Exhibit 4.26
MASTER PROCUREMENT PARTNERSHIP AGREEMENT
NO.K.TEL.34/HK.910/UTA-00//2003
BETWEEN
PERUSAHAAN PERSEROAN (PERSERO)
PT TELEKOMUNIKASI INDONESIA, TBK.
AND
MOTOROLA, INC.
DATED MARCH 24, 2003
TABLE OF CONTENTS
CHAPTER 1. GENERAL TERMS AND CONDITIONS........................................................... 2
Article 1. Definitions............................................................................ 2
Article 2. Commencement and Duration of Agreement................................................. 11
Article 3. Project Description.................................................................... 12
Article 4. Scope of Work and Deliverables......................................................... 13
Article 5. Procurement Partnering Covenants....................................................... 15
Article 6. Importation; Local Facilities; Compliance with Licenses and Permits.................... 18
Article 7. Delivery Procedures.................................................................... 20
Article 8. Intellectual and Industrial Property Rights............................................ 22
Article 9. Force Majeure.......................................................................... 26
Article 10. Transfer of Risk and Title............................................................. 27
Article 11. Indemnification........................................................................ 28
Article 12. Equipment Maintenance and Support...................................................... 31
Article 13. Liquidated Damages for Delay........................................................... 32
Article 14. Termination of the Agreement........................................................... 34
Article 15. Governing Law.......................................................................... 38
Article 16. Settlement of Disputes................................................................. 38
Article 17. Language............................................................................... 41
Article 18. Corporate Representations and Warranties............................................... 42
Article 19. Confidential Information............................................................... 42
Article 20. Notice................................................................................. 43
Article 21. General Provisions..................................................................... 44
Article 22. Contract Value......................................................................... 47
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Article 23. Prices, Fees.............................................. 47
Article 24. Taxes and Duties.......................................... 49
Article 25. Insurance and Safety...................................... 49
CHAPTER 3. FINANCIAL TERMS AND PAYG.................................. 51
Article 26. Joint Planning Sessions, Design Review Meetings and
Monthly Meetings.......................................... 51
Article 27. Installed Line Procurements............................... 60
Article 28. Purchase Orders and Procedures............................ 61
Article 29. Performance Bond.......................................... 65
Article 30. Termination of Purchase Orders............................ 66
Article 31. Terms of Payment.......................................... 71
Article 32. PAYG Payments............................................. 74
Article 33. General Services Payments................................. 79
Article 34. Invoicing................................................. 80
Article 35. Financing................................................. 81
Article 36. Change Request Procedures................................. 81
Article 37. Relocation of Equipment................................... 83
Article 38. Details of PARTNER's Bank Accounts........................ 84
CHAPTER 4. PROJECT ORGANIZATIONAL MATTERS............................ 84
Article 39. Local Indonesian Entities, Subcontractors, Suppliers...... 84
Article 40. Assignment and Subcontracting............................. 85
Article 41. Involvement of Local Entities............................. 87
Article 42. Logistics................................................. 88
Article 43. Inventory................................................. 89
Article 44. Local Support Infrastructure.............................. 91
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Article 45. Project Management...................................... 91
Article 46. Research and Development................................ 95
Article 47. Training, Transfer of Know How.......................... 95
Article 48. Management Forum........................................ 99
Article 49. Development of Indonesian Industry...................... 99
CHAPTER 5. TECHNICAL PROVISIONS.................................... 99
Article 50. General Requirement for Equipment....................... 99
Article 51. Quality Assurance....................................... 101
Article 52. Survey, Design, and Planning............................ 101
Article 53. Site Preparation, Acquisition, Rights of Way and Permits 103
Article 54. Installation Procedures and Standards................... 104
Article 55. Testing and Commissioning............................... 106
Article 56. Integration, Inter-Operability and Compatibility........ 115
Article 57. Cut Over Procedures..................................... 116
Article 58. Compliance with Environmental Standards................. 117
Article 59. Development of Mediation Device......................... 118
Article 60. Documentation........................................... 118
CHAPTER 6. SERVICE LEVEL AGREEMENTS................................ 122
Article 61. Service Level Agreements................................ 122
CHAPTER 7. INTER-OPERABILITY AND CO-ORDINATION REQUIREMENTS FOR
PACKAGE 1 (MODULE 1) (DIVRE 1).......................... 122
Article 62. General................................................. 122
Article 63. JPS, DRMs and monthly meetings.......................... 124
Article 64. Commissioning Tests..................................... 125
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APPENDICES
Appendix 1 Details of Local Partners/Suppliers/Subcontractors
Appendix 2 [not used]
Appendix 3 Scope of Work
Appendix 4 Price Schedule
Appendix 5 Technical Specifications
Appendix 6 Demand Forecast
Appendix 7 Deployment Plan
Appendix 8 Project Management Plan
Appendix 9 Implementation Schedule
Appendix 10 Local Infrastructure
Appendix 11 Pay As You Grow (PAYG)
Appendix 12 Purchase Orders
Appendix 13 Xxxx of Quantities
Appendix 14 Technical and Engineering Norms
Appendix 15 [not used]
Appendix 16 Project Schematic
Appendix 17 Quality Assurance Guidelines/Acceptance Test Procedures
Appendix 18 Change Request
Appendix 19 Training
Appendix 20 Service Level Agreement
Appendix 21 Inter-Operability Commitment Agreement
Appendix 22 Documentation
Appendix 23 Technical Terms
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Appendix 24 Non-Disclosure Agreement
Appendix 25 Performance Bond
Appendix 26 Software License
Appendix 27 Bank Guarantee
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MASTER PROCUREMENT PARTNERSHIP
AGREEMENT
NO.K.TEL.34/HK.910/UTA-00//2003,
24 MARCH 2003
THIS MASTER PROCUREMENT PARTNERSHIP AGREEMENT (the "Agreement") is made as of 24
March 2003
BETWEEN:
(1) PERUSAHAAN PERSEROAN (PERSERO) PT TELEKOMUNIKASI INDONESIA, TBK., a
limited liability public State-owned company established under the laws
of the Republic of Indonesia, having its head office at Jalan Japati
No. 1, Bandung, in this legal action duly represented by Kristiono in
his capacity as President Director, hereinafter referred to as
"TELKOM";
and
(2) MOTOROLA, INC., a corporation established under the laws of the State
of Delaware, U.S.A., by and acting through its Global Telecom Solutions
Sector, having offices at 0000 Xxxxx Xxxxx, Xxxxxxxxx Xxxxxxx, XX00000,
U.S.A., for the purpose of signing of this Agreement being duly
represented by Xxxxx Ma, in his capacity as Vice President & General
Manager, Asia, hereinafter referred to as "PARTNER".
(TELKOM and PARTNER are individually hereinafter referred to as a "Party" and
collectively as the "Parties").
WHEREAS
(A) TELKOM is a telecommunications network and service provider which
provides fixed telecommunications services (fixed wireline and fixed
wireless) and telecommunications infrastructure throughout Indonesia;
(B) TELKOM has embarked on a significant investment program to modernize
and expand its network infrastructure (the "T-21 Program");
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(C) PARTNER, the BSS supplier and turnkey contractor for DIVRE 1 and
proposing to develop contractual relationships with a number of local
subcontractors/suppliers each with specialized telecommunications
expertise, knowledge or infrastructure, has the necessary technical
expertise, financial resources and strategic business interest in
establishing a long term business partnership with TELKOM for the
procurement of core network assets contemplated in the T-21 Program.
Details of each of the local subcontractors/suppliers involved with
PARTNER in this Project are set out in Appendix 1;
(D) TELKOM, in accordance with the procedures established in the RfP dated
21 February 2002 has selected and appointed PARTNER as the leading
technology supplier to enter into this Agreement for the purpose of
implementing the T-21 Program in accordance with the terms and
conditions set out on this Agreement.
CHAPTER 1.
GENERAL TERMS AND CONDITIONS
ARTICLE 1. DEFINITIONS
1.1 Where the context permits, the following expressions shall have the
following meanings:
"AGREEMENT" means this Agreement and the Appendices, including any
amendments thereto;
"BASELINE XXXX OF QUANTITIES" ("BoQ") means the baseline xxxx of
quantities set out in Appendix 13, as may be modified from time to time
in accordance with Articles 26 and 36;
"BUSINESS DAY(S)" means a day, other than a Saturday, Sunday or
official Indonesian holiday, on which commercial banks in Jakarta are
open for business during normal working hours;
"CHANGE REQUEST" means the forms attached as Appendix 18, which in
accordance with Article 36 shall be used to make any and all
amendments, among others, to the contents of a Purchase Order;
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"COMMISSIONING" means the successful testing, integration and
acceptance testing of the Deliverables in a state ready for full
commercial operation by PARTNER as certified by TELKOM's issuance of
either an Integrated System Acceptance Test Certificate or a Partial
Integrated System Acceptance Test Certificate in accordance with the
terms of this Agreement. "Commission" or "Commissioned" shall be
construed accordingly;
"CONTRACT VALUE" means with respect to the overall value of the
procurement contract contemplated by this Agreement, the sum of all of
the Purchase Orders and with respect to each Purchase Order, the total
payment (in USD and IDR as the case may be) to be made by TELKOM to
PARTNER under each Purchase Order for all Deliverables to be supplied
under the said Purchase Order(s) and for the full and diligent
performance by PARTNER of all of its obligations and covenants under
this Agreement, including all amounts payable to PARTNER for use or
license rights to software and Documentation, and for costs of
insurance, freight and all other costs specified by this Agreement,
subject to any variations expressly permitted under this Agreement or
the respective Purchase Order(s);
"CUT OVER PERIOD" means the time period set forth in Article 57.2;
"DELIVERABLES" means the equipment, components, software and
Documentation to be delivered and all related services to be performed
by PARTNER pursuant to Purchase Order(s);
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"DEMAND FORECAST" means the demand forecast set out in Appendix 6 as
updated from time to time by the Parties during a JPS or DRM;
"DESIGN REVIEW MEETING" ("DRM") means a design review meeting conducted
in accordance with Article 26.2;
"DEPLOYMENT PLAN" means the number of installed lines/subscriber
targets that are projected to be deployed in each year based on
subscriber targets as set out in Appendix 7, as may be amended from
time to time in accordance with Article 26 and this Agreement;
"DIVRE" means a TELKOM Regional Division and "DIVRE 1" means the
TELKOM Regional Division for Sumatra;
"DOCUMENTATION" means the documentation listed in Appendix 22;
"DOCUMENTATION ACCEPTANCE CERTIFICATE" means the certificate signed by
TELKOM indicating that it is satisfied the documentation provided by
PARTNER complies with the requirements of this Agreement;
"FISCAL YEAR" means the financial year of TELKOM commencing January 1
and ending December 31 of each calendar year;
"GOODS DELIVERY CERTIFICATE" means the certificate signed by TELKOM
indicating that the goods as delivered by PARTNER have been checked and
inspected by TELKOM in accordance with Article 7.3;
"IMPLEMENTATION SCHEDULE" means the time schedule and milestones set
out in Appendix 9 as amended from time to time in accordance with
Article 26;
"INSTALLED LINE PROCUREMENTS" means the number of installed lines that
will be procured by TELKOM as agreed by the Parties in accordance with
the flexible procurement methodology contemplated in Article 27;
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"INTEGRATED SYSTEM ACCEPTANCE TEST" or "ISAT" means the integrated
system test to be performed upon completion of all Sub-systems and
other tests (including tests on measuring equipment and spare parts),
in accordance with Article 55 and Appendix 17 (Quality Assurance
Guidelines/ Acceptance Test Procedures);
"INTEGRATED SYSTEM ACCEPTANCE TEST CERTIFICATE" means the acceptance
certificate to be issued and signed by TELKOM after successful
completion of an Integrated System Acceptance Test or as otherwise
issued in accordance with Article 55.8.9;
"INTELLECTUAL PROPERTY RIGHTS" means patents, registered designs,
designs, copyrights, semiconductor mask works, and other forms of
intellectual or industrial property, know-how, inventions, formulae,
confidential or secret processes, trade secrets and confidential
information, and any other protected rights and assets, and any
licenses and permits in connection therewith, in each case in any part
of the world and whether or not registered or registerable and for the
full period thereof and all extensions and renewals thereof, and all
applications for registration in connection with the foregoing;
"IOP AGREEMENT" means the Inter-Operability Commitment Agreement
attached as Appendix 21;
"IOP CERTIFICATE" means the certificate or statement issued and signed
by TELKOM confirming that PARTNER's equipment has passed all required
inter-operability tests in accordance with IOP Agreement;
"JOINT PLANNING SESSION" ("JPS") means a joint planning session to be
conducted in accordance with Article 26.1;
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"LOCAL CONTENT" means the equipment and services to be provided through
Local Indonesian Entities in the Indonesian currency (IDR) amounting to
at least 20% of the total Contract Value in accordance with Article 41;
"LOCAL INDONESIAN ENTITIES" means individuals that are Indonesian
nationals, proprietary concerns or partnerships owned by Indonesian
nationals, or companies in which Indonesian nationals hold more than
51% shares. Subsidiaries of international companies, their
representative offices and agencies or agents operating in Indonesia
will not be considered as "Local Indonesian Entities" for this purpose;
"LOCATION" means a location within a Project area relating to a TELKOM
PSTN switch (STO);
"NETWORK" means the telecommunications network/system to be designed,
built and supplied by PARTNER pursuant to this Agreement, more
particularly described in Appendix 3 (Scope of Work);
"PACKAGE 1 (MODULE 1)" means the regional package of BSS procurement
for DIVRE I;
"PACKAGE LEVEL REQUIREMENT" means the constituent requirements of
Package 1 (Module 1);
"PARTIAL INTEGRATED SYSTEM ACCEPTANCE TEST" means the integrated system
test to be performed upon completion of one or more Sub-systems and
other tests (including tests on measuring equipment and spare parts),
in accordance with Article 55 and Appendix 17) (Quality Assurance
Guidelines/ Acceptance Test Procedures);
"PARTIAL INTEGRATED SYSTEM ACCEPTANCE TEST CERTIFICATE" means the
acceptance certificate to be issued and signed by TELKOM after
successful completion of a Sub-system Acceptance Test pursuant to
Article 55.8 for which an Integrated System Acceptance Test cannot be
conducted within a period of thirty (30) calendar days by reason of
delays in testing of a Sub-system which TELKOM is responsible to
provide;
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"PAYG PAYMENT PERIOD" means a period calculated in relation to the
Purchase Orders aggregated on a DIVRE basis in the same Quarter, such
period commencing from the last date of the Quarter in which the
relevant Integrated System Acceptance Test Certificate issued by TELKOM
in relation to Commissioning of the Deliverables in the relevant
Purchase Order(s) issued in that Quarter and ending four (4) years
later, or upon TELKOM'S payment of the last PAYG payment due (of the
last Purchase Order issued), if earlier;
"PAYG VALUE" means the proportionate value of each Purchase Order
payable pursuant to Article 31.4;
"PERCENTAGE INDEX" means the index expressed as a percentage calculated
in accordance with Article 27.4;
"PERFORMANCE BOND" means the performance bond required to be delivered
by PARTNER to TELKOM pursuant to Article 29;
"PROJECT MANAGEMENT PLAN" ("PMP") means the project management plan to
be provided by PARTNER pursuant to Appendix 8;
"PROJECT" means the work to be undertaken by PARTNER for Package 1
(Module 1) of the T-21 Program pursuant to this Agreement for the
regional package of BSS procurement for DIVRE I;.
"PURCHASE ORDER" means a document issued by TELKOM from time to time
pursuant to Article 28 and acknowledged by PARTNER for the
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supply and Commissioning by PARTNER of all or parts of the Network
and/or for the provision of services. Any attachments or appendices to a
Purchase Order and any amendments to a Purchase Order in accordance with
Article 36 shall form an integral part of the Purchase Order;
"QUARTER" means a calendar three month period, ending on March 31, June
30, September 30, and December 31 of each calendar year;
"RfP" means the Request for Proposals for the T-21 Program dated 21
February 2002;
"SCOPE OF WORK" means the scope of work set forth in Appendix 3;
"SITE" means site within a Location where a BTS is to be installed;
"SLA" or "SERVICE LEVEL AGREEMENT" means the 3-year service level
agreement to be entered into between the Parties on Commissioning as set
forth in Article 61;
"SUBSCRIBER RECORDER" means TELKOM's database system in the MSC/NSS in
the related DIVRE;
"SUBSCRIBER TARGET" means projected portion of the number of lines to be
deployed on an annual basis in the DIVRE/Location for the relevant
Quarter based on the Deployment Plan as updated and determined at the
related DRM in relation to the Installed Line Procurements agreed for
the DIVRE/Location in the relevant Quarter;
"SUB-SYSTEM" means a BSC, BTS, transmission equipment, BSS NEM
(equipment grouped as BSS); PDSN, AAA, HA, DNS, Fire wall, PDN's NEM
(equipment grouped as PDN), and other similar or related equipment
supplied by the PARTNER, including all associated software and
components;
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"SYSTEM" means two or more Sub-systems forming a network that is ready
for commercial service;
"SUB-SYSTEM ACCEPTANCE TESTS" means the tests to be performed upon
completion of particular Sub-systems in accordance with Appendix 17;
"TECHNICAL SPECIFICATIONS" means collectively, the technical
specifications set out in Appendix 5, and the respective manufacturer's
current published specifications and all specifications agreed pursuant
to amendments to Agreement or on a Purchase Order;
"TRAINING ACCEPTANCE CERTIFICATE" means the certificate signed by TELKOM
indicating that the training provided by PARTNER complies with the
requirements of this Agreement;
1.2 Technical Terms. Technical terms used in this Agreement (e.g., BTS,
PDN) are defined in Appendix 23.
1.3 Writings. References in this Agreement to writings shall include
typewriting, printing, lithography, photography, telefax, facsimile,
e-mail and telex messages and any mode of reproducing words in a legible
and non-transitory form.
1.4 Plural; Gender; Persons. Words importing the singular include the
plural and vice versa; words importing a gender include every gender;
and references to persons include bodies corporate or unincorporate.
1.5 Agreement. Any document expressed to be "in the agreed form" or "agreed
means a document approved by TELKOM and PARTNER and (for the purpose of
identification) initialed on behalf of each of them.
1.6 Headings. Headings in this Agreement are used for convenience only and
shall not affect the construction of this contract.
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1.7 Days. In this Agreement, unless otherwise defined or the context
otherwise requires, references to a "day" shall mean a calendar day
covering a period of twenty-four (24) hours ending at 12 midnight.
Whenever in this Agreement a period of time is referred to, the day
upon which that period commences shall be the day after the day from
which the period is expressed to run, or the day after the day upon
which the event occurs which causes the period to start running.
1.8 References. References to Articles and Appendices are references to the
Articles of and the Appendices to this Agreement. References to any
laws or regulation shall be construed as references to those laws and
regulations as from time to time amended or re-enacted.
1.9 Priority of Documents. In the event of any inconsistency between this
Agreement and the Appendices, the terms and conditions in this
Agreement shall prevail.
1.10 General and Specific Provisions. In the event of ambiguity or
inconsistency over the application of any provision of this Agreement,
this Agreement shall be interpreted to favour the specific provision,
meaning and/or application over the general provision, meaning and/or
application.
1.11 Appendices
Appendix 1 Details of Local Partners/Suppliers/Sub-contractors
Appendix 2 [not used]
Appendix 3 Scope of Work
Appendix 4 Price Schedule
Appendix 5 Technical Specifications
Appendix 6 Demand Forecast
Appendix 7 Deployment Plan
Appendix 8 Project Management Plan
Appendix 9 Implementation Schedule
Appendix 10 Local Infrastructure
Appendix 11 Pay As You Grow (PAYG)
10
Appendix 12 Purchase Orders
Appendix 13 Xxxx of Quantities
Appendix 14 Technical and Engineering Norms
Appendix 15 [not used]
Appendix 16 Project Schematic
Appendix 17 Quality Assurance Guidelines / Acceptance Test Procedures
Appendix 18 Change Request
Appendix 19 Training
Appendix 20 Service Level Agreement
Appendix 21 Inter-Operability Commitment Agreement
Appendix 22 Documentation
Appendix 23 Technical Terms
Appendix 24 Non-Disclosure Agreement
Appendix 25 Performance Bond
Appendix 26 Software License
Appendix 27 Bank Guarantee
ARTICLE 2. COMMENCEMENT AND DURATION OF AGREEMENT
2.1 This Agreement shall become effective upon signing of this Agreement,
and shall continue in effect until PARTNER and TELKOM have fully
performed their respective obligations under this Agreement, unless
earlier terminated in accordance with Article 14.
2.2 The Scope of Work related to Network deployment shall be carried out
and completed within 42 months, subject to the terms of this Agreement.
The period for completion includes Sundays and government holidays,
days for consultancies (meeting and documents approval) with TELKOM and
the day for signing an Integrated System Acceptance Test Certificate.
2.3 TELKOM's obligations regarding payment for the Deliverables shall end
upon TELKOM's payment of the last PAYG payment due, subject to the
performance of TELKOM's obligations under this Agreement.
2.4 The initial term of the SLA to be
11
entered into by the Parties pursuant to Article 61 shall be for a
period expiring three (3) years from (i) the date of Commissioning of
the equipment supplied under the first Purchase Order or (ii) an
earlier date at TELKOM's request.
