Section III

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Terms and
Construction of Office for HBP Camp in Garraf Oilfield Condition
Tender NO : HBP-2019-PWT-0002 Page:1 of 47
SUBCONTRACT
BETWEEN
CHINA OIL HBP SCIENCE & TECHNOLOGY CORPORATION LTD.

IRAQ BRANCH
And
[Subcontractor Name]
And
CHINA OIL HBP SCIENCE & TECHNOLOGY CORPORATION LTD
FOR
CONSTRUCTION OF OFFICE FOR HBP CAMP

IN GARRAF OILFIELD
DATE: [.]
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Terms and
SUBCONTRACT AGREEMENT
This SUBCONTRACT AGREEMENT is made on …………. (“EFFECTIVE DATE”) by and

between China Oil HBP Science & Technology Co. Ltd Iraq Branch, a company incorporated
under the law of Iraq with registered office is at Baghdad, Al Kindi Area, Sec 213, St.19, and
Bloc.23, (hereinafter referred to as “HBP” or “CONTRACTOR” or “Party A” )
And
[.] a company incorporated under the laws of Iraq having its registered office at ………. (Hereinafter
referred to as “SUBCONTRACTOR or “Party B”) of the second part
And
China Oil HBP Science & Technology Corporation Ltd, a company incorporated under the
laws of the People’s Republic of China and having its registered office at 1212,11th Floor,
No.17, East Madian Road, Haidian District, Beijing, China and place of business at 12th Floor,
Jin’ao International Building, No.17, East Madian ROAD, Haidian District, Beijing, China
(hereinafter referred to as the “Party C”) of the third part.
(Hereinafter the parties of the first, second and third parts may be referred to singularly as
"Party" and collectively as "Parties").
WHEREAS
I. HBP is engaged in the Engineering, Procurement, Construction and Commissioning

(EPCC) Project of Oil Gathering Facilities Phase 3 for Petronas Carigal Iraq
Holding B.V’s Garraf Operation in Iraq, and requires for such operation specialized
WORK and personnel of the type offered by SUBCONTRACTOR, and
SUBCONTRACTOR desires to furnish such WORK.
II. HBP requires the provision of Construction of Office for HBP Camp in Garraf Oilfield
, (hereinafter referred to as the "WORK") as described in the Exhibit 1-SCOPE OF WORK
(attached hereto and made a part hereof) and in accordance with the terms of this
SUBCONTRACT;
III. SUBCONTRACTOR represents that it is able and willing to provide the aforementioned
WORK and that it has the experience and capability to do so expeditiously.
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Now, therefore, for and in consideration of the mutual covenants and agreements set forth
herein, the Parties hereto agree as follows:
1. In this SUBCONTRACT, words and expressions shall have the same meaning as are
respectively assigned to them in the Conditions of SUBCONTRACT hereinafter referred
to.
2. The following documents and their attachments shall together constitute the
SUBCONTRACT between the CONTRACTOR and the SUBCONTRACTOR and the
term ‘SUBCONTRACT’ shall in all such documents be construed accordingly.
(a) This SUBCONTRACT AGREEMENT.
(b) Terms and Conditions of SUBCONTRACT.
(c) Clarifications and Minutes of Meetings between both parties.
(d) The Exhibits:
Exhibit I Scope of Work

Exhibit II Schedule of Work
Exhibit III Price & Payment Schedule
The documents forming the SUBCONTRACT are to be taken as mutually explanatory of

one another. If an ambiguity or discrepancy is found in the contractual documents, the
priority of the documents for the purposes of interpretation shall be in accordance with the
above sequence. If no resolution is reached, then the interpretation by the CONTRACTOR
shall be final.
3. In consideration of the payment to be made by the Party C to the SUBCONTRACTOR,

SUBCONTRACTOR hereby covenants to execute and complete the WORK in
conformity in all respects with the provisions of the SUBCONTRACT.
4. In consideration of the execution and satisfactory completion of the WORK by the

SUBCONTRACTOR, Party C hereby covenants to pay SUBCONTRACTOR the
SUBCONTRACT PRICE at the times and in the manner prescribed in the
SUBCONTRACT.
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5. The estimated SUBCONTRACT PRICE is the all-inclusive price of United States Dollar
………. (…………. United State Dollar Only), the SUBCONTRACT PRICE is estimated
price only and subjected to changed based on the final BOQ.
6. The SUBCONTRACT constitutes the entire agreement between the CONTRACTOR and
the SUBCONTRACTOR with respect to the performance of the SUBCONTRACT WORK
and supersedes all prior negotiations, representations or agreements relating thereto,
whether written or oral, except to the extent that they are expressly incorporated in the
SUBCONTRACT.
In witness whereof the Parties hereto have caused this SUBCONTRACT to be executed in their
respective names and by their duly authorized representatives as of the EFFECTIVE DATE first
written above.
For and on behalf of
China Oil HBP Science & Technology Co. Ltd Iraq Branch
Signature:
Name:
Position:
Subcontractor Name
Signature:
Name:
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Terms and
Position:

China Oil HBP Science & Technology Corporation Ltd
Signature:
Name:
Position:
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Terms and
TERMS AND CONDITIONS OF SUBCONTRACT

CONTENTS
1.0 DEFINITIONS AND INTERPRETATION.......................................................................................6
2.0 INTENT OF THE SUBCONTRACT................................................................................................8
3.0 NATURE OF THE SUBCONTRACT WORK................................................................................9
4.0 SCOPE OF SUBCONTRACT WORK, DRAWINGS, SPECIFICATION AND STANDARDS9
5.0 SUBCONTRACTOR’S RESPONSIBILITIES.............................................................................11
6.0 SUBCONTRACTOR’S REPRESENTATIVE AND PERSONNEL...........................................13
7.0 CONTRACTOR’S RESPONSIBILITIES......................................................................................14
8.0 THE CONTRACTOR’S REPRESENTATIVE..............................................................................14
9.0 SCHEDULE AND PROGRESS.....................................................................................................14
10.0 PROCUREMENT AND SUPPLY..................................................................................................15
11.0 CHANGE...........................................................................................................................................16
12.0 CLAIM................................................................................................................................................17
13.0 INSPECTION AND TESTING........................................................................................................18
14.0 ACCEPTANCE OF THE SUBCONTRACT WORK...................................................................18
15.0 WARRANTY PERIOD AND FINAL ACCEPTANCE..................................................................19
16.0 LIQUIDATED DAMAGES...............................................................................................................21
17.0 PRICE AND TERMS OF PAYMENT............................................................................................21
18.0 TAXES, DUTIES AND PERMITS..................................................................................................24
19.0 INSURANCE.....................................................................................................................................27
20.0 PERFORMANCE BOND/PERFORMANCE GUARANTEE.....................................................29
21.0 INDEMNIFY AND LIABILITY........................................................................................................30
22.0 PATENT AND OTHER PROTECTED RIGHTS..........................................................................30
23.0 ASSIGNMENT AND SUBCONTRACTING.................................................................................31
24.0 RIGHT TO AUDIT............................................................................................................................31
25.0 FORCE MAJEURE..........................................................................................................................32
26.0 CONFIDENTIALITY AND OWNERSHIP OF DOCUMENTS...................................................34
27.0 HEALTH, SAFETY AND ENVIRONMENT..................................................................................35
28.0 ARCHAEOLOGICAL OBJECTS..................................................................................................42
29.0 CONTRACTOR’S RIGHT TO OCCUPY......................................................................................43
30.0 SUSPENSION..................................................................................................................................43
31.0 OPTIONAL TERMINATION...........................................................................................................44
32.0 TERMINATION FOR DEFAULT....................................................................................................45
33.0 NON-WAIVER..................................................................................................................................47
34.0 COORDINATION AND NOTICES.................................................................................................47
35.0 GOVERNING LAWS AND ARBITRATION.................................................................................49
36.0 RELATED ISSUES UNDER THE CONTRACT..........................................................................49
37.0 LOCAL CONTENT..........................................................................................................................50
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Terms and
1.0 Definitions and Interpretation

1.1 Definitions
In the SUBCONTRACT, unless the context otherwise requires, the following expressions
shall have the meanings hereby assigned to them.
‘CONFIDENTIAL INFORMATION’ means all documentation and other technical or
commercial information in any form obtained directly or indirectly from the EMPLOYER, the
CONTRACTOR or the CONTRACTOR’s representative by the SUBCONTRACTOR, or from
the SUBCONTRACTOR by the EMPLOYER, the CONTRACTOR or the CONTRACTOR’s
representative, or which is generated by the SUBCONTRACTOR or any SUB-
SUBCONTRACTOR in connection with the SUBCONTRACT.
‘CONTRACT’ means the contract signed between EMPLOYER and CONTRACTOR.
‘CONTRACTOR’ or ’HBP’ means China Oil HBP Science & Technology Co., Ltd. Iraq
Branch
‘CHANGE’ and ‘CHANGE ORDER’ have the meanings set out in Clause 11.
‘DAY’ means a calendar day, ‘MONTH’ means a Gregorian month.
‘DECISION’ means any decision, certificate, notice, instruction, order, agreement, approval,
rejection or consent in written by CONTRACTOR.
‘EFFECTIVE DATE’ means the date on which the SUBCONTRACT comes into full force
and effect.
‘EMPLOYER’ shall mean Petronas Carigal Iraq Holding B.V’s.
‘FINAL ACCEPTANCE’ shall mean the WORK has been fully completed by
SUBCONTRACTOR and accepted by CONTRACTOR in accordance with the
SUBCONTRACT.
‘FINAL ACCEPTANCE CERTIFICATE’ has the meaning stated in Clause 14.
‘FORCE MAJEURE’has the meaning set out in Clause 25.
‘KEY PROJECT PERSONAL’ has the meaning set out in Exhibit 2 Price and Payment.
‘LIQUIDED DAMAGES’ has the meaning set out in Clause 16.
‘MECHANICAL COMPLETE’ Shall mean the completion of the WORK that it is fully ready
for commissioning and use and having been tested and pre-commissioned and a Certificate
of MECHANICAL COMPLETION having been issued to SUBCONTRACTOR by
CONTRACTOR in accordance with the SUBCONTRACT.
‘PARTY’ or ‘PARTIES’ means the CONTRACTOR and/or the SUBCONTRACTOR, as the
case may be.
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‘PROJECT’ means the Engineering, Procurement, Construction and Commissioning

