Common use of Entrustment Agreements Clause in Contracts

Entrustment Agreements. The Government and the Company entered into an entrustment agreement for the design of and site investigation and procurement activities in relation to the HSR in 2008 (the “HSR Preliminary Entrustment Agreement”) and another entrustment agreement for the construction, and commissioning of the HSR in 2010 (the “HSR Entrustment Agreement”) (together, the “Entrustment Agreements”). Pursuant to the HSR Preliminary Entrustment Agreement, the Government is obligated to pay the Company the Company’s in-house design costs and certain on-costs, preliminary costs and staff costs. Pursuant to the HSR Entrustment Agreement, the Company is responsible for carrying out or procuring the carrying out of the agreed activities for the planning, design, construction, testing and commissioning of the HSR and the Government, as owner of HSR, is responsible for bearing and financing the full amount of the total cost of such activities (the “Entrustment Cost”) and for paying to the Company a fee in accordance with an agreed payment schedule (the “HSR Project Management Fee”) (subsequent amendments to these arrangements are described below). The Government has the right to claim against the Company if the Company breaches the HSR Entrustment Agreement (including, if the Company breaches the warranties it gave in respect of its project management services) and, under the HSR Entrustment Agreement, to be indemnified by the Company in relation to losses suffered by the Government as a result of any negligence of the Company in performing its obligations under the HSR Entrustment Agreement or any breach of the HSR Entrustment Agreement by the Company. Under the HSR Entrustment Agreement, the Company’s total aggregate liability to the Government arising out of or in connection with the Entrustment Agreements (other than for death or personal injury) is subject to a cap equal to the total of HSR Project Management Fee and any other fees that the Company receives under the HSR Entrustment Agreement and certain fees received by the Company under the HSR Preliminary Entrustment Agreement (the “Liability Cap”). In accordance with general principles of law, such Liability Cap could not be relied upon if the Company were found to be liable for the fraudulent or other dishonest conduct of its employees or agents, to the extent that the relevant loss had been caused by such fraudulent or other dishonest conduct. Although the Government has reserved the right to refer to arbitration the question of the Company’s liability for the Current Cost Overrun (as defined hereunder) (if any) under the Entrustment Agreements (as more particularly described in paragraph (b)(v) below), up to the date of the interim financial report, no claim has been received from the Government.

Entrustment Agreements. The Government and the Company entered into an entrustment agreement for the design of and site investigation and procurement activities in relation to the HSR in 2008 (the “HSR Preliminary Entrustment Agreement”) and another entrustment agreement for the construction, and commissioning of the HSR in 2010 (the “HSR Entrustment Agreement”) (together, the “Entrustment Agreements”). Pursuant to the HSR Preliminary Entrustment Agreement, the Government is obligated to pay the Company the Company’s in-house design costs and certain on-costs, preliminary costs and staff costs. Pursuant to the HSR Entrustment Agreement, the Company is responsible for carrying out or procuring the carrying out of the agreed activities for the planning, design, construction, testing and commissioning of the HSR and the Government, as owner of HSR, is responsible for bearing and financing the full amount of the total cost of such activities (the “Entrustment Cost”) and for paying to the Company a fee in accordance with an agreed payment schedule (the “HSR Project Management Fee”) (subsequent amendments to these arrangements are described below). The Government has the right to claim against the Company if the Company breaches the HSR Entrustment Agreement (including, if the Company breaches the warranties it gave in respect of its project management services) and, under the HSR Entrustment Agreement, to be indemnified by the Company in relation to losses suffered by the Government as a result of any negligence of the Company in performing its obligations under the HSR Entrustment Agreement or any breach of the HSR Entrustment Agreement by the Company. Under the HSR Entrustment Agreement, the Company’s total aggregate liability to the Government arising out of or in connection with the Entrustment Agreements (other than for death or personal injury) is subject to a cap equal to the total of HSR Project Management Fee and any other fees that the Company receives under the HSR Entrustment Agreement and certain fees received by the Company under the HSR Preliminary Entrustment Agreement (the “Liability Cap”). In accordance with general principles of law, such Liability Cap could not be relied upon if the Company were found to be liable for the fraudulent or other dishonest conduct of its employees or agents, to the extent that the relevant loss had been caused by such fraudulent or other dishonest conduct. Although the Government has reserved the right to refer to arbitration the question of the Company’s liability for the Current Cost Overrun (as defined hereunder) (if any) under the Entrustment Agreements (as more particularly described in paragraph (b)(v) below), up to the date of the interim financial report, no formal claim has been received from the Government. The Government has informed the Company of a number of areas of interest to it arising out of the Company’s performance under the Entrustment Agreements (“Areas of Interest”) for which the Government is seeking further information and explanations from the Company. The Company is in the process of reviewing such Areas of Interest and will, following such review, enter into a dialogue with the Government with a view to addressing such Government Areas of Interest.