ARTICLE 3. PROJECT DESCRIPTION
3.1 This Agreement is an umbrella contract covering the various steps
involved in the T-21 Program, from demand forecasting, Network design,
issuance of Purchase Orders, shipping and receiving, installation and
commissioning, operation and maintenance support, customer utilization
of the equipment, to the Pay As You Grow payment scheme as illustrated
in the schematic in Appendix 16 (Project Schematic). Subject to
agreement of the Parties on procurement requirements for Installed Line
Procurements in accordance with any adjustments agreed under the
flexible procurement methodology contemplated for each JPS and DRM as
set forth in Article 26, PARTNER shall be obligated to undertake and be
jointly responsible for the demand forecast and solely responsible for
the survey, design, development, manufacture, delivery, supply,
installation, integration and Commissioning of the Network, including
all project management, training and other related services, on a
turnkey basis in accordance with the terms of this Agreement.
3.2 "Turnkey basis" means that pursuant to the Scope of Work, once PARTNER
receives a Purchase Order PARTNER shall be fully and jointly
responsible for the demand forecast and solely responsible for the
survey, design, development, manufacture, delivery, supply,
installation, integration and Commissioning of the Network, and the
remedying of any defects, so as to make the Network ready for service
in accordance with the terms of this Agreement. PARTNER shall also do
everything necessary as reasonably
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may be inferred from this Agreement as being required of PARTNER to
perform all of its obligations under this Agreement. PARTNER shall
provide all personnel, goods, consumables and other things and
services, whether of a temporary or permanent nature, required in and
for the design, execution, completion of the Network and the remedying
of defects in accordance with the terms of this Agreement. TELKOM shall
cooperate with PARTNER as it performs its obligations under this
Agreement on a turnkey basis.
ARTICLE 4. SCOPE OF WORK AND DELIVERABLES
4.1 The Scope of Work for this Project is set out in Appendix 3 (Scope of
Work).
4.2 PARTNER agrees and undertakes to:
4.2.1 carry out the Scope of Work in a good and workmanlike manner in
accordance with the Technical Specifications using materials necessary
for the completion of the said works which are of the quality
and standards specified in Appendix 5 (Technical Specifications);
4.2.2 be solely responsible for the correct design, quality and adequacy of
the works and for the correct quantities of materials, articles and
goods necessary for completion of the said works in accordance with
Appendix 3 (Scope of Work) and Appendix 5 (Technical Specifications);
4.2.3 to provide the Deliverables as specified in Appendix 3 (Scope of Work),
Appendix 5 (Technical Specifications) and Appendix 4 (Price Schedule)
and all cables, connectors and other miscellaneous materials required
for completion of the Network in accordance with the terms of this
Agreement. All such Deliverables shall conform in all respects with the
technical, capacity, functionality, design
13
features and performance specifications set out in Appendix 5
(Technical Specifications);
4.2.4 conduct a survey, design, plan, develop, manufacture, deliver, install,
test, Commission, and interconnect the Deliverables and provide all
other services relevant or relating to the Network in accordance with
Appendix 3 (Scope of Work), Appendix 5 (Technical Specifications) and
Appendix 9 (Implementation Schedule), and otherwise in accordance with
this Agreement;
4.2.5 perform the works under each Purchase Order in accordance with Appendix
9 (Implementation Schedule) and complete each stage of the works by the
relevant dates or times specified;
4.2.6 provide the Documentation to TELKOM in accordance with this Agreement;
4.2.7 provide land acquisition and frequency licence application services in
accordance with this Agreement;
4.2.8 provide services to TELKOM upon request from TELKOM by the issue of a
Purchase Order in accordance with the unit prices stated in Appendix 4
(Price Schedule);
4.2.9 provide technical personnel as specified in the Purchase Order in
accordance with the prices stated in Appendix 4 (Price Schedule);
4.2.10 provide training in accordance with Article 47 of this Agreement; and
4.2.11 perform and comply with all its other obligations under this Agreement
and the respective Purchase Orders.
4.3 PARTNER shall ensure the proper
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interworking, interfacing and integration of the Network with the
equipment, components and software of any third party vendor or other
licensed operators in Indonesia which are connected to Network
Deliverables specified in Appendix 3 (Scope of Work), Appendix 5
(Technical Specifications) and Appendix 21 (Inter-Operability
Commitment Agreement), or if not so specified, then in accordance with
best practice industry standards as agreed by the Parties.
4.4 PARTNER shall design the Network in such a way that, unless otherwise
agreed in writing:
4.4.1 individual Sub-systems (including all services) are deployable
regardless of the deployment status of other Systems or Sub-systems;
4.4.2 the Network can be readily scaled up or down to meet changing customer
demand;
4.4.3 the Network is capable of being migrated from a fixed or limited
mobility network (allowing a subscriber to move within one BTS coverage
area only) to a full mobility network in the future;
4.4.4 the Network is capable of being migrated to a third generation (3G)
based network in the future.
ARTICLE 5. PROCUREMENT PARTNERING COVENANTS
5.1 The Parties agree to be guided by certain principles during
implementation of this Agreement. The general principles set out below
are intended to be implemented in good faith and are without prejudice
to the rights and obligations of each Party contained in this
Agreement:
5.1.1 TELKOM's objective to achieve the optimum performance of its
telecommunications networks in order to provide the best possible
service for its customers shall not be deemed
15
incompatible with PARTNER's objective to sell its equipment and
services on commercial terms for a sustained period;
5.1.2 The Parties agree that a key mutual objective is to support the
development of the Indonesian telecommunications industry and economy
through maximizing the amount of equipment, materials, manpower and
services procured locally within Indonesia;
5.1.3 The Parties agree to conduct regular consultations to discuss the
respective performance of the Network deployment with the aim of
resolving amicably and promptly any disputes that may arise from time
to time in the spirit of building joint business opportunities and
creating mutual value together so as to create a responsive and stable
commercial relationship between themselves;
5.1.4 PARTNER shall inform TELKOM as effectively and fully as possible, in
good time, of possible problems with any Deliverables which have been
delivered or which are to be delivered and of permitted material
changes in costs, deliveries and developments previously agreed upon
which may be relevant to TELKOM;
5.1.5 The Parties agree to inform each other as fully as possible of any
circumstance relevant to the Deliverables affecting the
telecommunication networks of TELKOM, so as to enable one another to
respond quickly to technology or commercial developments. With respect
to future equipment purchases for potential use in Package 1 (Module
1), PARTNER shall notify TELKOM of its estimated prices in relation to
new telecommunications technology adaptable to Indonesia which has been
developed by PARTNER or by its affiliated companies, at least as early
as the time such technology is offered to other telecommunications
operators in Indonesia;
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5.1.6 Subject to Chapter 7 of this Agreement, PARTNER undertakes to consult
and co-operate with other relevant suppliers of equipment and/or
services relevant to this Agreement or to the Deliverables, in order to
achieve optimum functioning of the Deliverables before, during and
after delivery. Such consultation shall start at the earliest possible
time and shall include technical support with the aim of achieving the
optimum operation of the telecommunication networks of TELKOM;
5.1.7 The Parties shall pursue quality improvement and a degree of
standardisation suitable for the integrated management of the
telecommunication networks of TELKOM. To that end, PARTNER shall be
capable of adapting the Network under the T-21 Program to
state-of-the-art technology over the period of this Agreement;
5.1.8 One of TELKOM's key objectives in the T-21 Program is the purchase of
equipment and services that conform to international standard while
minimizing major capital expenditures. PARTNER shall work with TELKOM
to bring its know-how and expertise to bear in meeting this objective.
This means, for instance, that PARTNER must use its best endeavours to
analyze and take into account the financial and technical consequences
of introducing its technology developments for TELKOM, especially in
relation to hardware and software delivered by PARTNER and that which
is already in place in the telecommunication networks of TELKOM;
5.1.9 PARTNER shall take all reasonable measures necessary to communicate
17
to TELKOM the advantages and disadvantages of new technology
developments, including the newest tested technology offered by PARTNER
or by its affiliated companies. PARTNER shall agree from time to time
with TELKOM on additions or improvements to the "road map" of
technological development and evolution contemplated for the Project
which can be implemented during the course of the Project in a timely
manner;
5.1.10 PARTNER has agreed that it shall not have exclusive rights in its
Package Package 1 (Module 1) (BSS) area to install, deploy equipment
and/or provide services over the duration of the T-21 Program, in
consideration of which TELKOM has agreed to procure from PARTNER at
least the minimum Installed Line Procurements as provided in Chapter 3.
ARTICLE 6. IMPORTATION; LOCAL FACILITIES; COMPLIANCE WITH LICENSES AND PERMITS
6.1 Except as may otherwise be agreed between the Parties, Deliverables
which are imported into Indonesia shall be imported in the name of
TELKOM but under the physical arrangement and management of PARTNER.
All importation of Deliverables under this Agreement shall be
calculated on a cost at Location/Site basis and shall be delivered at
the agreed time and place and in accordance with applicable Indonesian
regulations and this Agreement. PARTNER shall initially make the
payment of any import VAT, sales tax on luxury goods, if applicable,
income tax (Article 22) on imports, import or customs duties and all
customs clearance costs in relation to all imports. PARTNER shall at
its own cost obtain all required Indonesian import permits and
approvals necessary to import Deliverables into Indonesia in the name
of TELKOM. TELKOM shall cooperate with PARTNER in this process and
provide PARTNER with all documents reasonably requested by PARTNER in
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connection with any import application required to include TELKOM's
name for purposes of importation. TELKOM shall ensure prompt signature
and delivery of documents required by the competent authorities for
such purposes.
6.2 TELKOM shall reimburse PARTNER for its prepayment of import VAT and
income tax Article 22 on imports within twenty-one (21) Business Days
after receipt of complete related claim documents from PARTNER. Customs
duties are included in the Contract Value and will be paid by TELKOM in
accordance with Articles 31 and 32. In the event a waiver is not
forthcoming and sales tax on luxury goods is assessed against any
Deliverables imported into Indonesia, the cost of such tax shall be
added to the Contract Value and be paid by TELKOM in accordance with
Articles 31 and 32.
6.3 PARTNER shall maintain complete and accurate inventory records of the
movement of such equipment after importation into Indonesia in
accordance with recognised industry practices and ensure that all
equipment imported into Indonesia pursuant to any Purchase Orders shall
be stored separately from all other equipment to facilitate inspections
by Indonesian customs authorities. Any imposition of customs duties or
penalties due to any act, default or omission of PARTNER in breach of
this provision shall be borne by PARTNER.
6.4 PARTNER shall comply with the requirements of all local laws,
regulations, and decrees and with the lawful requirements of other
authorities in any way affecting any Deliverables procured under this
Agreement.
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6.5 PARTNER will be responsible, at its own cost, for obtaining in a timely
fashion all necessary export permits, licenses, and approvals from the
country of origin and any intermediate locations, including the payment
of any and all levies for freight handling and other costs related to
such permits, licenses and approvals.
ARTICLE 7. DELIVERY PROCEDURES
7.1 All physical deliveries of Deliverables covered by Purchase Orders
shall be accompanied by a consignment note, which includes:
7.1.1 Name and registered office of PARTNER;
7.1.2 Purchase Order number;
7.1.3 Date of shipment and delivery;
7.1.4 Quantities included; and
7.1.5 Shipping documents (such as xxxx of lading or air way bills) and/or
inland delivery documents.
7.2 Delivery of equipment to the intended Location/Site shall be
implemented by reference to complete Systems or Sub-systems and not
piecemeal, except as otherwise mutually agreed between the Parties.
7.3 TELKOM shall conduct a goods delivery inspection pursuant to Article
55.5 on delivery of goods at the intended Location/Site.
7.4 PARTNER shall be responsible for delivery of the Deliverables from the
country of origin to the point of landing in Indonesia, and from the
point of landing to the intended Location/Site as specified in the
applicable Purchase Order in accordance with Appendix 9 (Implementation
Schedule). PARTNER shall be responsible for all inland transportation
shipping costs to the intended Location/Site.
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7.5 PARTNER represents and warrants that all Deliverables installed are
type-approved by the relevant authorities in Indonesia and have passed
quality assurance by TELKOM in accordance with the quality assurance
guidelines set forth in Appendix 17 (Quality Assurance Guidelines/
Acceptance Test Procedures).
7.6 PARTNER shall be responsible for the provision and cost of any of the
following facilities, equipment and services that may be required by
PARTNER and its staff:
7.6.1 all locally engaged skilled and unskilled personnel, including
electricians, wiremen, laborers, tradesmen, artisans, and their
equipment and tools;
7.6.2 any work and/or entry permits, licenses, visas, etc., necessary for
personnel employed or temporarily engaged by PARTNER and its
sub-contractors, and any income taxes incurred by such personnel or
corporate income taxes;
7.6.3 transportation (including, without limitation, to and from any
Location/Site), housing and medical facilities for such personnel as
may be necessary;
7.6.4 equipment, tools and other resources necessary for such personnel to
complete the works;
7.6.5 telephone, telegram, telex, modem, internet and facsimile services;
7.6.6 security, warehousing, storage and office facilities; and
7.6.7 customs and/or excise duties on tools, equipment and personal effects
of PARTNER staff.
21
ARTICLE 8. INTELLECTUAL AND INDUSTRIAL PROPERTY RIGHTS
8.1 PARTNER warrants:
8.1.1 that it has or will obtain prior to installation all Intellectual
Property Rights necessary to enable PARTNER to meet its obligations
under this Agreement; and
8.1.2 that the Contract Value includes all amounts paid or payable for the
rights to use the software and Documentation, and all Deliverables
forming a part of any Deliverables.
8.2 PARTNER shall grant or shall cause to be granted to TELKOM a
royalty-free, irrevocable (except as set forth in the Software
License), non-transferable (except as set forth in this Article),
non-exclusive and perpetual license or sub-license, as the case may
be in the Republic of Indonesia to use the software (excluding any
source code) and Documentation of PARTNER or its constituent members or
any third party (including the employees or agents of PARTNER and any
sub-contractors) to enable TELKOM to use such software and
Documentation in connection with the repair, maintenance, operation and
use of the relevant System, Sub-systems and the Deliverables to the
extent contemplated by this Agreement.
8.3 PARTNER further warrants that the supply or undertaking of any item of
the Deliverables will not infringe (or cause TELKOM to infringe) any
third party Intellectual Property Rights. PARTNER shall indemnify and
hold harmless TELKOM at all times from all direct damages, costs and
expenses arising from any claim or demand based on an allegation of
such infringement. PARTNER shall, at the request of TELKOM. defend at
PARTNER's own cost any or all such claims or demands, provided TELKOM:
22
(a) gives PARTNER prompt written notice of such claim;
(b) PARTNER has sole control of the defense and all related
settlement negotiations;
(c) does not admit liability in respect of the whole or any part
of the claim or agrees to settle or dispose of the claim; and
(d) provides all reasonable assistance to PARTNER in defending or
settling the claim.
This indemnity shall not apply where the liability arises:
(a) solely as a result of modifications to the Deliverables or
written instructions made by TELKOM without the approval of
PARTNER;
(b) from the combination of the Deliverables with any equipment
not supplied by PARTNER, and if without TELKOM having made
that combination the claim of infringement would not have been
valid; the indemnification shall, however, be applicable if
PARTNER has provided the system integration services which
caused the infringement;
(c) use of the Deliverables by TELKOM other than as contemplated
in this Agreement;
(d) TELKOM'S continued use of the Deliverables after
23
notification by PARTNER of any modification or changes in the
Deliverables required to avoid infringement claims.
8.4 TELKOM agrees that it shall use the applicable license for software and
Documentation pursuant to this Agreement only for its business
purposes, and shall not market or otherwise commercialize it. The
license for software and Documentation so granted shall authorize
TELKOM to undertake all activities related to and/or as reasonably
required for the intended use of the relevant equipment. The license
for software and Documentation shall become effective at the latest
upon TELKOM's issuance of the integrated System Acceptance Test
Certificate related to the applicable software and Documentation and
shall be limited to the right to use the Documentation and software to
operate the related equipment. TELKOM shall not assign, transfer or
sub-license such software without the prior written consent of PARTNER,
which consent shall not unreasonably be withheld or delayed. Further
terms relating to the licensed software are contained in the Software
License attached as Appendix 26.
8.5 TELKOM shall be entitled to make copies of the applicable software for
back-up purposes only. TELKOM shall be entitled to make copies of
software Documentation for internal use and for archival purposes, and
when making permitted copies TELKOM shall transfer to the copy/copies
any copyright or other marking on the software or related
documentation. Use by TELKOM's affiliates in Project-related
activities, shall be with
24
PARTNER'S approval. TELKOM may not de-compile the software, except as
agreed in writing by PARTNER. Further terms relating to the software
are contained in the Software License attached as Appendix 26.
8.6 If, owing to the relevant equipment or its use, a right of a third
party is infringed or an unlawful act is committed against a third
party, PARTNER shall, at its option and own expense and in consultation
with TELKOM:
8.6.1 replace the equipment or part of the equipment with equivalent
equipment or parts of the equipment which do not infringe a right of a
third party or whose use does not in any other way constitute an
unlawful act against a third party; or
8.6.2 acquire a license in respect of the said right; or
8.6.3 modify the equipment in such a way that the infringement or unlawful
act is terminated, provided that modification and/or replacement shall
not cause the functionality and/or quality of the equipment to be
materially reduced.
8.7 PARTNER and/or its sub-contractors shall provide TELKOM with the
interface specification of the applicable software and with all
Documentation and information in order to enable TELKOM to make
external enhancements and/or modifications to the relevant equipment or
add additional functionality to the equipment and/or to achieve inter-
operability and compatibility. PARTNER shall be relieved from its
indemnification obligations to the extent the claim is caused by TELKOM
enhancements and/or modifications.
25
8.8 If the central processing unit on which the applicable software is
installed becomes temporarily unavailable, such software may be
temporarily transferred to an alternative central processing unit. If
TELKOM desires to use the software in a service bureau mode (i.e., to
provide computing services to another supplier of similar services),
TELKOM shall request a meeting with PARTNER in which the Parties shall
discuss the required terms and conditions under which PARTNER would
enter into a written agreement permitting such use.
8.9 The provisions of this Article 8 shall in substance be included in the
BOT arrangements contemplated in Articles 28.10-28.14.
ARTICLE 9. FORCE MAJEURE
9.1 Neither Party shall be liable for delays in delivery or performance, or
for failure to manufacture, deliver or perform when caused by any of
the following which are beyond the reasonable control of the delayed
Party, including but not limited to acts of God, acts of the public
enemies, acts of civil or military authority, acts of war, acts of
terrorism, riots, strikes, lockouts, other labor disturbances,
hurricanes, earthquakes, fires, floods or other natural disasters,
epidemics and embargoes or a change to any government of Indonesia law,
regulation, decree or government department policy having the force of
law which has a material adverse impact on the ability of a Party to
perform this Agreement.
9.2 Any occurrence belonging to a Force
26
Majeure category shall be notified immediately to the other Party not
later than fourteen (14) days after such occurrence. If an event of
Force Majeure causes TELKOM to fail to pay any amounts due for a period
of more than ninety (90) days, any of the Parties may terminate this
Agreement. Any other event of Force Majeure continuing for a period in
excess of 6 months shall entitle any of the Parties to terminate this
Agreement.
9.3 In the event that due to Force Majeure the implementation of this
Agreement or relevant agreement, acceptance test, integration, drive
test or other matters provided for in this Agreement are suspended, the
implementation period shall be extended by the numbers of days equal to
the duration of such suspended implementation.
9.4 Neither Party shall be liable for any losses suffered by the other
Party arising as a result of Force Majeure, provided that in the event
of termination of this Agreement by PARTNER by reason of Force Majeure
pursuant to Article 9.2, the provisions of Articles 31 and 32 shall
apply with respect to losses involving Commissioned Deliverables and
the provisions of Articles 14.4, 14.5 and 14.6 shall apply with respect
to losses involving non-Commissioned Deliverables.
ARTICLE 10. TRANSFER OF RISK AND TITLE
10.1 Notwithstanding any transfer of legal title pursuant to the provisions
of Article 10.2, the transfer of operational risk with respect to the
relevant Deliverables from PARTNER to TELKOM shall only take place when
the respective Deliverables have been installed, and the relevant
Integrated System Acceptance Test Certificate has been issued by
TELKOM.
27
10.2 Legal title and other rights to the relevant Deliverables shall only
pass to or vest in TELKOM (i) at the time the related Integrated System
Acceptance Test Certificate is issued for Deliverables procured in
Indonesia, and (ii) delivery per FCA (Incoterms 2000) (port of
shipment) for Deliverables procured outside of Indonesia.
Notwithstanding anything to the contrary in this Agreement, title to
the software shall not pass to TELKOM at any time.
ARTICLE 11. INDEMNIFICATION
11.1 Without prejudice to any other provisions of this Agreement, PARTNER
shall indemnify and hold TELKOM harmless from all direct damages, cost
and expenses arising from any Claims (as defined below), if Claims
arise:
11.1.1 as a result of a failure by PARTNER to perform its obligations pursuant
to this Agreement, Purchase Orders or other specific agreement related
to these agreements;
11.1.2 in connection with the work carried out pursuant to its obligations
under this Agreement, unless the occurrence of the damage is not
attributable to PARTNER;
11.1.3 in connection with the faulty design of the equipment or any other
material or supplies which are supplied by PARTNER;
11.1.4 in connection with an infringement of any Intellectual Property Rights
or industrial property right belonging to a third party in relation to
Article 8.3;
11.1.5 in connection with any Claims including, without limitation, any fines
or other penalties suffered by TELKOM as a result of the violation by
28
PARTNER or any of its employees or agents of any laws or regulations in
Indonesia related to Article 6;
11.1.6 in connection with any interruption to the Network under Article 57.4;
11.1.7 for personal injury to and death of any persons and damage to any
property arising out of the performance of this Agreement due to acts
or omissions whether negligent or otherwise of PARTNER, its employees,
agents or sub-contractors;
11.1.8 for loss or damage caused by the gross negligence or wilful act, fault
or omission of PARTNER, its employees, agents or sub-contractors,
including without any limitation any damage or interruption to TELKOM's
existing Network during the migration to the new network to be provided
by PARTNER; or
11.1.9 in connection with termination by TELKOM for non-delivery of contracted
Deliverables.