(EPCC) Project of Oil Gathering Facilities Phase 3 for Petronas Carigal Iraq Holding B.V’s
Garraf Operation in Iraq.
‘Project Control’ means the project control method set out in Exhibit 2.
‘PROVISIONAL ACCEPTANCE CERTIFICATE’ shall mean the certificate signed by
CONTRACTOR to certify that Commissioning and Performance test for the last portion of
the WORK has been completed to the satisfaction of SUBCONTRACT requirements and
that the WORK and related facilities is ready for use and put in service by CONTRACTOR.
‘SUBCONTRACT’ means the documents listed or referred in this SUBCONTRACT signed
between CONTRACTOR and SUBCONTRACTOR and the provisions and requirements
expressed therein.
‘SUBCONTRACT PRICE’ or ‘SUBCONTRACT VALUE’ means the estimated Price
payable by the CONTRACTOR to the SUBCONTRACTOR based on the BOQ quantities.
SUBCONTRACTOR price may increase or decrease due to change in quantities of actual
final priced BOQ.
‘Specifications and Standards’ means the specifications and standards issued as part of
the SUBCONTRACT, which sets out the technical definition of the SUBCONTRACT WORK.
‘SUBCONTRACT WORK’ means all services to be provided by the SUBCONTRACTOR
for the Road and Kitchen Work of Camp as per the description in the scope of work of the
SUBCONTRACT.
‘SUBCONTRACTOR’ means the Party having a contract with HBP for the performance of the
WORK or part thereof as set forth in the SUBCONTRACT and shall, as the context may so
admit or require, include its SUBCONTRACTOR PERSONNEL, the SUBCONTRATOR'S
EMPLOYEES, management, representatives, successors-in-title and such other persons or
body of persons to whom the SUBCONTRACTOR has assigned, transferred and/or novated its
rights, interests, title and/or benefit under this SUBCONTRACT with the prior written approval
of HBP.
‘SUBCONTRACTOR’S EQUIPMENT’ means all equipment, construction plant, vehicles,
temporary facilities, materials, tools or things brought on to the Site by or on behalf of the
SUBCONTRACTOR for carrying out the SUBCONTRACT WORK but not for permanent
incorporation in the SUBCONTRACT WORK.
‘SUSPENSION ORDER’ has the meaning set out in Clause 30.
‘WARRANTY PERIOD’ has the meaning stated in Clause 15.
1.2 Interpretation
The singular shall include the plural and the plural shall include the singular except where
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the context otherwise requires and the words ‘he’, ’him’ and ‘his’ shall be taken to mean
‘she’, ’her’ and ‘hers’ where appropriate.
The headings and marginal notes in the Terms and Conditions together with the
accompanying introductory notes, guidance on compiling the Agreement, Specification, and
Exhibits shall not form part of the SUBCONTRACT nor shall they be taken into
consideration in the interpretation of the SUBCONTRACT.
2.0 Intent of the Subcontract
2.1 All parts of the SUBCONTRACT are intended to be correlative and complementary, and
any work or obligation required by one part and not mentioned on another shall be
performed to the same extent and purpose as though required by all. The misplacement,
addition, or omission of a word or character shall not change the intent of any part of the
SUBCONTRACT from that set forth by the SUBCONTRACT as whole.
2.2 This SUBCONTRACT is non-exclusive and CONTRACTOR reserves the right to
engage other SUBCONTRACTORS or itself to perform similar or identical work.
SUBCONTRACTOR shall afford such other SUBCONTRACTORs adequate opportunity to
carry out their subcontracts and shall accomplish the work associated with this
SUBCONTRACT in cooperation with those subcontractors and with CONTRACTOR. Under
this circumstance CONTRACTOR shall not be deemed default or breach of
SUBCONTRACT.
3.0 Nature of the Subcontract Work
Prior to the date of this SUBCONTRACT, the SUBCONTRACTOR will be deemed to have
familiarized itself with all applicable laws and regulations of the Country where
SUBCONTRACT WORK is to be executed, including orders, by-laws issued by relative
authorities and satisfied itself to the nature of the SUBCONTRACT WORK, the location and
local conditions of the Site where the SUBCONTRACT WORK is to be performed and the
requirements for access thereto, the character, quality and quantity of equipment and
material (if applicable), the type and magnitude of construction services and labor required,
the availability of skilled and unskilled labors, the availability of the equipment, utilities and
other required facilities at the Site and all other matters relating to the SUBCONTRACT
WORK which any renowned SUBCONTRACTOR should know during the execution of the
work. Any failure by the SUBCONTRACTOR to have discovered such matter that affects
the SUBCONTRACT WORK shall not relieve the SUBCONTRACTOR from its obligations
hereunder. Nothing shall it constitute grounds for additional reimbursement to
SUBCONTRACTOR.
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4.0 Scope of SUBCONTRACT WORK, Drawings, Specification and Standards

4.1 SUBCONTRACTOR shall perform and complete the SUBCONTRACT WORK specified in
the Exhibit 1 Scope of Work in conjunction with the requirements in the drawings,
specifications and standards and as per BOQ. The Scope of SUBCONTRACT WORK
specified in the SUBCONTRACT shall be for all the work to be done by the
SUBCONTRACTOR for Construction of Office for HBP Camp in Garraf Oilfield, in case
some works in relation to the construction and commissioning for the Project are not
specified in the SUBCONTRACT documents but necessary for the completion of the
Project, the SUBCONTRACTOR shall use his endeavor to complete the same to the
satisfaction of the CONTRACTOR without any extra cost.
4.2 The SUBCONTRACTOR acknowledges that, as part of the Project, the CONTRACTOR is
having Related Works performed by third parties under separate subcontracts and that it is
of paramount importance that the completion of the SUBCONTRACT WORK is to be fully
and completely coordinated with the Related Works in view of their concurrent, sequential
or interrelated nature. The SUBCONTRACTOR further undertakes to coordinate the
performance of the SUBCONTRACT WORK with the performance of the Related Works
without any additional payment (including any loss of profits) and/or extension of time as a
result of or in connection with the SUBCONTRACTOR complying with any instruction of the
CONTRACTOR under this clause and fulfilling his obligations under this clause.
4.3 The Scope of SUBCONTRACT WORK shall be modified, amended, altered, increased or
decreased in accordance with Clause 11.0 and other provisions of the SUBCONTRACT.
4.4 The Drawing, Specification and Standard specified in the SUBCONTRACT shall be
applicable to the SUBCONTRACT WORK and SUBCONTRACTOR shall strictly comply
with these documents during the execution of the SUBCONTRACT WORK.
SUBCONTRACTOR shall complete WORK as per the drawings and instruction of
CONTRACTOR. CONTRACTOR have right to revised the drawings/specifications and
SUBCONTRACTOR shall require to complete as per that without any cost impact.
4.5 In the event of the disputes with respect to interpretation or applicability of any standards, it
shall be the SUBCONTRACTOR’s responsibility to obtain a ruling on the matter from an
international recognized authority specialized for the issue or verification of such standards
at no additional cost to the CONTRACTOR. The final settlement is subject to
CONTRACTOR and EMPLOYER’s approval before execution.
4.6 Where different standards relative to the same matter appear or are referred to in the
technical specifications, the most stringent of such standards shall apply.
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5.0 SUBCONTRACTOR’s Responsibilities

5.1 The SUBCONTRACTOR shall carry out the SUBCONTRACT WORK with sound
workmanship and materials, safely and in accordance with good engineering practice,
applicable legislation and specification, and complete the SUBCONTRACT WORK in
accordance with the provision of the SUBCONTRACT to the reasonable satisfaction of the
CONTRACTOR.
5.2 The SUBCONTRACT WORK as completed by the SUBCONTRACTOR is in every
respect fit for the purpose for which it is intended as defined in the SUBCONTRACT
Specification or in any other provision of the SUBCONTRACT and CONTRACT.
5.3 The SUBCONTRACTOR shall at all times during the execution of the SUBCONTRACT
WORK provide and maintain resources including but not limit to the equipment, material
and manpower adequate to carry out the SUBCONTRACT WORK. Should in the opinion of
CONTRACTOR such equipment, material and/or manpower be inadequate in number
and/or competence, CONTRACTOR shall have the right at its sole discretion to require
SUBCONTRACTOR to provide, without extra cost to CONTRACTOR, such additional
and/or alternative additional equipment, material and/or competent personnel and/or
overtime work.　Failure to provide the adequate equipment, material and manpower within
the period required by CONTRACTOR shall be deemed as default of SUBCONTRACTOR.
When HBP provided material arrive at site, subcontractor shall provide the necessary
service, for example: the unloading work using cranes, the keeping for temporary material,
etc.
5.4 The SUBCONTRACTOR shall report in writing to the CONTRACTOR on the progress
of the SUBCONTRACT WORK, supporting his reports with appropriate documentation
following the Exhibit 2.
5.5 SUBCONTRACTOR is fully responsible for the handling and coordination with Local
authorities and local people. CONTRACTOR is not responsible for any trouble and issues if
arises due to local people and SUBCONTRACTOR shall take full responsibility and shall
resolve such issue without any damage to CONTRACTOR at soonest.
5.6 Any delay in SUBCONTRACT WORK resulting due to interference of local people ,
SUBCONTARCTOR shall take fully responsibility and shall compensate CONTRACTOR if
the SUBCONTRACT WORK cannot complete or become delayed for long time.
CONTRACTOR shall pay only after the completion of whole SUBCONTRACT WORK as
per the satisfaction of CONTRACTOR.
5.7 SUBCONTRACTOR shall always make sure that all its employee/worker have all the
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necessary valid insurance as required by the Government of Iraq and as per the
requirement of TOC and/or oilfields workers rule and regulations.
5.8 The SUBCONTRACTOR shall develop, implement and maintain the Health, Safety and
Environment to take account of the development of the construction and maintenance
procedures of the SUBCONTRACT WORK having particular regard to the health and safety
of all personnel involved with construction work on the Site and of all personnel who will be
involved with the execution of the SUBCONTRACT WORK.
5.9 SUBCONTRACTOR shall ensure that SUBCONTRACTOR’s personnel entering the
Site meet the requirement specified which include but not limited to the following:
(1) Have attended a Safety orientation course.
(2) Have the appropriate clothing, safety helmet, safety shoes, and safety glasses.
(3) Have the appropriate pass and be identifiable as SUBCONTRACTOR’s employees.
5.10 Unless otherwise agreed with the CONTRACTOR, the SUBCONTRACTOR shall
within fourteen (14) days after the CONTRACTOR has taken over the SUBCONTRACT
WORK remove from the Site all waste and debris, SUBCONTRACTOR’s equipment,
including temporary buildings and structures, and other things of his, other than those that
are necessary for the proper performance of the SUBCONTRACTOR’s obligations and
shall leave the Site in an orderly and safe condition. Where the SUBCONTRACT WORK
is taken over by specified section(s), the SUBCONTRACTOR shall remove such things
from within the defined perimeter of each such section as it is taken over, or if there be no
such perimeter then from the area about the section as prescribed by the CONTRACTOR.
5.11 Any surplus SUBCONTRACTOR’s materials or materials provided by CONTRACTOR
that have been held in care by the SUBCONTRACTOR and which are to remain the
property of the CONTRACTOR shall be handed over by the SUBCONTRACTOR before
he leaves the Site.
5.12 The SUBCONTRACTOR shall execute and complete the SUBCONTRACT WORK in
strict accordance with the SUBCONTRACT to the satisfaction of the CONTRACTOR, and
shall comply with and adhere strictly to the decisions, directions, instructions and orders
given by the CONTRACTOR and/or on any matter concerning the SUBCONTRACT
WORK whether mentioned in the SUBCONTRACT or not.
5.13 Because SUBCONTRACTOR is local construction company, its management cost
have considered all aspects, so during construction of Office for HBP camp in Garraf
Oilfield, SUBCONTRACTOR shall be responsible for coordinate solve the dispute with
local villager, landowners, local relations etc.
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5.14 SUBCONTRACTOR will be responsible for providing security protecting for

