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SUPPLY AND PURCHASE AGREEMENT

This Supply and Purchase Agreement (hereinafter referred to as the Contract) is entered into on this 1st day of March 2013 by and between: PT Komatsu Undercarriage Indonesia, having its official address at Jalan Jababeka XI Blok H16 Cikarang Industrial Estate, Bekasi 17530 (hereinafter referred to as First Party); and ____________________, having its official address at _________________ (hereinafter referred to as Second Party). Both party have hereby concluded Contract concerning basic matters related to the transaction of main materials and or supplementary materials and or parts and assemblies (hereinafter referred to as Products) according to the term and conditions mentioned hereof.

CHAPTER 1. GENERAL RULES


Article 1. Basic Principle First Party and Second Party have executed this Contract in good faith in accordance with mutual trust and spirit of cooperation. Article 2. Range of Application As far as there is no special contract in writing, this Contract shall apply to all Products transaction contracts (hereinafter referred to as Individual Contract). Article 3. Individual Contract 1. The Individual Contract shall be concluded when First Party places order to Second Party based on an order sheet and Second Party accepts the order. 2. First Party shall put down the Products name, quantity, unit price, money amount, delivery time and place of delivery in the above-mentioned order sheet or any documents, which belong to the order sheet. Article 4. Amendment of Individual Contract 1. First Party may, upon Second Partys agreement and according to First Partys circumstances such as design change, production change in First Party side, etc., partially or entirely amends or cancels the Individual Contract. 2. In case Second Party suffers loss due to the above-mentioned amendment or cancellation, First Party shall compensate such loss based on mutual consultation.

CHAPTER 2. TRANSACTION
Paragraph 1. Products Specification and Price Article 5. Specification 1. The specification of the Products delivered by Second Party to First Party shall conform to First Partys designation mentioned hereafter.

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a. First Party shall prepare drawings, specification sheets, standards and corresponding documents and lend those documents (hereinafter referred to as Loaned Drawings) to Second Party; b. First Party may approve drawings and specification sheets (hereinafter referred to as Approved Drawings) prepared by Second Party. In case of doubt and or unclear matters with regard to the above-mentioned Loaned Drawings, Approved Drawings etc or First Partys designation, Second Party shall immediately bring forward the matter to First Party, and Second Party shall receive instructions from First Party. First Party may upon necessity revise the specification of the Products. In case Second Party revises the Approved Drawings, Second Party shall have First Partys prior approval and shall keep the revision history.

Article 6. Management of the Loaned Drawings Second Party shall manage the Loaned Drawings with the care of good manager and shall observe the following matters. 1. Second Party shall never make copies of the Loaned Drawings, or let any third party read them, lend and or provide them to any third party, without the permission of First Party. 2. Second Party shall return the Loaned Drawings to First Party when the Loaned Drawings are no longer used by Second Party or when First Party instructs Second Party to do so. Article 7. Price 1. The price of the Products shall be fixed in the Individual Contract after consultation between First Party and Second Party, and the concerned price, as far as not specifically described in the Individual Contract, shall conclude the packing cost, freight charges, insurance charges incurred by Second Party until the Products is delivered to prescribed location. 2. When Second Party is requested by First Party to offer a quotation sheet or quotation detail sheet, Second Party shall immediately provide the concerned documents to First Party. Paragraph 2. Delivery Article 8. Delivery 1. Second Party shall deliver the Products, which have passed qualified inspections done by Second Party, at the prescribed place of delivery, according to the prescribed delivery time and delivery method. 2. When carrying out the above-mentioned delivery, Second Party shall attach the prescribed documents of the delivered Products as well as an Inspection Result Sheet. 3. In every month, First Party shall calculate the demand of Products through Material Requirement Planning (MRP) process and shall immediately issue and inform Purchase Order as well as the Forecast Order to the Second Party which time shall be fixed upon mutual consultation between the parties hereto.

