With Comments Framework Subcontract Agreement-TI

AGREE S1PH2020012519WBF1
MENT NO.
FRAMEWORK SUBCONTRACT
AGREEMENT
FOR
TI&RF&IBS Project
BETWEEN
ZTE PHILIPPINES, INC.
AND
FUTONG INFORMATION INDUSTRY (PHILIPPINES) INC
PROPRIETARY AND CONFIDENTIAL PAGE 1 of 41

MENT NO.
Agreement No.: S1PH2020012519WBF1
Contents
ARTICLE 1 DEFINITION.................................................................................................................................. 4
ARTICLE 2 PURCHASE ORDER ................................................................................................................... 8
ARTICLE 3 RESPONSIBILITY MATRIX .................................................................................................... 9
ARTICLE 4 TIME AND COMPLETION OF WORK ............................................................................... 15
ARTICLE 5 PRICE AND TERMS OF PAYMENT ................................................................................... 16
ARTICLE 6 COMMUNICATION AND MEETING ................................................................................. 20
ARTICLE 7 PROJECT QUALITY ................................................................................................................. 20
ARTICLE 8 MODIFICATIONS TO PROJECT AND DESIGN ............................................................. 21
ARTICLE 9 TEST AND ACCEPTANCE..................................................................................................... 22
ARTICLE 10 INSURANCE ............................................................................................................................. 23
ARTICLE 11 SOCIAL AND ENVIRONMENT RESPONSIBILITY (SER) ....................................... 24
ARTICLE 12 WARRANTIES ......................................................................................................................... 25
ARTICLE 13 FORCE MAJEURE .................................................................................................................. 27
ARTICLE 14 INTELLECTUAL PROPERTY RIGHT (IPR)................................................................... 28
ARTICLE 15 CONFIDENTIALITY .............................................................................................................. 29

MENT NO.
ARTICLE 16 LIQUIDATED DAMAGES .................................................................................................... 29
ARTICLE 17 INDEMNIFICATION .............................................................................................................. 30
ARTICLE 18 TERM AND TERMINATION ............................................................................................... 31
ARTICLE 19 GOVERNING LAW AND DISPUTE SETTLEMENT ................................................... 33
ARTICLE 20 PRIVACY PROTECTION AND GDPR ............................................................................. 33
ARTICLE 21 EXPORT CONTROL COMPLIANCE ................................................................................ 34
ARTICLE 22 MISCELLANEOUS ................................................................................................................. 37
This Agreement is entered into by and between

MENT NO.
xxxxxxxxxxxx, a company incorporated in Philippines with its registered office in 20/F Ayala Life
FGU Center 6811 Ayala Avenue, Makati City, Philippines (hereinafter referred to as ‘Contractor’
or ‘ZTE’).
AND
FUTONG INFORMATION INDUSTRY (PHILIPPINES) INC, a company registered office at

XXXXXXXXXX (hereinafter referred to as ‘Subcontractor’).
WHEREAS:
A. The Subcontractor is engaged in the business of TI, RF and IBS Works.
B. The Contractor and Subcontractor wish to establish an overall contractual framework for the
provision of Products and Services as provided in this Agreement and Annexes hereto.
C. The cooperation relationship established by this Agreement is the basis on which Contractor
may place purchase order with Subcontractor during the term of this Agreement.
Now Therefore, in consideration of the mutual obligations, representations, covenants and other
good and valuable consideration, the adequacy of which is hereby acknowledged, the Parties agree
to be bound by the following terms and conditions:
ARTICLE 1 DEFINITION
When used in this Agreement, the terms and expressions defined hereinafter between quotation
marks with a capital letter will be capitalized throughout this Agreement and shall have the meaning
hereby respectively assigned to them:
1.1 “Agreement” shall mean the present Framework Subcontract Agreement between the
Contractor and the Subcontractor, any Annex attached and any valid amendment hereto, any
supplementary agreements and succeeding amendments thereto, defining the rights and
duties of the Parties.
1.2 “Business Day” shall mean the weekdays excluding any public holidays stipulated in the
local legislations.
1.3 “Commencement Date” shall mean the date when Contractor shall start to execute the
Project.
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1.4 “Confidential Information” shall mean any and all documents, data and other information
disclosed or made available in any form whatsoever (including, but not limited to, disclosure
made in writing, orally or in the form of samples, models, computer programs, know-how or
otherwise) by the Disclosing Party to the Receiving Party, or of which the Receiving Party
has gained knowledge, as a result of this Agreement. For the avoidance of doubt,
Confidential Information shall also include any and all documents, data and information that
the Receiving Party develops or otherwise produces by aid of information received from the
Disclosing Party, including but not limited to, any test results in any form whatsoever
1.5 “Contractor’s Project Outsourcing Manager” shall mean the person who is appointed by
the Contractor and acts as the contact and interface person between the Contractor and the
Subcontractor.
1.6 “Contractor’s Site Representative” shall mean the person who represents the Contractor
to coordinate and supervise the site works.
1.7 “Employer” shall mean XXX Ltd, which is one party to the Main Agreement with its
registered office at XXX.
1.8 “FAC” or “Final Acceptance Certificate” shall mean the final acceptance certificate
issued by the Employer under the Main Contract.
1.9 “FAT” or “Final Acceptance Test” shall mean the final acceptance test undertaken by the
Employer under the Main Contract.
1.10 “Force Majeure” shall mean an event which could not reasonably have been avoided by a
diligent party in the circumstances, which is beyond the reasonable control of a party and
which makes a party’s performance of its responsibilities hereunder impossible and includes,
but is not limited to, war, riots, earthquake, storm, flood, terrorist acts, confiscation or any
other action by government agencies.
1.11 “Key Personnel” shall mean Subcontractor's personnel who plays an essential role in
respect of the performance and fulfilling of the PO and Agreement during different phases
of the Project, which includes but not limited to project manager, technical manager, quality
manager, safety manager and the team leader, quality inspector, safety principal of any
particular construction team.
1.12 “Main Agreement” shall mean the contract of CONTRACT FOR Modernization of
Telecommunication Network for Digital Connectivity (the title of Main Agreement)
concluded between the Contractor and the Employer.

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1.13 “PAC” or “Preliminary Acceptance Certificate” (or Provisional Acceptance certificate as

the case may be) shall mean the preliminary/provisional acceptance certificate issued by the
Employer under the Main Contract.
1.14 “Party” shall mean, individually, the Contractor or the Subcontractor as the context requires;
“Parties” shall mean Contractor and Subcontractor collectively.
1.15 “PAT” or “Preliminary Acceptance Test” (or Provisional Acceptance Test as the case
may be) shall mean the preliminary/provisional acceptance test undertaken by the Employer
under the Main Contract.
1.16 “Personnel” shall mean all the persons involved in this Project and working for or on behalf
of the Subcontractor
1.17 “PO Value” shall mean the total sum for the actual volume of work carried out by the
Subcontractor and accepted by the Contractor under a particular PO.
1.18 “PO” or “Purchase Order” shall mean the document which sets forth the service item,
quantity, progress requirement and so on by the Contractor in accordance with Article 2.
1.19 “Products” shall mean the equipment and materials used in the Project and supplied by
the Subcontractor according to Error! Reference source not found..
1.20 “Project” shall mean the supply of Products and Service, as defined in 1.18 and 1.21, by
Subcontractor in accordance with this Agreement.
1.21 “Service” shall mean services provided by Subcontractor as per Po and SOW.
1.22 “Site” shall mean the land and other place on, under, in or through which the Work of this
Agreement are to be executed and any other lands and places designated by the Contractor
for working space or any other purpose as may be specifically stipulated in this Agreement
as forming part of the Site.
1.23 “Subcontractor’s Project Manager” shall mean the project manager appointed and fully
authorized by the Subcontractor to act in its name and on its behalf under this Agreement.
1.24 “Unit Price” shall mean the price which is set against each of the items in Error! Reference
source not found. and represents the inclusive price for all the work in that item.