Provided that TELKOM:
(a) gives PARTNER prompt written notice of such Claim;
(b) permits PARTNER to defend or settle the Claim;
(c) does not at any time admit liability in respect of the whole
or any part of the Claim or agrees to settle or dispose of the
Claim; and
(d) provides all reasonable assistance to PARTNER in
29
defending or settling the Claim.
11.2 "Claims" shall mean any demands, claims, actions, liabilities, losses,
damages awarded by a court or arbitration tribunal against TELKOM,
costs (including legal and other professional costs), penalties and
expense incurred by TELKOM as a result of a breach by PARTNER or any
sub-contractor of any of its obligations, representations, undertakings
or warranties under this Agreement.
11.3 Notwithstanding any provision of this Agreement to the contrary, the
liability of PARTNER to TELKOM under this Agreement shall in no
circumstances exceed in any one case, an amount equal to 100% of the
Contract Value of the relevant Purchase Order, subject to in aggregate
(after taking into account amounts previously paid under those clauses)
an amount equal to 10% of the total Contract Value of all Purchaser
Orders which have been issued and accepted up to the date on which the
liability falls due.
11.4 Neither Party shall in any circumstance be liable to the other for
indirect or consequential losses or damages, whether or not such losses
or damages are subject to this indemnity.
11.5 It is agreed that TELKOM shall indemnify and hold PARTNER harmless from
all direct damages, cost and expenses arising from any Claims if Claims
arise for personal injury to and death of any person and damage to any
property arising out of the performance of this Agreement due to acts
or omissions whether negligent or otherwise of TELKOM, its employees,
agents or sub-contractors.
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ARTICLE 12. EQUIPMENT MAINTENANCE AND SUPPORT
12.1 PARTNER undertakes that the Scope of Work will be executed in
accordance with the terms and conditions of this Agreement and any
Purchase Orders.
12.2 PARTNER shall deliver all equipment and Network Systems and Sub-systems
to TELKOM in 100% (one hundred per cent) new condition, having no
latent defects (excluding software latent defects) or other latent
defects which PARTNER is incapable of remedying pursuant to the Service
Level Agreement and provided that such Service Level Agreement is in
force upon discovery, and shall not have originated through unlawful
procurement or manufacturing practices. PARTNER shall further
undertake, subject to the Service Level Agreement, that all equipment
(both hardware and software) delivered to TELKOM under this Agreement
shall have a service life of at least ten (10) years from the date of
issuance of the respective Integrated System Acceptance Test
Certificate, or from the time the equipment is used commercially by
TELKOM, whichever occurs first, provided that TELKOM has:
(a) materially complied with the terms of the SOP and SMP (as
referred to in Article 60.1.2); and
(b) not made any material modifications or changes to the
equipment (both hardware and software) delivered to TELKOM.
12.3 If, upon the expiry of any applicable SLA period, TELKOM requires
maintenance assistance for the equipment from PARTNER, PARTNER agrees
to carry out such maintenance including replacement of the same or
comparable spare parts within the life
31
time of the equipment as referred to in Article 12.2, with costs
thereof as agreed at least ninety (90) days prior to the expiration of
the applicable SLA.
12.4 Up to the date of issuance of the relevant Integrated System Acceptance
Test Certificate (including issuance pursuant to Article 55.8.9), all
equipment supplied to TELKOM shall be in accordance with Appendix 3
(Scope of Work) and Appendix 5 (Technical Specifications). PARTNER
shall execute the works in accordance with this Agreement and best
practice standards (as agreed by the Parties).
12.5 Except as otherwise provided in this Agreement, all warranties express
or implied are excluded, including warranties of merchantability or
fitness for a particular purpose.
ARTICLE 13. LIQUIDATED DAMAGES FOR DELAY
13.1 PARTNER shall be deemed to have failed to perform an obligation under
this Agreement for reasons for which it can be held responsible, if
after the performance has become due and PARTNER has been given due
notification of non-performance with a reasonable time allowance not
exceeding thirty (30) days to rectify or correct the failure to perform
condition, it has not fulfilled the obligation or has not fulfilled it
in time or in accordance with what has been agreed upon. Without
limitation, among other examples of delays by PARTNER are the
following:
13.1.1 the Deliverables stated in the respective Purchase Order or specific
agreement have not met the acceptance criteria at the agreed date on a
per Location/Site basis;
32
13.1.2 the contracted Deliverables to be delivered are not available at the
time and place committed by PARTNER in accordance with the terms and
schedules of the respective Purchase Order, including without
limitation where the delay results from damage or loss of goods during
shipment.
13.2 PARTNER shall not be responsible to TELKOM for non-performance if the
non-performance is a result of (i) late or non-performance of TELKOM,
or the Investor pursuant to Article 28.10 or other Network equipment
suppliers, or (ii) delays in acquiring land, provided PARTNER has been
diligent and used its reasonable endeavours during the land acquisition
process, it being agreed that the cost of the land acquisition process
itself for which PARTNER is responsible shall not be a reason for
PARTNER seeking to excuse its delayed performance, or (iii) force
majeure in accordance with Article 9. In such events, PARTNER shall be
entitled to an appropriate extension of time for the performance of its
obligations. PARTNER shall take all reasonable steps to minimize the
impact of the delay and shall promptly notify TELKOM in writing, with
supporting details, of the extension of time required. PARTNER's
entitlement to extension of time shall be limited to the time which
would have been due if it had given prompt notice and had taken all
reasonable steps.
13.3 The liquidated damages for each day of delay shall be calculated on the
basis of a percentage of the Contract Value specified in the respective
Purchase Order related to the delayed Location in the amount of 6% per
annum, up to a maximum of 5% of the said Contract Value in the
applicable Purchase Order. For the avoidance of doubt, if
non-performance is not remedied within the remedial period
33
permitted under Article 13.1, or as otherwise agreed by the Parties,
then liquidated damages shall be calculated and payable starting from
the first day following the remedial period.
13.4 Liquidated damages assessed for delays in performance pursuant to
Article 13 shall be without prejudice to any other non-financial claims
TELKOM may have in respect of delays for which PARTNER is responsible.
Subject to Article 11.3, these include without limitation, TELKOM's
right: (i) to terminate this Agreement in accordance with Article 14;
and (ii) following discussions with PARTNER and acting reasonably with
respect to the selection of a third party, to appoint the third party
to continue this Agreement with respect to such works as may be able to
be completed by third parties on condition that any excess amounts
reasonably incurred for continuing such works as required shall be
borne by PARTNER. Payment of such excess amounts shall be in lieu of
liquidated damages payable from the time the third party is appointed.
ARTICLE 14. TERMINATION OF THE AGREEMENT
14.1 If PARTNER is in material breach of any of its obligations under this
Agreement, which failure is not capable of being cured, or if it can be
cured, and PARTNER shall have failed to cure such default within thirty
(30) days or an agreed lapse of time after written notice requiring
that such default be made good (given either under this Article 14.1 or
pursuant to Article 13.1 and 13.2), then TELKOM shall have the right,
at its election and without prejudice to other rights and remedies
provided in this Agreement to terminate this Agreement and recover
damages from PARTNER.
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14.2 Subject to the cure provisions of Article 14.1, TELKOM shall be
entitled to terminate all or part of this Agreement, and/or all or part
of the Purchase Orders and/or any related agreement upon any of the
following events:
14.2.1 PARTNER's material breach of the Inter-Operability Commitment
Agreement;
14.2.2 PARTNER declares or clearly states that the Scope of Work, or any
substantial part thereof, will not or cannot be completed;
14.2.3 PARTNER takes or has taken or instituted against it any action or
proceeding, whether voluntary or compulsory, which has as an object or
may result in the winding up of PARTNER (other than a voluntary winding
up by members for the purpose of reconstruction or amalgamation), or is
placed under official management or enters into a compromise or other
arrangement with its creditors or any class of them or an
administrative receiver or an administrator or receiver is appointed to
carry on its business or to take control or possession of any of its
assets for the benefit of its creditors or any of them;
14.2.4 PARTNER violates any law relating to the prevention of corruption or
bribery in PARTNER's home country or any jurisdiction in which PARTNER
is carrying out any of the works;
14.2.5 Pursuant to Article 9.
14.3 PARTNER shall only be entitled to terminate or abandon this Agreement
in the event that TELKOM is in material breach and has failed to remedy
the default (provided that the default is capable of being remedied)
within thirty (30) days or an agreed lapse of time
35
after written notice from PARTNER requiring that such default be
remedied in the context of the following events;
14.3.1 TELKOM takes or has taken or instituted against it any action or
proceeding, whether voluntary or compulsory, which has as an object or
may result in the winding up of TELKOM (other than a voluntary winding
up by members for the purpose of reconstruction or amalgamation), or is
placed under official management or enters into a compromise or other
arrangement with its creditors or any class of them or an
administrative receiver or an administrator or receiver is appointed to
carry on its business or to take control or possession of any of its
assets for the benefit of its creditors or any of them; or
14.3.2 TELKOM fails to pay any amounts due, or becomes unable to pay amounts
to become due, for a period of more than six (6) months and during
discussions with TELKOM during such period the Parties cannot agree on
a satisfactory mechanism for payment and/or security for payments owed,
including the provision of a bank guarantee by TELKOM acceptable to
PARTNER; or
14.3.3 Pursuant to Article 9.2; or
14.3.4 TELKOM, (a) without PARTNER's prior written approval: (i) transfers or
assigns the license for software and Documentation granted in Article
8, or (ii) transfers PARTNER's proprietary software or equipment
outside the Republic of Indonesia, (iii) commercializes or manufactures
the applicable software, equipment and Documentation or uses the
Deliverables in a manner not permitted in this Agreement; or (iv)
encumbers PARTNER's Intellectual Property Rights; or (v) is otherwise
in material
36
breach of the terms and conditions of the Software License; or (b) is
in material breach of Article 21.10; or (c) is in material breach of
its confidentiality obligations under a duly executed Appendix 24
(Non-Disclosure Agreement); or (d) is in material breach of applicable
laws and regulations, which breach as a direct consequence imposes on
PARTNER a legal obligation to cease performing its obligations under
this Agreement.
14.4 Termination of this Agreement shall be without prejudice to any accrued
rights of the Parties up to the date of termination.
14.5 The termination of this Agreement or other specific agreement shall not
affect or prejudice any provisions of those agreements which are
expressly or by implication provided to continue in effect after such
termination.
14.6 If this Agreement is terminated by either Party as provided in this
Article 14. TELKOM, in addition to any other rights provided in this
Article, may require PARTNER to transfer title and to deliver to TELKOM
in the manner and to the extent directed by them upon full payment, any
completed equipment, material or supplies, and such partially completed
cable and materials, parts, tools, dies, jigs, fixtures, plans,
drawings, information, and contract rights as PARTNER has had
specifically produced or specifically acquired for the performance of
such part of this Agreement as may have been terminated and which if
this Agreement had been completed, would have been required to have
been furnished to TELKOM. In addition, PARTNER shall, upon the
direction of TELKOM, protect and preserve property in its possession in
which TELKOM have an interest. PARTNER shall be paid the prices
specified in Appendix 4 (Price Schedule) for completed equipment,
material and
37
supplies delivered and services performed, and the amounts agreed upon
by TELKOM and PARTNER for the manufacturing materials delivered to
TELKOM by PARTNER, and for the protection and preservation of property
in which TELKOM has an interest.
14.7 If this Agreement is terminated in accordance with Article 14.2, TELKOM
may elect to take over and to complete the work. In such event,
PARTNER, shall, without prejudice to any other rights or remedies of
TELKOM hereunder, be liable to TELKOM for all reasonable excess costs
so incurred by them taking into account any sums due under this
Agreement to PARTNER for work commenced, partly executed or completed
and accepted by TELKOM or materials, plant, machinery, tools and
implements and other things purchased, used or to be used in connection
with the work.
14.8 In the event of termination, the Parties agree to waive the provisions
of Article 1266 of the Indonesian Civil Code to the extent necessary to
effect termination of this Agreement in accordance with Article 14
without the need for a court decision.
ARTICLE 15. GOVERNING LAW
This Agreement shall be interpreted and governed in accordance with the
laws of the Republic of Indonesia.
ARTICLE 16. SETTLEMENT OF DISPUTES
16.1 If any disputes arising between TELKOM and PARTNER in connection with
or arising out of this Agreement or the breach, termination of validity
thereof (a "Dispute"), the Parties shall attempt for a period of thirty
(30) days
38
after receipt by one Party of a notice from the other Party of the
existence of the dispute, to settle such Dispute in the first instance
by mutual discussions between senior executives of the Parties.
16.2 Any Dispute which cannot be resolved by amicable settlement between the
Parties arising out of or in connection with this Agreement, including
any question regarding its existence, validity or termination, shall be
referred to and finally resolved by arbitration in Singapore in
accordance with the Arbitration Rules of the Singapore International
Arbitration Centre ("SIAC") for the time being in force which rules are
deemed to be incorporated by reference to this clause.
16.3 The arbitration shall be conducted before an arbitral tribunal composed
of three (3) arbitrators. The language of the arbitration shall be
English.
16.4 The three (3) person arbitration panel shall be selected as follows:
(a) each arbitrator shall be fluent in English and shall be
experienced with legal matters concerning the
telecommunications industry.
(b) each of (A) the Party initiating the arbitration and (B) the
respondent Party or Parties to the Dispute shall nominate one
(1) arbitrator within thirty (30) days of the written notice
of the Dispute described above. The relevant Parties shall
within (30) days of the appointment of the two (2) arbitrators
seek to appoint a third arbitrator. If any relevant Party does
not nominate an arbitrator or if the relevant Parties cannot
agree on the choice of the third arbitrator, in each case
within the relevant period, then each unappointed arbitrator
shall be selected by the Chairman of the SIAC (provided that
the
39
requirements in Article 16.4(a) are satisfied).
16.5 The award rendered shall be in writing and shall set out the facts of
the Dispute and the reasons for the arbitration panel's decision. The
award shall apportion the costs of the arbitration as the arbitration
panel deems fair.
16.6 The Parties agree that the arbitration award shall be final and binding
on the Parties. The Parties agree that no Party shall have any right to
commence or maintain any suit or legal proceedings until the Dispute
has been determined in accordance with the arbitration procedure
provided herein and then only for enforcement of the award rendered in
the arbitration. Judgment upon the arbitration award may be rendered in
any court of competent jurisdiction or application may be made to such
court for a judicial acceptance of the award and an order of
enforcement, as the case may be.
16.7 Each of the Parties hereby expressly waives any Indonesian laws and
regulations, decrees or policies having the force of law that would
otherwise give a right to appeal against the decision of the
arbitration panel, and the Parties agree that no Party shall appeal to
any court against the award or decision contained therein. The Parties
agree that any dispute in connection with or arising out of this
Agreement or the breach, termination of validity thereof under is of a
commercial nature.
16.8 Each of the Parties waives the applicability of Article 48(1) of the
Indonesian Law on Arbitration and Alternative Dispute Resolution (the
"Arbitration Law") and agrees that no
40
arbitration need be completed within a specific time. For purposes of
Article 5 paragraph 1 of the Arbitration Law, the Parties agree that
the relationship among the Parties is commercial in nature and any
Dispute related to this Agreement shall be deemed commercial.
16.9 No Party or person involved in any way in the creation, coordination or
operation of the arbitration of any Dispute may disclose the existence,
content or results of the Dispute or any arbitration conducted under
this Agreement in relation to that Dispute, in each case subject to
those disclosures permitted by Article 19.
16.10 This Agreement and the rights and obligations of the Parties shall
remain in full force and effect pending the award in such arbitration
proceeding, which award, if appropriate shall determine whether and
when termination shall become effective. The provisions contained in
this Article 16 shall survive the termination and/or expiration of this
Agreement.
ARTICLE 17. LANGUAGE
17.1 All data, documents, Purchase Orders, invoices, descriptions, diagram,
books, catalogues, instructions, marking for easy identification of
major items of the material and most correspondence shall be in the
English language and in the metric system of weights and measures.
17.2 PARTNER's personnel shall be proficient in English both written and
spoken, for the purpose of providing instruction, offering advisory
services, training and any other submission as required.
17.3 This Agreement is concluded in both English and Bahasa Indonesia. In
the event of any inconsistency or contradiction between the Bahasa
Indonesia and English texts, the Parties shall first endeavor to
resolve
41
such inconsistencies through negotiations, failing which the Bahasa
Indonesia text shall govern and prevail.
ARTICLE 18. CORPORATE REPRESENTATIONS AND WARRANTIES
18.1 Each Party (including each constituent member of PARTNER) represents
and warrants that (i) it has obtained all necessary approvals, consents
and authorizations of third parties and governmental authorities to
enter into this Agreement and to perform and carry out its obligations
under it; (ii) the persons executing the Agreement on its behalf have
express authority to do so, and, in doing so, to bind the party to it;
(iii) the execution, delivery, and performance of this Agreement does
not violate any provision of any bylaw, charter, regulation, or any
other corporate governing authority of the Party; (iv) the execution,
delivery and performance of the Agreement has been duly authorized by
all necessary corporate action; (v) the execution, delivery and
performance by it of this Agreement constitute private and commercial
acts rather than public or governmental acts; and (vi) the obligations
of the Parties under the Agreement are valid and binding obligations of
such Party, enforceable in accordance with its terms.
ARTICLE 19. CONFIDENTIAL INFORMATION
19.1 TELKOM and PARTNER shall enter into a Non-Disclosure Agreement in the
form set out in Appendix 24 (Non-Disclosure Agreement) which details
the terms and conditions related to permitted uses and disclosures of
confidential information in the development (if applicable) operation,
use and maintenance of the relevant Systems in the T-21 Program.
42
ARTICLE 20. NOTICE
20.1 All notifications required or permitted under this Agreement shall be
sufficiently given if made in writing and delivered personally by hand
or by courier or sent by prepaid registered post or by facsimile to the
addresses of the Parties as from time to time notified.
20.2 All notification required in connection with the implementation of this
Agreement shall be addressed as follows:
To TELKOM:
Perusahaan Perseroan (Persero) PT
Telekomunikasi Indonesia Tbk.
Xx. Xxxxxx Xx. 0, Xxxxxxx 00000
Xxxxxxxxx : President Director
Fax : (022)440-313
To PARTNER:
Motorola, Inc.
c/o PT Motorola Indonesia
Gedung BRI II, Suite 3001
Xx. Xxxx. Xxxxxxxx Xxx. 00-00
Xxxxxxx 00000, Xxxxxxxxx
Attention : General Manager
Fax : (000) 000-0000
Cc: Motorola Electronics Pte. Ltd.
00 Xxx Xx Xxx Xx 64
Motorola Innovation Centre Xxxxx 0X
Xxx Xx Xxx Xxxxxxxxxx Xxxx 0
Xxxxxxxxx 000000
Fax : (00) 0000-0000
Attn. : Commercial Contracts Manager
20.3 PARTNER shall appoint a point of contact or designated representative
authorized to act on behalf of PARTNER, and whose instructions and
requests shall be binding for PARTNER as to all matters pertaining to
implementation of the Project brought to his attention by TELKOM.
TELKOM shall also appoint a point of contact or designated
representative authorized to act on behalf of TELKOM whose instructions
and requests shall be binding for TELKOM as to all matters pertaining
to implementation of the Project. The initial point of contact
43
for each Party is listed below:
PARTNER's Point of Contact:
Project Manager
c/o PT Motorola Indonesia
Gedung BRI II, Suite 3001
Xx. Xxxx. Xxxxxxxx Xxx. 00-00
Xxxxxxx 00000, Xxxxxxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
Email: xxxxx.xxxxxxx@xxxxxxxx.xxx
Mobile: 00000000000
TELKOM's Point of Contact:
PT Telekomunikasi Indonesia Tbk.
Head of Fixed Wireless Division (as
Project Manager)
Xx. Xxxxx Xxxxx, Xxx. 00
Xxxxxxx
Xxxxxxxxx
Tel : (000) 000-0000
Fax : (000) 000-0000
E-mail : xxxx_xx@xxxxxx.xx.xx
Mobile : (0811) 965-500
20.4 A Party may change its address by giving prior written notice to the
other Party. Notices and other communications may be in the Indonesian
or English language. All notices shall be effective (i) in the case of
delivery by personal delivery or courier, on the date of receipt as
evidenced by a delivery receipt from the recipient or confirmation of
delivery received by the sender from the courier, and (ii) in the case
of transmission by facsimile transmission or electronic mail or other
electronic transmission, on the date of receipt as promptly
acknowledged by the recipient, failing which acknowledgement then on
the date of such transmission as evidenced by the convention applicable
to such transmission.
ARTICLE 21. GENERAL PROVISIONS
21.1 If any provision of this Agreement or part thereof is rendered void,
illegal or unenforceable by any legislation to which it is subject, it
shall be rendered void, illegal or unenforceable only to that extent
and it shall in no way affect
44
or prejudice the enforceability of the remainder of such provision or
the other provisions of this Agreement. The invalidity, illegality or
unenforceability of any provision in this Agreement under the laws of
any one jurisdiction shall not in itself affect the validity, legality
and enforceability of such provision under the laws of any other
jurisdiction.
21.2 No remedy conferred by any of the provisions of this Agreement is
intended to be exclusive of any other remedy that is otherwise
available at law or otherwise, and each and every other remedy shall be
cumulative and shall be in addition to every other remedy given
hereunder or now or hereafter existing at law or otherwise. The
election of any one or more of such remedies by either Party shall not
constitute a waiver by such Party of the right to pursue any other
available remedies.