SUBCONTRACTOR personnel and equipment in the construction period.
5.15 SUBCONTRACTOR shall strictly abide by the quality and safety standards, schedule
and international policy in the SUBCONTRACT.
5.16 SUBCONTRACTOR shall provide LAND DEEDS of HBP CAMP AREA. The land is also
authorize to be used free of charge by HBP.
5.17 SUBCONTRACTOR responsible the safety of personnel in the construction period, If
there are casualties, mechanical damage, etc. SUBCONTRACTOR shall deal with by
itself, Including but not limit to: liability and compensation.
6.0 SUBCONTRACTOR’s Representative and Personnel
6.1 The SUBCONTRACTOR shall, at all times ensure his representative at the Site who
shall be authorized to represent, and act for and on behalf of the SUBCONTRACTOR in all
matters in relation to the SUBCONTRACT and who shall give his whole time to the
superintendence of the SUBCONTRACT WORK and be in full charge thereof. The
SUBCONTRACTOR’s representative may appoint a deputy to act in his place in his
absence, and shall inform CONTRACTOR’s representative in writing of his intention to
appoint such a deputy who will be deemed to have full authority to act on the
SUBCONTRACTOR’s behalf during his absence.
6.2 The person appointed, as SUBCONTRACTOR's representative shall be competent and
qualified with an appropriate professional qualifications and experienced in projects of a
similar nature, complexity and size.
6.3 The SUBCONTRACTOR's representative shall not be removed from the worksite or
replaced without the prior written permission of the CONTRACTOR.
6.4 The SUBCONTRACTOR shall at all times ensure that he has sufficient and qualified
personnel stationed where the SUBCONTRACT WORK is to be performed to undertake the
responsibilities imposed upon the SUBCONTRACTOR hereunder and to provide full
attention in the execution of the SUBCONTRACT WORK and for the proper carrying out of
his obligations under the SUBCONTRACT.
6.5 The SUBCONTRACTOR shall comply with all the relevant labor law applicable to the
SUBCONTRACTOR’s personnel including laws relating to their employment, health, safety,
welfare, work time and vacation and shall allow them all their legal rights.
7.0 CONTRACTOR’s Responsibilities
7.1 If the SUBCONTRACT provides that CONTRACTOR shall carry out any work or
provide any free-issue materials (if applicable) and other items specified in
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SUBCONTRACT, CONTRACTOR shall carry out his obligation as per the description stated
in Subcontract.
7.2 Project progress and quality inspection and acceptance. For the avidness of doubt, there is
no free issue material for this SUBCONTRACT.
8.0 The CONTRACTOR’s Representative
8.1 The CONTRACTOR’s representative shall have full
authority to act on behalf of the CONTRACTOR in connection with the SUBCONTRACT.
The CONTRACTOR may from time to time appoint other individual to act as
CONTRACTOR’s representative in place of the individual previously so named or appointed
and shall give notice to the SUBCONTRACTOR without delay. The notice shall describe the
powers, functions and terms of agency of assignee.
8.2 Any determination, instruction, examination, testing or
similar act by the CONTRACTOR’s representative, in accordance with his delegated
authority shall have effect as though it had been an act of the CONTRACTOR.
8.3 All communication between the CONTRACTOR and the
SUBCONTRACTOR relating to the SUBCONTRACT WORK shall be through the
representatives of CONTRACTOR and SUBCONTRACTOR. No communication by any
other means shall be of any effect unless receipt thereof is acknowledged by the
CONTRACTOR’s representatives and SUBCONTRACTOR’s representative as the case
may be.
9.0 Schedule and Progress
9.1 The SUBCONTRACTOR shall complete the SUBCONTRACT WORK specified in
Exhibit 1-Scope of Work, be ready for acceptance or be taken over on or before the date as
specified in SUBCONTRACT.
9.2 The SUBCONTRACTOR shall at the same time as submission of SUBCONTRACT
Execution Schedule submit the manpower mobilization plan to the CONTRACTOR for
review and approval. The manpower list for mobilization shall also have the prior approval
of the CONTRACTOR before they are mobilized to the site. SUBCONTRATOR shall
require to follow the WORK schedule.
9.3 If at anytime during the progress of the SUBCONTRACT WORK, the
SUBCONTRACTOR’s actual progress, in the opinion of CONTRACTOR, falls behind the
SUBCONTRACT Execution Schedule and/or appears to be inadequate to meet the
requirements of the SUBCONTRACT, CONTRACTOR may notify the SUBCONTRACTOR
of such imminent or actual non-compliance with the SUBCONTRACT and may require,
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without limitation, an increase in labor force, equipment and materials without additional
cost to CONTRACTOR. If the SUBCONTRACTOR fails to comply with CONTRACTOR’s
instruction within two (2) working days of receiving such notice and take corrective actions,
CONTRACTOR may, when it necessary, terminate the SUBCONTRACTOR’s right to
proceed with the SUBCONTRACT or any part thereof, or perform part of the
SUBCONTRACT Work by itself or any third parties at the SUBCONTRACTOR’s cost
without prejudice to any other contractual rights.
9.4 CONTRACTOR have full right to deduct any monies due to slow progress of work and
such deduction shall be from SUBCONTRACT PRICE. Such reasonable amount shall be
decided by CONTRACTOR at its own discretion.
10.0 Procurement and Supply
10.1 SUBCONTRACTOR shall procure and supply all materials, items and/or equipment for
incorporation into the SUBCONTRACT WORK, including all special tools and templates
for installation and maintenance etc. The SUBCONTRACTOR shall, as appropriate,
receive and store all materials and/or equipment properly and shall be fully responsible for
all cost occurred in connection herewith.
10.2 A list with brief specification and vendor of all aforesaid special tools and templates etc.,
shall be submitted to CONTRACTOR for review and approval prior to the issue of
purchase order. Otherwise CONTRACTOR shall have the right to reject the procured
items and request SUBCONTRACTOR to re-procure such items without additional cost to
CONTRACTOR.
10.3 Evaluation of vendor’s proposals for the supply of materials and equipment by
SUBCONTRACTOR shall be made having regard to its technical capability, cost and easy
of operation and maintenance, cost and need of spare parts, as well as purchase price.
11.0Change
11.1 Change to the WORK and/or SUBCONTRACTOR Equipment, except for
SUBCONTRACTOR Personnel as specified herein, may be required during the
performance of WORK, or any extension of the SUBCONTRACT, and should be handled
expeditiously and effectively by the Parties hereto. Such change may include, but are not
limited to additions, deletions, substitutions, alterations, and modifications.
11.2 HBP shall have the right, at any time, to make any changes but such changes shall in no
way affect the rights or obligations of the Parties hereto except as provided in a written
CHANGE ORDER. All provisions of the SUBCONTRACT shall apply to all changes.
CONTRACTOR have right to reduce the Scope of WORK and SUBCONTRACTOR shall
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submit the reduce WORK proposal same as mentioned as per unit price given in the
SUBCONTRACT or as per the instruction of CONTRACTOR.
11.3 Except as provided in ARTICLE 11.6 below, SUBCONTRACTOR shall not proceed with
any changes prior to receipt of a CHANGE ORDER, unless authorized in writing by HBP
Representative.
11.4 Should HBP desire a change to the WORK and/or SUBCONTRACTOR Equipment, it shall
advise SUBCONTRACTOR of said request. SUBCONTRACTOR shall, upon request from
HBP Representative, provide HBP within three (3) days a Proposal defining the terms and
conditions of the CHANGE PROPOSAL. The terms and conditions shall include, but not
be limited to price, method of payment, earliest commencement date, and any other
information deemed necessary.
11.5 When and if HBP approves the CHANGE PROPOSAL, HBP will issue to
SUBCONTRACTOR a written CHANGE ORDER in duplicate originals.
SUBCONTRACTOR shall sign both duplicate originals of the CHANGE ORDER to
indicate its receipt, understanding and acceptance of it.
11.6 In cases of extreme urgency for which SUBCONTRACTOR is unable to submit a firm
proposal prior to commencement of WORK on the necessary Change, HBP may issue a
"Preliminary Change order" to authorize SUBCONTRACTOR to proceed with the Change
on the basis of an approximate written estimate prepared by SUBCONTRACTOR. As
soon as possible thereafter, SUBCONTRACTOR shall submit a Change Proposal giving a
firm price for the Change. If the firm price quoted in the CHANGE PROPOSAL is more
than that quoted in the "Preliminary Change Order", SUBCONTRACTOR shall furnish
HBP with the reasons for the differences. Upon agreement of the Parties on the firm price,
a CHANGE ORDER shall be issued as outlined in ARTICLE 11.5.
12.0 Claim
12.1 In any case where SUBCONTRACTOR considers that extra payment is due for
work or materials not ordered by CONTRACTOR as an extra, as defined herein,
SUBCONTRACTOR shall notify CONTRACTOR in writing of its intention to make such
claim within two (2) days after starting work on which the claim is based.
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12.2 If such notification is not given, the claim for such extra payment shall not be
allowed and shall be deemed to be waived by SUBCONTRACTOR. Such notice by
SUBCONTRACTOR and the fact CONTRACTOR has kept account of the cost of afore
said shall not in any way be construed as proving validity of the claim. If the claim, after
consideration of CONTRACTOR, is allowed, such claim will be paid for as provided herein
for extra work.
13.0 Inspection and Testing

13.1 The SUBCONTRACTOR shall be responsible for all inspection and
testing required by law and HBP instruction, appropriate codes, standards, specification,
sound engineering and construction practices of the component parts of the work at the
Site.
13.2 The CONTRACTOR’s representative shall have the right to at all

reasonable times to inspect, or cause the inspection of, or witness the testing of, any part of
the SUBCONTRACT WORK. The SUBCONTRACTOR shall give the adequate written
notice of the arrangements for any inspection and testing of any part of the
SUBCONTRACT WORK at the Site.
13.3 Inspection or witnessing by the CONTRACTOR, or failure to

inspect or witness, shall not be construed as acceptance of any part of the SUBCONTRACT
WORK nor to relieving SUBCONTRACTOR of its responsibility for any part of the
SUBCONTRACT WORK complying with the requirements of the SUBCONTRACT and
being free from defects and capable of performing their respective functions.
14.0 Acceptance of the SUBCONTRACT WORK

14.1 SUBCONTRACTOR shall initial acceptance of the
SUBCONTRACT WORK by submitting written application to CONTRACTOR advising that
the SUBCONTRACT WORK and the associated deliverable documentation is considered
completed by SUBCONTRACTOR. Then CONTRACTOR shall review
SUBCONTRACTOR’s application and determine whether the SUBCONTRACT WORK is
indeed in compliance with all the requirements of the SUBCONTRACT.
14.2 If the SUBCONTRACT WORK is not considered to be

completed, CONTRACTOR shall advise in writing those areas and items not considered to
be completed in accordance with the SUBCONTRACT within three (3) days of having
received SUBCONTRACTOR’s application. The date of FINAL ACCEPTANCE of the
SUBCONTRACT WORK shall be the date confirmed and written in the FINAL
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ACCEPTANCE CERTIFICATE issued by CONTRACTOR. From the date of FINAL

ACCEPTANCE, CONTRACTOR shall take over care, custody and control of the work and
defective liability of the SUBCONTRACT shall commence in accordance with Clause 15.
15.0 Warranty Period and Final Acceptance

15.1 The WARRANTY PERIOD is 12 months or other period agreed by both parties
commencing from the effective date of the PROVISIONAL ACCEPTANCE CERTIFICATE
issued by CONTRACTOR.
15.2 If at any time during the WARRANTY PERIOD defined herein which start from the date
of PROVISIONAL ACCEPTANCE, the CONTRACTOR’s representative:
()1 Decides that any work done is or are defective or not in accordance with the
SUBCONTRACT or that the SUBCONTRACT WORK or any part thereof is defective
or incomplete or does not fulfill the requirements of the SUBCONTRACT, and
()2 As soon as reasonably practicable will give the SUBCONTRACTOR notice in writing
of the particulars of alleged defects.
15.3 Subject to this clause, if any defect is attributable to any breach of the SUBCONTRACT
committed by the SUBCONTRACTOR, the SUBCONTRACTOR shall bear his own cost of
making good the defect.
15.4 If in the course of making good any defect which arises during the WARRANTY PERIOD
the SUBCONTRACTOR shall repairs, replaces or renews any part of the
SUBCONTRACT WORK, the provisions of this Clause shall apply to the repair or to that
part of the SUBCONTRACT WORK so replaced or renewed and shall further apply until
the expiry of a period of WARRANTY PERIOD from the date of such repair, replacement
or renewal.
15.5 If the SUBCONTRACTOR neglect or refuse to make good within a reasonable time any
defect which he is liable to make good under this clause then the CONTRACTOR may,
without prejudice to any other remedies or relief available to him under SUBCONTRACT,
proceed to do the work, provided that the CONTRACTOR gives at least fourteen (14)
days notice of his intention in writing.
15.6 If the CONTRACTOR reasonably requires that any defect notified to the
SUBCONTRACTOR under this clause which arises during the WARRANTY PERIOD be
made good urgently and the SUBCONTRACTOR is unable or refuses to comply within a
reasonable time, then the CONTRACTOR may, without prejudice to any other remedies or
relief available to him under the SUBCONTRACT, proceed to do the work in such a
manner as the CONTRACTOR’s representative may decide, including the employment of
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a third party. The cost occurred as results of these remedies shall be on