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1.25 “Work” shall mean s the work specified in Error! Reference source not found. to be
executed and completed by the Subcontractor in accordance with this Agreement.
1.26 “Other ZTE Matters” means
 any existing or potential business activity of the ZTE Group and

 the transfer of any other goods or services by or to the Subcontractor Group to, from, for or
on behalf of the ZTE Group other than under this Agreement.
1.27 “Subcontractor Group” means, collectively or individually,
 the Subcontractor and its affiliates (including other companies sharing a common control
person or companies under the control of Subcontractor) and
 its and their agents, directors, employees, officers, other third party representatives and
subcontractors.
1.28 “Restricted Party” means an individual or entity that is identified on (or owned, controlled
or acting on behalf of an individual or entity identified on ):
 the United Nations Security Council Sanctions List, as applicable,

 the European Union’s List of Persons, Groups and Entities Subject to Financial Sanctions,
as applicable,
 the United States’ Specially Designated Nationals and Blocked Persons List,
 the United States’ Denied Persons List or Entity List (except activities with these parties
that are in full compliance and have been approved in advance and in writing by ZTE’s
Chief Export Compliance Officer) or
 another list of individuals and/or entities maintained by any other government or country
having jurisdiction over the ZTE Group, the Subcontractor Group or the performance
of this Agreement that makes the performance of the Agreement unlawful without first
obtaining a license or other authorization from that government.
1.29 “Restricted Regions” means
 the Crimea region, Cuba, Iran, North Korea, Sudan, Syria and
 any other region or country that becomes subject to comprehensive economic sanctions
imposed by the People’s Republic of China, the United Nations, the European Union,

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the United States of America or any government having jurisdiction over the ZTE
Group, the Subcontractor Group or the performance of this Agreement.
1.30 “Significant Compliance Risk” means an act, omission or event that, in connection with
this Agreement or Other ZTE Matters, is reasonably likely to cause
 the information, representations, warranties, covenants and certifications (including any

certifications made pursuant to this Section) of the Subcontractor Group to be or
become inaccurate or insufficient at the time given or made or at any time thereafter
until the end of the term of this Agreement or
 the ZTE Group or the Subcontractor Group to violate any economic sanctions or
export/reexport controls of the People’s Republic of China, the United Nations, the
European Union, the United States of America or any government having jurisdiction
over the ZTE Group, the Subcontractor Group or the performance of this Agreement.
1.31 “ZTE Group” means, collectively or individually, Zhongxing Telecommunications

Equipment Corporation, its wholly-owned subsidiaries, its controlled affiliates (including all
joint ventures or business partnerships that are 50% or more owned, directly or indirectly, by
Zhongxing Telecommunications Equipment Corporation), ZTE and the employees
(including directors and officers) acting in their official capacities, agents and other third
party representatives of any of them.
ARTICLE 2 PURCHASE ORDER
2.1 This Agreement is not an exclusive agreement and shall not restrain Contractor from
concluding the same or similar agreement with any third parties. Any and all of the
Contractor’s purchases of Products and/or Services from the Subcontractor under this
Agreement is subject to the Contractor’s issuance of PO to the Subcontractor as a
confirmation.
2.2 The Subcontractor shall not reject the Contractor’s PO under this Agreement. Subcontractor
shall duly sign and return the PO to the Contractor within three (3) Days from the date of
PO issuance, beyond which period, the Subcontractor shall be deemed to have rejected the
PO and the Contractor reserves the right to rescind the PO in question.
2.3 The Subcontractor shall perform the Work specified in this Agreement after receiving a PO
which normally details work quantity and the time for starting and completion of the Work.
If Commencement Date is absent in the PO, the date of receiving the relevant PO by the

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Subcontractor shall be deemed as the Commencement Date of the Work. The Subcontractor
shall be paid only for actual quantities of Work completed and accepted.
2.4 In case of any discrepancies between this Agreement and the PO, the provisions of this
Agreement shall prevail.
ARTICLE 3 RESPONSIBILITY MATRIX
3.1 Responsibility of Contractor
Contractor shall supply relevant and necessary technical drawings as well as other documents
required for this Project;
3.2 Responsibility of Subcontractor
3.2.1 Subcontractor’s General Responsibilities:
a) Subcontractor shall execute and complete the Work in accordance with the Error!
Reference source not found. and shall remedy any defect of the Services (if any).
When completed, the Work shall be fit for the purposes for which the Work is
intended under this Agreement.
b) During the whole period of this Agreement, the Subcontractor shall not, directly or
indirectly enter into any exclusive agreement or contract with a third party, under
which the Subcontractor is contractually prevented from providing service or products
to Contractor or to the parent company, affiliates, subsidiaries or associates of the
Contractor.
c) Subcontractor shall provide all the documents specified in this Agreement, and all
personnel, goods, instruments, consumables and other things and Services, whether of
a temporary or permanent nature, required in and for design, execution, completion
and remedying of defects.
d) All Works carried out by the Subcontractor shall satisfy the Contractor’s requirement
as specified in this Agreement or implied otherwise; Subcontractor shall ensure all Site
works, operations and construction methods are safe and complete.

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e) Subcontractor shall, whenever required by the Contractor, submit details of the

arrangements and methods which the Subcontractor proposes to adopt for the
execution of the Work. Subcontractor shall not make any changes to these
arrangements and methods without prior written consent of Contractor.
f) Subcontractor shall submit the work documents for approval and counter-signed by
Contractor for the acceptance of the Project. Upon completion of the acceptance,
Subcontractor shall hand over all the acceptance documents including but not limited
to the drawings, Project and testing records to Contractor. If Contractor has any
comments on the above documents, Subcontractor will incorporate such comments
and submit a newly revised version for Contractor’s approval.
g) Subcontractor shall duly submit daily and weekly reports on the progress of the Project
as required by the Contractor and shall be responsible for the authenticity of the
reports.
h) Subcontractor shall promptly notify Contractor of any error, omission, fault or other
defect in the design for the Work upon its first awareness or knowledge of such
occurrence.
i) Subcontractor shall be responsible for recording and promptly reporting problems

found in the Project or reported by the Employer during the Work to Contractor’s Site
Representative in twenty-four (24) hours.
j) Subcontractor shall provide all its Personnel with necessary tools, equipment and
facilities to ensure their health and safety while they are present at the workplace of
this Project. Proper work methods, procedures and personal protection measures shall
be adopted and strictly observed by Subcontractor.
k) Subcontractor shall advise, instruct and train (if necessary) all its Personnel to strictly
follow the mandatory health and safety rules of the workplace. Subcontractor is liable
for any damage and/or loss resulted from any safety incidents except such damage
and/or loss is evidenced to be solely caused by Contractor’s gross negligence.
3.2.2 Subcontractor’s Personnel