21.3 No failure on the part of either Party to exercise and no delay on the
part of either Party in exercising any right hereunder will operate as
a release or waiver thereof, nor will any single or partial exercise of
any right under this Agreement preclude any other or further exercise
of it. The rights and remedies provided in this Agreement are
cumulative and not exclusive of any right or remedy provided by law.
21.4 This Agreement embodies all the terms and conditions agreed upon
between the Parties as to the subject matter of this Agreement, and
supersedes all prior representations, arrangements, understandings and
agreements between the Parties whether written or oral (including
without limitation, the RfP, except as provided otherwise under this
Agreement).
45
21.5 This Agreement may be executed in any number of counterparts, each of
which shall constitute an original and take effect without reference to
any other counterpart, and together the counterparts shall be deemed as
one and the same agreement.
21.6 Notwithstanding the reference to the terms "Partner" and/or
"partnership" in this Agreement, the relationship between the Parties
shall not constitute a legal partnership. Neither Party has the power
or the right to bind, commit or pledge the credit of the other Party.
21.7 This Agreement shall enure to the benefit of and be binding upon the
Parties and their respective successors and permitted assigns.
21.8 This Agreement does not establish an employer-employee relationship and
PARTNER is for all purposes, an independent contractor.
21.9 No modification, amendment or other change may be made to this
Agreement or any part thereof unless reduced to writing and executed by
authorized representatives of both Parties.
21.10 TELKOM agrees to comply with all applicable export laws and regulations
of the United States of America, the United Kingdom, or such other
country of origin. Specifically, but without limitation, TELKOM agrees
that it will not resell or re-export Motorola products or technical
data in any form without obtaining appropriate export or re-export
licenses from the respective governmental authority of the United
States of America, the United Kingdom or other country of origin.
21.11 TELKOM further agrees to perform and comply with its obligations under
this Agreement and the respective Purchase Orders.
46
21.12 The Parties agree that where the context of any provision indicates an
intent that it shall survive the expiry or termination of this
Agreement, such provision shall survive. Specifically, the following
Articles shall survive expiry or termination: 8, 11.3, 11.4, 15, 16,
19, 21.10 and Appendix 26.
21.13 The Parties agree that to their knowledge there are no laws or
regulations specifically applicable to sales to an entity owned or
partly owned by a government entity which would apply to the Parties in
the circumstances of this Agreement.
CHAPTER 2.
COMMERCIAL TERMS AND CONDITIONS
ARTICLE 22. CONTRACT VALUE
22.1 Based on the unit prices referred to in Article 23.3, the initial
Contract Value (excluding VAT and excluding the fees under the Service
Level Agreement) for execution of the Project under this Agreement is
US$ 20,686,855 (primarily for goods and services purchased outside
Indonesia) and IDR 61,268,263,751 (primarily for goods and services
procured within Indonesia). This Contract Value may be adjusted from
time to time in accordance with the mechanism provided in Article 27.
ARTICLE 23. PRICES, FEES
23.1 The prices, and fees as listed under Appendix 4 (Price Schedule) are
the agreed prices and applicable to the relevant Purchase Orders. Such
prices and fees shall be deemed to include all costs, expenses and
customs and import duties which are deemed necessary to carry out this
Agreement, but excluding VAT, income tax Article 22 on imports and
sales tax on luxury goods.
47
23.2 The prices and fees payable by TELKOM under this Agreement shall be
denominated in United States of America Dollars (USD) or in Indonesian
Rupiah (IDR), as applicable or as may be required under this Agreement
to satisfy Local Content requirements. All payments made under or
pursuant to this Agreement by TELKOM shall be made in the currency
specified. In the event that any such payments are unable to be made in
the currency specified for whatsoever reason, then at the option of
PARTNER such payments may be made by TELKOM by payment of an equivalent
amount (at the then prevailing exchange rates) of such other currency
as is permissible. If so requested by PARTNER, TELKOM shall pay the
relevant amount in the name of PARTNER or a third party designated by
PARTNER at a bank within Indonesia.
23.3 Unit prices quoted in Appendix 4 (Price Schedule) are firm fixed prices
and shall not be varied except as permitted under this Agreement. Unit
prices for equipment are deemed to include payments by PARTNER for all
costs of freight, insurance, customs and import duties, clearance at
the port of entry, inland transportation, warehousing and delivery to
the Location/Site where the equipment is to be installed. Unit prices
for equipment related services shall include survey, planning, design,
permits, rights of way, installation, integration, project management,
insurance up to transfer of title, testing and commissioning costs,
services related to land acquisition, frequency licence application
services and all related materials and expenses to complete the Project
on a turnkey basis as contemplated in Article 3. Import or custom
duties are included in the unit prices set out in Appendix 4 (Price
Schedule) and shall remain fixed. Variations in unit price shall only
be subject to change if specifically agreed upon by the Parties
pursuant to a Change Request.
48
ARTICLE 24. TAXES AND DUTIES
24.1 The Contract Value excludes VAT, sales tax on luxury goods, and
prepayment of income tax (Article 22) on imports, but includes
customs/import duties imposed by the government of Indonesia on the
Deliverables in connection with the Project. Each Party shall be
responsible for all taxes which it is required to pay, withhold or
collect as the case may be, in accordance with prevailing laws and
regulations, it being acknowledged by PARTNER that in relation to VAT
administration TELKOM is a designated VAT collector under applicable
regulations. In the event withholding taxes are applied on any payments
made by TELKOM to PARTNER, TELKOM shall provide PARTNER with a copy of
the withholding tax receipt within fourteen (14) days from the date of
payments.
ARTICLE 25. INSURANCE AND SAFETY
25.1 PARTNER shall at its own expense take out an all risk (or equivalent
coverage) insurance policy ("All Risk Policy") to cover any works to be
carried out pursuant to any Purchase Order. The insurance shall cover
all risks against losses, damages (including accidents caused by the
work performed by PARTNER, its employees, agents or sub-contractors) at
a minimum until the transfer of title to the relevant Deliverables
pursuant to Article 10.2. The All Risk Policy shall also cover any
plant, machinery, tools, goods, vehicles or property belonging to
PARTNER, its employees, agents or sub-contractors which have been
placed at any relevant Location/Site where any works are being
executed, all risks during transportation, warehousing, storage,
delivery, installation and testing, whether by fire, theft,
earthquake/flood, natural
49
disaster, consequence of fault in construction, or otherwise, and legal
liability to third parties during construction, installation and
operation periods including PARTNER's loss of revenue and damage to
surrounding property. PARTNER shall provide evidence of this All Risk
Policy to TELKOM upon request. Subject to the conditions that PARTNER
retains full responsibility for its obligations under this Article 25,
and that TELKOM is not required to execute the policy document, PARTNER
may at its option procure that the All Risk Policy name TELKOM as a
co-insured and beneficiary of such policy.
25.2 PARTNER shall at its own expense replace any lost, damaged and/or
destroyed Deliverables while such are in the process of being delivered
and installed.
25.3 Notwithstanding the procurement of an All Risk Policy, PARTNER's
liability in respect of loss or damage attributable to the acts,
omission or negligence of PARTNER shall not be limited to the amount of
the insurance coverage under the All Risk Policy.
25.4 PARTNER shall take full responsibility for the adequacy, stability and
safety of all works carried out at the relevant Locations/Sites in
accordance with the provisions of any law, order, regulation, decree,
directive or standards now or hereinafter in force in Indonesia.
PARTNER shall ensure that all equipment, tools, facilities and other
items used by PARTNER or its sub-contractor in the execution of the
works shall be safe, sound, in good working condition which shall, at a
minimum,
50
conform to acceptable standards in the industry. PARTNER shall at its
own expense provide the necessary safety equipment, protective
clothing, footwear and such other appliances as may be necessary or
required by law or regulation for proper and safe execution of the
works. PARTNER shall ensure that all personnel provided are fully
trained and qualified and properly certified by the relevant
authorities or bodies if such certification is required under the
applicable laws, rules or regulations or directive of any governmental
body.
CHAPTER 3.
FINANCIAL TERMS AND PAYG
ARTICLE 26. JOINT PLANNING SESSIONS, DESIGN REVIEW MEETINGS AND MONTHLY MEETINGS
26.1 Joint Planning Session or JPS
26.1.1 The Parties agree to conduct systematic, periodic and comprehensive
joint planning exercises as described below.
26.1.2 TELKOM and PARTNER shall conduct annual Joint Planning Sessions ("JPS")
in October or November at the end of each Fiscal Year to plan for the
following Fiscal Year's Package Level Requirements. The first of these
JPSs shall be conducted at a time to be mutually determined after the
Parties have executed this Agreement and shall cover the period
immediately following the execution of this Agreement up to the end of
Fiscal Year 2003. The JPS may also be convened at such other times as
the Parties may agree. TELKOM and PARTNER shall jointly conduct and/or
agree on at least the following activities as applicable to the
following Fiscal Year:
51
(a) demand forecasting (which in this Agreement shall refer to a
minimum of one (1) year time horizon) at DIVRE 1 level
considering various macro economic factors;
(b) economic analysis to assess the business feasibility of
deploying the intended Network; and
(c) development of the details of the Deployment Plan and
Implementation Schedule on a quarterly basis with
prioritization of Locations for Network deployment.
26.1.3 At each subsequent JPS, TELKOM and PARTNER shall conduct jointly and/or
agree on at least the following activities as applicable to the
following Fiscal Year.
(a) demand forecasting for DIVRE 1 considering various macro
economic factors;
(b) economic analysis to assess the business feasibility of
deploying the intended Network; and
(c) development of details of the Deployment Plan and
Implementation Schedule on a quarterly basis with
prioritization of Locations for Network deployment;
(d) review of future technology deployment strategies, considering
availability and suitability of the latest technologies,
equipment or software; and
(e) resolve issues referred to it by a DRM or otherwise and agree
on corrective actions.
26.1.4 PARTNER shall take responsibility for the organizational and
administrative activities required to convene the JPSs.
52
PARTNER shall be responsible for all reasonable costs of convening the
JPS and shall fund at its own expense the cost of external consultants,
if needed, in performing any of the work or analyses contemplated under
Article 26.1. TELKOM shall only be responsible for the costs of
providing accommodations and transport for TELKOM staff attending a
JPS.
26.1.5 The Parties shall produce minutes of the JPS meetings in which any
substantive agreements shall be recorded as agreements of the Parties,
as evidenced by signature of the minutes (or the applicable sections
thereof) by the authorized representative of each Party.
26.1.6 At each JPS and subject to either or both Parties first reporting
unresolved issues to the respective senior executives of each Party for
consideration, TELKOM shall be entitled to make the final decisions on
such matters as revision of the Deployment Plan and adjustments to the
calculation of Installed Lines Procurements, after taking into account
PARTNER's inputs concerning, among others, demand forecasts, market
outlook and take-up of the capacity deployed.
26.2 Design Review Meeting or DRM
26.2.1 TELKOM and PARTNER shall conduct systematic, periodic and comprehensive
Design Review Meetings ("DRM") on a quarterly basis at a DIVRE level
throughout the term of this Agreement.
26.2.2 The first DRM shall be conducted within ten (10) Business Days after
the first JPS or within such timeframe agreed at the first JPS.
Thereafter, DRMs are intended to be held at the end of each Quarter
with an agenda which looks forward to the contemplated activities of
the following Quarter.
26.2.3 Before the first DRM, TELKOM and PARTNER jointly shall conduct at least
the following activities:
53
(a) survey the planned deployment Location/Site(s) to ensure the
readiness of the Location/Site(s);
(b) calculate Installed Line Procurements (reasonably equating to
Subscriber Targets) required by Location and Site (BTS);
(c) based on the Subscriber Targets, develop a detailed network
design, agree and approve the detailed BoQ and the value of
the detailed BoQ by Location and Site (BTS);
(d) develop a detailed resource plan;
(e) develop a detailed training plan; and
(f) update the Deployment Plan for the next Quarter if necessary.
26.2.4 At the first DRM, TELKOM and PARTNER jointly shall conduct and/or agree
on at least the following activities:
(a) check and update the calculation of Installed Line
Procurements (reasonably equating to Subscriber Targets) by
Location and Site (BTS);
(b) based on the Subscriber Target, agree and approve the detailed
Network design;
(c) based on the Subscriber Target, agree and approve the detailed
BoQ and the total value of the detailed BoQ by Location and
Site (BTS);
(d) agree and approve the detailed resource plan;
54
(e) agree and approve the detailed training plan;
(f) agree and approve adjustments, if any, to the Project
Management Plan and the Implementation Schedule; and
(g) agree and approve the updated Deployment Plan for the
following Quarter if necessary.
26.2.5 Following the first DRM and after each subsequent DRM, upon agreement
of the Parties on the relevant terms and conditions, TELKOM shall
promptly issue Purchase Order(s) signed by the TELKOM Project Manager
or other person authorized by TELKOM based on the results of the
related DRM.
26.2.6 With respect to the quarterly DRM which coincides with a JPS each
fiscal year, the DRM shall be convened immediately after the completion
of such JPS, with an agenda which is designed not to repeat or
duplicate JPS activities in such DRM, unless necessary.
26.2.7 Before each subsequent DRM, TELKOM and PARTNER jointly shall conduct
and/or agree on at least the following activities:
(a) survey the planned deployment Location/Site(s) to ensure the
readiness of the Location/Site(s), to assess the demand;
(b) update the Deployment Plan for that Quarter by calculating the
Installed Line Procurement (reasonably equating to Subscriber
Targets) required by Location and Site (BTS);
(c) based on the Subscriber Targets, develop a detailed
55
Network design, a detailed BoQ and the total value of the
detailed BOQ by Location and Site (BTS);
(d) develop a detailed resource plan;
(e) develop a detailed training plan; and
(f) assess market demand and update deployment plan for the
following Quarter if necessary.
26.2.8 At each subsequent DRM, TELKOM and PARTNER jointly shall conduct and/or
agree on at least the following activities for the following Quarter:
(a) check and update the calculation of Installed Line
Procurements (reasonably equating to Subscriber Targets) by
Location and Site (BTS);
(b) based on the Subscriber Target, agree and approve the detailed
Network design;
(c) based on the Subscriber Target, agree and approve the detailed
BoQ and the total value of the detailed BoQ by Location and
Site (BTS);
(d) agree and approve the detailed resource plan;
(e) agree and approve the detailed training plan;
(f) agree and approve adjustments, if any, to the Project
Management Plan and Implementation Schedule;
(g) evaluate performance of the Project in the previous Quarter
and revise implementation procedures to take account of
failures or other unsatisfactory
56
performance;
(h) agree and approve the updated Deployment Plan for the
following Quarter if necessary; and
(i) resolve issues referred to it by a monthly meeting or
otherwise and agree on corrective actions.
26.2.9 PARTNER shall take responsibility for the organizational and
administrative activities required to organize all DRMs. PARTNER shall
be responsible for all reasonable costs of convening the DRM and shall
fund at its own expense the analysis, if needed, contemplated under
Article 26.2. TELKOM shall only be responsible for the costs of
providing accommodations and transport for TELKOM staff attending a
DRM.
26.2.10 The Parties shall produce minutes of each DRM in which any substantive
agreements shall be recorded as agreements of the Parties, as evidenced
by signature of the minutes (or the applicable section thereof) by the
authorized representative of each Party.
26.2.11 The following additional agreements apply to the DRMs:
(a) TELKOM and PARTNER jointly will design and calculate the exact
BoQ to support the intended number of Subscriber Targets based
on the design rules in Appendix 14 (Technical and Engineering
Norms);
(b) the design rules in Appendix 14 (Technical and Engineering
Norms) are based on technical and engineering norms current at
the date of this Agreement and may be adjusted by written
agreement of the Parties during the planning process based on
the evolution of the market to avoid any over or
under-estimation of the equipment required;
57
(c) in case there are any major issues that need urgent attention
or cause any significant deviation from the original
Deployment Plan, PARTNER shall bring it to the attention of
TELKOM and, if mutually agreed, promptly convene a special DRM
to address such issues;
(d) if necessary, any activities mandated by a JPS meeting may be
executed in conjunction with a DRM meeting;
(e) in the event that terms of a particular Purchase Order are
inconsistent with agreements reached in a DRM, the Parties
shall review and if necessary amend any mistakes or
discrepancies in the Purchase Order or BoQ;
(f) At each DRM, decisions on such matters as revision of the
Deployment Plan and calculation of Installed Line Procurements
shall be mutually agreed by the Parties after taking into
account all inputs of both Parties concerning, among others,
demand forecasts, market outlook, equipment production
capacity, and take up of the capacity deployed; and
(g) TELKOM and PARTNER agree that the Deployment Plan for the
following Quarter for a particular Location shall be
calculated based on Installed Line Procurements that
realistically can be provisioned within a period of a
58
minimum of three (3) years if new common equipment is
deployed, and a minimum of one (1) year for each module such
as racks, sub-racks and cards.
Notwithstanding anything to the contrary in this Agreement, a Purchase
Order shall only be issued if the terms and conditions of the Purchase
Order are agreed in writing, either at the relevant DRM or
subsequently, by the authorized person of each Party, as notified to
each Party from time to time in accordance with Article 20.3. If the
Parties cannot reach agreement at a DRM on matters such as the terms of
a particular Purchase Order or other critical issue, the matter shall
first be referred to senior management of each Party for resolution,
failing which the provisions of Article 16 shall apply.
26.3 Monthly Meetings
26.3.1 PARTNER through its authorized representatives shall conduct monthly
meetings with the relevant TELKOM staff in the Location to be developed
to ensure smooth execution of Project operations and to raise and
discuss issues in a timely manner.
26.3.2 The first of these meetings will be conducted at a time to be mutually
determined after the first DRM has been conducted. Thereafter, these
meetings shall be held on a monthly basis throughout the term of this
Agreement.
26.3.3 At each monthly meeting, PARTNER shall be responsible for at least the
following activities: preparation of progress reports from site
managers, site supervisors, and other staff to the TELKOM Project
Manager or his authorized representative, updates on any relevant
developments, and discussion of any problems or
59
unresolved issues arising in the previous month.
26.3.4 Monthly meetings may be held anywhere at such times and places as
mutually convenient to the Parties.
26.4 Representation at JPS, DRM and Monthly Meetings
26.4.1 TELKOM and PARTNER shall notify each other from time to time regarding
their appointments (and any changes to such appointments) of authorized
representatives who have authority to execute or make agreements in any
JPS and/or DRM and/or monthly meeting on their behalf.
26.4.2 Agreements of the Parties reached at a JPS and/or DRM and/or monthly
meeting shall be signed by authorized representatives of each of the
Parties as notified to each other from time to time.
ARTICLE 27. INSTALLED LINE PROCUREMENTS
27.1 The planned number of lines to be installed in each Quarter (the "Base
Line") as set out in Appendix 7 (Deployment Plan) shall be used as a
fixed number from which to calculate the amount by which planned
Installed Line Procurements can be adjusted from time to time at a DRM
or JPS in accordance with the flexible procurement methodology
contemplated in this Article 27.
27.2 Based on the Deployment Plan for the following Quarter, the calculation
of Installed Line Procurements contemplated in the following Quarter
will be adjusted in accordance with the following formula:
Installed Line Procurements = Base Line x (1+ Percentage Index)
60
27.3 The Percentage Index shall be 0% for the first Quarter. For subsequent
Quarters, TELKOM may at its sole discretion vary the Percentage Index
by a maximum of 15%, up or down, from the Percentage Index adopted for
the previous Quarter, i.e., the Percentage Index = Percentage Index for
the previous Quarter +/- 15%, provided that over the term of this
Agreement, the minimum Installed Line Procurements shall be 60% of the
total cumulative Base Line.
27.4 The Parties may also agree to change the Percentage Index by more than
15% for a particular Quarter, provided that for purposes of calculating
the applicable maximum limits of the Percentage Index for the following
Quarter, the Percentage Index for the previous Quarter will be deemed
to have been varied by a maximum of 15% only, and the Percentage Index
for the following Quarter calculated from that limit rather than from
the actual Percentage Index of the previous Quarter in which the
applicable maximum limits were exceeded.
27.5 For the avoidance of doubt, once the commitment volumes set forth in
Article 27.3 have been reached, TELKOM shall have no further commitment
to increase the Installed Line Procurements.
ARTICLE 28. PURCHASE ORDERS AND PROCEDURES
28.1 PARTNER shall deliver all Deliverables to TELKOM in response to
Purchase Orders issued by TELKOM from time to time, generally on a
quarterly basis in conjunction with a DRM.
28.2 TELKOM through the TELKOM Project Manager (preferably) or other
authorized TELKOM representative and/or authorized BOT representatives
agreed by the Parties (for particular geographical areas as notified in
writing by TELKOM from time to time) will issue Purchase Orders based
on deployment at a particular DIVRE level.
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28.3 A Purchase Order will be valid only if it is: (a) made in writing in
the form set out in Appendix 12 (Purchase Orders), and (b) signed by
the TELKOM Project Manager or his designated representative, and (c)
accompanied by the written undertaking which complies with Article
32.10(b).
Each Purchase Order shall include necessary and appropriate attachments
to clearly describe:
28.3.1 Subscriber Target numbers defined per Location and Site (BTS);
28.3.2 Value of Purchase Order defined per Location and Site (BTS);
28.3.3 Local Content items and value;
28.3.4 Project Locations/Site;
28.3.5 Detailed Network Design;
28.3.6 Detailed BoQ; and
28.3.7 The overall Implementation Schedule and the breakdown for each
Location.
28.4 The Subscriber Target for a Purchase Order shall be the Installed Line
Procurement for the DIVRE/Location for the relevant Quarter based on
the Deployment Plan as updated and determined at the related DRM.