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Article 9. Change of Delivery Time 1. When there is a risk of delay in the delivery according to Second Partys judgment, Second Party shall immediately bring forward the reason of delay and the expected revised delivery date to First Party and shall receive instructions form First party to that effect. 2. When the delay in delivery may cause loss to First Party, for which Second Party is responsible, Second Party shall compensate the loss to First Party based on mutual consultation. 3. In case of advance in delivery, except First Partys request, Second Party shall have First Partys prior approval. Article 10. Delivered Quantity Second Party shall not deliver a quantity of Products, which is different from the prescribed quantity on order sheet, without First Partys prior approval. When the quantity is less than the prescribed quantity, due to a reason which is acceptable by First Party, Second Party shall deliver the remaining quantity at First Partys prescribed delivery time. When the shortage of quantity is caused by an unacceptable reason and causes loss to First Party, Second Party shall compensate the loss to First Party based on mutual consultation. Article 11. Receipt of Products 1. When the formal delivery meets the stipulations in Article 8, First Party shall immediately receive the Products and surrender a document certifying such receipt to Second Party. 2. In case the delivered Products are not in conformity with the stipulations in Article 8, Second Party shall immediately withdraw the Products according to First Partys notice. First Party, however, may, upon Second Partys request, keep the Products. In such case, First party shall not be responsible for any loss incurred, such as loss of Products, damage of Products, reduced quantity, change in quality etc., the cause of which is not attributable to First Party. Paragraph 3. Inspection Article 12. Receiving Inspection 1. First Party shall without delay carry out Receiving Inspection to the received Products according to the Inspection Method decided by First Party and shall accept the Products which are judged as qualified by First Party. 2. In case First Party, during the Receiving Inspection, discovers disqualified Products, First Party shall notify Second Party the content of such disqualification. Article 13. Treatment in Case Disqualification Upon receipt of the notification mentioned in point 2 of Article 12, Second Party shall immediately repair the Products or deliver substitute Products in the manner decided by First Party. Article 14. Exceptional Use When any of the Products, which is disqualified through Receiving Inspection, is subject to exceptional use, First Party may accept such Products after allowing price discount, which will be fixed upon mutual consultation between the parties hereto.
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Article 15. Transfer of Ownership 1. The ownership of the delivered Products and the risk attached to the Products shall be transferred from Second Party to First Party at the same time the acceptance of inspection mentioned in Article 12 and 14 is completed. However, in case First party includes Supply Parts to the Products, the ownership shall be stipulated in Article 23. 2. In the event that the Receiving Inspection, as mentioned in Article 12 and 14, is done by First Party at Second Partys premises, Second Party shall keep the Products with the care of good manner until delivery is completed to the prescribed place according to First Partys instructions. Article 16. Withdrawal of Disqualified Goods 1. Second Party shall withdraw the disqualified Products, except the Products for exceptional use stipulated in Article 14, within 1 (one) week since the day notice mentioned in point 2 of Article 12 is received. First Party, however, may dispose of the disqualified Products containing Supply Parts supplied by First Party, as mentioned in Article 21, according to the procedures fixed by First Party. 2. First Party may, after confirming Second Party, dispose of the disqualified Products, which are not withdrawn by Second Party for more than 1 (one) month after the notice mentioned in point 2 of Articles 12 Paragraph 4. Payment Article 17. Payment First Party shall pay the price of the Products, which have been received by First Party, in the manner and on the date to be mutually agreed by First Party and Second Party, as may be described in the order sheet issued by First Party or billing documents issued by Second Party. Article 18. Offsetting 1. Concerning the payment mentioned in Article 17, when First Party has a money claim that should be received from Second Party, such as the price of Supply Parts that is supplied with charge, machine rental fee etc., First Party may offset the payment with such claim on the prescribed date. 2. When carrying out an offset mentioned in the point 1 of Article 18, First Party shall notify Second Party by sending detailed statement or bill. Paragraph 5. Quality Assurance Article 19. Quality Assurance 1. Second Party shall assure that all Products delivered to First Party shall have the quality, which fulfills the Product Specification described in Article 5. 2. Second Party shall bear the responsibility to repair, substitute, or compensate the loss caused by non-conforming and or defective Products, discovered on or after the Receiving Inspection done by First Party.