MENT NO.
a) Subcontractor shall appoint a Subcontractor’s Project Manager and shall fully

authorize this position so as to enable its Project Manager to act on the Subcontractor’s
behalf under this Agreement.
b) Subcontractor shall, prior to the Commencement Date, submit the name list and
relevant particulars, such as resumes and contact details of its Key Personnel Commented [WU1]: Subject to violation of data privacy law,
(including the project manager, regional manager, quality manager, construction team there must be signed waiver from employees whose resumes
will be given to contractor

leader, and security manager) to Contractor for approval. When in possession of
Contractor’s written consent of these Key Personnel, Subcontractor shall issue written
appointment to such Key Personnel. If such consent is withheld or subsequently
revoked by the Contractor, or if the appointed person fails to act as this position as
judged by contractor, the Subcontractor shall submit forthwith replacement name list
and resume for such appointment within required time. Subcontractor shall keep an up
to date list of people involved in the performance of the works, such list shall be
provided to contractor at any time as required by the contractor and whenever any
changes in the subcontractor’s organization occur.
c) Subcontractor shall not revoke the appointment of any Key Personnel or appoint a
replacement for any of them without the prior written consent of Contractor.
d) Subcontractor’s Project Manager shall work on full-time basis and be on duty as long
as there is Work in process. In the case that Subcontractor’s Project Manager
unavoidably has to be temporally absent due to such reasons as illness etc., a suitable
acting project manager shall be appointed by the Subcontractor and agreed by the
Contractor during his absence.
e) The Subcontractor’s Project Manager shall, on behalf of Subcontractor, receive

instructions from Contractor’s Project Outsourcing Manager.
3.2.3 Subcontractor shall, within required time limit, build demonstration sites in accordance Commented [WU2]: What is time limit? Must be specified so
with the standards and criteria set forth by the Employer and/or the Contractor. The that it can be monitored to avoid violations specially so 3.2.4
provides that failure to follow time limit results to suspension

Subcontractor shall be paid only for the demonstration sites which satisfy the Employer
or rescission of PO
and the Contractor in quality and standards; and such satisfactory demonstration sites shall
model all the following sites to be built by the Subcontractor. Any costs and expenses
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incurred from the unsatisfactory demonstration sites shall be borne by the Subcontractor. If
the Subcontractor fails to build demonstration sites within the required time limit or
demonstration sites fail to meet the required standards or criteria, the Contractor has the
right to suspend or rescind the relevant PO.
3.2.4 Subcontractor shall have no right to subcontract all or any part of this Project to any third
party without Contractor’s prior written consent. If Subcontractor breaches this clause,
without prejudice to any other remedies, the contractor shall be entitled to claim 10% (ten
percent) of all the PO amount under this agreement which has been performed and/or
terminate this Agreement. The subcontractor shall bear any and all costs, expenses, losses,
and damages arising out of such termination.
3.2.5 Subcontractor has full regard for the safety of all persons on the Site and keep the Site (so
far as the same is under his control) and the Work (so far as the same are not handed over
to Contractor) in an orderly state appropriate to the avoidance of danger to such persons,
equipment, tools, sites, and take all reasonable steps at his own cost to protect the
environment on and off the Site and to avoid damage or nuisance to persons or to property
of the public or others resulting from pollution, noise or other causes arising as a
consequence of his methods of operation.
3.2.6 Subcontractor shall institute a quality assurance system to demonstrate compliance with the
requirements of the Contractor. Contractor shall be entitled to audit any aspect of the
system. Details of all procedures and compliance documents shall be submitted to
Contractor for information before each design and execution stage is commenced. When
any document of a technical nature is issued to Contractor, evidence of the prior approval
by Subcontractor himself shall be apparent on the document itself. Compliance with the
quality assurance system shall not relieve Subcontractor of any of his responsibilities,
obligations or liabilities under this Agreement.
3.2.7 Subcontractor shall run self-checks on all the Works carried out, including but not limited
to the concealed works; photographs can be taken as an evidence of self-checks. The
self-check records shall be kept ready for Contractor’s inspection at any time. The

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concealed works shall be inspected and approved by the Contractor before any following
work being dealt with.
3.2.8 Subcontractor shall promptly and effectively remedy any defect occurred during the
execution of the Works. If the defect is caused due to the Subcontractor’s fault, such as
negligence or omission, all costs and expenses of the remedy shall be borne by the
Subcontractor.
3.2.9 Subcontractor shall be deemed to have inspected and examined the Site and its
surroundings and information available in connection therewith and to have satisfied
himself, so far as is practicable, before acceptance of the PO issued hereunder, as to the
form and nature thereof, including the sub-surface conditions, the hydrological and
climatic conditions, the extent and nature of work and materials necessary for the
completion of the Works, the means of access to the Site and the accommodation that may
be required, and in general, shall be deemed to have obtained all necessary information,
apart from the above mentioned, as to risks, contingencies and all other circumstances
which may influence or affect its work. The Subcontractor shall be liable to any
consequences subsequently caused by the said conditions
3.2.10 Subcontractor shall bear all costs and charges for special and/or temporary permission to
access which he may require, including those for access to the Site. Subcontractor shall
also obtain, at his risk and cost, any additional facilities outside the Site which he may
require for the purposes of the Work.
3.2.11 Subcontractor shall be responsible for all its Personnel’s accommodation, transportation
and other expenses arising from the execution of the Work during the Project.
3.2.12 Subcontractor will be liable to the Contractor and the Employer for any debts, claims, suits,
payments, legal actions or judicial decisions filed in or issued by the competent authorities
arising out of or in connection with the execution of the Work by Subcontractor, its
personnel, agents, representatives or sub-subcontractors, or by reason of losses or damage
to property of the Contractor and the Employer or any third parties, including landowners
or holders of easements or other real rights of vested possession or simply occupants, or by
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reason of injuries to or death of persons, provided that in all cases such losses or damages
are susceptible to be claimed to the Contractor and the Employer.
3.2.13 Subcontractor shall not interfere unnecessarily or improperly with the convenience of the
public, or the access to and use and occupation of all roads and footpaths, irrespective or
whether they are public or in the possession of the Employer or of others. Subcontractor
shall indemnify and hold the Contractor and Employer harmless against and from all
damages, losses and expenses (including legal fees and expenses) resulting from any such
unnecessary or improper interference.
3.2.14 Subcontractor shall visually inspect equipment, materials and tools provided by Contractor,
and shall promptly give notice to Contractor of any shortage, defect or default in the
equipment, materials and tools. After this visual inspection, the equipment, materials and
tools shall come under the care, custody and control of Subcontractor and all the risk shall
be passed to Subcontractor. All the sites shall be under the care of Subcontractor from
Subcontractor coming into the site until the issuance of PAC by Contractor.
3.2.15 Subcontractor shall guarantee and maintain the authenticity, legitimacy and validity for all
the documentation including but not limited to register documents, financial statement,
authorization document, acceptance document and any other document subcontractor
presented to Contractor and Employer, and subcontractor shall bear any and all the
responsibility, costs of any damages and legal fees and/or penalty that may be arising out
of or in connection with its breach of this terms or other terms of this Agreement.
3.2.16 The Subcontractor shall submit the work schedule (including General Plan, Monthly Plan,
and Weekly Plan) to Contractor’s Project Outsourcing Manager for approval. The
Subcontractor shall appoint personnel solely devoted to the preparation and submission of
the documentation specified below.
a) project implementation plan ;

