Contract Agreement of Bored Pile Construction

Sub Contract No.: CSCEC4zh-(2017)-001MJD-SUB-004

This Contract Agreement (hereinafter together with all appendices and attachment hereto
and forming an integral part hereof, called the Agreement) is dated on April 29, 2017.

Between

CSCEC-SAJR JO (herein referred to as Main Contractor) as represented by:

Name: HE TING

Title: Chairman of the Board

Address: Maxx Box Orange County, Jl. OC Boulevard Utara, Lippo Cikarang, Cibatu Cikarang

Selatan, Kab. Bekasi, Jawa Barat

NPWP: 81.234.190.7-413.000

E-mail: cscec4thdivisionzhuhai@gmail.com

Delegating authority to:

Name: ZHANG HUA

Title: Project Manager of Branch No. 1 of ,Meikarta Project

To act for and on behalf of China State Construction Engineering Co., Ltd - PT. Sarana Abadi
Jaya Raya Joint Operation (CSCEC-SAJR JO) Board for the implementation of Branch No. 1 of
Meikarta Project.

And

(hereinafter referred to as Subcontractor) as represented by:

Name:

NRIC:

Title:
Address:

NPWP:

E-mail:

Being authorized to act for and on behalf of for the execution of this Agreement for Branch
No.1 of Meikarta Project.

NOW IT IS HEREBY AGREED AS FOLLOWS:

Article 1: Scope of Work

Main Contractor gives the assignment to Subcontractor, and Subcontractor accepts such
assignment from Main Contractor. Subcontractor has the responsibility to implement the
bored pile construction of 5 (five) building for the Branch No.1 of Meikarta Project
(hereinafter referred to as Subcontractors Work).

The procedures and sequences for Subcontractors Work shall include:

Setting out pile position (by Main Contractor) Pre-drilling the borehole and installing
temporary steel casing Drilling until the required depth Cleaning drilled hole
Checking drilled holes verticality and diameter by ultrasonic testing (if necessary ,by Main
Contractor) Processing, transporting and installing reinforcement cage Conducting seal
test for tremie pipe and installing tremie pipe Pouring concrete Extracting temporary
steel casing Site clearing Excavating footing (by Main Contractor) Cutting pile head
(by Main Contractor) Conducting pile dynamic test and pile integrity test (by Main
Contractor).

Other procedures and sequences which have not yet been mentioned above, but related
and necessary to Subcontractors Work, will not be measured and calculated separately.

Article 2: Unit Price and Tax

Subcontractor shall be deemed to have visited the site and fully acquainted himself with
the site conditions. No claim of whatsoever nature will be entitled or no extension of time
will be granted due to Subcontractors failure to accurately ascertain the site conditions and
geological conditions under which Subcontractors Work is to be carried out.

The Agreement Price, agreed by both parties, is as follows:

 Estimated Unit Price Estimated Total
No Description Unit
Quantity (IDR) Price (IDR)

1 Mobilization and Demobilization Ls 5 150,000,000 750,000,000

2 Preliminary works Ls 5 30,000,000 150,000,000

3 Bored pile (Dia. 800mm)

3.1 Bored pile drilling M 550,000 0

3.2 Empty pile M 275,000 0

4 Bored pile (Dia. 1000mm)

4.1 Bored pile drilling M 20800 653,500 13,592,800,000

4.2 Empty pile M 326,750 0

5 Bored pile (Dia. 1200mm)

5.1 Bored pile drilling M 850,500 0

5.2 Empty pile M 425,000 0

Standby of equipment and worker due

to work stoppage and down time
6 (within 7 days free of charge, beyond 7 day 10.000.000
days shall pay according to the lump
sum daily rate)
 Subtotal 14,492,800,000

Add 10% VAT 1,449,280,000

Total 15,942,080,000

In Words: Fifteen Billion Nine Hundred and Forty Two Million and Eighty Thousand
Rupiah.

This Agreement is using Unit Price and Fixed Unit Price system which shall remain
unchanged for 1 (one) year and since this Agreement has been signed until the completion
of Subcontractors Work to Main Contractors satisfaction.

The actual quantity, size and type of bored pile construction will be in accordance with the
shop drawings provided by Main Contractor to Subcontractor. The completed quantity paid
to Subcontractor shall be based on the unit prices stated in the above table.