SUBCONTRACTOR’s account.
15.7 SUBCONTRACTOR shall issue a written application of FINAL ACCEPTANCE of the
SUBCONTRACT WORK, when SUBCONTRACTOR considers it has completed the
SUBCONTRACT WORK in all respects, that it fully meets and satisfies the requirements
of this SUBCONTRACT and that the SUBCONTRACT WORK specifically meets all the
acceptance criteria set three herein and the following additional criteria:
(1) All documentation required by this SUBCONTRACT has been delivered to and
received by CONTRACTOR.
(2) All defect items have been completed to CONTRACTOR’s satisfaction.
(3) The WARRANTY PERIOD has ended and no further warranty issues are outstanding.
15.8 CONTRACTOR shall within fourteen (14) working days of receipt of such application of
issuing the FINAL ACCEPTANCE CERTIFICATE, either issue a certificate of FINAL
ACCEPTANCE CERTIFICATE or otherwise inform SUBCONTRACTOR in writing of
CONTRACTOR’s reasons for not accepting the SUBCONTRACT WORK.
SUBCONTRACTOR shall continue in this fashion until all deficiencies have been
corrected to CONTRACTOR’s satisfaction and a FINAL ACCEPTANCE CERTIFICATE
has been issued.
16.0 Liquidated Damages
16.1 If the SUBCONTRACTOR fails to complete and deliver the SUBCONTRACT
WORK in accordance with the schedule of this SUBCONTRACT and as specified in
EXHIBIT-II Schedule of Work, SUBCONTRACTOR shall be liable for and shall pay
CONTRACTOR, as liquidated damages and not as a penalty, a sum equal to 0.5% of the
estimated Lump Sum SUBCONTRACT PRICE for each calendar day of the delay till the
subjected work is completed as per the satisfaction of CONTRACTOR and as per
SUBCONTRACT requirement. The cumulative amount of LIQUIDATED DAMAGES for
delay shall be up to twenty percent (20%) of the SUBCONTRACT PRICE.
16.2 The CONTRACTOR shall be entitled to impose the LIQUIDATED DAMAGES
notwithstanding that it shall have terminated this SUBCONTRACT under Clause 32 and
has engaged other subcontractor(s) to complete the SUBCONTRACT WORK.
17.0 Price and Terms of Payment

17.1 Notwithstanding any other provision of the SUBCONTRACT, the following shall be
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precondition to any payment by Party C to SUBCONTRACTOR:

Party C having received proper evidence of compliance by SUBCONTRACTOR with its
insurance obligations under the SUBCONTRACT.
17.2 The SUBCONTRACTOR acknowledges and agrees that the estimated
SUBCONTRACT PRICE covers all obligations under and in relation to the
SUBCONTRACT and all matters and things necessary for proper execution of the
SUBCONTRACT WORK whether the same is expressly provided for the SUBCONTRACT
or is to be reasonably inferred from the SUBCONTRACT. The SUBCONTRACTOR further
acknowledges and agrees that it shall be deemed satisfied before entering into the
SUBCONTRACT as to the correctness and sufficiency of the SUBCONTRACT PRICE and
agrees that SUBCONTRACT PRICE shall not be adjusted for any reasons except as
expressly provided in the SUBCONTRACT.
17.3 The Party C and Party A shall pay the SUBCONTRACTOR for the SUBCONTRACT
WORK and the total of the sums payable shall constitute the SUBCONTRACT PRICE
listed in SUBCONTRACT and paid in accordance with the provisions of this clause. The
Unit price mentioned in ATTACHMENT-2 BOQ or anywhere else in the SUBCONTRACT
shall not be changed due to escalation, inflation, fluctuation of exchange rate, increase of
labor wages, and change in tax law during the valid period of this SUBCONTRACT, and is
all-inclusive of any taxes, duties, levies or any other charges due by the
SUBCONTRACTOR. All payments shall be subject to tax deductions as per Iraqi tax laws.
17.4 The SUBCONTRACT will take the BOQ UNIT RATE contract, so the construction
content included but not limited in BOQ, shall be done by SUBCONTRACTOR and any
addition and reduction in quantities shall be calculated and for the changes in quantities,
quantities reconciliation shall be done for all the addition or reduction in quantities as per
final prices BOQ.
17.5 Unless otherwise provided for herein, after completion of the SUBCONTRACT
WORK in accordance with milestones as per Payment Schedule, Exhibit III - Price and
Payment schedule, SUBCONTRACTOR shall, for Party C’s approval, invoice Party C
based upon the BOQ quantities and amounts set out in ATTACHEMENT-2 BOQ for Work
performed and shall also provide Party C with a separate cumulative statement of
account. The cumulative statement of account shall set out the total amount previously
billed, the current milestone billing and the total cumulative amount billed to date. Invoicing
for Work performed shall be kept current at all times. Each invoice shall include details of
the Work performed during that milestone and shall separately identify any Work
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performed in that milestone but not invoiced, including the amount charged for such Work.
17.6 SUBCONTRACTOR unit price have considered all the costs and if there is extra
work or delay in work due to weather conditions or due to any other reasons, the
SUBCONTRACTOR shall perform the extra work without any extra cost.
17.7 The Party C shall pay the amount of every undisputed invoice during forty five (45)
days upon approval of such invoice.
17.8 Unless otherwise agreed by both parties herein, the invoice amounts due to the
SUBCONTRACTOR under this SUBCONTRACT shall be paid by bank transfer (or other
agreed methods) to SUBCONTRACTOR’s Bank Account. The Account Information is as
follow:
Company Name: ………….
Bank Name: ………………..
Bank Address: ……………………
Account No: ………………
Swift Code: …………….
IBAN USD: ………………..
The SUBCONTRACTOR shall present and warrant that the bank account provided above
to Party C for the payment shall be accurate and authentic for the transfer of the payment
without any defectiveness.
Accordingly, the SUBCONTRACTOR shall be further liable for, and indemnify and hold
harmless Party C from and against any losses, claims, demands, judgments, penalties
and expenses (including legal expenses) which may arise out of or result from the way of
payment through its bank account. Any losses or expenses to the Party C arising from the
defectiveness or illegality of the above bank account information provided by the
SUBCONTRACTOR shall be at the SUBCONTRACTOR’s own cost.
17.9 Without prejudice to any other remedy, which may have, the Party C shall be entitled
to deduct from any payment due to the SUBCONTRACTOR any sums which are due from
the SUBCONTRACTOR to the Party C under the SUBCONTRACT.
If the Party C intends to withhold any amount from or set off any amount against any
payment which is due to the SUBCONTRACTOR, including but not limited to sums that
may be due from the SUBCONTRACTOR to the Party C under the SUBCONTRACT, the
C Party C shall give notice to the SUBCONTRACTOR not later that seven (7) days before
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the due date for payment, specifying the amount he proposes to withhold and the reason
for withholding payment. If there is more than one reason, such notice shall specify
separately each reason and the amount attributable to it.
Party C shall be entitled to withhold the disputed amount of payment until settlement of
the dispute by mutual agreement or in accordance with Clause 35.0. All payment made by
Party C shall not preclude the right of Party C from thereafter disputing any of the items
and amounts paid.
In respect of the undisputed amount, SUBCONTRACTOR shall resubmit the invoice
specifies the undisputed amount and supporting documents. Party C shall pay the
undisputed amount on or before the applicable due date.
17.10 If as a result of any audit or otherwise an error is discovered in the amount paid to
the SUBCONTRACTOR then such error shall be corrected in the next payment due under
the SUBCONTRACT or, following the making of the last payment, any finding of
underpayment to the SUBCONTRACTOR shall be remedied and any finding of
overpayment shall be remedied by the SUBCONTRACTOR making the necessary
repayment within thirty (30) days of receipt of the relevant notification.
18.0 Taxes, Duties and Permits

18.1 The SUBCONTRACTOR shall be responsible for, and shall pay at its own
expense when due and payable, all TAXES assessed against it in connection with the
SUBCONTRACT. All TAXES levied on the SUBCONTRACTOR shall be for the
SUBCONTRACTOR’s account, and shall not be reimbursed by Party C. The
SUBCONTRACTOR shall protect, indemnify and hold harmless HBP and Party C against
all such TAXES.
18.2 For WORK performed in Iraq, the SUBCONTRACTOR shall comply to the
registration requirements with the General Commission of Taxes (“GCT”) in Iraq and
provide evidence of registration to Party C. The SUBCONTRACTOR shall be obligated to
submit the Tax Identification Number (“TIN”) and the tax clearance letter to Party C on the
EFFECTIVE DATE. Should the SUBCONTRACTOR not have the TIN and tax clearance
letter upon the EFFECTIVE DATE of the SUBCONTRACT, the SUBCONTRACTOR shall
submit the TIN and tax clearance letter to Party C within thirty (30) days of the
EFFECTIVE DATE. Non-compliance to this requirement shall give the right to Party C,
without prejudice to its other rights and remedies under the SUBCONTRACT or under law,
to withhold any invoice payment until such time the submission of the abovementioned
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documents.
18.3 Party C shall have the right to withhold an amount determined at the
applicable rate as set by the GOVERNMENT from time to time to the extent that such
withholding may be required by the GCT or any relevant authorities thereof, or withhold
any amount required to be withheld by the government of any other country, from any
payment due or which may become due to the SUBCONTRACTOR under this
SUBCONTRACT. Payment by Party C to the respective governmental office of the amount
of money so withheld will relieve Party C from any further obligation to the
SUBCONTRACTOR with respect to the amount so withheld. If applicable, the
SUBCONTRACTOR shall submit to Party C a letter from the GCT stating that the
SUBCONTRACTOR is a fiscal resident in Iraq for establishing the amount of withholding
tax that the SUBCONTRACTOR is subject to, failing which Party C shall consider the
SUBCONTRACTOR a non-resident of Iraq for tax purposes and thereby subject to the
withholding tax provision at the highest applicable rate until such time as the required
letter is submitted to Party C.
18.4 Party C shall have the right to withhold from any payment due or which may
become due.to the SUBCONTRACTOR under this CONTRACT an amount determined at
the applicable rate as set by the GOVERNMENT from time to time (including without
limitation any such withholding as may be required by the GCT or any relevant authorities
thereof, or withhold any amount required to be withheld by the government of any other
country, from any payment due or which may become due to the SUBCONTRACTOR
under this CONTRACT. Payment by Party C to the GOVERNMENT office of the amount of
money so withheld will relieve Party C from any further obligation to the
SUBCONTRACTOR with respect to the amount so withheld. If applicable, the
SUBCONTRACTOR shall submit to Party C a letter from the GCT stating that the
SUBCONTRACTOR is a fiscal resident in Iraq for establishing the amount of withholding
tax that the SUBCONTRACTOR is subject to, failing which Party C shall consider the
SUBCONTRACTOR a non-resident of the Republic of Iraq for tax purposes and thereby
subject to the withholding tax provision at the highest applicable rate until such time as the
required letter is submitted to Party C.
18.5 Party C shall have the right to retain the final installment or last payment
under this SUBCONTRACT as required by Iraqi TAX law. The SUBSUBCONTRACTOR
shall provide a tax clearance letter from the GCT within thirty (30) days from the date of
completion of the SUBCONTRACT in order for the amount to be released, failing which
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Party C shall remit the amount of money so withheld to the GCT.