28.5 The Subscriber Recorder is TELKOM's database system in the NSS/MSC in
the related DIVRE.
28.6 Within five (5) Business Days from receipt of a Purchase Order, PARTNER
through its authorized representative shall either:
28.6.1 accept the Purchase Order by countersigning on the space provided on
the Purchase Order or a copy thereof and returning the same to TELKOM
by way of facsimile, followed by mail or hand delivery or by courier.
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Countersigning of the Purchase Order by authorized representatives of
PARTNER shall be deemed to constitute acceptance of the Purchase Order
without conditions by PARTNER and any terms and conditions accompanying
such acceptance shall be null and void; or
28.6.2 notify TELKOM by way of facsimile, followed by mail or hand delivery or
by courier that the Purchase Order has not been accepted.
PARTNER shall be entitled to refuse to accept a Purchase Order if: (a)
the Purchase Order is incomplete or does not have the required
attachments; or (b) the Purchase Order does not reflect the written
decision of the relevant DRM pursuant to Article 26.2.11.
28.7 TELKOM shall not be legally bound to purchase more than its minimum
obligations under this Agreement, based on the maximum reduction to the
Installed Line Procurements allowable under Article 27.
28.8 TELKOM may issue one or more new Purchase Orders as appropriate in
conjunction with a DRM relating to the Installed Line Procurement
requirements for the following Quarter.
28.9 TELKOM may issue one or more new Purchase Orders for general services
or combine them with Purchase Orders for Installed Line Procurement
with a separate breakdown for the general services component.
28.10 The T-21 Program includes elements which may be covered by Build
Operate and Transfer ("BOT") arrangements between TELKOM and other
local entities (each an "Investor"). The procurement volumes under
these BOT arrangements are included within the overall T-21 procurement
volumes and are to be planned as part of the JPS and DRM meetings, but
will not be
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paid in accordance with the PAYG payment method set forth in Article
32, but shall be paid 100% on Commissioning unless otherwise agreed
with an Investor. An Investor shall: (a) provide PARTNER evidence of
its bona fides as a financially sound company of good reputation; and
(b) enter into a separate agreement with PARTNER on terms and
conditions acceptable to PARTNER.
28.11 The Purchase Orders may be issued by one or more Investors directly
and, if accepted by PARTNER, shall constitute separate contract(s)
between PARTNER and the Investor for the equipment and services to be
supplied. TELKOM shall provide PARTNER with a list of authorised
representatives of the Investors for each region who can issue such
Purchase Orders.
28.12 The Parties shall exercise their reasonable efforts to ensure that the
maximum prices of the equipment and services and other commercial terms
of these BOT arrangements shall be as provided in Chapter 2 of this
Agreement, but the actual prices shall be subject to negotiation to the
extent of the interest or other savings achieved by virtue of payment
on Commissioning, or as otherwise agreed, rather than by the PAYG
payment method. Title in the equipment shall be transferred upon full
payment by the Investor (to eventually be transferred to TELKOM at the
end of the BOT arrangement by virtue of the agreement between TELKOM
and the Investor) except that title to the software shall not pass at
any time. Payment guarantee will be made by Investor pursuant to one of
the following payment mechanisms: (i) payment to an escrow account at a
bank in Indonesia with terms and conditions acceptable to PARTNER; (ii)
opening of an L/C issued by a bank in Indonesia with terms and
conditions acceptable to PARTNER; or (iii) issuance of a bank guarantee
from a bank in Indonesia with terms and conditions acceptable to
PARTNER.
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28.13 A three year Service Level Agreement in form and substance as set forth
in Appendix 20 (Service Level Agreement) shall apply to the equipment
procured under the BOT arrangement upon Commissioning. The equipment
will be operated by TELKOM on behalf of the Investor during the term of
the BOT arrangement pursuant to a separate agreement and TELKOM shall
work together with PARTNER as if the BOT equipment were part of
TELKOM's network.
28.14 The substance of Chapters 1 and 5 of this Agreement, appropriately
adjusted to the circumstances, shall be included in the contract
between PARTNER and the Investor, unless otherwise agreed.
ARTICLE 29. PERFORMANCE BOND
29.1 As security for the performance of the work to be undertaken by PARTNER
for Package 1 (Module 1) of the T-21 Program, within ten (10) Business
Days following TELKOM's issuance and PARTNER's acceptance of the first
Purchase Order, PARTNER shall deliver to TELKOM a performance bond in
favor of TELKOM in the amount of 5% of the total value of the first
Purchase Order, in form and substance as appears in Appendix 25
(Performance Bond). The Parties agree that it is a condition precedent
to the first Purchase Order and any subsequent Purchase Orders becoming
a binding contract between the Parties that the Performance Bond
covering the work to be performed under the relevant Purchase Order(s)
is in full force and effect.
29.2 As each new Purchase Order following the first Purchase Order is issued
and accepted, the value of the then existing Performance Bond shall be
adjusted to reflect the aggregate value of: (i) 5% of the total value
of that Purchase Order; plus (ii) 5% of the total value of that
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portion of the previous Purchase Order(s) relating to Deliverables not
yet Commissioned as of that date. This process of adjustment may only
be made at the end of each Quarter at the relevant DRM so as to ensure
that as each new Purchase Order is issued and accepted, PARTNER will
adjust the value of the Performance Bond to the appropriate level,
taking into account the value of all Deliverables not yet Commissioned
at that time under the relevant Purchase Orders (new or prior). PARTNER
shall maintain the Performance Bond at the appropriate value levels for
a period terminating on a date which is six (6) months from the first
to occur of the issuance of the first Integrated System Acceptance Test
Certificate by TELKOM pursuant to this Agreement or commercial
deployment of any of the Deliverables.
ARTICLE 30. TERMINATION OF PURCHASE ORDERS
30.1 A Purchase Order may be terminated by TELKOM in whole or in part and
from time to time, by TELKOM acting reasonably under the circumstances.
TELKOM shall deliver to PARTNER a written notice, the "Notice of P.O.
Termination", signed by authorized signatories of TELKOM, specifying
the reasons for its action, the extent to which performance of work
under the Purchase Order is terminated and the date (which shall be not
less than five (5) Business Days from the date of Notice of P.O.
Termination) upon which such termination becomes effective.
30.2 On receipt of such a Notice of P.O. Termination, unless otherwise
directed by TELKOM in the notice, PARTNER shall:
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30.2.1 stop work under the Purchase Order on the date and to the extent
specified in the Notice of P.O. Termination (except to the extent
reasonably required by considerations of security or safety);
30.2.2 place no further orders or contracts for materials, services, or
facilities except as may be necessary for completion of any portion of
the work under the Purchase Order which is not terminated;
30.2.3 use reasonable efforts to terminate all orders and contracts to the
extent that they relate to the performance of work terminated by the
Notice of P.O. Termination;
30.2.4 subject to payment by TELKOM in accordance with Article 30.3, as
reasonably requested assign to TELKOM (where possible under the orders
and contracts), in the manner, at the time and to the extent directed
by TELKOM, PARTNER's rights, title and interest under the orders and
contracts so terminated;
30.2.5 use reasonable efforts to mitigate any damages caused by the
termination of the Purchase Order and settle outstanding liabilities
and claims arising out of such termination of orders and contracts,
with TELKOM's approval or ratification to the extent they may require,
which approval or ratification shall be final for all the purposes of
this Article 30;
30.2.6 subject to payment by TELKOM in accordance with Article 30.3 and as
reasonably requested by TELKOM, (i) transfer title and deliver to
TELKOM in the manner, at the time, and to the
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extent (if any) directed by TELKOM the fabricated or unfabricated
parts, work in progress, completed work, supplies, and other material
produced as part of, or acquired in connection with the performance of
the work terminated by the Notice of P.O. Termination, and (ii) deliver
to TELKOM the completed or partially completed plans, drawings,
information and other property which, if the Purchase Order had been
completed, would have been required to be furnished to TELKOM;
30.2.7 complete performance of such part of the Scope of Work as may not have
been terminated by the Notice of P.O. Termination; and
30.2.8 take such action as may be necessary, or which TELKOM may direct, for
the protection and preservation of the property related to the Purchase
Order which is in PARTNER's possession and in which TELKOM has or may
acquire an interest, provided that if it complies with TELKOM's
directions, PARTNER shall have no liability to TELKOM for loss or
damage to such property.
30.3 After reception of a Notice of P.O. Termination PARTNER shall submit to
TELKOM a written termination claim. Such claim shall be submitted
promptly, but in no event later than ninety (90) calendar days from the
Notice of P.O. Termination. Payment of claimed amounts under such
termination claim agreed by TELKOM to be payable in accordance with
performance by PARTNER of its obligations under Article 30.2, shall be
payable to PARTNER pursuant to issuance of a special Purchase Order and
payment within twenty-one (21) Business Days of approval by TELKOM
(such approval not to be unreasonably withheld or delayed) of
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the claim. For the avoidance of doubt, for purposes of TELKOM's payment
obligations under this Article 30, any Deliverables related to a
Purchase Order for which Notice of P.O. Termination has been given
shall be inspected and checked to the satisfaction of TELKOM, which
inspection shall be deemed to constitute Commissioning. In such event
the Subscriber Target for the terminated portion of the Deliverables
will be adjusted to zero and the value of that portion of the Purchase
Order terminated shall not be taken into account for the purposes of
Article 32.2.
30.4 In the settlement of any such partial or total termination claim,
TELKOM's payment to PARTNER shall be limited to the following:
30.4.1 the price for completed work, based on Appendix 4 (Price Schedule);
30.4.2 a fair and reasonable sum in respect of partially completed work
prorated where practicable based on Appendix 4 (Price Schedule);
30.4.3 the cost of supplies and materials reasonably and necessarily purchased
in respect of the terminated portion of the Purchase Order, but not
incorporated into completed or partially completed work;
30.4.4 the cost of settling and paying claims arising out of the termination
of the work under contracts and orders, as provided above, which are
properly chargeable to the terminated portion of the Purchase Order;
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30.4.5 the reasonable costs of accounting, legal and clerical expenses
reasonably necessary for the preparation of settlement claims and
supporting data with respect to the terminated portion of the Purchase
Order and for the termination and settlement of contracts thereunder,
together with reasonable storage, transportation, and other costs
incurred in connection with the protection or disposal of property
allocable to the Purchase Order.
30.5 Notwithstanding the above, the total payment to PARTNER pursuant to
this Article 30, taken together with any other payment, shall not
exceed the value applicable to the work or to part therefore so
terminated. TELKOM shall not be responsible for any costs or charges
beyond those costs which have been claimed and validated in accordance
with Article 30.4. TELKOM shall not be liable to PARTNER in the event
of such termination for any loss of profit or consequential damages
whatsoever.
30.6 In arriving at the amount due to PARTNER under this Article 30, there
shall be deducted from all monies paid or due to be paid to PARTNER,
any amounts then due and owing by PARTNER to TELKOM and the agreed
price for or the proceeds of sale of any materials, supplies or other
things acquired by PARTNER or sold, pursuant to the provisions of this
Article, and not otherwise recovered by or credited to TELKOM. If this
results in PARTNER having a net liability towards TELKOM, such sum
shall be payable by PARTNER to TELKOM within thirty (30) calendar days
after written demand.
30.7 For a period of one (1) year after final settlement under the Purchase
Order, PARTNER shall preserve and make available to TELKOM at all
reasonable times at PARTNER's premises, but without charge to TELKOM,
all books, records and documents bearing on
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costs and expenses under the Purchase Order relating to the work
terminated under this Article 30.
ARTICLE 31. TERMS OF PAYMENT
31.1 Payments by TELKOM shall be made to PARTNER in accordance with the
terms of this Agreement. The Parties contemplate that TELKOM will pay
for equipment procured pursuant to this Agreement in three instalments:
upon delivery, following Commissioning as evidenced by issuance of the
respective Integrated System Acceptance Test Certificate, followed by
payment during the PAYG Period, in accordance with the terms and
conditions of this Article 31.
31.2 TELKOM will pay 10% of the value of a particular Purchase Order upon
delivery of the Deliverables (and equipment related services but not
including general services for operation and maintenance, spare parts,
software upgrades, Documentation and training) to the Location
specified in the Purchase Order. This amount shall be due and payable
upon delivery to TELKOM of an invoice for the relevant sum, accompanied
by the following documents, or such additional documents as may
reasonably be required by TELKOM:
31.2.1 Invoice covering letter;
31.2.2 Original shipping documents (xxxx of lading or A/W xxxx) for imported
equipment;
31.2.3 Packing list for equipment;
31.2.4 Detailed BoQ and the value of the detailed BoQ by Location and Site;
31.2.5 Tax invoice (Faktur Xxxxx") and tax payment slip (SSP) ("Surat Setoran
Xxxxx");
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31.2.6 Original Goods Delivery Certificate ("Berita Acara Barang Tiba") issued
by TELKOM for equipment; and
31.2.7 Simple receipt ("Kuitansi");
31.2.8 Insurance documentation (consisting of a copy of the relevant policy
and a statement letter from PARTNER confirming that the Deliverables
referred to in the relevant invoice are covered by said policy).
31.3 TELKOM will pay 15% of the proportionate value of a particular Purchase
Order upon successful Commissioning of all or part of the Deliverables
in a particular Purchase Order as evidenced by TELKOM's issuance of the
related Integrated System Acceptance Test Certificate or Partial
Integrated System Acceptance Test Certificate, or commercial deployment
of any of the Deliverables, whichever is earlier. This amount shall be
due and payable upon delivery to TELKOM of an invoice for the relevant
sum, accompanied by the following documents, or such additional
documents as may reasonably be required by TELKOM:
31.3.1 Invoice covering letter;
31.3.2 Detailed BoQ and the value of the detailed BoQ by Location and Site;
31.3.3 As-built drawings (as then available);
31.3.4 Original Integrated System Acceptance Test Certificate and/or Partial
Integrated System Acceptance Test Certificate, certified by TELKOM;
31.3.5 Tax invoice ("Faktur Xxxxx") and tax payment slip (SSP) ("Surat Setoran
Xxxxx"); and
31.3.6 Simple receipt ("Kuitansi");
31.3.7 Insurance documentation (consisting of a copy of the relevant policy
and a statement letter from PARTNER confirming that the Deliverables
referred to in the relevant invoice are covered by said policy).
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31.4 The remaining value of each Purchase Order, constituting 75% of the
total value of a particular Purchase Order (the "PAYG Value"), shall be
invoiced (a "PAYG Value Invoice") only upon issuance of the associated
Integrated System Acceptance Test Certificate(s) (and not Partial
Integrated System Acceptance Test Certificates) or any issuance
pursuant to Article 55.8.9, whichever is earlier, and shall be payable
in accordance with the provisions of Article 32. PAYG Value Invoices
shall be accompanied by the following documents, or such additional
documents as may reasonably be required by TELKOM:
31.4.1 Invoice covering letter;
31.4.2 Simple receipt ("Kuitansi");
31.4.3 Copy of Integrated System Acceptance Test Certificate(s) certified by
TELKOM; and
31.4.4 A worksheet showing the PAYG Value of the Purchase Order.
31.5 To request quarterly payments during the PAYG Payment Period under PAYG
Value Invoices issued in accordance with the provisions of Article 32,
PARTNER shall deliver to TELKOM a "PAYG payment request" in form and
substance as shall be agreed between the Parties, each such request to
be accompanied by a tax invoice ("Faktur Xxxxx") and tax payment slip
(SSP) ("Surat Setoran Xxxxx") and shall include at least the following
data:
(a) the total additional number of T-21 Program CDMA subscribers
in the relevant DIVRE at the end of the Quarter;
(b) the total Subscriber Target number attributable to the
Deliverables that have been Commissioned in the relevant DIVRE
in the Quarter;
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(c) the total PAYG Value of all Deliverables that have been
Commissioned in the Quarter; and
(d) the requested quarterly payment calculated in accordance with
the provisions of Article 32.
ARTICLE 32. PAYG PAYMENTS
32.1 For the purposes of implementing the Pay As You Grow (PAYG) concept
contemplated in the T-21 Program, all Purchase Orders relating to all
or any part of the Deliverables components that have been Commissioned
(excluding those in relation to general services for operation and
maintenance, spare parts, software upgrades, Documentation and
training) in the same Quarter shall be grouped together on a DIVRE
level basis, provided also that a group of Purchase Orders may be
segmented by types of Deliverables and scope of services, if necessary.
For the purposes of administration, each Purchase Order shall at the
end of the relevant Quarter be treated as if comprised of two parts as
appropriate, one part comprising all Commissioned Deliverables and one
part comprising the Deliverables not yet Commissioned.
32.2 Subject to the provisions of Article 32, PAYG payments for that part of
each Purchase Order comprising Commissioned Deliverables shall become
due at the end of each Quarter based on the net increase in subscribers
in the DIVRE at the end of each Quarter as stated in the Subscriber
Recorder. The initial calculation of PAYG payments in the case where
there are no outstanding Purchase Orders will be as follows:
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Total number of T-21 Program CDMA subscribers in
that DIVRE at the end of that Quarter minus the
total number of T-21 Program CDMA subscribers
in that DIVRE at the end of previous Quarter Total PAYG Value of
------------------------------------------------ X all Deliverables
Total Subscriber Target number attributable to Commissioned in that Quarter
the Deliverables that have been Commissioned
in that DIVRE in that Quarter
The detailed methodology to calculate PAYG payments under various
circumstances is provided in Appendix 11.
32.3 Where only part of the equipment (e.g., a BTS or card) in a
Location/Site referred to in a Purchase Order has been Commissioned,
(i) the Subscriber Target shall be based on the Commissioned BTS or
cards; and (ii) the PAYG Value attributable to that Deliverables shall
be based on the value of said Commissioned BTS or cards including the
associated software and components.
32.4 The PAYG Value of Deliverables such as BSC, PDN, and other equipment in
relation to a particular Purchase Order containing such equipment shall
be calculated at the end of the relevant Quarter by using the total
value of such Deliverables Commissioned in that Quarter multiplied, by
the ratio of the Subscriber Target of all BTS Commissioned in that
Quarter divided by the total Subscriber Target of all BTS in the
related Purchase Order.
32.5 Purchase Orders signed by TELKOM will be paid off sequentially
commencing with the earliest in time. Non-Commissioned Deliverables in
a Purchase Order issued in a particular Quarter will be carried forward
into the Purchase Order(s) aggregated in the following Quarter, until
Commissioned,
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and if Commissioned in that Quarter, will be accounted for in the
calculation of the PAYG payment in that Quarter. To facilitate this
calculation, the particular Purchase Order from which non-Commissioned
Deliverables have been carried forward into the following Quarter shall
be deemed amended by mutual agreement of the Parties by way of
inclusion of such non-Commissioned Deliverables in a subsequent
Purchase Order issued in that following Quarter. Thereafter, without
further action of the Parties, such Purchase Order previously comprised
of both Commissioned and non-Commissioned Deliverables shall be deemed
to be comprised only of Commissioned Deliverables and, as such, shall
become payable under the PAYG payment mechanism set out in this Article
32.
32.6 The net subscriber increase within the second and/or following Quarter
will be counted first towards the cumulative subscribers related to the
Deliverables Commissioned in the first Quarter to the extent such
portion of such Purchase Order relating to the Deliverables
Commissioned in the relevant Quarter have not been paid fully, and then
towards the cumulative subscribers related to the Deliverables
Commissioned in the second and/or following Quarter.
32.7 If there is a decrease in the number of subscribers due to churn or
other reasons in the following Quarter, then no PAYG payments shall be
due until the current number of subscribers has exceeded the number of
subscribers at the time the last PAYG payment became due.
32.8 If the PAYG Value of a Purchase Order has not been paid by the end of
its
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PAYG Payment Period, the remaining unpaid amount shall be due upon
delivery to TELKOM of a PAYG payment request, for that amount.
32.9 In order to calculate the PAYG Value applicable to each Quarter, TELKOM
shall within ten (10) Business Days of the end of each Quarter, provide
to PARTNER the net number of new subscribers added and the total number
of subscribers per DIVRE as recorded by the Subscriber Recorder.
PARTNER shall within ten (10) Business Days of receipt of the
Subscriber Recorder numbers, submit to TELKOM a calculation showing the
PAYG payments due by DIVRE and Purchase Order number (or amended
Purchase Order number) for that Quarter.
32.10 As security for its obligation to pay PARTNER the PAYG Value of a
particular PAYG Value Invoice issued from time to time. TELKOM shall
procure the issuance of a separate bank guarantee(s) in connection with
each of such invoices as provided in Article 32.10(b). The Parties have
agreed the following in connection with issuance of such bank
guarantees:
(a) it is agreed that the security to be provided by TELKOM in the
form of a bank guarantee is not intended to secure quarterly
PAYG Value payments owed to PARTNER, but rather any PAYG
Value payments still outstanding at the end of the relevant
PAYG Payment Period;
(b) each time TELKOM issues a Purchase Order, it shall submit a
written statement addressed to PARTNER in the form of an
undertaking to the effect that at the end of the relevant
Quarter in which any Deliverables under that
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Purchase Order are Commissioned, TELKOM will ensure the prompt
issuance following the end of the relevant Quarter of a bank
guarantee in accordance with this Article 32.10 for the
aggregate amount of the PAYG Value of all Deliverables
Commissioned in that Quarter;
(c) each bank guarantee accompanying each PAYG Value Invoice
issued pursuant to this Article 32 shall:
(i) be denominated in the currency in which TELKOM's
payment obligation is denominated;
(ii) be issued by a bank acceptable to PARTNER; and
(iii) be valid for at least sixty (60) days after the end
of the relevant PAYG Period; and
(iv) be issued in form and substance and on terms and
conditions acceptable to PARTNER, substantially in
the form of Appendix 27 (Bank Guarantee), provided
that in all events each bank guarantee shall provide
a covenant that the PARTNER shall not demand payment
under that bank guarantee until at least thirty (30)
days have elapsed after the end of the relevant PAYG
Payment Period applicable to the Deliverables
Commissioned in the respective PAYG Value Invoice
covered by that bank guarantee;
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(d) all bank charges and fees arising in connection with the
issuance and maintenance of any bank guarantee under this
Article 32.10 shall be borne by PARTNER, and PARTNER shall pay
the required amounts directly to the bank on behalf of TELKOM
upon instructions of TELKOM or the bank, as the case may be;
and
(e) as each quarterly payment of a PAYG Value Invoice is made,
the Parties agree to co-operate with the relevant bank to
adjust the value of the corresponding bank guarantee
accordingly, in accordance with the procedures of the bank
issuing the bank guarantee.