The unit price of mobilization and Demobilization has included 2 (two) complete sets of
equipment which comprises 2 (two) units of drilling rig and other supporting equipment (2
(two) units of crawler crane, 1 (one) unit of hydraulic vibro hammer (if necessary), minimum
2 (two) units of welding machine, 2 (two) unit of excavator, rebar bender, rebar cutter, etc.).
For crawler crane and excavator, Subcontractor may mobilize only 1 (one) unit for each
equipment at the outset of the implementation of Subcontractors Work on condition that
Subcontractor can guarantee the completion of Subcontractors Work within the work
period specified in Article 5 of this Agreement. In case the mobilized number of crawler
crane and excavator cannot fulfill the determined construction progress, Subcontractor shall
immediately mobilize other units of crawler crane and excavator on site, fulfilling the
required number of the equipment which has been included in the unit price of mobilization
and demobilization, in order to ensure the completion of Subcontractors Work in timely
manner.

If Main Contractor requires Subcontractor to mobilize extra sets of equipment for the
purpose to complete extra construction quantity assigned to Subcontractor, Main
Contractor shall give additional compensation to Subcontractor proportionately based on
the number of equipment set in accordance with the unit price of mobilization and
demobilization stated in above table.

If Subcontractor transfers the equipment from Main Contractors construction site to other
project site by Main Contractor recommend after the Subcontractors Work under this
Agreement has been completed, Main Contractor shall only compensate 50% (fifty percent)
of the unit price of mobilization of demobilization of this Agreement.

The unit prices of each size of bored pile drilling have included the fabrication and
installation of rebar cage with the sounding pipe, concrete pouring with tremie pipe,
disposal of slurry and mud to the locations appointed by Main Contractor, etc.

The unit price of standby of workers and equipment (including 2 (two) units of drilling rig, 2
(two) units of crawler crane, 1 (one) unit of hydraulic vibro hammer (if necessary), minimum
2 (two) units of welding machine and 2 (two) unit of excavator, etc.) shall only be
compensated to Subcontractor if the placement of standby is caused by Main Contractor in
which the standby period has exceeded 7 (seven) days. Such payment shall be made by
Main Contractor to Subcontractor from the 8 th (eighth) day since the workers and equipment
are placed on standby until the execution of Subcontractors Work can be resumed.

The Agreement Price include all costs of the Subcontractors manpower, materials,
equipment, machines, mobilization and demobilization, tools, diesel, electricity, lubricants,
labour, supervision, accommodation, maintenance, insurance, taxes, duties, transportation,
profit, liabilities, labour compensation under labour law, security (including coordinating
and handling relation with local people, local group and local organization), social affairs and
any other expenses associated with the implementation of Subcontractors Work on the
project. The Agreement Price shall further include all incidental and contingent work which
although not specifically mentioned in this Agreement, as necessary for the completion and
maintenance of the work and workmanlike manner.

The Agreement Price shall also be full compensation for the construction of bored piles
including the protection of existing piles and structures, install the sounding pipe (if
necessary), backfill the soil to the empty pile, threading the rebar, installation of
straightthreadsleeve, slurry tanks and slurry disposal, circulation with pumping facilities,
hauling, jetting, joint cutting and all materials, such as lap splices of rebar, shall also be
considered to have been included in the Agreement price and shall not be measured
separately.

In the event that Main Contractor assigns extra construction quantity to Subcontractor in
addition to the scope of work stated in Article 1 of this Agreement, Subcontractor has the
responsibility to implement the extra construction quantity in accordance with the terms
and provisions under this Agreement accordingly. The unit prices for the extra construction
quantity shall remain in compliance with the unit prices stated in the above table.

The Agreement unit prices include income tax (PPh - Pajak Penghasilan) and other types of
taxes excluding 10% (ten percent) VAT (Value Added Tax). The 10% (ten percent) VAT shall be
paid to Subcontractor after Main Contractor has received VAT invoice from Subcontractor at
the time of each payment.

Article 3: Payment

Advance Payment: After Main Contractor has issued Notice of Commencement to

Subcontractor, 30% (thirty percent) of estimated Agreement amount, as advance payment,
will be paid to Subcontractor within 7(seven) days after the Main Contractor has received
advance payment bond which is approved by the Main Contractor, correct signed invoice
from Subcontractor and based on quantity of sets of equipment which arrived in site. 35%
(thirty five percent) of each progress payment amount will be deducted until the full
amount of advance payment is fully recouped.