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b) a checklist and detailed schedule for the provision of Contractor’s drawings, tools,
equipment and logistics requested by Subcontractor for the implementation of the
Project.
c) The Subcontractor’s construction teams, list of personnel, contact information and

primary working staffs’ resumes in English.
The Subcontractor must submit the above stated reports within ten (10) Days after signing
this Agreement.
ARTICLE 4 TIME AND COMPLETION OF WORK
4.1 The Subcontractor shall perform the Work according to the schedule approved by
Contractor and complete the Project within the time period specified in each PO.
4.2 Subcontractor shall commence the execution of the Work on the Commencement Date as
specified in PO, and shall then proceed with the Work with due expedition and without
delay.
4.3 The Subcontractor shall not suspend or delay the progress of the Project or any part thereof
without the prior written consent of the Contractor.
4.4 Contractor may at any time instruct Subcontractor to suspend progress of part or all of the
Work. During such suspension, Subcontractor shall protect and secure the Sites and any
equipment, devices, instruments stored at the Sties against any deterioration, loss or damage.
The written instruction document issued by Contractor shall be properly kept by
Subcontractor. Contractor may also notify Subcontractor of the cause for the suspension.
4.5 If the suspension is solely caused by Subcontractor, Contractor has the right to terminate this
Agreement and claim damages from Subcontractor.
4.6 The Subcontractor shall within one (1) calendar day notify Contractor's Outsourcing Commented [WU3]: Can we request for three (3) days para
Manager of any delay which is not caused by the Subcontractor itself but due to reasons mapahaba lang?
beyond its reasonable control including but not limited to changes in design, force Majeure,
etc. The Subcontractor shall, within seven (7) calendar days after its first knowledge or
awareness of the delay, provide adequate evidences to the Contractor's Project Outsourcing
Manager to justify the delay. If the Contractor's Project Outsourcing Manager, judging by
the adequate and valid evidences provided by the Subcontractor within the above fixed time
limit, signs to confirm that the Subcontractor shall not be held responsible for the delay, the
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Subcontractor can then be exempted from any liabilities in connection with the delay. The
time schedule shall be continuously checked and may be adjusted during execution by
Contractor if the circumstances or the progress of Work so requires.
4.7 The Project period may be extended upon written consent of Contractor’s Project
Outsourcing Manager when the delay is confirmed not the liability of Subcontractor by
Contractor in accordance with 4.6.
4.8 Contractor might, under special circumstances, require Subcontractor to execute the Work
during the night, on weekends and on holidays. Subcontractor hereby acknowledges that it is
the Subcontractor responsibility to obtain all required permissions and to take adequate
measures to ensure the aforesaid overtime performance.
4.9 Subcontractor hereby acknowledges that it is Subcontractor’s full responsibility to obtain all
required permissions relating to the Project at no cost to the Contractor and to take due
measures to safeguard performance according to applicable laws, including during the night,
on weekends and on holidays (if any).
ARTICLE 5 PRICE AND TERMS OF PAYMENT
5.1 When requesting payment, Subcontractor shall apply for settlement in accordance with
Contractor’s paying procedures set out in Annex 4 Payment Flow Chart hereto.
5.2 Only after Contractor approves the settlement application and confirms the settlement
amount on the settlement sheet shall the Subcontractor issue and send the corresponding
invoice to Contractor. The payment will be made within fifteen (15) Days from the date of
the original invoice being accepted by Contractor. Contractor shall not be assumed any
liabilities if the payment is delayed due to Subcontractor’s fault.
5.3 Payment Proportions are as follows:
a) For TI Part
For Logistics and Delivery(Transportation, Manual hauling, Manual Lifting)
i.One hundred percent(100%) of the PO Value after work complete or third-party

invoice issued and accepted by ZTE.

MENT NO.
For other TI Works except Logistics and Delivery
i.The 1st Payment: Seventy Percent (70%) of the PO Value after work completion and
confirmed by ZTE.
ii.The 2nd Payment: Thirty Percent (30%) of the PO Value after issuance date of the
PAC.
b) For RF Part
i.The 1st Payment: Seventy Percent (70%) of the PO Value after work completion and
confirmed by ZTE.
ii.The 2nd Payment: Thirty Percent (30%) of the PO Value after issuance date of the
PAC.
c) For IBS Part
For Logistics and Delivery(Transportation, Manual hauling, Manual Lifting)
i.One hundred percent(100%) of the PO Value after work complete or third-party

invoice issued and accepted by ZTE.
For Survey and Design
i.The 1st Payment: Eighty Percent (80%) of the PO Value after work completion and
accepted by ZTE.
ii.The 2nd Payment: Twenty Percent (20%) of the PO Value after issuance date of the
PAC.
For other IBS Works except Logistics and Delivery and Survey and Design

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i.The 1st Payment: Thirty Percent (30%) of the PO Value after Contractor receiving
the advance payment guarantee.
iii.The 2nd Payment: Fifty Percent (50%) of the PO Value after work completion and
confirmed by ZTE.
iii.The 3rd Payment: Twenty Percent (20%) of the PO Value after issuance date of the
PAC.
The following common documents should be submitted when apply the payment:
•Original commercial invoice duly signed & stamped by partner.
•WCC/PAC approved by ZTE Authorized Representative.
•Frame Agreement Key pages copy duly signed & stamped by ZTE and partner.
5.4 An advance payment guarantee in favor of ZTE, in the amount of _30__% of the PO value,
and valid until PAC or deemed PAC after signing of PO by Subcontractor, shall be
delivered to Contractor in fourteen (14) days after signing of PO by Subcontractor. The
guarantee shall be issued by bank or insurance company. The insurance company can be
choosed as following:
a) Malayan Insurance Company,Inc
b) Pioneer Insurance&Surety Cooperation
c) Prudential Guarantee & Assurance,Inc
d) BPI/MS Insurance Cooperation
e) Charter Ping An Insurance Corporation
f) FPG Insurance Company,Inc.(Federal Phoenix)
5.5 Contractor has the rights to refuse the concerned payment where:
a) The settlement sheet is not in the format of Contractor’s form or is not filled in
completely.
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b) Subcontractor fails to respond in time to Contractor’s request for clarification.
Contractor shall not be held responsible for any costs and expenses incurred by
Subcontractor due to such payment rejection.
5.6 From the date of advance payment, if after a period of one (1) year ZTE still does not
receive the payment request for the next payment milestone, ZTE shall have the right to
deduct and set off the advance payment from the unpaid payment of the Subcontractor
directly or advance payment guarantee.
5.7 In a situation that advance payment was already paid but the Purchase Order (PO) was
canceled after that, the Subcontractor shall submit a Credit Memo and Cancellation Note in
a favor of ZTE to set off this advance payment within thirty (30) days from the date of the
PO cancellation’s acceptance. Otherwise, ZTE will get the money from advance payment
guarantee or ZTE can set off directly from the unpaid payment of the Subcontractor by
Payment Deduction from without need of any confirmation from the Subcontractor.
5.8 Settlement sheets and the related invoices shall match with the relevant PO. The bank
account names, account opening banks and account numbers of both Parties provided herein
shall be used for payment. In case of any change(s) thereof, the Party making change(s)
shall notify the other Party in writing twenty-five (25) Days prior to the relevant agreed
payment time limit and any such change(s) shall be subject to the written confirmation of
the Party’s authorized representative.
5.9 Subcontractor shall be deemed to have satisfied himself as to the correctness and sufficiency
of the price and have based the price on its full understanding and examination of the data,
interpretations, information, inspections as to all relevant matters and designs. The price
covers all the Contractor’s obligations under this Agreement and the PO hereunder and all
things necessary for the proper design, execution and completion of the Project and the
remedying of any defects.
5.10 The prices set forth in Error! Reference source not found. include all the costs and expenses
incurred by Subcontractor for this Project. The Unit Price shall remain fixed and firm during
the term of this Agreement, Subcontractor shall not raise the Unit Price in any way after the
effective date of this Agreement for any cause including but not limited to float of market
price on raw materials or parts, salary or wages, the fluctuation of exchange rates or any
other factors.