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All matters pertaining to Quality Assurance shall follow the Quality Assurance Agreement, which is entered into and signed by the parties hereto, and hereby made an inseparable part hereof. In the event of non-conformity and or conflict between the terms and or conditions of the Contract and the Quality Assurance Agreement, First Party and Second Party shall amend and or make necessary adjustment to the relevant term and or condition based on mutual consultation. Paragraph 6. Sub-Contracting

Article 20. Sub-Contracting 1. Second Party may sub contract the production process of the Products, entirely or partially, to a third party after obtaining First Partys prior approval. 2. In case Second Party assigns a sub-contractor, Second Party shall let the concerned sub-contractor thoroughly understand and observe the term and condition of the Contract. Second Party shall not escape from all responsibilities to First Party with regard to the act and behavior of the subcontractor. Paragraph 7. Supply Parts Article 21. Supply Parts First Party may, after consultation with Second Party, supply basic materials, parts, half-finished goods, assemblies etc. (hereinafter referred to as Supply Parts) to be used in the production process of the Products, with charge or free of charge, according to the procedure to be fixed by First Party, in the cases which come under the items mentioned here below. a. When the Supply Parts are necessary to maintain the quality, characteristic and standard of the Products; b. When so requested by Second Party to First Party; c. When other appropriate reasons exist. Article 22. Inspection of Supply Parts 1. Upon receiving the Supply Parts, Second Party shall without delay inspect the Supply Parts and when Second Party discovers defects or shortage of quantity, Second Party shall immediately notify First Party and receive First Partys instructions. The same case shall apply when hidden defects of the Supply Parts are discovered during the production process. 2. Second Party shall be responsible for damages or losses occurred to the Products and or Supply Parts because of non-observance of point 1 of Article 22 and or the causes attributable to Second Party. Article 23. Ownership of the Supply Parts 1. The ownership of the free of charge Supply Parts as well as the ownership of the Products in process, half-finished Products and or the Products produced or processed by Second Party using such Supply Parts, shall remain in First ..Partys hand. 2. First Party shall keep the ownership of the Supply Parts received with charge by Second Party from First Party as well as the ownership of the Products in process, half-finished Products, and the Products produced or processed by
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Second Party using such Supply Parts, until Second Party completes the payment of the prices of such Supply Parts. Article 24. Management of the Supply Parts 1. Second Party shall manage the Supply Parts with the care of good manager and shall use the Supply Parts only for producing the Products. 2. Second Party shall handle scraps and chips of the free of charge Supply Parts, according to First Partys instructions. 3. In case a situation may occur in which First Partys ownership may be violated, or risk of the occurrence of such situation like seizure of the Supply Parts by a third party and other treatment, Second Party shall prove that the Supply Parts belong to First Party and shall also notify First Party to that effect and shall follow First Partys instructions. 4. First Party may inspect the condition and management of the Supply Parts at Second Partys work-site. Article 25. Damage and Quality Deterioration of Supply Parts In case of loss, damage, deterioration or change in quality of the Supply Parts, after the Supply Parts are received by Second Party, the causes of which are not attributable to First Party, Second Party shall compensate the incurred loss to First Party based on mutual consultation. Paragraph 8. Jigs, Dies, Machines etc. Article 26. Disposal of Jigs or Dies In case Second Party wishes to dispose or transfer the jigs or dies, which are possessed and used by Second Party in the production process of the Products, Second Party shall bring forward the matter to First Party beforehand, and shall take care that it shall not hinder the production process of the Products. Article 27. Lending of Jigs or Dies Whenever deemed necessary, First Party may lend jigs and or dies to Second Party, for the use in the production process of the Products, which matter shall be concluded in a separate agreement between the parties hereto. Article 28. Lending of Machines First Party may, as occasion demands or upon request of Second Party, lend machines and or equipment to be used in the production process of the Products, which matter shall be concluded in a separate agreement between the parties hereto.