Progress Payment: Subcontractors billing will be measured and submitted to Main

Contractor on monthly basis in accordance with the actual accomplishment approved by
Main Contractor. 70% (seventy percent) of a certain completed construction quantity, as
progress payment, shall be made to Subcontractor after approval by Main Contractor, and
the remaining 30% (thirty percent) shall be made to Subcontractor after PIT (Pile Integrity
Test) and PDA (Pile Driving Analyzer) test have been conducted or max 40 days after the
completion of the last pile, and the result of the tests shows that the completed bored pile
construction is proven to be qualified and satisfactory.

The progress payment will be paid to Subcontractor by Main Contractor within 14 (fourteen)
days after Main Contractor has received the following required documents from
Subcontractor:

1. Correct invoice signed by Subcontractor

2. Certificate of progress payment

3. Receipt of VAT paid by Subcontractor (if any)

4. Other necessary documents requested by Main Contractor.

Otherwise, Main Contractor has the right to withhold the progress payment until all
requirements are fulfilled by Subcontractor.

Retention: 5% (five percent) retention will be deducted from each progress payment and
the retention will be released to Subcontractor by Main Contractor after all Subcontractors
Work has finished completely and been accepted by the Main Contractor, and after the
Defects Notification Period has ended.
The Defects Notification Period shall be 6 (six) months after Main Contractor has issued
Taking-Over Certificate for Subcontractors Work.

All payments will be paid by Telegraphic Transfer (T/T) or cheque to the following bank
account:

Account Holder: PT.INDONESIA PONDASI RAYA Tbk

Account No.: 024.010.405.326
Bank: OCBC NISP

Article 4: Performance Bond

Subcontractor shall submit a performance bond which is issued by Indonesia authorized

bank and / or insurance company and must be approved by Main Contractor to Main
Contractor as a guarantee for satisfactory and full performance of Subcontractors work
pursuant to this Agreement. The performance bond shall represent 10% (ten percent) of the
estimate amount of this Agreement and shall be in the form as approved by Main
Contractor. Subcontractor shall submit the performance bond within 7 (seven) days since
this Agreement has been signed by both parties. At the same time, after the main
contractor received the performance bond, the advance payment should be released in
7(seven) days

The validity period of the performance bond should be until September 30, 2017.

Subcontractor has the responsibility to keep performance bond valid and effective until the
defects notification period has ended. If the terms of the performance security specifies its
expiry date, and Subcontractor has not become entitled to receive the performance bond by
the date 28 (twenty eight) days prior to the expiry date, Subcontractor shall extend the
validity of performance bond until the Subcontractors Work has been completed and any
defects have been remedied.

The performance bond may be drawn against in an appropriate amount as determined by

Main Contractor in its sole discretion when there is occurrence of damage to Main
Contractor resulted from Subcontractors failure to implement Subcontractors Work or
breach in performance hereof.

Article 5: Commencement and Schedule

Subcontractor shall submit to Main Contractor the personnel and equipment mobilization
plan, and site organization chart outlining the hierarchy and role of personnel assigned by
Subcontractor to carry out the subcontractors work on site (including project manager,
safety engineer, quality engineer, foreman, etc.), construction plan, plane layout within 2
(two) days after this Agreement has been signed by both parties, and complete the
personnel and equipment mobilization before May 15, 2017.

The commencement date of Subcontractors Work shall be on May 15, 2017. The work
period for Subcontractors Work shall not exceed 2 (two) months from the commencement
date. The minimum construction quantity to be completed by Subcontractor shall be 3
(three) points per set equipment per day.

In case of adverse weather condition or any other factors, such as unprepared site
conditions, changes to the shop drawings or construction plan, etc., which causes
Subcontractor to be put in standby and/or which hinders Subcontractor to complete the
Subcontractors Work on time, the work period may be extended accordingly after Main
Contractor has given approval on the time extension. However, Subcontractor shall not
make any claim in any form whatsoever to Main Contractor in the event of such
occurrence.