MENT NO.
5.11 Unless otherwise specified in this Agreement, any kinds of duties, taxes, social security,
levies and charges arising out of or in connection with the performance of this Agreement
shall be deemed to have been included in the price and shall be borne by the Subcontractor.
5.12 The Contractor is entitled to: (1) withhold or deduct or retain a fraction of payment if the
laws and regulations of any jurisdiction to which it may be subject require so, provided that
relevant certificates or documents with respect to such deduction are served.
ARTICLE 6 COMMUNICATION AND MEETING
6.1 A kick-off meeting between the Parties, attended by Subcontractor’s Project Manager and
other key personnel shall be organized before project commencement. Details with respect
to team build-up/establishment, communication system, progress plan, report template, etc,
shall be recorded and confirmed by both Parties at this meeting.
6.2 Routine meetings for the progress, schedule and problems shall be organized by both Parties
at regular intervals, which shall not be longer than half a month. Subcontractor shall make
preparations for such meetings, including preparing relevant documents, schedule, progress
report, etc.
6.3 Temporary meetings shall be organized to solve cooperation problems and discuss
performance difficulties at Contractor’s request. Minutes shall be taken and signed by all the
attendants of the meeting. Attendants of this meeting shall include Subcontractor’s Project
Manager, Key Personnel and other senior personnel from Subcontractor’s side as requested
by Contractor.
ARTICLE 7 PROJECT QUALITY
7.1 The quality of this Project must meet the following requirements of Contractor:
a) Comply with the requirement specified include but not limited in Annex 1 Technical
Specification, Annex 5 Quality Checklist and Annex 12 Default Penalty Form.
b) Comply with all requirements in the Main Agreement between Contractor and the
Employer which are related to the Project works;
c) Comply with local national standards (the place of Project); if there aren’t local national
standards it should be used in international standards.
d) Comply with the Project design requirements and ZTE or Employer related quality
requirement.
MENT NO.
7.2 Subcontractor provide the project milestone, Contractor will use it check and evaluate the
subcontractor’s work.
7.3 Subcontractor shall strictly follow the master plan in the Project. When the master plan
needs to be changed as required by the Project, written approval by Contractor and
Employer must be available (verbal Agreements over the telephone is allowed only in
emergency, but the within 2 days Subcontractor shall issue requirement and get written
approval by Contractor and Employer before any modification to the original design.
Otherwise, Subcontractor shall bear the concerned responsibility.
7.4 Subcontractor shall observe the following requirement during the Project:
a) Auxiliary materials, equipment (such as measurement apparatus/instruments) and

components/fittings provided by Subcontractor must be qualified products for the use
of the Project and shall be accepted by Contractor before using;
b) When defects are discovered by Contractor’s Site representative during Project

activities, the Contractor are entitled to request Subcontractor for rework until the
Project becomes acceptable;
c) Relevant items in the work manual and acceptance manual shall be counter signed by
both Contractor and Subcontractor.
ARTICLE 8 MODIFICATIONS TO PROJECT AND DESIGN
8.1 All design drawings, requirements and documents approved and delivered by Contractor
shall constitute integral part of this Agreement and modification made to the aforesaid
contents shall be deemed the amendment to this Agreement.
8.2 Contractor’s prior written approval is required when any modifications becomes necessary.
(verbal agreements over the telephone is allowed in emergency only, provided that such
modification request and approval is transformed into writing within two(2) days after such
verbal communication). Subcontractor shall be responsible for the quality of any
modifications made by it.
8.3 When variations are requested by the Contractor and Employer during the Project,
Subcontractor shall provide all assistance in carrying out the variations. Variations can be
initiated by Contractor at any time prior to the issuance of FAC for this Project, either by
instruction of variation or by requesting Subcontractor for a proposal. A variation shall not
comprise the omission for any work which is to be carried out by others.

MENT NO.
8.4 The Subcontractor shall execute and be bound by each variation, unless it promptly gives
notices to the Contractor stating with supporting particulars that (i) the Subcontractor can
not readily obtain the goods required for the Variation; (ii) it will reduce the safety or
suitability of the works, or; (iii) it will have adverse impacts on the completion of this
Project as scheduled. Upon receiving this notice, Contractor may accordingly cancel,
confirm or vary the instruction of variation.
8.5 If Contractor requests proposal for variation, the Subcontractor shall respond in writing as
soon as practicable, either by giving reasons why it cannot comply (if this is the case) or by
submitting:
a) A description of proposed design and/or work to be performed and a schedule for its
execution;
b) A proposal for any necessary modification to the schedule of the Project;
c) A proposal for adjustment to the price.
The Subcontractor shall not delay any work whilst awaiting a response.
ARTICLE 9 TEST AND ACCEPTANCE
9.1 Contractor is entitled to inspect the Products provided by Subcontractor and reject the
Products if they are defective or fail to meet any applicable standards and/or specifications
provided for in this Agreement. The inspection and acceptance of the Products shall not
relieve Subcontractor from its warranty obligations hereunder.
9.2 Subcontractor shall notify and apply within three (3) Days after completion of the work list
in PO on cluster or site basis for the PAT which is conducted under the supervision of the
Contractor and Employer. For Contractor’s convenience, Subcontractor shall submit all
records and documents, drawings, and acceptance documents.
9.3 Upon issuance of PAC, Subcontractor shall transfer all documentation associated with the
Project to Contractor.
9.4 The subcontractor shall remove all the snag remain in PAC.

MENT NO.
9.5 The standards of acceptance are specified in Annex 5 Quality Check List. Client acceptance
checklist and other related acceptance checklist also should be executed.
ARTICLE 10 INSURANCE
10.1 The Subcontractor shall within three (3) Days after acceptance of PO procure and maintain
at his expense, insurances against any damage, loss or injury which may occur to any
property or to any person from whatever cause for a period beginning from Commencement
Date and till the end of warranty period.
10.2 The following insurances shall be effected by the Subcontractor Commented [WU4]: Is there a need for a fire insurance? Or is
it already included in the ALL risk Insurance?
(a) workers’ compensation insurance and Employer’s Liability Insurance in such amounts
and with such limits as required by the applicable laws. Subcontractor is fully responsible
for any kind of injury claims by its workers;
(b) Erection All Risk Insurance covering the full value of the equipment and facilities
provided by Contractor but under Subcontractor’s control;
(c) third party liability insurance in respect of claims by third parties arising out of or in
connection with the Work including coverage for bodily injury, death and property damage
until the expiration of the warranty period. No deductible shall be paid by Contractor.
10.3 These insurance policies shall be approved by the Contractor, which approval shall not be
unreasonably withheld, and the Subcontractor shall upon Contractor’s request produce to
Contractor copies of the policies and the receipt indicating payment of current premiums for
such policies.
10.4 Subcontractor shall give or make the insurance-issuing company give the Contractor at least
thirty (30) days prior written notice of cancellation, non-renewal, or reduction in coverage,
terms, or limits.
10.5 Both Parties agree that:
a) Contractor’s failure to demand a particular insurance or to identify a deficiency will

not be construed as a waiver of Subcontractor’s obligation to purchase and maintain
Commented [WU5]: Here it is provided that even if wala sa
the insurance required by local laws or under this Agreement; list ang insurance an required under this agreement, e kasalanan
p din ni subcon. So need to determine if kasama na nga sa all
risk insurance ang fire

MENT NO.
b) the insurance required under this Agreement shall not represent that coverage and
limits is adequate enough to protect Subcontractor, nor shall it be deemed as a
limitation on Subcontractor’s liability to Contractor or any third party involved under
this Agreement.
ARTICLE 11 SOCIAL AND ENVIRONMENT RESPONSIBILITY (SER)
11.1 In consideration for the opportunity of being a sustainable business partner of the
Contractor, the Subcontractor hereby agrees to conduct its business in conformity with the
standards set out in Annex 7 Subcontractor Code of Conduct, the requirements in Annex
10 HSW Compliance Commitment and Annex 12 Default Penalty Form and any
environment, health, safety laws and regulations that apply to its performance under this
Agreement.
11.2 The Subcontractor shall contractually secure that its own employees, subcontractors(only to
the extent that such act of subcontract is allowed under this Agreement), business partners,
suppliers and other third parties accept and adhere to the SER requirements set out herein.
11.3 Contractor may request from Subcontractor information related to the measures adopted to
ensure compliance with the SER requirements set out herein. Subcontractor shall report to
Contractor as per Annex 11 Accident Classify and Report Module immediately after the
occurrence of any environment, health, safety (EHS) incident.
11.4 Upon prior written notice, Contractor shall be entitled, by itself or through an authorized
auditor, to audit Subcontractor in order to verify its conformity with the SER requirements
set out herein. In case of any non-compliance, Contractor may serve a warning notice and
demand Subcontractor to take any measures leading to compliance or remedy within thirty
(30) Days following the receipt of written notice. Contractor may, without prejudice its
other rights hereunder, cancel the PO(s) issued hereunder if: (1) Subcontractor fails to
remedy the non-compliance within the said period or; (2) such non-compliance recurs or; (3)
a major incident as defined in Error! Reference source not found. occurs.