ARTICLE 33. GENERAL SERVICES PAYMENTS
33.1 General services for training provided under this Agreement are not
under the PAYG payment scheme set out in Article 32 and shall be
invoiced by PARTNER supported by a copy of the Training Acceptance
Certificate issued by TELKOM after the services have been completed.
General services invoices for training shall be payable by TELKOM
thirty (30) days after the date the invoice is received by TELKOM.
33.2 All general services for Documentation to be provided by PARTNER under
this Agreement shall be invoiced by PARTNER supported by a copy of a
Documentation Acceptance Certificate issued by TELKOM and shall be paid
25% on delivery and the remaining 75% shall be paid in accordance with
the PAYG payment scheme set out in Article 32, by adding the amount due
to the Contract Value of the group of Purchase Orders for Deliverables
Commissioned in the relevant Quarter and paid in accordance with the
PAYG Payment Period for that group of Purchase Orders.
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33.3 Payments for operation and maintenance, spare parts, software updates
and upgrades shall be made and paid in accordance with the terms of the
applicable Service Level Agreement.
ARTICLE 34. INVOICING
34.1 Payments by TELKOM shall be made to PARTNER based on the issuance and
delivering of invoices to TELKOM. PARTNER at its option may issue
invoices in the name of PARTNER for Deliverables procured outside of
Indonesia and/or by the Indonesian office of PARTNER for Deliverables
and services procured in Indonesia.
34.2 All invoices shall be submitted in triplicate, shall be sent by courier
and shall be accompanied by the relevant documentation listed in
Article 31 showing the acknowledgement by TELKOM or its agent of the
relevant equipment or services delivered and/or such other supporting
documents as may be required by TELKOM. All invoices shall be addressed
to:
PT Telekomunikasi Indonesia Tbk.
Head of Fixed Wireless Division (as Project Manager)
Xxxxx Xxxxx Xxxxx, Xxx. 00
Xxxxxxx
Xxxxxxxxx
34.3 TELKOM shall have (a) fifteen (15) Business Days from receipt of an
invoice to dispute the amounts due by notice in writing or (b) thirty
(30) calendar days to pay PARTNER unless otherwise agreed in this
Agreement. If TELKOM disputes the invoice, PARTNER shall have five (5)
Business Days to reissue a further invoice and the provisions of
sub-paragraph (a) and (b) shall again apply.
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34.4 TELKOM shall pay interest at the rate of 6% per annum, on any
undisputed payment due and unpaid for a period of three (3) months, up
to a maximum of 5% of the undisputed and unpaid portion of the Contract
Value referenced in the applicable Purchase Order, commencing from the
end of such 3-month period.
ARTICLE 35. FINANCING
35.1 Notwithstanding anything to the contrary in this Agreement, the Parties
agree that PARTNER is not arranging for financing of TELKOM's payment
obligations under this Agreement in respect of the Installed Line
Procurements as provided in Chapter 3. In the event such procurement is
exceeded and as reasonably requested by TELKOM, the Parties agree to
meet to discuss mutually acceptable terms and conditions for financing
of such additional procurements.
ARTICLE 36. CHANGE REQUEST PROCEDURES
36.1 During implementation of the Scope of Work, a Party may request at any
time that a change be made to (without limitation) the Deliverables,
Purchase Orders, the Installed Line Procurements, the Implementation
Schedule, the Deployment Plan or other Appendix to this Agreement, as
the case may be. Such request shall be made in the form of a "Change
Request" and must be in writing.
36.2 The Change Request form shall be completed by the requesting party in
accordance with Appendix 18 (Change Request);
36.3 Within ten (10) Business Days after receipt of a Change Request, or
within such other period as may be agreed, PARTNER will evaluate the
Change Request and provide a full written quotation or cost reduction
estimate
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specifying the form that the proposed amendment will take and detailing
the cost impact and effect on the works, including the Implementation
Schedule.
36.4 In the event that the Change Request is processed and agreed in the
required form, the relevant Deliverables, Purchase Order(s), Installed
Line Procurements, Implementation Schedule, Deployment Plan or other
Appendix to this Agreement, as the case may be, shall be deemed amended
accordingly.
36.5 In the event that the Change Request cannot be agreed, there shall be
notification of the reasons in writing within ten (10) Business Days of
receiving the Change Request. Otherwise, when the Parties agree to
implement the Change Request, the details of such change shall be
specified and agreed in writing.
36.6 At the same time as giving the Change Request, the requesting Party
shall provide the other Party such information as may reasonably be
required to assess the impact of the Change Request on the overall
Scope of Work. If there is a reasonable possibility that there will
need to be a material amount of time and effort spent in dealing with a
Change Request, additional payment or payment reduction, as
appropriate, for that time and effort may be negotiated, but
compensation for any work to deal with the Change Request shall be
contingent on prior written agreement between TELKOM and PARTNER.
36.7 PARTNER shall make such changes and implement the Change Request only
upon execution by the Parties of a written document specifying the
agreed changes, the scope of the changes, the adjustments to the
Implementation Schedule, if any, the additional costs or reduction of
costs, if any.
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36.8 Where immaterial changes in the overall size, scope or functionality of
the Deliverables or to the Scope of Work or Technical Specifications
result in an amendment of a Purchase Order and/or this Agreement, such
changes will not affect the Contract Value or the Implementation
Schedule. The cost of any minor amendments or variations or amendments
required by reason of any defect or deficiency in any design or
Documentation or any Deliverables made or provided by PARTNER shall be
borne solely by PARTNER.
36.9 In the event TELKOM and PARTNER cannot reach agreement on the scope and
impact of a Change Request, the matter shall first be referred to the
respective managements of both TELKOM and PARTNER, and failing
agreement, the provisions of Article 16 shall apply.
36.10 Only the designated TELKOM and PARTNER Project Managers or
representatives authorized by them in writing shall be authorized to
sign a Change Request.
ARTICLE 37. RELOCATION OF EQUIPMENT
37.1 Following discussion between the Parties of costs and benefits, TELKOM
may decide to re-locate equipment within a DIVRE if it decides that
initial demand projections or forecast in a given Location were not
accurate and the equipment to be procured pursuant to a Purchase Order
is not likely to generate the revenue that was expected.
37.2 Upon written request of TELKOM, PARTNER shall assist with and supervise
such relocation including redesigning the Network and conducting
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all appropriate tests to put the redeployed equipment into service.
37.3 PARTNER shall bear the costs for the relocation of modular equipment
such as sub-racks and cards which the Parties have agreed do not entail
substantial costs. In all other cases, TELKOM and PARTNER shall conduct
a cost benefit analysis prior to any relocation. All reasonable costs
and risk of loss associated with the relocation of all other equipment
shall be borne by TELKOM. Any relocation of equipment conducted by
TELKOM shall be supervised by PARTNER. PARTNER shall bear the costs of
providing the supervision service, provided that the Service Level
Agreement is in force. TELKOM shall bear the costs of any additional
equipment required.
ARTICLE 38. DETAILS OF PARTNER's BANK ACCOUNTS
38.1 Details of PARTNER's bank accounts into which all payments from TELKOM
shall be paid into are set out below:
For invoices raised by Motorola Inc.:
Citibank N.Y.
Account of Motorola Inc.
Account No. 3849 - 2274
Routing: 000000000
For invoices raised by the Indonesian office of Motorola Inc.:
Citibank N.A.
USD A/C : 0-000000-000
IDR A/C : 0-000000-000
CHAPTER 4.
PROJECT ORGANIZATIONAL MATTERS
ARTICLE 39. LOCAL INDONESIAN ENTITIES, SUBCONTRACTORS, SUPPLIERS
39.1 PARTNER shall enter into contractual relationships with one or more
Local Indonesian Entities and local subcontractor/suppliers as required
to
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meet its Local Content obligations under this Agreement.
39.2 PARTNER shall be the leading technology supplier for the Project,
although it is understood and accepted by TELKOM that wherever in this
Agreement there is reference to the PARTNER taking responsibility for
the manufacture of any equipment, or PARTNER manufacturing the
equipment, or PARTNER being the radio network manufacturer, that the
equipment may actually be manufactured by an affiliate of PARTNER (such
as Motorola Ltd. or Motorola China Electronics Ltd.).
39.3 All substitutions, replacements or other changes to PARTNER's planned
usage of local subcontractors, suppliers and other Local Indonesian
Entities as set out in Appendix 1 must be submitted to and approved by
TELKOM in writing (such consent not to be unreasonably withheld) before
being implemented.
ARTICLE 40. ASSIGNMENT AND SUBCONTRACTING
40.1 PARTNER shall not, without the prior written consent of TELKOM (which
consent shall not be unreasonably withheld or delayed), transfer its
obligations under this Agreement. Notwithstanding this agreement of the
Parties, TELKOM hereby agrees that PARTNER may assign or sub-contract
the in-country services portion of this Agreement to its subsidiary, PT
Motorola Indonesia, but only to the extent that such assignment or
sub-contracting (i) does not prejudice PARTNER's Local Content
obligations under this Agreement, (ii) does not relieve PARTNER of
responsibility under this Agreement, and (iii) does not encumber any of
the moneys due or becoming due under this Agrement. The Parties agree
that TELKOM shall not be required to give its consent to any
encumbrance (for the avoidance of doubt, the Parties agree that the
bank guarantee issued in accordance with Article 32.10 shall not be
deemed a form of encumbrance) of money due or
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becoming due under this Agreement if by reason or consequence of such
consent the assignee shall have direct or indirect recourse to TELKOM.
TELKOM reserves the right to assign this Agreement, without prior
approval of PARTNER to an Investor, as contemplated in Articles
28.10 - 28.14 provided the Investor gives PARTNER satisfactory payment
assurances under Article 28.12 of this Agreement.
40.2 TELKOM reserves the right to assign this Agreement, with the prior
written consent of PARTNER (such consent not to be unreasonably
withheld or delayed), to any of TELKOM's subsidiaries or related
companies, provided the subsidiaries or related companies provide
satisfactory payment assurances.
40.3 A schedule of each proposed sub-contractor and the part of the Scope of
Work proposed to be performed by such sub-contractor is attached in
Appendix 1. In case of any plan to change and/or to add a
sub-contractor, PARTNER shall notify TELKOM in writing immediately
before the proposed sub-contractor is appointed. TELKOM shall advise
within ten (10) Business Days if it has substantive objections to the
appointment of any of such proposed sub-contractors and/or the work
they were intended to do, and PARTNER shall take such objections into
account so as to meet with TELKOM's approval.
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40.4 The use of sub-contractors shall in no way relieve PARTNER from its
responsibility to deliver the Deliverables to TELKOM (in particular to
ensure that any Deliverables comply with all requirements of this
Agreement) or to perform necessary tasks such as project management
related to this responsibility in accordance with this Agreement.
40.5 PARTNER shall ensure that the addition or removal of any sub-
contractors shall not impact the agreed Contract Value or
implementation of the Scope of Work.
ARTICLE 41. INVOLVEMENT OF LOCAL ENTITIES
41.1 PARTNER shall use all reasonable efforts to maximize involvement of
entities in Indonesia in its provision of Deliverables, the objective
being to maximize financial benefits as well as transfer of knowledge
and learning in Indonesia and thereby reduce TELKOM's exposure to
foreign exchange risk. In this connection, "all reasonable efforts"
will be defined by reference to a minimum threshold level of local
Indonesian involvement in executing the Project, comprising a
percentage of the total contract value of the Project, which is a
minimum of 20% of the Contract Value (quoted in Indonesian currency) of
Package 1 (Module 1).
41.2 The Local Content requirement can be satisfied by reference to the
total contract value of the Project executed through Local Indonesian
Entities, whether as key subcontractors of PARTNER or through other
external Indonesian parties.
41.3 TELKOM agrees that expenses of non-Local Indonesian Entities in
Indonesia supporting the Project may be included in the calculation of
total contract value for these purposes, including salaries paid to
staff located in Indonesia
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(Indonesian nationals or residents only), property rental and other
operational expenses of Indonesia offices, administrative materials and
services acquired in Indonesia, provided that PARTNER executes an
undertaking to TELKOM as provided below.
41.4 The undertaking required by TELKOM shall state that PARTNER will, over
the duration of the Project, procure certain materials and services
within Indonesia (stating all categories of materials and services) to
support the local operations of the overseas companies in the Project.
Further, that all such procurements will be in accordance with the
requirements stated by TELKOM in the RfP for the T-21 Program to the
extent not inconsistent with this Agreement and in aggregate equate to
or exceed the minimum threshold amount required to be quoted in
Indonesian currency as set forth in Article 41.1.
41.5 TELKOM reserves the right to verify, accept or reject all claims in
part or in full regarding execution of the Project through Local
Indonesian Entities, expenses of overseas companies and in regard to
the claimed transfer of skills, technology and financial benefits.
ARTICLE 42. LOGISTICS
42.1 PARTNER shall provide all logistical requirements from the point of
origin of any Deliverables or other Project goods to the applicable
Project Location/Site, inclusive of all charges, such as transport and
transit, demurrage, storage, insurance, fees and levies. In addition,
pursuant to the Scope of Work, PARTNER shall provide all equipment
related services (covering survey, design, planning, permits, right of
way, services related to land acquisition, installation, integration,
project management, insurance up to
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transfer of title in accordance with Article 10.2, testing and
commissioning, and all related materials and expenses) for both
imported and local goods.
42.2 PARTNER shall provide all arrangements for shipping/transportation,
forwarding and servicing Deliverables or other Project goods from their
point of origin to the Project Location/Site where they are finally
deployed.
42.3 PARTNER shall provide all warehousing requirements and explain the
locations of the facilities to be used for this purpose. PARTNER will
also be required to arrange for warehousing and storage facilities at
installation sites to ensure proper storage and protection of all
Deliverables or other Project goods. PARTNER shall ensure that all
equipment is adequately packaged and stored to avoid any damage. While
in such warehousing, the equipment and material will be the sole
responsibility of PARTNER.
42.4 PARTNER shall provide all required protection, insurance and other
services to ensure safe delivery of the all Deliverables or other
Project goods. PARTNER shall be responsible for any damage or loss of
goods.
ARTICLE 43. INVENTORY
43.1 PARTNER shall provide all services to ensure proper installation of
Deliverables or other Project goods, provide optimal operating
conditions and maximize the long term viability of the foregoing.
PARTNER must provide all tools and equipment necessary to install and
commission any Project equipment procured under this Agreement.
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43.2 Provision of materials, labor, equipment, tools and machinery for
installation shall consist of the following activities:
43.2.1 PARTNER's contractor shall provide all materials (including cables,
connectors and other miscellaneous materials), labor, tools,
transportation, telecommunication facilities (telephone, facsimile,
etc.) and everything else necessary for completion of work in
accordance with this Agreement;
43.2.2 PARTNER's contractor shall employ an adequate supervisory force and an
adequate staff of experienced engineers, technicians and workmen to
complete the Scope of Work in a satisfactory and workmanlike manner
within the time specified in the this Agreement;
43.2.3 with the cooperation of TELKOM staff, all work at any Location/Site
shall be carried out in such a manner as to minimize any obstructions
to the operation of TELKOM's staff at such Location/Site;
43.2.4 PARTNER and its sub-contractors shall itemize and provide all
equipment, tools, measuring equipment, machinery and electrical power
equipment necessary for execution of the Scope of Work in Indonesia;
and
43.2.5 PARTNER and its sub-contractors shall provide a list of equipment,
tools, measuring equipment, machinery and electrical power equipment
which is used for installation purpose only.
43.3 Delivery and storage of Project equipment and materials shall consist
of the following activities:
43.3.1 PARTNER and its sub-contractors shall be responsible for storage
arrangements during the interval from the delivery of equipment until
it is required for installation;
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43.3.2 PARTNER and its sub-contractors shall be responsible for loading and
unloading as well as handling of any equipment and materials at all
stages up to Commissioning;
43.3.3 PARTNER and its sub-contractors shall also be responsible for unpacking
(and repacking where necessary), identification and checking of
materials and relevant invoices or other documents; and
43.3.4 PARTNER and its sub-contractors shall be responsible for handling and
storage of any goods during transportation and at the site.
ARTICLE 44. LOCAL SUPPORT INFRASTRUCTURE
44.1 PARTNER shall have local (Indonesian) infrastructure in place to
support the T-21 Program as set out in Appendix 10. PARTNER shall
provide TELKOM access to its local technical staff to ensure effective
deployment, operations and timely problem solving. PARTNER shall use
its best endeavours to ensure that such local support is timely, cost
effective, and of high quality in order to meet TELKOM's desired
service levels.
ARTICLE 45. PROJECT MANAGEMENT
45.1 PARTNER shall propose a Project Management Plan ("PMP"), in a form as
provided in Appendix 8 (Project Management Plan). TELKOM and PARTNER
shall discuss and mutually agree on the details of the PMP.
45.2 Prior to start-up of Project activities, the Parties shall have
agreed on a PMP containing at least the following:
45.2.1 Scope of work;
45.2.2 Project organization and personnel;
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45.2.3 Project activity plan and schedule by Location;
45.2.4 Reporting of progress and issues.
45.3 PARTNER shall appoint the Project personnel as described in the PMP
including a Project Manager who will be responsible for contact with
TELKOM with respect to resolving issues arising in the course of
Project implementation. The Project Manager may also serve as one of
the Project personnel referenced in the PMP.
45.4 The identity and qualifications of all key Project personnel proposed
by PARTNER to work on the Project in Indonesia, including the Project
Manager as described in the PMP shall be notified in writing by PARTNER
to TELKOM before appointment. The Project Manager shall only be
appointed with TELKOM's prior approval. For all other key Project
personnel, TELKOM shall inform PARTNER of any objections within ten
(10) Business Days of notification and any Project personnel to whom
TELKOM objects shall not be appointed. Replacements must be equally
well qualified and appropriate for the Project.
45.5 TELKOM shall appoint its Project Manager with whom PARTNER Project
personnel shall maintain close cooperation and communication at all
times. TELKOM may also appoint local supervisors with whom PARTNER's
local Project personnel shall maintain close cooperation and
communication at all times.
45.6 TELKOM may object to and, after consultation with PARTNER direct
PARTNER to remove from any site immediately any person employed by
PARTNER or any sub-contractor at the site who, in the reasonable
opinion of TELKOM, misconducts himself, has proved to be unsuitable
under the terms of the Scope of Work or is incompetent or negligent in
the performance of his duties, and such person shall not be employed
again at any Project site except with the prior written approval of
TELKOM.
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45.7 PARTNER shall submit to TELKOM the required progress report described
in the Scope of Work. With respect to any period covered by a progress
report, in the event that PARTNER fails to inform TELKOM of any
problem, TELKOM shall be entitled to presume that no such problem arose
during such period. However, submission by PARTNER to TELKOM of the
specified progress reports will not alter, amend or modify PARTNER
obligations pursuant to any other provision of this Agreement.
45.8 PARTNER shall provide complete project management support to the
Project including without limitation, managing the constituents members
of PARTNER, subcontractors and other suppliers, as well as managing the
acquisition of required sites, licenses, permits and rights of way.
45.9 PARTNER shall provide comprehensive and up-to-date reporting to TELKOM
management at all appropriate levels to track progress of the Scope of
Work, monitor key requirements, identify and address issues and ensure
high quality of deployment achieved within budget.
45.10 PARTNER shall provide the following types of reports to TELKOM during
the period of deployment of the Network on a monthly basis:
(a) Deployment Status Update;
(b) Updated Issues Log;
(c) Shipment Tracking Report.
45.11 PARTNER shall at intervals of two (2) months submit an updated
Implementation Schedule to TELKOM. The updated Implementation Schedule
shall contain important milestones including:
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45.11.1 Commencement of implementation of each Location;
45.11.2 Commencement of the detailed survey for each Location;
45.11.3 Completion of installation, construction designs, drawings associated
with the Project;
45.11.4 Readiness dates for interim inspections, PARTNER own tests, and
Commissioning tests for each Location/Site;
45.11.5 Manufacturing and transportation schedules of materials for each Sub-
system per each Location including the times of factory performance
tests.
45.12 Delivery of Deliverables and services by PARTNER, shall be in
conformity with the provisions of this Agreement and/or the respective
Purchase Order, including the time schedule and milestones set forth in
Appendix 9 (Implementation Schedule).
45.13 Each alteration to the implementation Schedule shall be upon mutual
agreement of the Parties and valid only if executed as a Change Request
signed by the authorized representative of each of the Parties.
45.14 PARTNER shall keep records of (without limitation) the general business
administration of the Project, i.e.:
45.14.1 Invoicing and records of TELKOM payments;
45.14.2 Personnel management;
45.14.3 Taxes; and
45.14.4 Insurance.
45.15 PARTNER shall report on the Project's progress, including any
significant difficulties encountered, to TELKOM at monthly meetings in
accordance with Article 26.3.