Subcontractor is required to provide and maintain sufficient amount of skillful labour,

materials, equipment, machines and tools to implement Subcontractors Work at all times. If
at any time in the opinion of Main Contractor that any part or the overall progress of the
Subcontractors Work are likely to be delayed due to any reason whatsoever, then after
receiving Main Contractor's written notice, Subcontractor shall increase an adequate number
of labour, materials, equipment, machines and tools to accelerate the progress and catch up
the program, at Subcontractors own cost, within 7 (seven) days after the notification has
been received.

Article 6: Measurement

The quantity of bored pile drilling (including fabrication and installation of rebar cage with
the sounding pipe, and concrete pouring with tremie pipe) to be measured and paid for
shall be the number of meter of the completed depth, and the drilling depth shall be the
total length of designed pile and pile head. The pile head shall not be longer than 1 (one)
meter for the purpose to ensure the quality of concrete pouring. Thus, the measured
quantity for drilling shall be the total of designed pile length, and pile head length not
longer than 1 (one) meter The quantity of rebar and concrete pouring are deemed to have
been included in the Agreement Price which will not be measured separately.

The quantity of empty pile to be measured and paid for shall be the length of the empty pile
deducted with 3 m (three meters). The 3 m (three meters) of empty pile will not be
measured separately as it is deemed to have been included in the Agreement Price.

Article 7: Quality and Technical Requirements

The quality and technical requirements shall comply with the specifications as attached
herein.

Other technical requirements, that shall be complied, are listed as follows:

1. The height of excess concrete shall be less or equal to 1 (one) meter, excluding the
bored piles that need to be tested by using PDA test. The excess concrete cost shall be
deducted from the progress payment.

2. The reinforcement cage shall be fastened and the floating shall be properly
controlled during pouring concrete. The length of reinforcement cage shall be accurately
calculated and checked.

3. The process of removing tremie pipe shall be strictly controlled in order to prevent
secondary concrete pouring and/ or pile breaking.

4. If the bored piles are proven to be insufficient after having been tested by PIT and
PDA tests, all loss shall be borne by Subcontractor unless the insufficiency occurs due to the
design.

Article 8: Responsibility and Obligation

The Responsibility and Obligation, agreed by both Parties, are as follows:

No. Description Main Contractor Subcontractor

1 General

Mobilization and demobilization, including transfer from site to

1.1 V
site

1.2 Arrange everything for Subcontractor's personnel V

1.3 Quality assurance V

1.4 Quality and quantity inspection V V

1.5 Safety supervising V V

1.6 Shop drawings and soil investigation report V

1.7 Survey work V

1.8 Prepare the inspection report V

Relationship with local people, local group and local

1.9 V
organization

1.10 Equipment for transporting rebar from workshop to site V

1.11 Equipment for transporting other materials V

Loading and unloading all materials, equipment, machines and

1.12 V
tools

Security guard for materials, equipment, machines, tools and

1.13 V
other property

Provide and wear Safety apparatus (helm, safety, shoes, safety

1.14 V
belt, etc.)

1.15 Provide land for Subcontractor to build workshop V

1.16 Build rebar workshop and provide security guard on site V

2 Bored pile construction

 Levelling and compacted ground platform and ground access
2.1 V
on the site

Provide rebar, concrete, straightthreadsleeve and the

2.2 V
sounding pipe

Provide minimum 2 (two) units of welding machine, welding

2.3 V
rod, steel casing and drilling tools

Provide minimum 2 (two) sets of tremie pipe of minimum 40 m

2.4 V
(forty meters)

2.5 Provide sufficient steel plate V

Provide rebar cutter, rebar bender, generator, electric wire and

2.6 V
steel wire

Provide fuel, maintenance and reparation for Subcontractors

2.7 V
equipment and machines

Provide qualified and sufficient manpower for Subcontractors

2.8 V
Work

2.9 Conducting seal test for tremie pipe V

Provide water, water pump and mixing equipment for adjusting

2.10 V
the proportion of slurry (if necessary)

Dealing with negative impact (noise, pollution, vibration, etc.)