MENT NO.
ARTICLE 12 WARRANTIES
12.1 Either Party represents and warrants to the other Party that on the Effective Date of this
Agreement:
a) the execution and delivery of this Agreement has been properly authorized;
b) it has full corporate power to execute, deliver and perform its obligations under this
Agreement;
12.2 Subcontractor represents and warrants that:
a) this Agreement does not conflict with or result in the breach of or default under any
provision of its constitution, or any material term or provision of any law or regulation
to which it is a party or a subject or by which it is bound;
b) to the knowledge of the Party, there are no actions, claims, proceedings or

investigations pending or threatened against it or by it of which it is aware, and which
may have a material effect on the subject matter of this Agreement; and
c) it has (or will at the relevant time have) all licenses, authorizations, consents, approval
and permits required by all applicable laws and regulations in order to perform its
obligations under this Agreement, and otherwise complies with all laws and
regulations applicable to the performance of those obligations.
12.3 Subcontractor represents and warrants that the use, possession, marketing or selling of the
Products and Services do not and will not infringe the rights (including Intellectual Property
Rights) of a third party.
12.4 Subcontractor warrants that Products furnished hereunder will be, new and unused, of
satisfactory quality, free from defects whether actual or latent in design, material and
workmanship, free from all liens and encumbrances and will substantially conform to and
perform in accordance with applicable Specifications (whether statutory or agreed) ,
drawings and samples.
12.5 Subcontractor warrants and represents that the Services shall be:
MENT NO.
a) performed by adequate numbers of appropriately qualified and trained personnel, with

due care and diligence and to such high standard of quality as it is reasonable for
Contractor to expect in all the circumstances;
b) compliant with all laws and regulations applicable to Subcontractor, the Services and
Subcontractor’s obligations under this Agreement;
c) free from defects as regards its performance.
12.6 Breach of Warranty for Products and Services:
a) Without prejudice to any other remedies available to Contractor under this Agreement
or otherwise, Subcontractor undertakes at its own cost and risk either to repair or to
replace (at Contractor’s option) any Products which are faulty and/or fail to comply
with any part of the Specifications or of this Agreement during a period of two year
(warranty period) from the issuance date of PAC. Subcontractor shall ensure that any
replacements for faulty Products shall comply with the Specifications and match the
original faulty Products in all respects except the fault itself. Unless otherwise agreed,
Subcontractor shall collect faulty Product, return repaired or replacement Products at
Subcontractor’s expense and risk. Subcontractor shall ensure that all repairs and
replacements are carried out within a turnaround of 7 Business Days beginning from
the day when Contractor requests for repair or replacement. Subcontractor shall be
responsible for installing the repaired or replacement Product at the site.
b) Without prejudice to any other remedies available to Contractor under this Agreement
or otherwise, if in Contractor’s discretion any Services are found to be faulty within
the first twelve (12) months after the issuance date of PAC, then Contractor shall be
entitled at its own option to require Subcontractor within 5 Business Days, to (i)
perform those Services again, (ii) provide such additional Services as shall be
necessary to make good the fault or (iii) to pay Contractor all costs incurred by
Contractor in obtaining such Services from a third party at the Subcontractor’s cost.
c) If Subcontractor fails to fulfill its obligations under this article, Contractor shall be
entitled to correct the defect or failure by itself and a third party, and Subcontractor
shall compensate Contractor fully for any reasonable costs of correction.
MENT NO.
ARTICLE 13 FORCE MAJEURE
13.1 In this Agreement, “Force Majeure” means an exceptional event or circumstance that: (i)is
beyond the affected Party’s control; (ii)such Party could not reasonably have foreseen and
provided against before entering into this Agreement; (iii)having arisen, such Party could
not reasonably have avoided or overcome by the exercise of reasonable diligence and good
operating procedures and;(iv)is not substantially attributable to the other Party. Force
Majeure shall not include any event which is caused by the negligence or intentional action
of a party or such party’s subcontractors or agents or employees, or by a failure to observe
good professional practice. In case that the Project is not able to be performed due to Force
Majeure, the liabilities shall be exempted in part or wholly in light of the effects of Force
Majeure. For the purpose of the definition of Force Majeure, and unless otherwise provided
in this Agreement, Force Majeure does not include lack of authorizations, of licenses, of
entry or residence permits, or of approvals necessary for the performance of this Agreement
and to be issued by a public authority of any kind whatsoever .
13.2 In the case of Force Majeure, the Frustrated Party shall:
a) promptly notify the Non-Frustrated Party of the nature and extent of the circumstances
of the Force Majeure once known; within fifteen(15) Days present valid documents
issued by the notary public of the locale, stating the details of the incident;
b) forthwith establish and implement a plan that minimizes the disruption to the
Non-Frustrated Party and shall use its commercially reasonable efforts to remedy the
situation and remove the cause of its inability to perform as soon as possible.
c) give the Non-Frustrated Party prompt notice of the cessation of the Force Majeure.
13.3 If the said Force Majeure lasts for thirty(30) calendar Days, the other Party shall have the
right to terminate the PO(s) so affected after serving a written notice to the Frustrated Party.
13.4 Where only part of the Project is impacted by the Force Majeure, the unaffected part of the
Project shall continue to be performed.
13.5 Failure by the Subcontractor to obtain the relevant permits, licenses, permission and or the
renewal from the relevant authorities shall not be classified as a Force Majeure Event.

MENT NO.
ARTICLE 14 INTELLECTUAL PROPERTY RIGHT (IPR)
14.1 All drawings, specifications, technical manual and commercial information provided by the
Contractor to the Subcontractor, as well as the Contractor's designs, trademarks, copyright,
know-how and other intellectual property rights, whether or not registered, shall remain the
sole and absolute property of the Contractor. The use of such documents or rights by the
Subcontractor shall be restricted to the purposes of fulfilling its obligations under this
Agreement.
14.2 The Subcontractor shall indemnify, defend and hold the Contractor harmless against/from
any lawsuits, claims and damages arising out of infringement or suspected infringement of
intellectual property rights including without limitation any patent, registered design or
copyright of a third party when providing the Products and Services herein.
14.3 The Subcontractor warrants the Service under this Agreement shall not infringe the
intellectual property of any third party. The Subcontractor undertakes to resist or defend at
its own expense any request for any claim for equitable relief or damages against the
Contractor and its Employer /end user based on an allegation that the reasonable use of the
Subcontractor’s Service, infringes any Intellectual Property Rights of any third party and to
pay any costs related to the settlement of such claim, and the Contractor and the Employer
/end user shall give prompt written notice of such claim. The Subcontractor shall take any of
measures hereof.
a) procure for Contractor and its Employer /end user the right to continue using such
product;
b) replace or modify the product so that it becomes non-infringement;
c) other reasonable measures.
14.4 The Contractor shall not bear the economic and legal responsibilities, which may arise from
any Intellectual Property Rights infringement. The Subcontractor shall indemnify the
Contractor and its Employer /end user for any damages. In any event the Subcontractor shall
be liable to the Contractor for any indirect damages.
14.5 In the event of an infringement of IPR, Subcontractor shall, at Contractor’s option: (a)
procure for Contractor the right to continue using such Products; (b) replace or modify the
Products to avoid infringement; (c) other measures deemed necessary by Contractor.