18.6 The SUBCONTRACTOR shall indemnify Party C against all claims,
demands and causes of action based on any actual TAXES for which they are liable, or
any actual or alleged failure by the SUBCONTRACTOR to make timely payment of any
TAXES for which they are liable, or any actual or alleged failure by the
SUBCONTRACTOR to comply with any applicable reporting, return, or other procedural
requirements with respect to their payment. This indemnity shall include, without limitation,
all penalties, awards and judgments, court and arbitration costs, attorneys' fees, and all
other expenses associated with such claims, demands, and causes of action.
18.7 The SUBCONTRACTOR shall give prompt notice to Party C of all matters
pertaining to non-payment, claims of immunity, or exemption from any TAXES.
18.8 All stamp duty related to this SUBCONTRACT shall be borne by the
SUBCONTRACTOR. The SUBCONTRACTOR shall provide a copy of the payment
receipt to Party C within ninety (90) days from the effective date of the SUBCONTRACT.
18.9 The SUBCONTRACTOR shall be responsible to seek clarification through
its tax advisor on the applicability of withholding tax provisions under applicable Iraqi TAX
law and on all other TAX matters relating to this SUBCONTRACT. Party C shall in no way
be liable for any loss, damage or penalties suffered by the SUBCONTRACTOR arising
from its failure to obtain proper TAX advice.
19.0 Insurance
19.1 SUBCONTRACTOR shall carry and maintain in full force for the
duration of the SUBCONTRACT including, but not limited to, the WARRANTY PERIOD at
least the following insurance to the satisfaction of the CONTRACTOR:
()1 Construction All Risk Insurance with a minimum limit of the SUBCONTRACT PRICE
covering all risks of physical loss or damage including physical loss or damage to the
SUBCONTRACT WORK or part thereof and all equipment, materials and supplies
intended to be used in or become part of the SUBCONTRACT WORK, whether in
transit to the Site, at the Site, awaiting erection or installation or during erection,
installation and testing;
()2 Workmen’s Compensation and / or similar statutory social insurance, as required by

applicable laws of Iraq and as per the requirement of the PCIHBV and TOC and
which may be applicable and/or accidental death or dismemberment insurance,
covering all SUBCONTRACTOR’s personnel engaged in accomplishing the
SUBCONTRACT WORK;
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()3 SUBCONTRACTOR to make sure all of its employees have insurance at all time
during the WORK and shall update regularly with the Government departments if may
necessary.
()4 In the event that SUBCONTRACTOR provides any automobiles in association with its
performance of the SUBCONTRACT WORK, Automobile Liability Insurance covering
owned, non-owned, hired, operated or licensed automobiles by SUBCONTRACTOR
providing unlimited coverage for injury or death;
()5 Comprehensive General Third Party Liability Insurance covering all operations
hereunder against bodily injury, death, losses or property damage. Such insurance
shall include tortious liability, SUBCONTRACTOR's protective liability and Cross
Liability and other liability as required in the applicable laws;
()6 Insurance covering loss of or damage to construction machinery, tools and equipment
owned by and/or on bare rental from a third party or parties and used by the
SUBCONTRACTOR in performing the SUBCONTRACT WORK, having coverage in
accordance with the actual cash values of such construction machinery, tools and
equipment; and
()7 Any other insurance which may be relevant and/or which may be required by any
applicable laws to which the SUBCONTRACTOR is subject to.
19.2 SUBCONTRACTOR shall cause CONTRACTOR to be included

as additional insured and to be covered by all insurances stipulated in Clause 19.1 with
respect to the operations conducted under this SUBCONTRACT and shall cause the
insurers thereof to waive all expressed or implied rights of subrogation against
CONTRACTOR.
19.3 All premiums, deductibles, exceptions and exclusions applicable

to the foregoing insurances shall be for the account of and be paid by the
SUBCONTRACTOR. Any breach of conditions and/or warranties contained in such
policies of insurances shall also be the account of the SUBCONTRACTOR.
19.4 SUBCONTRACTOR shall furnish CONTRACTOR with certified

copies of policies of insurance provided for in clause 19.1 accompanied by certified copies
of official receipts evidencing full payment of premiums thereof. No insurance shall be
canceled or materially discharged while the SUBCONTRACT WORK is in progress
without CONTRACTOR approval in advance. Policies and/or extension certificates or
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documents shall be furnished to CONTRACTOR as and when requested by

CONTRACTOR.
19.5 SUBCONTRACTOR shall notify CONTRACTOR immediately

upon receipt of any notice of claims, incidents or demands or of any situation, which may
give rise to such claims, or demands being made with respect to this SUBCONTRACT
under the said policies. Written notice of any accident shall be given not later than two (2)
days after the occurrence of the accident. However, for serious accidents (including but
not limited to death or serious injuries) SUBCONTRACTOR shall advise CONTRACTOR
immediately and then, provide written confirmation within two (2) days.
19.6 The amounts of SUBCONTRACTOR furnished insurance called

for herein shall be the minimum and not the maximum limits of liability.
SUBCONTRACTOR may provide other insurance coverage or higher limits of coverage.
CONTRACTOR will bear no financial liability attributable to deficient insurance coverage
by SUBCONTRACTOR.
19.7 SUBCONTRACTOR shall not commence the SUBCONTRACT

WORK until all the insurances required by this clause are in force. Nothing contained in
this clause shall serve in any way to limit or waive SUBCONTRACTOR’s responsibility
under this SUBCONTRACT.
20.0 Performance Bond/Performance Guarantee

20.1 There is no requirement of Performance Bond/Performance Guarantee for this
SUBCONTRACT. However, Party C shall withhold ten (10) percent of the
SUBCONTRACT PRICE, and that ten (10) percent payment will be released upon
issuance of FINAL ACCEPTANCE CERTIFCATE by CONTRACTOR.
21.0 Indemnify and Liability
21.1 CONTRACTOR shall be responsible for and shall indemnify,
defend and hold harmless SUBCONTRACTOR from and against all claims, demands,
causes and actions made or brought against SUBCONTRACTOR for any and all personal
injury, disease or death of any of CONTRACTOR resulting from the negligence or default
of CONTRACTOR and all compensation, damage, costs, expenses, losses and liability
whatsoever in connection therewith.
21.2 SUBCONTRACTOR shall be responsible for and shall indemnify,
defend and hold harmless CONTRACTOR from and against all claims, demands, causes
and actions made or brought against CONTRACTOR for any and all personal injury,
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disease or death of any of the employees or hired personnel of SUBCONTRACTOR or

loss or damage to the property of SUBCONTRACTOR, its subcontractors or their
employees and hired personnel resulting from the negligence or default of
SUBCONTRACTOR and all compensation, damage, costs, expenses, losses and liability
whatsoever in connection therewith.
21.3 Neither party shall be liable to the other for consequential
damages resulting from or arising out of the SUBCONTRACT including without limitation,
loss of profit, loss of business opportunity, loss of property or mineral rights, or business
interruption however same may be caused.
22.0 Patent and Other Protected Rights
22.1 If any work done or method employed by SUBCONTRACTOR in the construction of the
SUBCONTRACT WORK should infringe any patent, registered design, design right, trade
mark, copyright or other intellectual property protected by law, the SUBCONTRACTOR,
shall indemnify the CONTRACTOR against all losses, liabilities, cost and expenses that
may result from such infringement.
23.0 Assignment and Subcontracting
23.1 The SUBCONTRACTOR shall not without the prior consent of
the CONTRACTOR assign or transfer any benefit or obligation under the
SUBCONTRACT to any other person in whole or in part.
23.2 The SUBCONTRACTOR shall not subcontract the whole or a
part of the SUBCONTRACT WORK except that such sub-subcontract has been approved
by CONTRACTOR. The sub-subcontracting by the SUBCONTRACTOR of any part of the
SUBCONTRACT WORK shall not relieve the SUBCONTRACTOR in any way whatsoever
from his responsibility for the due performance of the SUBCONTRACT.
24.0 Right to Audit
24.1 SUBCONTRACTOR and its affiliates shall maintain a complete, correct and
confidential set of records in connection with the SUBCONTRACT WORK and shall retain
all such records for a period of twenty-four (24) months after the date of the FINAL
ACCEPTANCE CERTIFICATE has been issued by CONTRACTOR and for so long as any
dispute remains unresolved between the parties.
24.2 Subject to Clause 24.1, the Party C’s representative shall have the right at any time
including WARRANTY PERIOD after the date of the last FINAL ACCEPTANCE
CERTIFICATE to carry out audits of the contemporary records and to have such audits
carried out by an auditing firm appointed by the Party C.
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25.0 Force Majeure

25.1 For the purpose of this Subcontract, "FORCE MAJEURE" shall include acts of God, fire,
unavoidable accidents, acts of war, or conditions arising out of or attributable to war
(declared), civil war, embargo or blockade, floods, storms and other natural disturbances,
insurrections, riots or any other cause not due to the fault or negligence of the Party
invoking Force Majeure and any other cause beyond the reasonable control of the Party
invoking Force Majeure but not including:
(1) any event caused by the negligence of the Party invoking Force Majeure.
(2) any event caused by the failure to observe generally accepted good engineering
and international business practices.
(3) any event caused by the negligence of SUBCONTRACTOR’s personnel.
(4) any event resulting from compliance with applicable laws to the SUBCONTRACT
WORK.
(5) any event resulting from normal disturbances in the weather, any foreseeable event
not within the reasonable control of the Party claiming Force Majeure, which by the
exercise of due diligence such Party shall not have been able to avoid or overcome or
protect against.
Notwithstanding anything contained in this clause, lack of finances shall not be

considered a Force Majeure nor shall any Force Majeure suspend any obligation for
the payment of money due hereunder.
Any delays or failure in performance by either Party shall not give rise to any claims
for damages or consequential loss if, and to the extent, such delay or failure is caused
by Force Majeure.
25.2 If either Party is prevented or hindered by Force Majeure from performing any of its
obligations hereunder, the obligations of such Party, insofar as the obligations are affected
by Force Majeure, shall be suspended while (but only so long as) Force Majeure
continues to prevent or hinder, the performance of such obligations and only to the extent
of the said prevention or hindrance. The Party prevented or hindered from carrying out
any obligation by Force Majeure shall promptly give the other Party notice of the Force
Majeure including the evidence document and reasonably full particulars in respect
thereof and shall give notice to the other Party when such cause ceases to operate.
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25.3 If Force Majeure results in the suspension of all or part of the SUBCONTRACT WORK,
the Parties shall meet, as soon as practicable given the nature of the Force Majeure, and
determine the appropriate measures to be taken, including whether any or all of the
SUBCONTRACT WORK should be suspended or terminated.
25.4 Notwithstanding anything else contained in this Subcontract, in the event that Force
Majeure results in suspension of the SUBCONTRACT WORK for twenty-one (21)
consecutive days, CONTRACTOR shall have the right to terminate this SUBCONTRACT
upon delivering notice to SUBCONTRACTOR and shall pay SUBCONTRACTOR, upon
receipt and verification of SUBCONTRACTOR's invoices, all amounts properly due for the
SUBCONTRACT WORK performed prior to the date of Force Majeure.
25.5 The Party claiming suspension of its obligations as aforesaid shall, where applicable,
promptly remedy the cause and effect of the Force Majeure described in the said notice
insofar as it is reasonably able so to do provided that the terms of settlement of any strike
shall be wholly in the discretion of the Party hereby claiming suspension of its obligations
hereunder by reasons thereof; and that Party shall not be required to accede to the
demands of its opponents in any strike, lockout or industrial disturbances solely to remedy
promptly the Force Majeure thereby constituted.
26.0 Confidentiality and Ownership of Documents