2.11 V
resulted from Subcontractors Work

2.12 Provide all consumable, water and tools V

 Provide lighting, power-generation equipment and other
2.13 V
facilities for Subcontractors Work

2.14 Provide at least one supervisor who can listen, speak Chinese V

After this Agreement has been signed, Subcontractor gives his commitment not to enter
and sign Agreement with other company groups under the China State Construction
Engineering Co., Ltd located in Indonesia. Subcontractor shall mobilize sufficient manpower,
materials, equipment, machines and tools, as required by Main Contractor, for the
implementation and completion of the Subcontractors Work for Branch No. 1 of Meikarta
Project. In case Main Contractor finds Subcontractor using the same company name under
this Agreement or other company names of the same group, same owner and/or same
business field to enter and sign contract with other company groups under the China State
Construction Engineering Co., Ltd located in Indonesia, Subcontractor shall be deemed to
breach this Agreement, and consequently, Main Contractor is entitled to unconditionally
confiscate the retention money under this Agreement.

Subcontractor shall have complete and valid permits and licenses for operation,
transportation, etc. necessary for fulfilling the Subcontractors Work, which are issued by
government or local authorities. The application and acquirement of all permits and licenses
shall be at Subcontractors own costs and risks. Workers involved in special type of work
shall possess required work permits.

Subcontractor is responsibility to dispose excavated soil from drilling hole to the disposal
area designated by Main Contractor in time, and transportation cost on Subcontractor own
cost. Subcontractor shall bulldozed soil on disposal area. Equipment for dispose soil and
bulldozed soil shall provided by Subcontractor.

Subcontractor shall complete at least 3 (three) piles per day for Subcontractors Work during
Subcontractors Work period.

If Subcontractor employs foreign personnel and/ or workers of nationalities other than

Indonesian, Subcontractor has the responsibility to apply for the working visa at
Subcontractors own costs and expenses so that the personnel and/ or workers are
permitted to work in Indonesia legally. Subcontractor shall submit all valid and legal working
visa documents to Main Contractor as evidence that Subcontractor has followed all required
requirements in employing foreign personnel and/ or workers. If the improper working visa
has given adverse effect to the construction progress, any costs suffered by Main Contractor
shall be compensated by Subcontractor. Such compensation shall be directly deducted by
Main Contractor from the payment due or will become due to Subcontractor.
Subcontractor shall be responsible for the protecting the materials against theft, robbery,
loss, etc. before unloading. Subcontractor shall coordinate the relationship with local
people, local group and local organization (including SPSI) during the fulfillment of the
Agreement.

Subcontractor shall be deemed to have fully understood the site condition. If the
equipment, provided by Subcontractor at site, are not sufficient to complete
Subcontractors Work, Subcontractor shall mobilize extra equipment to the site to ensure
proper completion of Subcontractors Work. All costs and expenses incurred shall be borne
by Subcontractor.

Subcontractor shall construction water emissions, to avoid the scene with water orderly.
Vehicles enter and exit construction site should be clean up dirt, avoid fall dirt on municipal
road.

Subcontractor shall submit by picture daily before Subcontractor start Subcontractors

Work everyday to Main Contractor Safety Director. And Subcontractor shall attend weekly
meeting and sign attendance list and make meeting record.

Main Contractor shall install water pipe and water valve to connect the existing water pipe
from outside the project site to an area within the project site. Subcontractor shall be
responsible to connect the water pipe installed by Main Contractor to the vicinity of the
bored pile construction site by installing water meter and extra water pipe, at
Subcontractors own costs and expenses, in order to allow water to be used for
Subcontractors Work. All billing and charges for water use shall be borne by Subcontractor
based on the used volume measured by the water meter which is calculated based on the
rate determined by PT. Lippo Cikarang Tbk. as Employer.

Main Contractor only provide 3 (three) coordinate point for Subcontractor to survey, the
others things for Piling survey will be provided by Subcontractor.

Main Contractor may request Subcontractor to complete 1 (one) drilling hole in order to
conduct testing for the purpose of collecting data on the thickness of waste slag and the
stability of drilling hole from collapse under the condition of using Subcontractors
equipment and construction methods. In case Main Contractor raises such request,
Subcontractor shall perform the request accordingly at no cost. Subcontractor shall continue
construction work after the drilling hole has been proven to be qualified.