MENT NO.
ARTICLE 15 CONFIDENTIALITY
15.1 All Confidential Information shall be the properties of the disclosing Party and only used for
the purpose of this Agreement by the receiving Party. Either Party agrees to prevent
unauthorized disclosure, disclosure, sale, transfer, modification, translation, reproduction of
the other Party’s Confidential Information in accordance with the terms and conditions of
the Non-Disclosure Agreement entered into between the Parties, which is attached hereto as
Error! Reference source not found.. Commented [WU6]: Contractor must also sign a non
disclosure agreement
15.2 Neither the Subcontractor nor its employees or servants or agents shall disclose any
proprietary or confidential information relating to the Contractor's technologies, know-how,
and business secrets without the prior written consent of the Contractor. The Subcontractor
shall not divulge, sell, transfer, or give the above-mentioned technologies, know-how and
business secrets to any third party, or have the same licensed in its own name and vice versa.
15.3 Either Party hereto acknowledges that any violation of the duty of confidentiality set forth in
the Non-Disclosure Agreement is considered to be acting in bad faith and illegal. A Party
acting in bad faith during the term of this Agreement shall indemnify the damages caused to
the other Party.
ARTICLE 16 LIQUIDATED DAMAGES
16.1 If the provision of the Service or the delivery of the Deliverable is delayed from the date
specified in PO, upon receipt of the Contractor’s written notification of such delay, the
Subcontractor shall pay the Contractor liquidated damages at the rate of zero point five
percent (0.5%) of the purchase order (PO) value for each day of delay and such liquidated
damages shall not exceed fifteen percent (15%) of the purchase order (PO) value calculate
from date of the agreed date of performance or delivery until the date when such delayed
Service or Deliverable has been duly and completely performed or delivered.
16.2 If the provision quantity of the Teams is less than the team numbers committed by
subcontractor, upon receipt of the Contractor’s written notification of such discrepancy, the
Subcontractor shall pay the Contractor liquidated damages at PHP 100,000 for each missed
team and PHP 50,000 for incomplete team.
16.3 In the event any of the Equipment is lost or damaged due to the fault of the Subcontractor,
the Subcontractor shall compensate the Contractor for its losses and damages incurred which
can not be recovered by insurance.

MENT NO.
16.4 Subcontractor shall have no right to subcontract any part of this Project to any third party
without prior written consent of Contractor’s Project Outsourcing Manager. If Subcontractor
breaches this clause, without prejudice to any other remedies, the contractor shall be entitled
to claim ten percent (10%) of all the PO amount under this agreement which has been
performed and/or terminate this Agreement. The subcontractor shall bear any and all costs,
expenses, losses, and damages arising out of such termination.
16.5 The terms for Quality and HSW Liquidated Damages, which is attached hereto as Annex 12
Default Penalty Form.
16.6 If the Subcontractor rejects the PO issued by the Contractor, the Contractor reserves the
right to claim ten percent (10%) PO amount of rejected PO for each such case from history
payment and terminate this Agreement and seek remedies for its loss caused by
Subcontractor’s rejection of PO.
16.7 Contractor is entitled to claim any Liquidated Damages as set out herein from the payment
due to Subcontractor and/or guarantees.
ARTICLE 17 INDEMNIFICATION
17.1 Except for claims which arise from Contractor's gross negligence or willful misconduct,
Subcontractor agrees to indemnify and hold Contractor, its successors and assigns, officers,
directors, employees and Employer harmless, from and against any and all losses, expenses, claims,
and causes of action arising out of or in connection with Subcontractor's breach of any of its
representations, warranties or obligations contained in this Agreement.
17.2 Any claims made by the Employer against the Contractor in respect of the performance of
the Subcontractor including but not limited to the defective quality of the project and any delay due
to the Subcontractor shall be compensated by the Subcontractor during the performance of this
Agreement.

MENT NO.
ARTICLE 18 TERM AND TERMINATION
18.1 This Agreement shall come into effect on 25th January, 2020 (Effective Date), and shall
continue in force for one year unless earlier terminated according to provisions of this
Agreement.
18.2 The extension of this Agreement shall be mutually agreed by both parties in written form
and shall not exceed the completion of this Project.
18.3 For the purposes of this Agreement, “termination” of this Agreement also means termination
of the PO issued hereunder.
18.4 This Agreement may be terminated at any time prior to the expiration date by a mutual
written agreement of the Parties.
18.5 At any time prior to the expiration date, either Party may terminate this Agreement with
immediate effect through written notice to the other Party if the other Party becomes
insolvent or bankrupt or admits its inability to pay its debts as they mature, or makes an
assignment for the benefit of its creditors, or ceases to function as a going concern or to
conduct its operations in the normal course of business.
18.6 Contractor may terminate this Agreement by serving three (3) Days’ prior written notice to
the Subcontractor if :
a) the Project under a PO is delayed for more than thirty (30) Days or in Contractor’s
opinion will be delayed for more than thirty(30) Days; or
b) Subcontractor breaches or is in default of any obligation hereunder, which default is

incapable of cure or which, being capable of cure, has not been cured within thirty(30)
Days following Contractor’s written cure notice or within such additional cure period
as Contractor may grant; or
c) the Employer terminates or suspends the Main Agreement for any reason.
18.7 The Contractor is entitled to terminate this Agreement under any of the following
circumstances subject to serving three(3) Days’ prior written notice to the Subcontractor:
a) The Subcontractor assigns whole or part of this Agreement to any third party without
written approval of the Contractor;

MENT NO.
b) The Subcontractor’s Service fails to meet the reasonable requirements of the

Contractor and/or the Employer;
c) The Contractor finds the Subcontractor committing or committed any fraudulent acts
against the Contractor and/or the Employer;
d) The Subcontractor gives or offers to give (directly or indirectly) to any person any
bribe gift, gratuity, commission or other thing of value, as an inducement. However,
lawful inducement is an exception;
e) The Subcontractor rejects the PO issued by the Contractor.
18.8 The Contractor shall be entitled to terminate this Agreement without specifying any reason
and any penalty or cost upon giving Seven (7) days prior written notice to Subcontractor.
This Agreement shall stand terminated on the expiry of the said period of Seven (7) days
relieving both Parties of their respective obligations, save such obligations and / or liabilities
of the Parties that, by their nature, survive the termination of this Agreement.
18.9 The provisions of Articles of Indemnifications, Confidentiality, Settlement of Disputes,

Termination, and any other provision of this Agreement, which expressly or by implication
is intended to come into or remain in force on or after expiry or termination of this
Agreement, shall continue in full force and effect notwithstanding any such expiry or
termination.
18.10 The Subcontractor shall cease any Work immediately upon receipt of the termination notice.
18.11 Termination of this Agreement shall not affect or prejudice any right or liability hereunder
accrued to either Party on or before such termination, and/or any and all provisions of this
Agreement which by their nature are intended to survive such termination or expiry.
18.12 After a notice of termination has taken effect, the Contractor may:
a) Withhold further payments to the Subcontractor until the costs of design, execution,
completion and remedying of any defects, damages for delay in completion (if any)，
and all other costs incurred by the Contractor, have been recovered; and
b) Recover from the Subcontractor any losses and damages incurred by the Contractor
and any extra costs of completing the Work, after allowing for any sum due to the