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45.16 PARTNER shall liaise with TELKOM in each DIVRE for deployment
coordination and with regional authorities, public utilities and third
parties in the areas for permits and Network roll-out. The liaison
shall be arranged during regular monthly meetings with TELKOM and the
following parties during Network rollout: (i) TELKOM in the regional
division area; (ii) other TELKOM contracting parties; and (iii)
subcontractors.
45.17 In addition, the Parties shall arrange ad-hoc meetings as required on
reasonable notice to deal with coordination and implementation related
issues.
ARTICLE 46. RESEARCH AND DEVELOPMENT
46.1 PARTNER shall from time to time at TELKOM's request consider
participating in joint development efforts in the field of software and
services enhancement. Any such joint development activities shall be
mutually agreed upon as to the scope, responsibilities of each Party,
allocation of costs, ownership of Intellectual Property Rights and
other mutually agreed items. TELKOM employees shall be actively
involved in such development efforts.
46.2 Pursuant to Article 5.1.9, PARTNER shall provide timely notice to
TELKOM of its newest tested technologies relevant to the Project and
any improvements it deems advantageous to TELKOM in the current Project
"road map" of technology development.
ARTICLE 47. TRAINING, TRANSFER OF KNOW HOW
47.1 PARTNER shall provide training in accordance with this Article 47 and
the detailed training requirements and
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schedule specified in Appendix 19 (Training). TELKOM shall provide
qualified engineers for training programs provided by PARTNER under
this Agreement.
47.2 Training shall be conducted in two (2) parts, one in PARTNER's training
center overseas (at a location to be advised to TELKOM at least
forty-five (45) calendar days prior to such training), and the other in
Indonesia. For both training locations, PARTNER shall provide
class-room training ('Class') and On-the-job training ('Job'). PARTNER
shall propose detailed schedules for both types of training based on
TELKOM's requirements.
47.3 The training course shall cover three (3) areas of expertise, i.e.:
(a) System Engineering
PARTNER shall conduct training in an efficient manner to
produce well trained proficient personnel capable of
engineering. The course is intended to train personnel to have
basic knowledge of CDMA network planning and system design
engineering.
(b) Operation and Maintenance
The course is intended to train personnel to have basic
knowledge of system operation and maintenance and who shall be
required to provide guidance and instruction, necessary to the
entire operation team after completion.
(c) Business Development and Marketing
The course is intended to train personnel to have basic
knowledge on how to develop
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the CDMA FWA business and will include training on product
knowledge and marketing.
47.4 Overseas Training
47.4.1 The overseas training requirement for BSS is summarized below.
NUMBER OF TRAINEES PER
TRAINING
NUMBER OF --------
TRAINING DURATION CLASS JOB
-------- -------- ----- ---
System Engineering 2 times 2 weeks 10 N/A
Operation and Maintenance 2 times 2 weeks 10 10
Business Development and Marketing 2 times 2 weeks 10 N/A
47.4.2 For overseas training, the following costs are included in the unit
price:
(a) Daily allowance for accommodation and meals of $200 per
trainee including Saturday and Sunday and 2 days for travel
(arrival and departure)
(b) Airport tax, excess baggage and fiscal $500 per person
(c) Insurance, $50 per person
(d) Tuition Fee (including training materials)
(e) Roundtrip airfares from Indonesia to PARTNER's Main Training
Center, according to the following rates:
(i) Europe : $3,500/
PAX
(ii) United States : $3,500/
PAX
(iii) Asia : $1,500/
PAX
(iv) Australia : $2,000/
PAX
47.5 In-Country Training
47.5.1 The in-country training requirement for
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BSS is summarized below:
NUMBER OF TRAINEES PER
TRAINING
NUMBER OF --------
TRAINING DURATION CLASS JOB
-------- -------- ----- ---
System Engineering 2 times 2 weeks 10 N/A
Operation and Maintenance 2 times 2 weeks 10 10
Business Development and Marketing 2 times 2 weeks 10 N/A
47.5.2 For local training, the following costs per trainee are included in the
unit price:
(a) Divlat (TELKOM's training center) fee: $350 per week for
accommodation, meals and training venue (not required for
on-the-job training)
(b) Tuition fee (including training materials)
47.6 Training Materials and Tools
47.6.1 PARTNER shall provide materials and tools for the following classroom
training:
(a) Introduction of CDMA FWA including supported services;
(b) System Engineering, Operation and Maintenance Procedures;
(c) Network Planning, which includes Traffic Engineering and Link
Budget;
(d) Installation and Test Procedures; and
(e) Troubleshooting.
47.6.2 PARTNER shall propose training material and tools, for the following
on-the-job training:
(a) Operation and maintenance procedure of CDMA FWA;
(b) System performance measurement; and
(c) Trouble shooting by measuring equipment
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ARTICLE 48. MANAGEMENT FORUM
The Parties shall establish a regular channel of communication between their
respective managements and shall hold meetings on a semi-annual basis to discuss
the progress of the T-21 Program.
ARTICLE 49. DEVELOPMENT OF INDONESIAN INDUSTRY
The Parties agree to support the development of the Indonesian
telecommunications industry and to maximise the benefit of the T-21 Program to
local industry. In additional to providing economic benefit through maximising
local procurement. TELKOM and PARTNER have agreed on other steps that they will
take together, including setting up educational or training centres, and working
with TELKOM to develop business models to promote new local business
opportunities arising out of the deployment of T-21 Program technologies such as
new CDMA content development. PARTNER has also agreed to consider supplying CDMA
2000 1x test bed systems and trainers to the planned educational or training
centers for CDMA 2000 1x, EV-DO/EV-DV and other CDMA technology training of
TELKOM and other Project staff. The Parties agree to discuss the technical and
financial aspects of such joint actions and within ninety (90) days after the
effective date of this Agreement, agree on an implementation plan for
development of the Indonesian telecommunication industry in accordance with
PARTNER's commitments in its response to the RfP.
CHAPTER 5.
TECHNICAL PROVISIONS
ARTICLE 50. GENERAL REQUIREMENT FOR EQUIPMENT
50.1 All equipment installed by PARTNER to TELKOM shall:
50.1.1 meet the agreed requirements in Appendix 5 (Technical Specifications);
50.1.2 function in accordance with the technical documentation in the
Technical Specifications;
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50.1.3 have obtained type approval, if required, from DGPT and met TELKOM's
quality assurance standards;
50.1.4 at delivery meet the requirements prescribed by or pursuant to the
applicable laws, rules, regulations, guidelines, and standards of all
applicable jurisdictions;
50.1.5 conform to the Technical Specifications and be free of material,
production, construction and design faults;
50.1.6 be manufactured from new and sound material;
50.1.7 at a minimum comply with the MTBF (Mean-Time-Between-Failures) values
submitted by PARTNER and as updated from time to time;
50.1.8 be packed adequately; and
50.1.9 be accompanied by the agreed upon Documentation in English.
50.2 Until Commissioning of the relevant Deliverables in any Purchase Order
in which software is included, software delivered by PARTNER shall not
contain viruses or any improper additions or modifications. "Viruses"
includes time bombs, worms, 'trojan horses', drop dead devices, back
door devices or any other components, which may fully or partly affect
the intended functioning of the software. "Additions and modifications"
mean software components which modify the functionality in a different
way from that set forth in the applicable specifications. PARTNER shall
not be entitled to activate a virus to the detriment of TELKOM. If
PARTNER detects a virus or addition/modification or symptoms of a virus
prior to Commissioning and during the SLA period, it shall immediately
inform TELKOM and undertake its best efforts to eliminate the virus or
the addition/modification and prevent damage for TELKOM at no charge.
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ARTICLE 51. QUALITY ASSURANCE
51.1 PARTNER shall make all reasonable efforts to ensure that TELKOM at its
discretion, upon reasonable notice and during business hours, is
entitled to inspect and/or audit the production and installation phases
of the processes of all PARTNER's sub-contractors and suppliers.
PARTNER shall co-operate with TELKOM in case TELKOM elects at its
expense to conduct such inspections and/or audits.
51.2 PARTNER shall make a final inspection of all Deliverables prior to
delivery to TELKOM and a report containing the results of the final
inspection shall be supplied to TELKOM on delivery.
51.3 If and in so far as any equipment or a component thereof is produced by
a sub-contractor working for PARTNER, PARTNER shall make all reasonable
endeavors to include similar provisions in its contract with the
sub-contractor in order to enable TELKOM to perform inspections of a
similar nature.
ARTICLE 52. SURVEY, DESIGN, AND PLANNING
52.1 The planning and design activities for the Project must be able to
fully accommodate the JPS, DRM and monthly meeting mechanism described
in Article 26 and the flexible procurement mechanism as described in
Article 27 of this Agreement.
52.2 The planning and design works shall consist of the following
activities:
52.2.1 Survey of the Location/Site(s)
PARTNER shall determine the optimum Location/Site for installation of
the equipment, provided that the optimum Location/Site should
preferably be in the premises of TELKOM or its subsidiaries in order to
ease network integration and
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maintenance.
52.2.2 Maximizing use of existing infrastructure
Based on the information acquired during site surveys and data provided
by TELKOM, PARTNER will be required to maximize and optimize all
reusable infrastructure and incorporate it into the equipment
requirements. The underlying objective shall be to maximize the asset
turnover of TELKOM while ensuring that current infrastructure or future
development/expansion will not be impacted adversely. TELKOM shall
review and agree to the list proposed by PARTNER before PARTNER may
utilize it to support network roll-out.
52.2.3 Proposing more efficient solutions
PARTNER shall propose a more efficient solution, if available, after
TELKOM's review of PARTNER initial roll-out plan. Such solution shall
highlight areas of improvement from the original plan.
52.2.4 Network optimization planning
PARTNER will be required to conduct Network optimization planning
together with TELKOM considering both existing and future Network
requirements. Network optimization planning must be able to fully
accommodate the JPS, DRM and monthly meeting mechanism and the
flexibility procurement mechanism provided for in Articles 26 and 27,
respectively, of this Agreement. Network optimization planning shall
consist of the proposed plan and improvement of the current plan
including potential implication to the overall network performance.
Network optimization planning shall take into account the following
technical aspects:
(a) ease of maintenance/operation;
(b) network reliability (diversity to important subscriber);
(c) flexibility to demand fluctuation
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(capacity and features);
(d) expandability of the Network;
(e) ease of construction and integration; and
(f) inter-operability.
ARTICLE 53. SITE PREPARATION, ACQUISITION, RIGHTS OF WAY AND PERMITS
53.1 The Parties shall be responsible for preparing the Locations/Sites
where the Deliverables are to be installed in accordance with Appendix
3 (Scope of Work).
53.2 PARTNER shall perform all necessary tasks to ensure Location/Site
preparation for Network roll-out in coordination with TELKOM, as
follows:
53.2.1 arrange and acquire all the permits required to perform the work, such
as (but not limited to) installation permits, rights of way, and other
permits necessary either from local municipality or other parties. The
cost for acquiring the permit is included in the unit price and shall
not be priced separately, while the actual cost of the permit itself
shall be borne by TELKOM;
53.2.2 acquire the right of use of land on a rental basis, subsequent to
TELKOM's approval to install towers for mounting the antennas or for
other needs relating to the Project;
53.2.3 conduct the land acquisition process, in the event rental is not
possible, subsequent to TELKOM's approval to install towers for
mounting the antennas or for other needs relating with the Project.
TELKOM shall provide and procure that its subsidiaries provide all
reasonable assistance to PARTNER in relation to this land acquisition
process. The cost associated with the land acquisition process (but not
the cost of the land, rental and lease fee itself) shall be borne by
the PARTNER. The cost of the land itself shall be agreed in advance
with TELKOM (such agreement not to be unreasonably
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withheld or delayed). TELKOM shall make payment to the landowner or
lessor, as the case may be, for the cost of the land, rental or lease
promptly upon execution of the sale and purchase of land deed or upon
execution of the applicable rental or lease contract. The procedures
for implementing such payments shall be agreed upon within one (1)
month of the execution of this Agreement.
53.3 PARTNER shall arrange and acquire a frequency license from Directorate
General of Post and Telecommunication (DGPT) on behalf of TELKOM.
TELKOM will assist PARTNER by issuing the appropriate cover letter to
DGPT. For the avoidance of doubt, PARTNER shall not own the license,
but will simply support TELKOM by providing technical assistance and
consulting services (which are included in the unit prices). The cost
associated with the frequency acquisition process (but not the cost of
the license itself) shall be borne by PARTNER. TELKOM shall make
payment to DGPT for the actual cost of the license itself promptly upon
TELKOM's receipt from PARTNER of the appropriate documentation to
effect such payment.
ARTICLE 54. INSTALLATION PROCEDURES AND STANDARDS
54.1 PARTNER shall provide all services to ensure proper installation of all
equipment, provide optimal operating conditions and maximize its long
term viability. PARTNER shall provide all tools and equipment necessary
to install and commission their equipment.
PARTNER shall provide equipment installation services that shall
consist of the following activities:
54.1.1 provision of materials, labor, equipment, tools and machinery for
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installation;
54.1.2 materials delivery and storage;
54.1.3 transportation of goods;
54.1.4 installation of the equipment;
54.1.5 cleaning-up sites; and
54.1.6 site preparation plan and drawings.
54.2 Provision of materials, labor, equipment, tools and machinery for
installation shall consist of the following activities:
54.2.1 PARTNER's contractor shall provide all materials, labor, tools,
transportation, telecommunication facilities (telephone, facsimile,
etc.) and everything else necessary for completion of work in
accordance with this Agreement;
54.2.2 PARTNER's contractor shall employ an adequate supervisory force and an
adequate staff of experienced engineers, technicians and workmen to
complete the work in a satisfactory and workmanlike manner within the
time specified in this Agreement;
54.2.3 with the cooperation of TELKOM staff, all work at each Location/Site
shall be carried out in such a manner as to minimize any obstructions
to the operation of TELKOM's staff at site.
54.2.4 PARTNER's contractor shall itemize and provide all equipment, tools,
measuring equipment, machinery and electricity necessary for execution
of the Scope of Work in Indonesia; and
54.2.5 PARTNER's contractor shall provide a list of equipment, tools,
measuring equipment, machinery and electricity which is used for
installation purpose only.
54.3 Installation of the equipment shall consist of the following
activities:
54.3.1 PARTNER's contractor shall be responsible for providing connection and
integrating sub-components into
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Sub-system units;
54.3.2 PARTNER's contractor shall be responsible for Sub-system unit checks
and shall ensure the each Sub-system unit functions as required.
54.4 Cleaning-up at each Location/Site shall be conducted during
installation periods and consist of the following activities:
54.4.1 PARTNER's contractor shall keep the work and storage areas clean and
tidy and shall remove daily all combustible rubbish from inside and
near the buildings, structures and plant;
54.4.2 upon completion of each installation, PARTNER's contractor shall remove
from the Location/Site as early as possible all tools, appliances,
packing cases and plant not constituting an integral part of this
Agreement.
54.5 PARTNER shall cause its contractors to either remove or level all
excess earth or spoils resulting from any excavation.
54.6 PARTNER shall cause its contractors to make good at their own expense,
all damages to buildings, plants, finishes, etc., caused by contractor,
any subcontractor(s) and/or their employees.
ARTICLE 55. TESTING AND COMMISSIONING
55.1 BTS Pre-Commissioning Activities
55.1.1 Prior to PARTNER's personnel being dispatched to a Location/Site where
the BTS is being installed, PARTNER shall cause its sub-contractor to
provide to PARTNER and TELKOM a completed Location/Site Readiness
Checklist. The completed checklist shall be verified and signed off by
PARTNER's designated representative assigned to the wireless network in
which the work is being performed. Upon the successful completion of
the Location/Site Readiness Checklist the Location/Site will be
declared "Location/Site Ready".
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55.1.2 Once the Location/Site is declared "Location/Site Ready", PARTNER
shall:
(a) provide a Commissioning team to execute the PARTNER's Own
Tests and the Commissioning tests after obtaining approval
from PARTNER's sub-contractor, who shall be notified
reasonably in advance of the commencement of Commissioning;
(b) provide all tools and test equipment (including handsets in
sufficient numbers) required to Commission the Cell Site
Cabinet/Carrier;
(c) install and connect all batteries and circuit packs delivered
to the relevant Location/Site
(d) provide, place and terminate all RF cables from (i) the BTS to
the antenna cables(s)/feeder cables brought to BTS equipment
room by PARTNER's sub-contractor and (ii) from the BTS to the
GPS, including all clamps, connectors, etc; and
(e) install all required amplifiers and other elements as
necessary for adding carriers to an existing BTS Cabinet.
55.2 BSC Pre-Commissioning Activities
55.2.1 Prior to PARTNER's personnel being dispatched to a Location where the
BSC is being installed, PARTNER shall cause its sub-contractor to
provide to PARTNER and TELKOM a completed Location/Site Readiness
Checklist. The completed checklist shall be verified and signed off by
PARTNER's designated representative assigned to the wireless network in
which the work is being performed. Upon the successful completion of
the Location/Site Readiness Checklist the Location will be declared
"Location/Site Ready".
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55.2.2 Once the Location is declared "Location/Site Ready", PARTNER shall:
(a) provide a Commissioning team to execute the PARTNER's Own
Tests and the Commissioning tests after obtaining approval
from PARTNER's sub-contractor, who shall be notified
reasonably in advance of the commencement of Commissioning;
(b) provide all tools and test equipment (including handsets in
sufficient numbers) required to Commission the Cell Site
Cabinet/Carrier;
(c) provide, place and terminate, as applicable, all the cables
from:
(i) Tx equipment
(ii) PDN
(iii) other BSCs, including all clamps, connectors, etc.
55.3 Testing and Equipment Certification
55.3.1 PARTNER shall be required to perform and facilitate system tests for
all equipment and components delivered under this Agreement.
55.3.2 The Commissioning tests shall comprise of the Sub-system Acceptance
Tests and the Integrated System Acceptance Tests. A summary of the
testing, commissioning and certification conditions are summarized in
the table provided below:
NAME OF TEST CERTIFICATE CONDITION FOR CERTIFICATION
--------------------------------------------------------------------------------------
Factory Performance Test No certification issued, but None
TELKOM should have access
to the results of the test
--------------------------------------------------------------------------------------
Goods Delivery Test Goods Delivery Certificate Passes visual inspection
--------------------------------------------------------------------------------------
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KETENTUAN SERTIFIKASI/CONDITION
NAME OF TEST CERTIFICATE FOR CERTIFICATION
-------------------------------------------------------------------------------------------------------------------------------
PARTNER Own Test No certification issued, but TELKOM None
should be provided with the results of
the test prior to the Sub-system
Acceptance Test.
-------------------------------------------------------------------------------------------------------------------------------
Sub-system Acceptance Test No certification issued, but TELKOM should
be provided with the results of the test
prior to the Integrated System Acceptance
Test.
-------------------------------------------------------------------------------------------------------------------------------
Integrated System Acceptance Partial Integrated System Acceptance Test A system test has been completed for
Test Certificate the equipment, satisfying all relevant
requirements under this Agreement except
for end to end connectivity
-------------------------------------------------------------------------------------------------------------------------------
Integrated System Acceptance Test Certificate All system tests have been completed
for the equipment, satisfying all relevant
requirements, including end to end connectivity
-------------------------------------------------------------------------------------------------------------------------------
Civil Work Acceptance Test Certificate (for foundation) Passed PARTNER and TELKOM quality checks
Certificate (for tower)
Certificate (others)
-------------------------------------------------------------------------------------------------------------------------------
55.4 Factory Performance Test
55.4.1 PARTNER shall perform factory performance tests of all equipment to be
deployed to ensure that the equipment is complete in all respects and
complies with the terms of the Agreement. Details of the factory
performance test are set out in Appendix 17 (Quality Assurance
Guidelines/Acceptance Test Procedures).
55.4.2 PARTNER shall provide TELKOM with full access to the results of the
factory performance tests including without limitation evidence in the
form of certification letter provided by the
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factory.
55.4.3 Successful completion of the factory acceptance tests are a
pre-requisite for Sub-system Acceptance Tests.
55.5 Goods Delivery Test
55.5.1 TELKOM shall visually inspect the equipment on delivery to the
installation Location/Site based on a copy of the goods shipping
documents and TELKOM's Project Manager shall promptly (and no later
than five (5) Business Days) issue a Goods Delivery Certificate if
there is no obvious physical damage to the equipment and the quantity
of equipment delivered is correct according to the supporting
Documentation provided.
55.5.2 Issue of a Goods Delivery Certificate shall not constitute acceptance
of the equipment nor shall it affect TELKOM's rights under this
Agreement.
55.6 PARTNER Own Test
55.6.1 PARTNER shall perform on-Location/Site tests of each individual
Network Sub-system (BSS) following installation.
55.6.2 Successful completion of PARTNER's Own Tests are a pre-requisite for
Sub-system Acceptance Tests.
55.6.3 The tests for BSS shall comprise of tests to determine the overall
equipment functionality of:
(a) Base Station Controller (BSC);
(b) Base Transceiver System (BTS);
(c) Antenna;
(d) Transmission Equipment;
(e) BSS Network Element Manager (BSS NEM).
55.6.4 The tests for PDN shall comprise of tests to determine the overall
equipment functionality of:
(a) Packet Data Serving Node (PDSN) device;
(b) Authentication, Authorization and Accounting (AAA);
(c) Home Agent (HA);
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(d) Domain Name System (DNS);
(e) Fire Wall;
(f) PDN Network Element Manager (PDN NEM).
55.6.5 PARTNER shall provide TELKOM with the results of PARTNER's Own Tests
when it requests TELKOM to attend the Commissioning.