After the first bored pile drilling has been completed, Subcontractor shall wait for the result
of PDA test before continuing construction work as requested by Main Contractor and
Engineer. Subcontractor is allowed to continue construction work after the result of PDA test
has proven to be qualified.
Subcontractor shall follow the work sequences, responsibility requested by Main Contractor.
Once Main Contractor find out Subcontractor dose not execute Subcontractors
responsibility under this Agreement, Main Contractor will issued warning letter to
Subcontractor. After Subcontractor receiving warning letter, Subcontractor shall reform
within a 48 (fourty eight) hours. Otherwise, it will be deemed to authorize Main Contractor
to arrange for reforming separately. For the separate reforming arranged by Main
Contractor, the costs incurred and the corresponding responsibility will be borne by the
Subcontractor. The quantity of reforming work incurred in the above case shall be
determined by Main Contractor or third party to confirm the quantity of work required,
Main Contractor will deduct retention for the incurred costs according to the actual
occurrence of 1.2 times, If the balance of the retention is insufficient, Subcontractor shall
make up the difference to Main Contractor.

Subcontractor shall follow the shop drawings and specifications in implementing

Subcontractors Work.

Subcontractor shall supply adequate equipment and use reasonable construction

technology, methods and system to prevent the drilling hole side walls from collapse. In case
there is occurrence of collapse, Subcontractor shall be responsible to rectify the damage
and all costs incurred shall be borne by Subcontractor.

Subcontractor shall supply adequate equipment and other materials to meet the
requirements of drilling hole.

Subcontractor shall be responsible for cleaning the exceeding slurry in such a way that it is
harmless to environment, and Subcontractor shall be responsible to remove the mud from
the site to the locations appointed by Main Contractor.

Subcontractor shall be equipped with measuring rope, and bored pile construction shall
only be commenced after the pile position has been checked and approved by the Main
Contractor.

Subcontractor shall provide sufficient labour to meet the requirements of project progress
so that the Subcontractors Work can be completed within the work period as stated in
Article 5 (Commencement and Schedule).

Subcontractor shall provide minimum 2 (two) unit skip tank and 2 (two) standard hoppers
for the implementation of Subcontractors Work. The capacity of a hopper shall be more
than 1 (one) m3.

Subcontractor shall take precautions and reasonable protection to prevent damage, injury
and loss to labour and other persons who may be affected by Subcontractors Work. Main
Contractor will not be responsible for any accidents caused by Subcontractors negligence
and corresponding loss shall be borne by Subcontractor. Subcontractor shall also take
responsibility for rework and other negative impacts caused by false instructions or false
operation by Subcontractor.

Subcontractor shall be responsible to initiate, maintain and supervise all safety precautions
and programs in connection with Subcontractors Work. Subcontractor shall protect, guard,
secure and handle the materials, equipment, machines, tools and other Main Contractors
property such as rebar, etc. with care during the implementation of Subcontractors Work.
Subcontractor shall also bear all the risk of loss to materials, equipment, machines, tools
and other Main Contractors property due to theft until Subcontractors Work has been
finished completely and accepted by Main Contractor. All losses and damages to property,
including but not limited to the materials, that will not be permanently used or consumed,
caused in whole or in part by Subcontractor, or anyone directly or indirectly employed by
Subcontractor, or anyone whose acts Subcontractor may be liable, shall be remedied by
Subcontractor. Main Contractor has the right to request compensation to the lost or
damaged property in accordance to the market price. Main Contractor shall directly deduct
the compensation from the payment to Subcontractor. In case the deduction from payment
is not sufficient to compensate Main Contractor for the lost or damaged property,
Subcontractor shall pay the uncovered balance directly to Main Contractor by cash,
telegraphic transfer or other payment methods as required by Main Contractor.

In case it is required to perform ultrasonic testing, Subcontractor shall provide and assign
qualified personnel to conduct the test without additional charges to Main Contractor.

If the result of PDA test for the bored piles is proven to be unqualified, Subcontractor shall
replace or rectify the bored piles to the approval of Main Contractor, and all the costs for
the replacement or rectification shall be borne by Subcontractor. However, if the test result
shows insufficiency due to construction design, Subcontractor will not be responsible for the
replacement or rectification.