26.1 Confidential Information’ shall not include the following information:
(1) which is or becomes generally available in the public domain other than by any
unauthorized actions of the EMPLOYER, the CONTRACTOR or the
SUBCONTRACTOR;
(2) which is or comes into the possession of one party other than in breach of a duty of
confidence to the other party; or
(3) which is or comes into the possession of the SUBCONTRACTOR with the right to
disclose.
26.2 The SUBCONTRACTOR shall not, without the previous written consent
of the CONTRACTOR, use, publish or disclose to any person, nor cause nor permit any of
his employees, agents or Sub-subcontractors to use, publish or disclose any Confidential
Information otherwise that for the performance of his duties under the SUBCONTRACT.
Accordingly, CONTRACTOR has the same obligation of keeping confidentiality for
SUBCONTRACTOR.
27.0 Health, Safety and Environment
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27.1 The SUBCONTRACTOR shall comply with all laws (whether international, national,
local or otherwise) and regulations pertaining to safety, health, environmental protection,
fire protection and security regulations which are applicable to the location where the
WORK are being carried out. The SUBCONTRACTOR shall also comply at all times with
HBP's HSE Management System (HSE MS), HSE Manuals, policies, operating standards,
site HSE requirements, Zero Tolerance (ZeTo) Rules and any special instructions, and all
requirements stipulated in this SUBCONTRACT. These requirements are intended to
supplement any known or ought to be known laws and regulations applicable at the
location where the WORK is being carried out. The SUBCONTRACTOR shall take all
necessary HSE control and recovery measures related to or arising out of the
performance of the SUBCONTRACT in order to protect the WORK, the personnel and
property of the HBP, the SUBCONTRACTOR, all third parties and public from the hazards
and risks associated with the planning and execution of the WORK.
27.2 HSE Recognition
The SUBCONTRACTOR shall work closely with HBP to develop the most appropriate
HSE recognition program for this SUBCONTRACT. Such HSE recognition program shall
provide a structured means to periodically reward and recognize those personnel who
have contributed in making the Work Site a safe work place. HSE incentives will be based
on merits, active participation, and the achievement of HSE performance targets. In
addition, the SUBCONTRACTOR shall at all times employ a competent and qualified HSE
officer to ensure that HSE standards as set out in this SUBCONTRACT are upheld at all
times during the performance of the WORK.
27.3 Default of SUBCONTRACTOR
The failure of the SUBCONTRACTOR to comply with the HBP’s applicable Health, Safety
and Environment (HSE) requirements shall be deemed as a default by the
SUBCONTRACTOR and shall constitute a breach of the SUBCONTRACT.
27.4 Right to Stop WORK on HSE Grounds
HBP shall have the right to prohibit commencement of the WORK or to stop any WORK in
progress on HSE grounds if any (without limitation) MATERIALS, SUBCONTRACTOR
EQUIPMENT, SUBCONTRACTOR PERSONNEL (procured by the SUBCONTRACTOR
from third parties included) or work conditions are considered to be unsafe or not in
compliance with HBP’s HSE rules. In such event, the SUBCONTRACTOR shall,
immediately and without reservation, remove or rectify the unsafe materials, construction
equipment, SUBCONTRACTOR’s personnel or work conditions prior to seeking HBP’s
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permission to resume or commence the WORK. Any costs incurred by the

SUBCONTRACTOR as a result of any delays or actions taken or required which arise in
any way in connection with this ARTICLE and/or the WORKS stoppage, shall be at the
SUBCONTRACTOR’s sole expense and shall not entitle the SUBCONTRACTOR to any
compensation thereof.
27.5 Right to Withhold Payment on HSE Grounds
27.5.1 In the event that the BSUBCONTRACTOR fail to comply with any of the HSE
requirements, HBP shall be entitled to withhold amounts from payments due to
SUBCONTRACTOR under this SUBCONTRACT until the SUBCONTRACTOR rectifies
the non-compliance to the satisfaction of HBP whereupon HBP shall immediately release
such sums withheld to the SUBCONTRACTOR (without any interest imposed thereon).
27.5.2 In the event that the SUBCONTRACTOR fails to take appropriate remedial action or
refuses to remedy or remove the causes for withholding such payments after delivery of
written notice to the SUBCONTRACTOR by HBP, HBP shall be entitled to cause the
same to be remedied or removed on its own and may deduct the costs including the
expenses thereby incurred by HBP from any amounts due or owing or which may
become due or owing to the SUBCONTRACTOR under the SUBCONTRACT, provided
always that this provision shall not affect any other rights or remedies to which HBP may
be entitled under the SUBCONTRACT or at law or otherwise for the recovery of such
sums.
27.6 Consequence Management for HSE Non-Compliance
27.6.1 In the event of a fatality due to HSE non-compliance, or in the event of repeated HSE
violations by the SUBCONTRACTOR necessitating the sending of three (3) warning
letters by HBP to the SUBCONTRACTOR, HBP may terminate the SUBCONTRACT and
claim for any loss and/or damages suffered by HBP as a result thereof.
27.6.2 HBP have right to put penalties as per below table if SUBCONTRACTOR fail to comply.
No. Description Penalty(USD)
1 Organization
1.1 Inadequate HSE supervisor（1:50 for daytime/1:30 nightshift ） 1,000~10,000
1.2 High risk job performing without competent personal 500~1000
1.3 No correct action taken on findings or unsafe condition 200~500
1.4 Failure to complete safety rectification as required by contractor 1,000
1.5 Organizations who fail to report safety incidents in time According to
severity
1.6 Failure to carry out safety review, inspection, investigation, training, 300~500
meeting, etc.
1.7 Command or force workers to make violation 500
1.8 Failed to submit required safety report to CONTRACTOR within 200~500
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specified time
1.9 No job hazard analysis, or no safety method statement for the 300-2,000
activities with high risk
1.10 Refuse to implement or change their work plans as required by 500-2,000
construction plan
2 Excavation
2.1 Failure to shoring/sloping/barricade the excavation area, access is 300~1,000
not provided
2.2 Failure to carry out depth excavation safety inspection, monitoring 1000
and settlement observation
3 Formwork, scaffolding, ladder
3.1 Formwork support systems or scaffolding do not meet the safety 300~1000
requirements of approved method statement or applicable regulatory
procedures
3.2 No barricade and standby person while dismantling the formwork 100~400
support systems or scaffolding
3.3 Using the un-inspected scaffolding or the scaffolding with red tag 300-500
3.4 Unsafe use scaffolding or ladder (e.g. moving mobile scaffolding if 300
any person on it, do not use safe access)
4 PPE
4.1 Failing to wear mandatory PPEs entry worksite 50-200
4.2 Failure to properly use PPEs during working (e.g. safety helmet, 100-500
safety shoes, protective glasses, welding shield, etc.)
4.3 Damaged or substandard PPE 100
5 Work at height
5.1 Not use body harness while work at height 100-500
5.2 Improper using the lifeline, safety nets or do not tie-off body harness 50~300
5.3 No barricade or safety warning sign for opening hole, side edge of 200~800
foundation pi and other dangerous parts of the construction site
6 Tools and Equipment
6.1 Put into use without applying for inspection to relevant departments 200~500
6.2 Equipment and tools not well managed or do not carry out 100~500
maintenance according to regulations
6.3 Unsafe operating equipment against safe operation procedure 100~300
6.4 Equipment fail to apply for approval and cheating the inspection 1,000-5,000
personnel by revising the inspection materials or force them into the
construction site
7 Temporary electrical installation
7.1 The temporary electrical installation system to be used without 300~1000
inspection
7.2 a potential power hazard without proper measures to control such as 100~1,000
multiple connections, no grounding for shell of equipment, or ELCB
failure
7.3 unauthorized personal engage in electric or critical activities without 500~1,000
permission
8 Lifting, rigging
8.1 Lifting gears damaged or without inspection under using 500-1,000
8.2 Against operating procedure to carry out lifting activities 100-1,000
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9 Fire fighting
9.1 Noncompliance with required firefighting equipment or apparatus 100~500
9.2 For gas cylinder missing flash back device 200~500
9.3 Failure to implement or improve on-site fire protection measures. 100~1,000
9.4 Smoking out of designated area 500
10 Permit to Work (PTW) system
10.1 Fail to comply with the required permit to work procedure for 1,000
construction work
10.2 Failure to dispose the PTW on work site 100
10.3 No supervisor on site to supervision the activities 500
10.4 Failure to follow the requirement descripted on PTW 100-1,000
11 Basic safety rules and housekeeping
11.1 Discharge/bypass safety equipment (e.g. fire extinguisher, guardrail, 500~2,000
manhole cover) without permission from responsible party
11.2 Lighting conditions for the night operation fail to meet the 100-500
requirement
11.3 For the construction materials, waste materials, etc., placed mess up 100~300
on worksite
11.4 Failing to dump construction waste and domestic waste in the 200-500
designated area
11.5 safety and health facilities, first-aid kit and first-aid medicine box are 300~500
not provided in accordance with the requirements
11.6 Failing to clean up the construction site in time 100~500
11.7 Using of chemical including fuel oil without leakage pit or MSDS 500~1,000
11.8 The construction site, temporary facilities and living area setup and 1,000~5,000
management fail to comply with the relevant regulations
Disobey the HSE management and insult the HSE personnel 1,000-5,000
11.9 Noncompliance on the security rules (e.g. sign-in, sign-off, body 200
check, etc.)
11.10 Fight on construction site or on camp 1,000~2,000
11.11 poor management of the employees and for the occurrence of 5,000-20,000
multiple (more than three people) fights or group disturbances of
more than three people
11.12 Violating the requirement of confined space or related clause 100~500
12 Accident, environment pollution
12.1 There was a personal accident 1,000~50,000
12.2 Damage to construction facilities and equipment occurred ,and 10,000~50,00
property 0
12.3 Fire accident 10,000~50,00
0
12.4 A bad influence is caused by a violation or potential 10,000~50,00
0
12.5 Environmental pollution 10,000~50,00
0
Note：
1. The above punishment amount shall be calculated according to the number of violations
discovered within one month and whether the rectification is timely.
2. The contractor shall not transfer the fine to the employee who violates the contract,
otherwise, it will be fined 3 times or more.
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3. In case of property damage or environmental pollution, in addition to the fine, the

