the
New Operations Period exceeds 18 months.]

Appendix 6
Contract Price Adjustment Appendix

CONTRACT PRICE ADJUSTMENT

APPENDIX 6 TO THE GENERAL CONDITIONS
FOR A CONTRACT TO
DESIGN, BUILD AND OPERATE
A SOLID WASTE DISPOSAL FACILITY
[Note: This is just a sample of a price adjustment formula and
individual project formulae should be developed on a case by case
basis.]
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CONTRACT PRICE ADJUSTMENT APPENDIX

SECTION 1 - CONTRACT PRICE ADJUSTMENT

1.1 Contract Price Adjustment Formula

(1) Prices payable to the Operator for the Operations Services in accordance with the
Contract shall, no sooner than 18 months after the New Operations Starting Date, be subject to adjustment
during performance of the Operations Services to reflect changes in the cost of labour and material
components for the Operations Services, in accordance with the following formula:

L1 M1
P1  P0  ( a  b c )  P0
L0 M0

in which:
P1 = adjustment amount payable to the Operator for Operations Services;

P0 = Contract price (base price);

a = fixed element representing profit and overhead in Contract price (a = %) for

Operations Services;

b = estimated percent of labour component in Contract price (b = %) for Operations

Services;

c = estimated percent of Operator’s Equipment (Operations) component in Contract price (c

= %);

L0, L1 = labour indexes applicable to the appropriate industry in the country of origin
on the base date and the date for adjustment, respectively; and

M0, M1 = material indexes for the major raw materials in the country of origin on the base date
and the date for adjustment, respectively.

The sum of the three coefficients a, b and c shall be one (1) in every application of the formula.

(2) The Bidder shall indicate the source of labour and materials indexes and the base date
indexes in its Bid.

Item Source of Indexes Used Base Date Indexes

(3) The base date shall be the date 30 days prior to the Bid closing date.

(4) The following conditions shall apply:

(a) Price adjustment will be applied only if the resulting increase or decrease is more
than 2% of the Contract price for Operations Services;
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(b) No price increase will be allowed for periods of delay in the performance of the
Operations Services for which the Operator is responsible. The Owner will,
however, be entitled to any price decrease occurring during such periods of
delay;

(c) The total adjustment (plus or minus) shall be subject to a ceiling amount of
percent (__%) of the Contract price for Operations Services;

(d) If the currency in which the Contract price for Operations Services, P0, is
expressed is different from the currency of the country of origin of the labour or
materials indexes, a correction factor will be applied to avoid incorrect
adjustments of the Contract price for Operations Services. The correction factor
shall correspond to the ratio of exchange rates between the two currencies on the
base date and the date for adjustment as defined above; and

(e) No price adjustment shall be payable on the portion of the Contract price for
Operations Services paid to the Operator as an advance payment.

TOR_2024-#11409780-v3-Contract_Price_Adjustment_Appendix.DOC