Subcontractor shall ensure that the maximum material wastage must meet the following
requirements:

1. Concrete wastage shall not be more than 10% (ten percent) of the designed
quantity.

2. Rebar wastage shall not be more than 3% (three percent) of the designed quantity.
The fabricated rebar that exceeds the designed quantity is regarded as rebar wastage. The
labour cost, for processing excess rebar, which is within 3% (three percent) of the designed
quantity, is deemed to have been included in the Agreement Price. Any wasted rebar of
more than 3% (three percent) of the designed quantity shall be borne by Subcontractor
which will be deducted from the progress payment in accordance with the market price
added with 3% (three percent) as compensation for administration fee. The wasted rebar
after processing shall belong to Main Contractor, and Subcontractor has the responsibility to
return the wasted and unused rebar promptly to Main Contractor. Any loss to the rebar,
which has been handed over to Subcontractor, shall be compensated by Subcontractor to
Main Contractor, by deducting from the progress payment, in accordance with the market
price added with 3% (three percent) as compensation for administration fee.

Subcontractor shall, whenever required by the Main Contractor, submit the details of the
arrangements and methods that Subcontractor proposes to adopt for the execution of
Subcontractors Work. No significant alteration to these arrangements and methods shall be
made without having previously been notified to Main Contractor.

Subcontractor shall maintain good quality performance, throughout the execution of

Subcontractors Work, which satisfies Main Contractors specifications and requirements.

Where rectification of unsatisfactory materials and/or construction is required,

Subcontractor has the responsibility to perform such rectification to Main Contractors and
Engineers satisfaction. No additional payment shall be made for additional quantity and
construction work necessitated by such rectification.

Subcontractor shall maintain good communication with Main Contractor throughout the
implementation of Subcontractors Work until its completion.

Other responsibility and obligation that have not been mentioned above shall be deemed to
be Subcontractor's responsibility and obligation.

The responsibility and obligation above shall be deemed to have been included in the
Agreement Price and will not be measured separately.

Article 9: Delays

If the actual progress is 1 (one) week slower than the scheduled progress, Main Contractor
may instruct Subcontractor to submit an action plan and supporting report describing the
revised methods which Subcontractor proposes to adopt in order to expedite progress and
complete within the time for completion.

If Subcontractor fails to comply with the Agreements work period, Subcontractor shall
subject to be noticed under Agreement to pay delay damages to Main Contractor for this
default. These delay damages shall be 1 (one per mille) of estimated Agreement Price
amount which shall be paid for per day which shall elapse between the relevant time for
completion and the date stated in the Taking-Over Certificate. However, the total amount
due under this Article shall not exceed 5% (five percent) of the final Agreement amount.
These delay damages shall be the only damages due from Subcontractor for such default,
other than in the event of termination under Article 12.2 (Termination) prior to completion
of the Subcontractors Work.

Article 10: Health and Safety Obligations

Subcontractor shall at all times take all reasonable precautions to maintain the health and
safety of the Subcontractor's personnel. In cooperation with local health authorities,
Subcontractor shall ensure that first aid facilities and sick bay are available at all times at the
site and shall post in clearly accessible places information on how to transport injured
personnel to medical facilities including having a site vehicle available at all times that can
be used to transport personnel to medical facilities, including the precise location and
contact details of such medical facilities, name and contact details of the site designed
accident prevention officer and that suitable arrangements are made for all necessary
welfare and hygiene requirements and for the prevention of epidemics.

Subcontractor shall appoint an accident prevention officer at the site, responsible for
maintaining safety and protection against accidents. This person shall be qualified for this
responsibility, and shall have the authority to issue instructions and take protective
measures to prevent accidents. Throughout the execution of Subcontractors work,
Subcontractor shall provide whatever is required by this person to exercise this
responsibility and authority.

Subcontractor shall send to Main Contractor, details of any accident as soon as practicable
after its occurrence. Subcontractor shall maintain records and make reports concerning
health, safety and welfare of persons, and damage to property, as Main Contractor may
reasonably require.

Subcontractors Work must be carried out in such a way as to minimize danger to the public
or the workmen on the site.

The obligation above shall be deemed to have been included in the Agreements total price
which will not be measured separately.