CHAPTER 3. GENERAL MATTERS


Article 29. Mutual Cooperation 1. Second Party shall, in order to improve the price, quality, function and method of production process of the Products, positively develop new technology, propose improvement and present information to First Party. 2. If necessary, First Party may, upon Second Partys knowledge, enter Second Partys work site and provide guidance and advice with regard to

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improvement of the technology, quality control, delivery control of the Products, and Safety Management/Control. When receiving a request from First Party to carry out every kind of inspection, Second Party shall positively cooperate to fulfill the request. In regard to establish long term and stable business relationship, both parties shall not only implement this Agreement in good faith but also realize that compliance is important business factor. Both parties should establish compliance structure to prevent all misconducts effect badly to both parties such as violation of law or social norms and other illegal practice. Second Party shall not only comply with related environment laws and or regulations but shall make effort to reduce waste, save energy and resources, and recycles.

Article 30. Preservation of Secrecy Either party hereto shall strictly keep the secrecy of the other party, with regard to the business and or technology obtained through both parties knowledge based on the transactions stipulated in this Contract, and shall never disclose those confidential matters to any third party, during the period of this Contract as well as after this Contract is expired. Article 31. Prohibition to Sell to Any Third Party Second Party shall not sell the Products or any goods which are similar to the Products to any third party, unless Second Party has obtained First Partys written approval. Article 32. Industrial Proprietary Right 1. When an invention has been made by Second Party, Second Party shall immediately inform First Party to that effect. Application and possession of the Industrial Proprietary Right based on the above intention shall be decided upon both parties consultation. 2. In case dispute may arise concerning the Industrial Proprietary Right related to the Products with a third party upon reasons which are not attributable to First Party, Second Party shall handle and solve this matter upon Second Partys sole responsibility and shall cause no harm or trouble to First Party. Article 33. Prohibition of Transferring Right and Obligation Except approved in writing by First Party, Second Party shall not transfer or pledge all claims to and or accept liabilities from any third party, which originate from this Contract as well as the Individual Contract. Article 34. Obligation to Notify When one of the under-mentioned cases occurs or when there is a risk of such occurrence, Second Party shall immediately notify First Party to that effect. a. The change of address of Second Partys office and or production facility, the change of Second Partys authorized representative, the change of Second Partys trade name, the change of Second Partys organization related to this Contract; b. Alienation or taking over a joint operation, entrustment or acceptance of a business, capital increase or capital decrease; c. Other important matters related to this Contract.

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Article 35. The Term of Validity 1. The term of validity of this Contract shall be 2 (two) years since the date set forth. If at least 3 (three) months prior to the expiration of the Contract, none of the parties hereto proposes in writing for an amendment or cancellation, the term of validity of the Contract shall continue for a successive 1 (one) year with the same terms and conditions. 2. Even when this Contract terminates, the provisions of the Contract still apply to the Individual Contract, which have been concluded prior to the termination. 3. Either party hereto may terminate the Contract before its expiration date, by sending notification to the other party at least 3 (three) months prior to the termination, upon the reasons acceptable for the parties hereto. Article 36. Cancellation of Contract 1. First Party may, without notice, cancel this Contract as well as the Individual Contract, entirely or partially, in one of the cases which comes under the followings : a. Second Party violates the provision of this Contract and or its amendments or the Individual Contract; b. Second Party, without justifiable reasons, does not perform or is anticipated not to perform its obligation provided for in this Contract; c. When a disaster occurs or due to other unavoidable reasons, it is difficult for Second Party to perform its obligation provided for in this Contract; d. When the competent authorities have decided that Second Party should cease or suspend its business; e. When Second Party stops payment or dishonors payment at a clearinghouse; f. When there is a claim for bankruptcy, reconciliation, arrangement and corporate reorganization process put to Second Party or when reasons to such proceedings may arise; g. When Second Party makes a decision as to liquidation or when there is an important change with respect to the management system like joint venture etc.; h. When there are appropriate reasons for First Party to judge that there is a risk that one of the above-mentioned cases may occur. 2. When First Party terminates the Contract according to the provision in point 1 of Article 36, First Party shall instruct Second Party as how to handle the Products, Products in process, half-finished Products etc., and Second Party shall comply with those instructions. 3. When the Contract is terminated according to the provision in point 1 of Article 36, First Party may demand for compensation of loss, resulting from such termination of the Contract, from Second Party. Article 37. Accomplishment of Obligation Upon Termination of Contract When the Contract is terminated or cancelled because of whatever reason, the debts of each party shall automatically become due and shall immediately be paid to the other party. When it is requested so by First Party, Second Party shall immediately accomplish the production and deliver the Products, which have been ordered based on Individual Contract by First Party to Second Party.