contractor shall be responsible for the full cost of the recovery.
4. Any person of the project management may make a request for a fine as a requestor.
The requestor shall collect as much evidence as possible at the scene, including a
description of the breach, the name of the contractor, the location, date and time of the
breach, a picture of the scene and the name or badge number of the violator.
5. In order to ensure fairness and consistency, all penalty applications must be evaluated
and approved by the fine assessor. Penalty assessors include:
• project management representative, HSSE director, safety manager, security
supervisor, environment supervisor.
• the project representative of the construction manager who is responsible for
managing the offending contractor;
6. The amount of the fine may be determined on a case-by-case basis. Penalties will be
increased in the event of repeated violations or if such conduct poses a broad or
significant threat to the safety of the project.
27.6.3 The above are without prejudice to any other rights and remedies of HBP arising
hereunder or by law or otherwise.
27.7 The SUBCONTRACTOR shall ensure that all services, EQUIPMENT, MATERIALS
SUPPLIES, SPARE PARTS and SUBCONTRACTOR EQUIPMENT used in the
performance of the WORK comply with all applicable laws, regulations and requirements
as may be required by the GOVERNMENT or any other relevant governments or
authorities having jurisdiction, and otherwise meet generally accepted industry standards
for occupational safety and health.
27.8 The SUBCONTRACTOR shall ensure that all EQUIPMENT, MATERIALS, SUPPLIES,
SPARE PARTS, and other items whether owned or otherwise in any way associated with
or utilized in the WORK and/or FACILITIES are maintained in a safe, sound and proper
condition, comply with laws, regulations and HBP's requirements.
27.9 The SUBCONTRACTOR shall establish and enforce its own written policy, safety rules
and regulations for SUBCONTRACTOR PERSONNEL which shall be applicable to HBP's
site team as well as its visitors. The SUBCONTRACTOR shall acquaint HBP
REPRESENTATIVE with this policy and regulations and shall be responsible for
enforcement during the course of the WORK.
27.10 In addition to all legal and specific requirements stated herein, the SUBCONTRACTOR,
employees and representatives who are engaged in the performance of the WORK shall
comply with, abide by and enforce at its own expense any rules, regulations and
standards on safety, drugs and alcohol, fire protection and security regulations as set forth
by HBP in its safety manuals, policies and special instructions. The SUBCONTRACTOR
shall ensure that its employees are notified of, observe and abide by said regulations.
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27.11 The SUBCONTRACTOR shall be solely responsible for the health and safety aspects
of the WORK and to protect the WORK, workers, the public, all other people and the
property of the third parties. Before construction, the SUBCONTRACTOR shall establish
and publish all necessary or appropriate health, fire, drugs and alcohol and other safety
regulations including construction, inspection, methods and procedures to be followed.
The SUBCONTRACTOR shall ensure that SUBCONTRACTOR PERSONNEL are
notified, observe and abide by said regulations.
27.12 As a minimum requirement, the SUBCONTRACTOR shall ensure that all of its
employees, agents comply with HBP's rules, regulations, practices and requirements as
set forth by HBP in its safety manuals, policies and special instructions. This shall not
relieve the SUBCONTRACTOR of its obligations as stipulated herein and compliance with
all relevant laws, regulations and rules.
27.13 The SUBCONTRACTOR shall at its own expense ensure that all SUBCONTRACTOR
PERSONNEL have given the necessary basic safety and job related training required by
law and the SUBCONTRACT prior to start of the WORK, and will provide certificates if so
required.
27.14 The SUBCONTRACTOR shall ensure that all SUBCONTRACTOR PERSONNEL who
are expected to perform the WORK have attended relevant HSE briefing courses and are
familiar with safety techniques and procedures.
27.15 The SUBCONTRACTOR shall be responsible for maintaining and enhancing the safety
awareness of its personnel, including arranging safety meetings. Copies of minutes of the
SUBCONTRACTOR's safety meetings shall be sent to HBP. The SUBCONTRACTOR
shall also exercise the emergency drills during the performance of the WORK.
27.16 The SUBCONTRACTOR warrants that SUBCONTRACTOR PERSONNEL, agents,
and shall not perform any work or service for HBP while under the influence of alcohol or
drugs or any form of controlled substance. SUBCONTRACTOR PERSONNEL and agents
shall not misuse legitimate drugs or possess, use, distribute or sell illicit or un-prescribed
forms of controlled substances or drugs while employed on HBP's WORK or while present
on the WORKSITE.
27.17 The SUBCONTRACTOR, SUBCONTRACTOR PERSONNEL and its agents shall not
possess, use, distribute, or sell alcohol or alcoholic beverages on premises owned or
controlled by HBP and/or the WORKSITE. The SUBCONTRACTOR shall adopt and
strictly enforce work rules and policies in order to ensure compliance with these
obligations.
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27.18 The SUBCONTRACTOR shall maintain good site housekeeping and shall furnish all
SUBCONTRACTOR PERSONNEL with all required appropriate safety gear including but
not limited to coveralls, safety helmets, safety shoes, safety harness, gloves, eyes and
ears protection. HBP shall reserve the right to reject any safety gear which in the opinion
of HBP is not of a suitable standard and/or which might not provide adequate protection to
the personnel. The SUBCONTRACTOR shall ensure that all SUBCONTRACTOR
PERSONNEL wear the safety gear at all times during the performance of the WORK or
while present at the WORKSITE.
27.19 From the EFFECTIVE DATE until COMPLETIOIN AND ACCEPTANCE, the
SUBCONTRACTOR shall, at its own cost, make provision for security and safeguarding
the WORK and all associated materials, as well as the security of SUBCONTRACTOR
PERSONNEL and all SUBCONTRACTOR EQUIPMENT and property. The
SUBCONTRACTOR shall also provide all such marks, signals and other appliances as
may be required by the nature of any part of the WORK.
27.20 HBP reserves the right to conduct searches of the person, possessions, vehicles and
other property of the SUBCONTRACTOR, SUBCONTRACTOR PERSONNEL and agents
while on the premises or transportation, both of which are owned or controlled by HBP
(including but not limited to the WORKSITE). Further, HBP also reserves the right to
conduct alcohol and/or drug tests on SUBCONTRACTOR PERSONNEL and agents while
employed on HBP's WORK where reasonable cause exists. HBP may also conduct
unannounced periodic or random alcohol and/or drug tests, particularly in its job
categories where safety and security is crucial. Any person who refuses to cooperate with
any such search shall be relieved of his duties and not permitted to return, and such
person shall be replaced at the SUBCONTRACTOR’s sole cost and expense.
27.21 HBP and/or its authorized representative(s) shall have the right but not the obligation to
inspect all tools at any time during the progress of the WORK. If any tool or items is, in the
opinion of HBP and/or its authorized representative(s), unsafe or not suitable for doing the
WORK, the SUBCONTRACTOR shall repair or replace it with a safe and suitable tool or
item at the SUBCONTRACTOR's expense. The foregoing shall not relieve the
SUBCONTRACTOR of its responsibility for safety with regard to the use, conditions, and
the like, of tools.
27.22 Before commencing any hazardous work operations, the SUBCONTRACTOR shall
inspect the site and items involved to ensure the WORK will be performed under safe
conditions acceptable to HBP. The SUBCONTRACTOR shall verify that all procedures are
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adhered to prior to initiating any hazardous work.

27.23 The SUBCONTRACTOR shall have an accident and incident reporting procedure
which shall be compatible with HBP reporting procedures and any hazardous incident
involving HBP, the SUBCONTRACTOR, or any third party personnel, plant or items, shall
be immediately reported to HBP. Fatal accidents shall require a thorough investigation and
detailed report.
27.24 The SUBCONTRACTOR shall, at its own expense, provide adequate first aid
equipment, fire extinguishers and other safety equipment of approved types and amount,
as may be specified in connection with this SUBCONTRACT and shall maintain this
equipment in a professional manner as dictated by legal and industry standards. The
SUBCONTRACTOR shall keep up-to-date records of all said equipment.
27.25 The SUBCONTRACTOR shall allow the HBP REPRESENTATIVE(s) access at any
time to plant, equipment, personnel and records when requested, to enable HBP to
inspect or audit any aspect of the SUBCONTRACTOR's operations relevant to safety and
the work environment.
27.26 The SUBCONTRACTOR shall prepare and execute an accident prevention program for
HBP's approval. At regular intervals and at such lesser periods as is determined by HBP,
the SUBCONTRACTOR REPRESENTATIVE and the HBP REPRESENTATIVE shall
conduct safety inspections of the WORKSITE. The SUBCONTRACTOR shall promptly
conform with and promptly implement all recommendations made pursuant to said
inspections.
27.27 SUBCONTRACTOR shall under any circumstances dump, throw or dispose of any
refuse, debris or garbage into the surrounding areas. The SUBCONTRACTOR shall
provide containers in which all refuse is to be placed and shall dispose of such refuse in
accordance with existing laws and regulations and at no additional cost to HBP. The
SUBCONTRACTOR shall ensure that SUBCONTRACTOR PERSONNEL and their
employees, are fully aware of the above and SUBCONTRACTOR shall enforce such
regulations to the satisfaction of HBP. The SUBCONTRACTOR shall adhere to existing
Iraqi or other relevant statutory regulations concerning waste disposal or discharges
resulting from the performance of the WORK.
27.28 The SUBCONTRACTOR shall ensure that all its employees engaged in the WORK are
medically fit and healthy. Any medical disabilities including such disabilities which the
SUBCONTRACTOR may consider will not adversely influence the employee's ability to
perform his role in the WORK should be reported to HBP prior to the start of the WORK.
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The SUBCONTRACTOR, if requested by HBP, shall provide medical certificates for

SUBCONTRACTOR PERSONNEL.
27.29 The SUBCONTRACTOR shall pay due regard to the environment by acting to preserve
air, water, animal and plant life as well as any archaeological or paleontological artifacts or
items/areas of historical interest from adverse effect of the SUBCONTRACTOR's
activities, and to minimize any nuisance which may arise from such operation
28.0 Archaeological Objects
In the event that during the performance of the SUBCONTRACT WORK, archaeological
objects or similar objects of artistic, scientific or historical interest are discovered on or
around the Site, SUBCONTRACTOR shall immediately inform CONTRACTOR and any
government agency if required by law, and shall hand-over such object to CONTRACTOR.
SUBCONTRACTOR shall immediately, if so notified by CONTRACTOR, stop
SUBCONTRACT WORK until experts explore the Site. In and insofar as such stoppage
of SUBCONTRACT WORK amounts to suspension of the SUBCONTRACT WORK,
Clause 30 shall apply.
29.0 CONTRACTOR’s Right to Occupy

The CONTRACTOR reserve the right to occupy or use any portion of the
SUBCONTRACT WORK before it has been completed, with the understanding that such
occupancy or use shall in no way constitute FINAL ACCEPTANCE of the SUBCONTRACT
WORK in whole or in part, or any work performed under this SUBCONTRACT.
30.0 Suspension
30.1 The CONTRACTOR’s representative may suspend performance of all or any part of the
SUBCONTRACT WORK by an order (herein called a “Suspension Order”) given to the
subcontractor in writing and the subcontractor shall thereupon do so until ordered to
resume performance by the CONTRACTOR’s representative. A Suspension Order shall
be final, conclusive and binding on the SUBCONTRACTOR.
30.2 If SUBCONTRACTOR is delayed in the performance of any of his obligations under the
SUBCONTRACT by any Suspension Order given by the CONTRACTOR’s representative,
there shall be no addition cost as a result of such order shall be paid to
SUBCONTRACTOR.
30.3 If by virtue of any Suspension Order, other than by reason of SUBCONTRACTOR’s
default, SUBCONTRACTOR’s performance of any of his obligations is suspended for a
continuous period of ninety (90) days, then at any time thereafter and provided that such
performance is still suspended, the SUBCONTRACTOR may give notice to the
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CONTRACTOR’s representative and to CONTRACTOR requiring that the

CONTRACTOR’s representative shall within fourteen (14) days of such notice either
withdraw the Suspension Order and instruct SUBCONTRACTOR to resume such
performance, or issue a Change order.
30.4 If the CONTRACTOR’s representative withdraws any Suspension Order, then the
approved schedule and completion date shall be extended by the full period of suspension
plus any reasonable additional time incurred by the SUBCONTRACTOR to re-establish
the activities of his own staff and labor.
31.0 Optional Termination
31.1 The CONTRACTOR may at any time by written order (herein called a Termination Order)
to the SUBCONTRACTOR to cease the further carrying out of the SUBCONTRACT
WORK. The SUBCONTRACTOR shall upon receipt of the Termination Order cease the
carrying out of the whole or part of SUBCONTRACT WORK which is stipulated in said
order.
31.2 As soon as practicable after receipt of the Termination Order, the SUBCONTRACTOR
shall in particular:
(1) Secure the cessation of work in accordance with and subject to the instruction.
(2) If so required by the CONTRACTOR, assign to the CONTRACTOR any subcontract
designated by the CONTRACTOR in preference to canceling or terminating it.
31.3 Upon receipt of the Termination Order or on such later date as may be specified in the
Termination Order, the SUBCONTRACTOR shall assign to the CONTRACTOR all or any
rights and titles held by the SUBCONTRACTOR relating to SUBCONTRACTOR materials
and the SUBCONTRACT WORK together with the obligations connected therein. The
SUBCONTRACTOR shall also deliver to the CONTRACTOR all plans, schedules and
documentation and other data prepared by the SUBCONTRACTOR in connection with the
SUBCONTRACT WORK and all documentation supplied to the SUBCONTRACTOR by or
on behalf of the CONTRACTOR in connection with the SUBCONTRACT WORK.
31.4 Within ninety (90) days of the SUBCONTRACTOR’s withdrawal from the Site, or if the
SUBCONTRACTOR has not entered the Site before receipt of the Termination Order, then
within ninety (90) days of his receipt of the Termination Order, the CONTRACTOR’s
representative shall issue to the SUBCONTRACTOR a certificate (a Termination
Certificate) which shall state:
(1) The amount (if any) due to the SUBCONTRACTOR under the SUBCONTRACT for
the SUBCONTRACT WORK carried out prior to the receipt by the
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SUBCONTRACTOR of the Termination Order.