Article 11: Insurance

11.1 Subcontractors Insurance for Equipment

Subcontractor shall provide Main Contractor with insurance policy or evidence for insuring
the Subcontractors equipment for not less than the full replacement value, including
delivery to site. For each item of Subcontractors equipment, the insurance shall be effective
while it is being transported to the site and until it is no longer required as Subcontractors
equipment.
11.2 Insurance for Subcontractors Personnel

Subcontractor shall provide Main Contractor with insurance policy or evidence for insurance
against liability for claims, damages, losses and expenses (including legal fees and expenses)
arising from injury, sickness, disease or death of any person employed by Subcontractor in
accordance with related Indonesian Law. The coverage of such insurance policy shall state
Main Contractor as the insured and/or policyholder.

All fees and charges relevant to the coverage of abovementioned insurances are deemed to
have been included in the Agreement Price, and will not be measured separately. The
insurances shall be maintained in full force and effect during the whole time that the
equipment and/or personnel are assisting in the execution of the works relevant to this
Agreement.

Article 12: Termination

12.1 Notice to Correct

If Subcontractor fails to carry out any obligation under the Agreement, Main Contractor may
by notice require Subcontractor to make good the failure and to remedy it within a specified
reasonable time.

Main Contractor will issue Warning Letters to Subcontractor if Subcontractor repeatedly

does not comply with Main Contractors instructions and Notice to Correct, and/ or the
work progress apparently slower than the scheduled progress, except that Main Contractor
agrees to revise the scheduled progress.

Three times warnings:

1. First warning: when the progress is 10% (ten percent) slower than the
scheduled progress or abovementioned conditions.

2. Second warning: when the progress is 20% (twenty percent) slower

than the scheduled progress or abovementioned conditions. After the second
warning has been issued, Main Contractor is entitled to take back partial work
from Subcontractors scope of work and assign it to other Subcontractors.

3. Last warning: when the progress is 30% (thirty percent) slower than
the scheduled progress or abovementioned conditions. After the third warning
has been issued, Main Contractor shall terminate this Agreement.

12.2 Termination
Main Contractor shall be entitled to terminate the Agreement if Subcontractor:

1. fails to comply with the warnings issued by Main Contractor;

2. abandons the works or plainly demonstrates the intention not to continue

performance of his obligations under the Agreement;

3. subcontracts the whole of the Subcontractors Work or assigns the Agreement

without approval by Main Contractor;

Subcontractor will remove all his manpower and equipment unconditionally from work site
within 10 (ten) days upon receipt of Notice of Termination from Main Contractor.

12.3 Valuation at Date of Termination

As soon as practicable after a notice of termination under Article 12.2 (Termination) has
taken effect and Subcontractor has removed all his personnel and equipment from the site,
Main Contractor shall proceed to agree or determine the finished value of the
Subcontractors Work, goods and Subcontractors documents, and any other sums due to
the Subcontractor for work executed in accordance with the Agreement.

12.4 Payment after Termination

After a notice of termination under Article 12.2 (Termination) has taken effect and
Subcontractor has removed all his personnel and equipment from the site, Main Contractor
may:

1. withhold further payments to Subcontractor until the costs of execution, completion

and remedying of any defects, damages for delay in completion (if any), and all other costs
incurred by Main Contractor, have been established, and/ or

2. recover from Subcontractor any losses and damages incurred by Main Contractor
and any extra costs of completing the Subcontractors Work, after allowing for any sum due
to Subcontractor under Article 12.3 (Valuation at Date of Termination). After recovering any
such losses, damages and extra costs, Main Contractor shall pay any balance to
Subcontractor.

Article 13: Dispute Resolution

In the event of any dispute arising out between Main Contractor and Subcontractor
concerning interpretation of any provision of this Agreement or the performance of any of
the terms of this Agreement, it shall be first settled amicably between both parties within
30 (thirty) days. If such amicable settlement shall not have been reached, the materials of
dispute will be submitted to the local court of projects operating district.

Article 14: Miscellaneous

This Agreement is made in 2 (two) original copies, each party receives 1 (one) duly signed
copy thereof.

Should there be any matters that have not been mentioned in this Agreement, both parties
shall settle them out through mutual negotiation and such additional matters will be written
in Contract Amendment, Contract Addendum or Supplementary Agreement as the part of
this Agreement.

This Agreement will come into effect after signing by both parties.

For and on behalf of,

Main Contractor Subcontractor

CSCEC-SAJR JO

President Director
 ZHANG HUA

Project Manager

of Branch No. 1 of Meikarta Project