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Article 38. Treatment when the Contract Expires 1. Irrespective of the reason, when this Contract expires or is terminated, Second Party shall immediately return the goods mentioned in the following aligns to First Party. However, goods, which are necessary to perform the existing Individual Contract, shall be immediately returned after these goods are no longer used. a. The Loaned Drawings lent by First Party to Second Party; b. The Supply Parts which First Party has supplied to Second Party free of charge, and or the Supply Parts which is supplied with charge but not yet paid by Second Party to First Party, and or the Supply Parts which have not been processed, and or the remaining of such Supply Parts; c. Properties of First Party borrowed or kept in custody by Second Party. 2. Second Party shall keep the goods mentioned in point 1 of Article 38 with the care of good manager, until those goods are returned to First Party. 3. First Party shall instruct treatment of the goods, work in process, half completed goods, and others which are kept by Second Party. Article 39. Treatment of the Goods when not returned In case Second Party does not return the goods mentioned in point 1 of Article 38, or in case, according to First Partys judgment, Second Party is unable to return the goods or unable to observe First Partys instructions mentioned in point 2 of Article 38, First Party may demand Second Party to pay an appropriate amount of money as compensation for the loss. Article 40. Calculation Standard of the Compensation for the Loss The calculation standard of the loss amount of Supply Parts mentioned in Article 38 and 39 shall be as follow : For Supply Parts, which are supplied free of charge, the standard shall be the cost of procuring the parts and materials and the processing cost incurred by First Party. For Supply Parts, which are supplied with charge but not yet paid by Second Party to First Party, the standard shall be the price of the Supply Parts at the time of supply. Article 41. Treatment of Jig and Dies 1. Irrespective of the reason, when this Contract expires, First Party may propose to take over all or portion of the jig and or dies used in the production process of the Products, possessed by Second Party or its sub-contractors. In such case Second Party shall immediately deliver the jigs and or dies to First Party. 2. The transfer price of the jigs and or dies mentioned in point 1 of Article 41 shall be based on the price of the concerned jigs and or dies at the time of transfer, taking into consideration the depreciation, and shall be fixed upon mutual consultation. Article 42. Handling of the Old Contracts 1. The Agreement/Contract concluded by the parties hereto prior to the date of this Contract, and its amendments and addendums, if any, shall be superseded by this Contract and shall become ineffective as of the date set forth. 2. The Individual Contract, received by Second Party prior to the effective date of this Contract, shall observe the terms and conditions of this Contract.

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Article 43. Consultation In case of matters that are not appropriately stipulated or have not been stipulated in this Contract, or when doubt may arise with regard to this Contract, the parties hereto shall settle it through mutual consultation. As an evidence of the conclusion of this Contract, 2 (two) copies of the text are made with adequate stamp duties, each party shall keep one copy of which after writing their signatures on the texts. First Party PT KOMATSU UNDERCARRIAGE INDONESIA, Second Party __________________

PRATJOJO DEWO President Director

__________________

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