Part 3 Special Conditions of Contract

PART3 SPECIAL CONDITIONS OF CONTRACT

1. FORCE ACCOUNT WORKS

1.1. The Contractor shall, if requested by the Owner in writing, perform Force
Account Work at Site. The Owner will pay the following to the Contractor
with respect to work performed at Site on a Force Account basis :

1.1.1. Labour and Materials

1. Direct wages paid to labour including foremen.

"0.
" 2. * percent of the direct wages paid to labour and foremen as full
reimbursement for assessments payable under any statutory scheme
relating to workmen's compensation, unemployment insurance,
holidays with pay, pension plan contributions and payroll charges
made in accordance with labour agreements, and for public liability
and property damage insurance premiums, which assessments shall
be defined as Payroll Overhead.

3. Premiums for special insurance if any requested by the Owner.

4. Materials purchased by the Contractor at the request of the Owner for

incorporation into the Permanent Works. Major purchases shall be
C, based on the lowest qualified bid of at least three (3) bids.

5. * percent of the cost of direct wages plus payroll overhead defined

under 1 and 2 herein based on straight time rate for the provision of
consumable materials and supplies required for Force Account Work
and not covered by 4 herein and for the provision of small tool each
having a replacement value of US $ 495 or less.

6. Transportation on and about the Site.

7. Transportation of labour brought to the Site specifically for Force

Account Work at the request of the Owner.

8. In respect to work on portions of the Works taken over by the Owner

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 Part 3 Special Conditions of Contract

which the Contractor is required to carry out on a Force Account basis

and which is covered by a permit because it is required to be carried
out during a shutdown period, the Owner will pay to the Contractor the
additional wages paid to labour for the hours worked during the night-
shift at rates in excess of those paid to labour for the day-shift hours
worked on the remainder of the Works, in accordance with Union
agreement or local regulations affecting labour. No additional payment
will be made to the Contractor in respect to overhead expense or
supervision or costs of any kind other than that payable by Clause
1.1.2 herein.

1.1.2. Fee

* percent of costs included in Clause 1.1.1 as a fee to cover the

Contractor's overhead expense, profit and Site office overhead, including
salaries and wages of clerical, timekeeping, accounting, warehousing and
similar administrative personnel including general foremen,
superintendents, engineers and all costs associated therewith.

* The Contractor shall indicate in Part 5, Schedule 3.4 {Payroll Overheads] the percentages
required.

1.1.3. Construction Equipment/Plant

1. Rentals for the Contractor's construction equipment when used on

Force Account Work and when certified as necessary by the Owner in
accordance with Part 5, Schedule 3.6 approved by the Owner and
incorporated herein including additional items of equipment added
thereto from time to time with the approval of the Owner.

2. The rates in Part 5, Schedule 3.6 [Equipment Rental Rates] shall

include the cost of operators, servicing, fuels, lubricants, maintenance,
repairs and all other services and overheads including, in the case of
rates for operators, room and board for operators required to operate
the equipment at the Site and maintain it in working order.

3. Rental rates for welding equipment shall include the provision of all
electricity, fuel, oxygen, acetylene, lubricants and welding rods.

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 Part 3 Special Conditions of Contract

4. No payment will be made for the use of any item of equipment on the
Works which is not listed in Part 5, Schedule 3.6 or has no rental rate
entered against it except that, if the Contractor brings to the Site
additional equipment for the construction of the Works and submits a
quotation for a rental rate which is approved by the Owner, such
equipment and the approved rate will be deemed to be entered in the
Schedule.

5. The rental rates listed in Part 5, Schedule 3.6 for each item of
equipment will be paid to the Contractor for the number of operating
hours said item of equipment is engaged on Force Account Work at
the request of the Owner whether such time is worked on day shift or
night shift, or both.

6. One-third of the hourly rental rate will be paid to the Contractor with
respect to time during which:

a) The equipment is engaged in traveling from and returning to the

place on the Site where the equipment was located when required
for Force Account Work.
b) The equipment and operator are ordered by the Owner in writing
to be held ready for work.

7. No payment will be made with respect to:

(J a) The time during which the equipment is being maintained,

repaired; replaced or modified for a different use.
b) The time, during which the equipment cannot be used because of
breakdown, fault of the equipment or Contractor, or because of
inclement weather conditions.
c) The time during which the equipment is not in use except as
provided in 1.1.3.1 and 1.1.3.2 above.

8. Unless otherwise specified the rates entered in Part 5, Schedule 3.6

shall be on an hourly basis. If equipment is required for special
continuous Force Account Work, bare monthly rates will be established
as may be mutually agreed upon.

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 Part 3 Special Conditions of Contract

1.1.4. Subcontractors

Payment made by the Contractor to subcontractors approved by the Owner

on Force Account Work together with five percent (5 %) of such payments
to cover the Contractor's overhead charges and profit for such work. If the
Contractor hires construction equipment from third parties for use on Force
Account Work with the approval of the Owner such third parties will be
deemed to be approved subcontractors and payment will be made under
this Sub-clause.

1.2. The above-mentioned rates are all inclusive and no separate payment shall
be made with respect to any other items including but not limited to:

0 1. Head office salaries and expenses;

2. cost of furnishings and equipment for Site offices;

3. any costs and expenses applicable to work paid for on a unit price
or lump sum basis;

4. the use of small tools that have been provided for the Works being
performed on a lump sum or unit price basis except as provided in
1.1.1.5 herein; and

5. salary and expenses of the Contractor's personnel.

1.3. No payment will be due to the Contractor with respect to work performed on
a Force Account basis:

1. without the written authority of the Owner; or

2. if not carried out and completed to the satisfaction of the Owner; and
or
3. if the Contractor has not obtained the approval of the Owner before
incurring any obligation or making any expenditure on account of such
works.

1.4. The Contractor shall keep proper accounts and records of the cost to the
Contractor of Force Account Work in such form and detail as shall be
satisfactory to the Owner and such accounts and records, together with all

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 Part 3 Special Conditions of Contract

invoices, receipts and vouchers, shall at all times be open to audit and
inspection by the Owner or his authorized representatives (who may make
copies thereof and take extracts there from). The Contractor shall furnish the
Owner or his authorized representatives with all such information about the
accounts as he or they may require.

1.5. Daily time sheets shall be prepared in triplicate by the Contractor showing
breakdown of hours in accordance with the Owner's costing system and
listing the names, worked hours and rates of pay for each workman, and
hours and rates for equipment engaged on the Works. These shall be
submitted daily to the Owner for checking. The Owner shall retain one copy
of these time sheets when approved. The Contractor's monthly billing for
labour shall be substantiated with copies of these approved time sheets.
0
1.6. Requisitions bearing the cost code defined in the Implementation Procedures
shall be prepared by the Contractor and submitted to the Owner for approval
prior to purchasing any materials and supplies or before shipping any items
of Contractor's equipment to the Site. All invoices for materials, supplies and
construction equipment shall be supported by these approved requisitions.
Any failure on the part of the Contractor to obtain the consent and furnish
when requested to do so such time sheets, invoices and receipts and other
substantiating information as specified in this subsection, shall render the
Contractor liable for the full amount of all costs in connection therewith and
the Contractor shall have no recourse whatsoever against the Owner for
reimbursement of all or any part thereof.

1.7. All prices for Force Account Work shall be fixed and not be subject to
escalation.

2. TERMS OF PAYMENT

The following terms of payment are applicable for both foreign and Rupiah
portions.

The Owner shall open the letter of credit within ninety (90) Days after the
Effective Date of the Contract.

The Term of Payment for LTSA shall follow the requirement in BOOK IIF

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