(2) The amount due to any third party in respect of which the SUBCONTRACTOR has
properly and irrevocably entered into a commitment relating directly to the
SUBCONTRACT; and
(3) The amount of any additional cost properly incurred by the SUBCONTRACTOR for
any work in connection with the termination authorized by the CONTRACTOR’s
representative.
31.5 For any part of the SUBCONTRACT WORK so terminated, the applicable provisions of
the SUBCONTRACT shall continue in full force and effect as all SUBCONTRACT WORK
performed prior to the effective date of termination. For the remainder of the
SUBCONTRACT WORK, the SUBCONTRACT shall remain in full force and effect.
32.0 Termination for Default
32.1 If the SUBCONTRACTOR is in default in that he:
(1) wholly suspends or abandons the carrying out of the SUBCONTRACT WORK before
completion thereof;
(2) Fails to proceed regularly and diligently with the SUBCONTRACT WORK or fails to
commence and diligently pursue the rectification of the default
(3) Commits any other material breach of the SUBCONTRACT; or
(4) Goes into liquidation or receive an administration order from court.
(5) Unable to coordinate with local people and authorities and work..
SUBCONTRACTOR fails to rectify his act stated in a, b of this clause after receipt of
notification within a period of fourteen (14) days. Then, without prejudice to any other
rights or remedies which the CONTRACTOR may possess, the CONTRACTOR may
notify the SUBCONTRACTOR of such default and terminate the SUBCONTRACT by
notice.
32.2 Notwithstanding any disagreement, dispute, protest, or legal proceeding arising
out of or in connection with the SUBCONTRACT or its performance at all times, the
SUBCONTRACTOR shall proceed with the Work unless the Main CONTRACTOR
otherwise agrees in writing. If the SUBCONTRACTOR fails to proceed with the Work, it
shall be considered to be in default of the SUBCONTRACT.
32.3 Upon termination of the SUBCONTRACTOR’s employment:
(1) The SUBCONTRACTOR shall, when so required by the CONTRACTOR, forthwith
deliver the CONTRACTOR all confidential information together with all documentation
and technical information prepared by the SUBCONTRACTOR pursuant to the
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provision of the SUBCONTRACT; and

(2) The SUBCONTRACTOR shall, when so required by the CONTRACTOR, assign to
the CONTRACTOR all his rights under any subcontracts including the sub-
subcontract, purchase orders and agreements entered into in connection with the
SUBCONTRACT WORK. SUBCONTRACTOR shall incorporate the right to make
such assignments into all its sub-subcontracts, purchase orders and agreements.
32.4 Upon termination of the SUBCONTRACTOR’s employment under this clause, the
CONTRACTOR shall have no obligation to make any further payment beyond that already
certified by the CONTRACTOR’s representative.
32.5 For any part of the SUBCONTRACT WORK on which the SUBCONTRACTOR’s
right to proceed has been terminated under this clause, the applicable provisions of the
SUBCONTRACT shall continue in full force and effect as all SUBCONTRACT WORK
performed prior to the effective date of termination. For the remainder of the
SUBCONTRACT WORK, the SUBCONTRACT shall remain in full force and effect.
32.6 In the construction period, if the land owner stop the work more than three(3)
days, CONTRACTOR have the right to terminate solely the contract with
SUBCONTRACTOR, CONTRACTOR have the right to choose other SUBCONTRACTOR
complete the work in this contract. If terminate the contract, CONTRACTOR have the right
not pay the payment of unsettled funds.
33.0 Non-Waiver
None of the provisions of the SUBCONTRACT shall be considered waiver by the
CONTRACTOR or the SUBCONTRACTOR except when expressly made in writing. None
such waiver shall be or be constructed to be, a waiver of any past or future default, breach
or modification of any of the terms, provisions, conditions or covenants of the
SUBCONTRACT except as expressly stated in such waiver.
34.0 Coordination and Notices
34.1 The SUBCONTRACTOR shall perform his works directly under the control and
supervision of CONTRACTOR. The SUBCONTRACTOR shall prepare and submit a
Project Coordination Procedure to CONTRACTOR for review and approval. All
information, letters, drawings and documentation to or from the EMPLOYER shall be
through CONTRACTOR. The SUBCONTRACTOR shall not contact the EMPLOYER
directly.
34.2 The SUBCONTRACTOR shall review and/or provide information required by other
contractors in a timely and accurate manner and requested by EMPLOYER, as applicable,
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any information about such work that may be required by CONTRACTOR to perform the
SUBCONTRACT WORK.
34.3 All approvals, requests and notices required herein shall be sent to the respective Party at
the address indicated below:
TO HBP:
China Oil HBP Science & Technology Co; Ltd Iraq Branch
Address: Bloc.23, St.19, Sec 213, Al Kindi Area, Baghdad
Contact Person: Yu Ran
Position: Project Manager
Tel.: +971 522548277
E-mail: yr@china-hbp.com
TO SUBCONTRACTOR:
Subcontractor.
Address: ……
Contract Person: ……
Mobile: …….
E-mail: …….
34.4 All approvals, requests and notices required herein shall be given or made by handwritten
or printed documentation including, but not limited to, faxes, e-mail, and similar forms of
written communication and shall be deemed to have been properly given or made if given
to either SUBCONTRACTOR or CONTRACTOR, as applicable, or if sent prepaid to the
other respective Party at the address stated above. Notices or instructions shall be
deemed to have been received at the time of:
(1)Delivery if delivered by hand.
(2)Transmission if sent by fax.
(3)Receipt or recorded delivery if sent by courier service; and
(4)Receipt if sent by e-mail.

Section
Terms and
34.5 If the time of such deemed receipt is not customary hours of business at the receiving
location, notice shall be deemed to have been received at 10.00 a.m. on the first
customary day of business thereafter at the receiving location.
35.0 Governing Laws and Arbitration

Governing Law
35.1 This SUBCONTRACT shall be governed by and construed exclusively in accordance

with the laws of People Republic of China (PRC) as amended, modified, re-certified or
reenacted, excluding any choice of law rules that would refer the matter to the laws of
another jurisdiction. For the avoidance of doubt, a person who is not a Party to this
SUBCONTRACT shall have no right under the any law to enforce any terms of this
SUBCONTRACT, notwithstanding that any such term may purport to confer or may confer
or may be construed as conferring a benefit on such third party.
35.2 Any dispute, controversy or claim arising out of or in connection with this
SUBCONTRACT, whether in delict, contract, under statute or otherwise, including any
question regarding its existence, validity, interpretation, breach or termination, shall be
subject to amicable negotiations between the Parties. If such negotiations fail to
resolve the dispute within thirty (30) days of such dispute arising, the dispute shall be
finally and exclusively resolved by arbitration under the effective arbitration rules of
China International Economic and Trade Arbitration Commission (CIETAC). The place
of Arbitration shall be in Beijing-China.
Section
Terms and
36.0
Related issues under the Contract

36.1 The SUBCONTRACTOR shall cooperate with and assist the CONTRACTOR to
such extent as is reasonable in the preparation and submission of information in
support of claims under the CONTRACT when such claims touch or concern
matters which are the subject of claims under the SUBCONTRACT.

36.2 The SUBCONTRACTOR shall be deemed to know the provisions of the
CONTRACT in so far as they apply to the SUBCONTRACT WORK. The
CONTRACTOR shall, if requested by the SUBCONTRACTOR, provide to the
SUBCONTRACTOR a copy of related part of the Main CONTRACT.

36.3 To the extent that obligations and liabilities related to the SUBCONTRACT, the
SUBCONTRACTOR shall perform the obligations and assume the liabilities of the
CONTRACTOR under the Main CONTRACT.

37.0
LOCAL CONTENT
37.1 In the procurement of GOODS and services required for the WORK, the
SUBCONTRACTOR shall, to the extent that it is technically and economically
practicable, utilize Iraqi companies and shall use its best endeavours to employ
suitable and qualified Iraqi personnel in the WORK.

37.2 The SUBCONTRACTOR shall, unless otherwise approved by PCIHBV:
(1)
give priority to hiring Iraqi personnel for the performance of the WORK, particularly
to residents of the GARRAF CONTRACT AREA;

(2)
give priority to Iraqi-manufactured goods in the purchase of items, tools, equipment,
facilities, goods, materials, and supplies required for the performance of the
WORK;
(3)
Section
Terms and
give priority to Iraqi suppliers or manufacturers for GOODS and services required
for the performance of the WORK; and

(4)
give priority to services and research facilities, professional or otherwise, which are
rendered by Iraqis or firms or companies incorporated or licensed in the
Republic of Iraq on the understanding that it is technically and economically
practicable to give such priority.

37.3 In determining what is "technically and economically practicable", the following
shall be considered:
(1)
conformity of the GOODS and services to acceptable technical and safety
standards ;
(2)
availability of the GOODS and services in required quantities and within the
applicable periods;
(3)
acceptability of the terms and conditions of supply, including maintenance,
servicing, availability of spare parts; and

(4)
Competitiveness of prices and costs.

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CHINA OIL HBP SCIENCE & TECHNOLOGY CORPORATION LTD.

CHINA OIL HBP SCIENCE & TECHNOLOGY CORPORATION LTD

CONSTRUCTION OF OFFICE FOR HBP CAMP

This SUBCONTRACT AGREEMENT is made on …………. (“EFFECTIVE DATE”) by and

I. HBP is engaged in the Engineering, Procurement, Construction and Commissioning

(a) This SUBCONTRACT AGREEMENT.

(b) Terms and Conditions of SUBCONTRACT.

(c) Clarifications and Minutes of Meetings between both parties.

(d) The Exhibits:

Exhibit I Scope of Work

The documents forming the SUBCONTRACT are to be taken as mutually explanatory of

3. In consideration of the payment to be made by the Party C to the SUBCONTRACTOR,

4. In consideration of the execution and satisfactory completion of the WORK by the

For and on behalf of

For and on behalf of

For and on behalf of

TERMS AND CONDITIONS OF SUBCONTRACT

1.0 Definitions and Interpretation

‘PROJECT’ means the Engineering, Procurement, Construction and Commissioning

4.0 Scope of SUBCONTRACT WORK, Drawings, Specification and Standards

5.0 SUBCONTRACTOR’s Responsibilities

5.14 SUBCONTRACTOR will be responsible for providing security protecting for

13.0 Inspection and Testing

13.2 The CONTRACTOR’s representative shall have the right to at all

13.3 Inspection or witnessing by the CONTRACTOR, or failure to

14.0 Acceptance of the SUBCONTRACT WORK

14.2 If the SUBCONTRACT WORK is not considered to be

ACCEPTANCE CERTIFICATE issued by CONTRACTOR. From the date of FINAL

15.0 Warranty Period and Final Acceptance

a third party. The cost occurred as results of these remedies shall be on

(2) All defect items have been completed to CONTRACTOR’s satisfaction.

17.0 Price and Terms of Payment

precondition to any payment by Party C to SUBCONTRACTOR:

Bank Name: ………………..

Bank Address: ……………………

Account No: ………………

Swift Code: …………….

IBAN USD: ………………..

18.0 Taxes, Duties and Permits

Party C shall remit the amount of money so withheld to the GCT.

()2 Workmen’s Compensation and / or similar statutory social insurance, as required by

19.2 SUBCONTRACTOR shall cause CONTRACTOR to be included

19.3 All premiums, deductibles, exceptions and exclusions applicable

19.4 SUBCONTRACTOR shall furnish CONTRACTOR with certified

documents shall be furnished to CONTRACTOR as and when requested by

19.5 SUBCONTRACTOR shall notify CONTRACTOR immediately

19.6 The amounts of SUBCONTRACTOR furnished insurance called

19.7 SUBCONTRACTOR shall not commence the SUBCONTRACT

20.0 Performance Bond/Performance Guarantee

disease or death of any of the employees or hired personnel of SUBCONTRACTOR or

25.0 Force Majeure

(3) any event caused by the negligence of SUBCONTRACTOR’s personnel.

Notwithstanding anything contained in this clause, lack of finances shall not be

26.0 Confidentiality and Ownership of Documents

permission to resume or commence the WORK. Any costs incurred by the

3. In case of property damage or environmental pollution, in addition to the fine, the

adhered to prior to initiating any hazardous work.

The SUBCONTRACTOR, if requested by HBP, shall provide medical certificates for

29.0 CONTRACTOR’s Right to Occupy

CONTRACTOR’s representative and to CONTRACTOR requiring that the

SUBCONTRACTOR of the Termination Order.

provision of the SUBCONTRACT; and