55.7 Commissioning : Sub-system Acceptance Test
55.7.1 Upon completion of PARTNER Own Tests, PARTNER shall conduct tests of
each individual Sub-system in the presence of TELKOM as a witness.
55.7.2 The tests shall be conducted during normal weekday working hours and
PARTNER shall notify TELKOM at least fourteen (14) calendar days before
the proposed test date to fix the timing and resources required for the
test. PARTNER shall co-ordinate the test dates across the relevant
DIVRE to ensure that the tests are scheduled efficiently.
55.7.3 Successful completion of the Sub-system Acceptance Tests are a pre-
requisite for Integrated System Acceptance Tests.
55.7.4 The tests for BSS shall comprise all tests necessary to verify the
overall equipment functionality of:
(a) Base Station Controller (BSC);
(b) Base Transceiver System (BTS);
(c) Antenna;
(d) Transmission Equipment;
(e) BSS Network Element Manager (BSS NEM).
55.7.5 The tests for PDN shall comprise tests to verify the overall equipment
functionality of:
(a) Packet Data Serving Node (PDSN);
(b) Authentication, Authorization and Accounting (AAA);
(c) Home Agent (HA);
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(d) Domain Name System ( DNS);
(e) Fire Wall;
(f) PDN Network Element Manager (PDN NEM).
55.7.6 In addition the following on-Location tests shall be conducted for each
Sub-system:
(a) Mechanical, quantity and appearance checks;
(b) Workmanship checks;
(c) Construction, installation, cabling, wiring, fixing, equipment
foundation, painting and galvanizing, appearance and
mechanical strength and labeling checks;
(d) Meter and Alarm Indication check;
(e) Power supply checks;
(f) Losses contact checks.
55.7.7 PARTNER shall provide TELKOM with full access to the results of any
Sub-system Acceptance Tests before initiating any Integrated System
Acceptance Tests.
55.8 Commissioning : Integrated System Acceptance Test
55.8.1 PARTNER (in cooperation with the NSS supplier) shall conduct Integrated
System Acceptance Tests in the presence of TELKOM as a witness upon
completion of the Sub-system Acceptance Tests (including tests on
measuring equipment and spare parts) to ensure that a System is
functioning as designed and ready for acceptance by TELKOM.
55.8.2 PARTNER shall prepare a comprehensive testing plan and test procedure
for TELKOM's approval.
55.8.3 The smallest Network element that may be System tested shall be a BTS
and its associated equipment. All System tests must be carried out on a
end to end basis (i.e., PSTN to MSC to BSC to BTS to test subscribers)
to
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verify that:
(a) the installed system complies with the Technical
Specifications of the Agreement;
(b) the System has been demonstrated to be compatible with the
existing NSS and other Systems.
55.8.4 The tests shall be conducted during normal weekday working hours and
PARTNER shall notify TELKOM at least ten (10) Business Days before the
proposed test date to fix the timing and resources required for the
test. PARTNER shall co-ordinate the test dates across the relevant
DIVRE to ensure that the tests are scheduled efficiently.
55.8.5 In addition, PARTNER shall provide TELKOM with details of all
transmission links and assistance to be provided by TELKOM. TELKOM may
postpone the test date if the transmission links required cannot be
provisioned in time.
55.8.6 TELKOM shall within ten (10) Business Days issue a Integrated System
Acceptance Test Certificate for the equipment tested once:
(a) all the relevant System tests have been successfully
completed;
(b) all required test equipment and necessary tools have been
supplied; and
(c) all handbooks, as-built drawings, inventory list and other
information necessary for maintenance of the relevant System
have been supplied.
The Integrated System Acceptance Test Certificate shall be issued on a
per Location basis. In the event that any Sub-system or Site within the
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Location cannot be tested caused by any reason, a Partial Integrated
System Acceptance Test Certificate may be issued for the Location
covering only the Commissioned Sub-system(s) or Site(s). Integrated
System Acceptance Test Certificates and Partial Integrated System
Acceptance Test Certificates shall not be withheld for defects which
are minor or cosmetic.
55.8.7 In the event that TELKOM is unable to provide, where required, the
necessary transmission links and/or an E1 link at the PSTN switch to
connect the Network elements to each other, but it is shown that the
relevant System otherwise fulfils all the requirements above, TELKOM
shall issue a Partial Integrated System Acceptance Test Certificate
within ten (10) Business Days.
55.8.8 15% of the applicable Contract Value for the equipment tested shall be
payable on TELKOM's issuance of the Integrated System Acceptance Test
Certificate or Partial Integrated System Acceptance Test Certificate,
as the case may be.
55.8.9 If TELKOM offers a System which has not yet received an Integrated
System Acceptance Test Certificate, for commercial service, i.e., such
System is functional and is connected to one or more-revenue-generating
subscribers, then this System shall be deemed to have been tested and
Commissioned and TELKOM shall issue the relevant Integrated System
Acceptance Test Certificate in accordance with Article 55.8.6.
55.9 Civil Work Tests
55.9.1 PARTNER shall regularly inspect all civil works in progress on a
continuous and/or interim basis, based on the civil work test plan
submitted to and agreed by TELKOM. The test plan shall include the
proposed frequency of the inspections and the test protocol to be
used. The test protocol shall be in the
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form of worksheets to be used on Location/Site as the work progresses.
55.9.2 TELKOM will issue certificates at each stage of work once the civil
work tests are successfully completed based on the agreed test
protocol. Such certificates shall not be withheld for defects which are
minor or cosmetic.
ARTICLE 56. INTEGRATION, INTER-OPERABILITY AND COMPATIBILITY
56.1 Integration and Interconnection
56.1.1 The CDMA Network consisting of BSS shall interface with TELKOM's data
network via a PDSN (Packet Data Serving Node) device as part of the PDN
(Packet Data Network) supplied by PARTNER.
56.1.2 In particular, PARTNER in cooperation with the NSS supplier shall
ensure without limitation that:
(a) the BSS/BSC as supplied by PARTNER is integrated with TELKOM's
NSS and PDN (Packet Data Network) equipment; and
(b) all related Sub-systems within the BSS and PDN to be delivered
by PARTNER are integrated with each other.
56.2 Inter-Operability Requirement
56.2.1 The BSS equipment must be interoperable with NSS equipment provided by
other CDMA FWA vendor(s) and compatible with CDMA IOS version 4.0
standards.
56.2.2 PARTNER shall provide TELKOM with supporting evidence in the form of a
written statement or certificate from operators, certification body, or
PARTNER stating operator's name and contact information, location,
types of BSS equipment, and examples where inter-operability occurs.
TELKOM shall issue an IOP Certificate to PARTNER in accordance with the
Inter-Operability
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Commitment Agreement following successful completion of its own
interoperability (IOP) tests.
56.3 Compatibility
56.3.1 New software releases or versions shall be backwards compatible with
the previous release and/or version and such other previous releases
and/or versions where technically and commercially feasible.
ARTICLE 57. CUT OVER PROCEDURES
57.1 PARTNER shall ensure that the cut over of any equipment on the Network
(for example, where a BTS is to be disconnected from an existing BSC
and reconnected to a new BSC being installed or where a BSC is to be
disconnected from an existing NSS and reconnected to a new NSS being
installed) does not interfere with the operation of the Network.
57.2 PARTNER shall liaise with TELKOM as to the procedures and timing for
the cut over and any cut over should take place during the hours of
2:00 am - 4:00 am (the "Cut over Period"), unless otherwise agreed by
TELKOM.
57.3 Unless otherwise agreed by the Parties, Network interruption during a
cut over operation shall not exceed fifteen (15) minutes in any given
instance.
57.4 PARTNER shall ensure that the previous connections can be re-
established without any interruption to the Network in the event that
the cut over does not work properly or perform satisfactorily. In the
event that the cut over appears unlikely to be completed during the Cut
over Period, PARTNER shall re-establish the previous connection and
re-attempt the cut over the following day.
57.5 PARTNER shall indemnify TELKOM against any loss or damage suffered as a
result of any interruption to the Network (including without limitation
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any service interruption or system downtime) occurring outside the Cut
over Period caused by a cut over that results in a revenue loss for
TELKOM, in accordance with Article 11.
57.6 These cut over procedures shall be applicable to Package 1 (Module 1).
ARTICLE 58. COMPLIANCE WITH ENVIRONMENTAL STANDARDS
58.1 The Deliverables supplied by PARTNER shall comply with all applicable
legal requirements and shall not contain any legally prohibited
substances and/or preparations. The Deliverables shall not contain any
substances and/or preparations that cannot be processed by means of a
normal waste processing method.
58.2 PARTNER shall allow TELKOM to examine its degree of environmental care
and provide reasonable assistance to TELKOM in examining that of the
manufacturers concerned.
58.3 PARTNER shall provide TELKOM with the following information early
enough to give TELKOM reasonable time to pass it on to all parties
involved before Deliverables are received;
58.3.1 which substances and/or preparations present in the equipment are
harmful to people, property or the environment, including soil, water
and air;
58.3.2 where such substances and/or preparations are located in the equipment
and how the components concerned must be treated at the end of their
useful life and at the end of the useful life of the equipment, and how
such components can be removed from the equipment safely and correctly;
58.3.3 which regulations are applicable to the transport, storage,
installation, use, dismantling and processing of the substance in
connection with the harm it is capable of causing; and
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58.3.4 how to improve the information distribution/acquisition process at and
by TELKOM to a reasonable extent without raising its costs.
58.4 PARTNER shall state which components of the equipment are suitable for
re-use or recycling other than by incineration at the end of its useful
life.
58.5 PARTNER shall provide TELKOM with the above-mentioned information,
either via an electronic information carrier or electronically in a
commonly used computer program and in a format as reasonably requested
by TELKOM.
58.6 PARTNER shall warrant that all of the information provided to TELKOM is
complete and correct to the best of its knowledge.
ARTICLE 59. DEVELOPMENT OF MEDIATION DEVICE
PARTNER shall at TELKOM's request develop and provide interfaces to TELKOM's
customer care, billing and NMS. The cost of the development shall be agreed in
advance with TELKOM and then added to the Contract Value of the Purchase Order
associated with the equipment with which the mediation device will be used. 25%
of the development costs shall be paid on commissioning of the mediation device,
and the remaining 75% paid by TELKOM in accordance with the PAYG payment scheme
for the associated equipment.
ARTICLE 60. DOCUMENTATION
60.1 PARTNER shall provide an adequate number of handbooks and drawings that
shall be required to support equipment maintenance, installation, and
test function. Handbooks and drawings shall include assembly drawings,
wiring information, schematics, drawings, network diagrams, block
diagrams and complete instruction for familiarization, installation,
operation, theory, maintenance, and parts replacements, as well as
appropriate system drawings. Instruction handbooks for
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each piece of equipment shall be prepared separately, and submitted to
TELKOM. Instruction handbooks to be supplied shall include but not be
limited to the following:
60.1.1 Installation and system handbooks;
60.1.2 Equipment handbook including Standard Operating Procedure (SOP) and
Standard Maintenance Procedure (SMP);
60.1.3 Troubleshooting handbooks including block diagrams;
60.1.4 Customer handbooks for the fixed terminal shall include assembly
drawings, wiring information, and complete instruction for
familiarization, installation, maintenance, and parts replacement;
60.1.5 Customer handbooks for the mobile handset shall include only complete
instruction for familiarization, maintenance and part replacement. All
handbooks shall be prepared in English and the metric system of weights
and measures should be used.
60.2 PARTNER shall maintain and keep updated a Project library in Indonesia
containing all relevant documents related to the Project, including
without limitation, minutes of each JPS, DRM and monthly meeting, all
Purchase Orders, demand forecasts, Change Requests, each agreed
revision of the Implementation Plan and all correspondence between
PARTNER, its sub-contractors and TELKOM. The Project library shall be
accessible by TELKOM and its representatives during normal working
hours and TELKOM may from time to time request copies of all or parts
of the Project library to be supplied to it at no further cost. The
Project library shall be handed over to TELKOM on termination of the
applicable Service Level Agreement.
60.3 PARTNER shall submit drawings and documents (including as-built,
assembly, connection and allocation drawings) related to the relevant
Sub-systems installed.
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60.4 Any drawings and documents with respect to the relevant Systems or
Sub-systems owned by PARTNER related to the relevant Deliverables shall
be kept in safekeeping for the duration of the applicable Service Level
Agreement to enable PARTNER to procure any parts which need replacement
and/or expansion of such System or Sub-system if so required at any
time. Following the expiration or termination of the applicable Service
Level Agreement, such drawings and documents shall be delivered to
TELKOM.
60.5 Any Intellectual Property Rights with respect to any equipment,
drawings, specifications, software and Documentation and data which are
issued by the respective Parties pursuant to the implementation of this
Agreement shall remain the property of the respective Parties in
accordance with this Agreement.
60.6 Any incompleteness, doubts with respect to breakdown and/or elaboration
contemplated in any documents and/or those which constitute parts of
this Agreement shall be presented to TELKOM for clarification.
60.7 As long as PARTNER is providing maintenance and support in accordance
with this Agreement and the applicable SLA, the cost of updates to the
Documentation shall be included in the fees paid by TELKOM to PARTNER
pursuant to the relevant SLA. For the avoidance of doubt, the initial
costs of the Documentation shall be payable under general services
pursuant to Article 33.
60.8 All Documentation shall be in accordance with the requirements stated
in the RfP or as separately compiled in a document approved by the
Parties. The standard documents required to be provided by PARTNER are
listed in Appendix 22 (Documentation).
60.9 At the first JPS, PARTNER shall submit to TELKOM its plan to execute
the Location/Site survey consisting, without
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limitation, of the following items:
60.9.1 time schedule;
60.9.2 manpower schedule;
60.9.3 team organization;
60.10 TELKOM will provide a letter of approval of the detailed Location/Site
survey plan submitted by PARTNER, after it has agreed to the proposed
content. PARTNER shall perform the Location/Site survey accompanied by
TELKOM's assigned team as scheduled in the Location/Site survey plan.
60.11 PARTNER shall provide a Location/Site survey report ("Survey Report")
for installation within two (2) weeks of the Location/Site survey. The
Survey Report shall consist of the following items:
60.11.1 Location/Site layout, that shall include guide map, floor lay out and
cable racking;
60.11.2 arrangement of terminal block and existing distribution frame;
60.11.3 arrangement of the sub distribution panel;
60.11.4 availability of supporting facility and other requirements;
60.11.5 availability of antenna space at the existing tower;
60.11.6 map of the site's path profile and, if required, the backhaul system
for PARTNER's equipment;
60.11.7 availability of port and link at TELKOM's exchanges; and
60.11.8 coverage map of each BTS;
60.12 PARTNER shall submit its final as-built drawings based on the Network
configuration upon completion of the installation work.
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CHAPTER 6.
SERVICE LEVEL AGREEMENTS
ARTICLE 61. SERVICE LEVEL AGREEMENTS
61.1 Service Level Agreement
61.1.1 TELKOM has requested PARTNER to render certain operation and
maintenance support services, and PARTNER has agreed to provide these
services in accordance with a Service Level Agreement.
61.1.2 Prior to Commissioning of the Deliverables in the First Purchase Order,
TELKOM and PARTNER shall enter into a Service Level Agreement in form
and substance as set out in Appendix 19 to cover operation and
maintenance, spareparts and software services support. The initial term
of the Service Level Agreement shall expire, unless earlier terminated
in accordance with the SLA, three (3) years from the earliest to occur
of: (a) the date of the first Integrated System Acceptance Test
Certificate; or (b) commercial deployment of any of the Deliverables
supplied by PARTNER. For the avoidance of doubt, any commercial use of
PARTNER's equipment supplied under the initial inter-operability
testing required under Chapter 7 shall be covered under the Service
Level Agreement.
CHAPTER 7.
INTER-OPERABILITY AND CO-ORDINATION
REQUIREMENTS FOR PACKAGE 1
(MODULE 1)(DIVRE 1)
ARTICLE 62. GENERAL
62.1 Subject to Article 14.2.1, this Chapter shall apply to Package 1
(Module 1) (DIVRE I) only.
62.2 PARTNER acknowledges that certain Network equipment for Package 1
(Module 1) is being supplied by other equipment vendor(s) and that
achieving inter-operability between each vendor's equipment is a key
requirement of the T-21 Program. In particular, TELKOM requires that
the BSS configuration be fully
122
interoperable with NSS equipment from other CDMA FWA vendor(s) in
accordance with Article 56. The Parties recognise that until
inter-operability has been achieved, service cannot begin in the DIVREs
where more than one vendor is providing equipment. To achieve this aim,
the Parties have entered into a separate inter-operability commitment
agreement with the NSS equipment vendor in Package 1 (Module 1) as
specified in Appendix 21.
62.3 In the event that the vendors are unable to achieve satisfactory inter-
operability by the end of the testing period as specified in Appendix
21, TELKOM may at its sole discretion:
(a) extend the testing period for such period as it thinks fit and
request the vendors to continue working towards inter-
operability;
(b) stop further testing until further notice;
(c) notify either of the vendors, or both as the case may be, that
based on a comprehensive technical review of the cause or
causes resulting in the failure of achieving inter-operability
as contemplated in this Agreement. TELKOM intends to exercise
its right to terminate this Agreement pursuant to Article 14.2
(subject to clause 8 of Appendix 21). In this event, PARTNER
shall have no further liability to TELKOM with respect to
achieving inter-operability.
62.4 Following issuance of the IOP Certificate, the Parties acknowledge
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that certain additional modifications are required to this Agreement to
allow inputs from each vendor at the JPS and DRMs and that they will
deal expeditiously with any delays caused by one or more vendors which
affect the other vendors.
ARTICLE 63. JPS, DRMs AND MONTHLY MEETINGS
63.1 At each JPS:
63.1.1 the demand forecasting and economic analysis shall be conducted by the
vendor of the BSS equipment and TELKOM jointly, with the vendor of the
NSS equipment providing comments only;
63.1.2 the prioritisation of Locations/Sites for network deployment of the BSS
equipment shall first be conducted by the vendor of the BSS equipment
and TELKOM jointly. The prioritisation of Locations for Network
deployment of the NSS equipment shall follow on and be conducted by the
vendor of the NSS equipment and TELKOM jointly; and
63.1.3 the technology review shall be conducted by all vendors and TELKOM
jointly.
63.2 At each DRM:
63.2.1 each vendor shall be responsible for surveying their own deployment
sites;
63.2.2 TELKOM and the vendor of the BSS equipment shall jointly calculate,
check and update the Installed Line Procurements, with the vendor of
the NSS equipment providing comments only;
63.2.3 the Deployment Plan for the BSS equipment for the next Quarter shall
first be jointly developed, agreed and approved by the vendor of the
BSS equipment and TELKOM; then the Deployment Plan for the NSS
equipment for the next Quarter shall be jointly developed, agreed and
approved by the vendor of the NSS equipment and TELKOM;
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63.2.4 TELKOM and each vendor shall develop, agree and approve their
respective detailed network designs, BoQ, resource plans and training
plans;
63.2.5 TELKOM and the vendors shall jointly discuss any changes which may be
required to the Project Management Plans and Implementation Schedule,
and in particular shall provide information on any potential delays or
other matters which could affect the other vendor(s) or the overall
deployment of the Network. TELKOM and each vendor shall then jointly
agree and approve any adjustments to their respective plans and
schedules taking into account the information provided by the other
vendor(s).
63.3 TELKOM may from time to time request the vendors to attend together the
monthly meetings to allow information sharing and joint discussions to
take place.
ARTICLE 64. COMMISSIONING TESTS
64.1 The Parties acknowledge that in order to test the Network end to end,
each Network component (MSC, BSC and BTS) must be interconnected and be
available for testing during the period scheduled for the Integrated
System Acceptance Tests.
64.2 The Integrated System Acceptance Tests shall be conducted during normal
weekday working hours and PARTNER seeking to test its equipment shall
co-ordinate with TELKOM at least fourteen (14) calendar days before the
proposed test date to fix the timing and resources required for the
test and TELKOM shall confirm within 48 hours of written notice by
PARTNER whether such date is acceptable. In the event that TELKOM has
expressed its firm intention to attend at Integrated System Acceptance
Tests but is unable to attend, TELKOM shall provide in lieu of its
presence written instructions to proceed in its absence and report the
results to TELKOM promptly following completion. TELKOM shall
co-ordinate
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the other vendors required for the test. PARTNER shall co-ordinate the
test dates across the relevant DIVRE to ensure that the tests are
scheduled efficiently.
64.3 Each vendor shall upon receipt of the notice promptly inform TELKOM and
the other vendor(s) whether its equipment has completed the required
Sub-system Acceptance Tests, and if not when such tests are scheduled
for and if it expects any delay to its agreed completion dates.
64.4 TELKOM, acting reasonably, may reschedule the proposed test date by up
to one (1) month to address any delays which are attributable to other
vendors. In the event that the other vendor's equipment is still not
available for testing after the one month grace period, but it is shown
that the vendor's system otherwise fulfills all the Integrated System
Acceptance Test requirements, TELKOM shall issue a Partial Integrated
System Acceptance Test Certificate to the vendor.
64.5 For the avoidance of doubt, the testing and Commissioning procedures
for Package 1 (Module 1) are provided in Article 55.
IN WITNESS WHEREOF, the Parties have caused this Agreement to be signed by their
duly authorized representatives on the day and year first above written.
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PERUSAHAAN PERSEROAN (PERSERO) MOTOROLA, INC.
PT TELEKOMUNIKASI INDONESIA, TBK.
By /s/ Kristiono By /s/ Xxxxx Ma
---------------------- -----------------------------------
Name: Kristiono Name: Xxxxx Ma
Title: President Director Title: Vice President & General
Manager, Asia
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