MENT NO.
Subcontractor. After recovering any such losses, damages and extra costs, the
Contractor shall pay any balance to the Subcontractor.
ARTICLE 19 GOVERNING LAW AND DISPUTE SETTLEMENT
19.1 This Agreement, including without limitation its execution, validity, construction,
performance and settlement of disputes, shall be governed by the laws of Singapore, without Commented [WU7]: Philippines
giving effect to its principles of conflict of law.
19.2 Except where a party is seeking injunctive relief, any dispute arising from, or in connection
with this Agreement shall be first settled through friendly negotiation by both Parties. In
case no settlement to disputes can be reached through amicable negotiation, the disputes
shall then be submitted to Singapore International Arbitration Centre (SIAC)for arbitration Commented [WU8]: Construction Industry Arbitration
in accordance with its Arbitration Rules in force at the time of application for arbitration. Commission (CIAC Philippines)
The arbitration place shall be Singapore. The arbitral award shall be final and binding upon
both Parties. The arbitration fees shall be borne by the losing party except otherwise
awarded by the arbitral tribunal.
19.3 To the fullest extent permitted by law, this arbitration proceeding and the arbitrator’s award
shall be maintained in confidence by the Parties so as to protect relevant confidential
information and intellectual property rights.
19.4 Notwithstanding any reference to arbitration, both Parties shall continue to perform their
respective obligations under this Agreement except for those matters in dispute and under
arbitration.
ARTICLE 20 PRIVACY PROTECTION AND GDPR
20.1 Subcontractor warrants and undertakes all the Work and the Service under the agreement
shall not infringe the GDPR and the Applicable law including all applicable privacy and
data protection laws, and subcontractor shall endeavor to assist the Contractor and the
Employer to fulfill their obligations under such laws in accordance with the terms and
conditions of the Data Processing Agreement entered into between the Parties, which is
attached hereto as Annex 8 Data Processing Agreement.
20.2 Without prejudice to the parties respective obligations and liabilities as set out in the Article
14 and Article 15, subcontractor shall indemnify, defend and hold the Contractor and the
MENT NO.
Employer harmless against/from any lawsuits, claims and damages arising out of
infringement or suspected infringement. In any event the Subcontractor shall be liable to the
Contractor for any direct or indirect damages.
ARTICLE 21 EXPORT CONTROL COMPLIANCE
21.1 Compliance Representations, Warranties and Covenants
The Subcontractor represents and warrants that
 it is not,
 it is not controlled by or more than 50% owned by and
 it does not wholly own, partially own or control a legal entity
a person or legal entity that is a Restricted Party, is headquartered in a Restricted Region or
is organized as a legal entity in a Restricted Region (for example, being incorporated or
otherwise legally formed in a Restricted Region). that will provide, perform or benefit
from the goods, services or personnel covered by this Agreement or Other ZTE Matters
Subcontractor will notify ZTE of any change in, or an agreement to change, the ownership,
organizational structure or other status of the Subcontractor Group that is reasonably likely
to violate the preceding representation and warranty in connection with this Agreement and
Other ZTE Matters only (particularly regarding affiliations or connections with Restricted
Parties and Restricted Regions).
In connection with this Agreement and Other ZTE Matters only, the Subcontractor
represents, warrants and covenants that (except as disclosed in a writing attached to this
Agreement) the Subcontractor Group has not taken or failed to take, and shall not take or
fail to take during the valid term of this Agreement, any action that, directly or indirectly,
would cause the Subcontractor Group or the ZTE Group

MENT NO.
 to violate any economic sanctions or export/reexport controls of the People’s Republic of

China, the United Nations, the European Union, the United States of America or any
government having jurisdiction over the ZTE Group, the Subcontractor Group or the
performance of this Agreement
 to engage in or facilitate a transaction in, to, through, involving or benefiting, directly or
indirectly, a Restricted Region or its government (including companies owned or
controlled by their governments),
 to engage in or facilitate transactions involving or benefiting, indirectly or directly, a
Restricted Party,
 to export, reexport, transfer, ship, sell, loan, give or otherwise provide or dispose of any
goods, software (including source code), services or technology obtained from the ZTE
Group to or for use by a Restricted Party or to, through or for use in a Restricted
Region,
 to, in whole or in part, source, manufacture in or otherwise obtain goods, software, services
or technology (including source code, commodities, materials or other supplies) from
or through any Restricted Parties or Restricted Regions (any such items may be
returned by the ZTE Group at Subcontractor’s expense) or
 to assign or allow any work under this Agreement or on Other ZTE Matters to any
employee or third party who is a Restricted Party, who is a citizen of Restricted Region
or who is permanently or ordinarily resident in a Restricted Region.
21.2 Compliance Obligations
In connection with this Agreement and Other ZTE Matters only, the Subcontractor warrants
and covenants that the Subcontractor Group will
 cooperate with the ZTE Group’s end-use, end-user, and/or end-destination due diligence
process and will provide any related information reasonably requested by the ZTE
Group,
 immediately notify the ZTE Group if the Subcontractor Group knows, should know or
suspects that a Significant Compliance Risk has occurred or is likely to occur,

MENT NO.
 stop (including withholding indefinitely) any payment, conduct or activity and avoid any
action or omission that ZTE reasonably believes would create a Significant Compliance
Risk; however, ZTE shall present reasonable evidence, in writing and upon request,
that good cause exists under this provision to exercise its right(s) to require withholding
of any payment or the avoidance of any action or omission,
 provide to the ZTE Group upon request (at no additional charge) complete and accurate
records and data used to support the legitimate transfer of the goods and services
provided to or from the ZTE Group, including all export/reexport/import licenses,and
any other documents and information as the ZTE Group reasonably requests to comply
with all applicable laws or information requested by any governmental authority having
jurisdiction over the ZTE Group.
21.3 Audit and Termination Rights
If the ZTE Group reasonably suspects in good faith that the Subcontractor Group may have
caused or has been a party involved in a Significant Compliance Risk, then the ZTE Group
shall, upon written notice to the Subcontractor Group, have the right
 to withhold further payments to the Subcontractor Group under this Agreement, without
liability to the Subcontractor Group, for a reasonable time to conduct this audit and
reasonably verify that no Significant Compliance Risk has occurred or will occur.
In the event that the ZTE Group determines, reasonably and in good faith, that the
Subcontractor Group has caused, is likely to cause or has been a party involved in a
Significant Compliance Risk, then the ZTE Group shall have the unilateral right, exercisable
immediately and in its sole discretion upon written notice to the Subcontractor Group, to
terminate or suspend its obligations under this Agreement. This right may also be exercised
in the discretion of the ZTE Group if a change in law or regulation causes continued
performance of the Agreement to be a Significant Compliance Risk.
21.4 Indemnification, Precedence

MENT NO.
In addition to any other indemnification available to the ZTE Group in this Agreement or for
Other ZTE Matters, the Subcontractor shall indemnify and hold free and harmless any
member of the ZTE Group, its subsidiaries, its affiliates, its subcontractors and its and their
directors, officers, employees, agents, representatives, from, for and against including but
not limited to any and all awards, claims, expenses, interest, judgments, liabilities, penalties
or expenses of any kind or nature whatsoever (including for legal costs, reasonable
attorney’s fees) suffered by or asserted against any of these indemnified persons, directly or
indirectly, in connection with, arising out of, based upon, resulting from or related to
Subcontractor Group’s failure to comply with this Section or any termination, or a
determination to withhold payments, by the ZTE Group made pursuant to it.
In the event of a conflict between the terms of this Section and the other portions of the
Agreement, then the language of this Section will control.
ARTICLE 22 MISCELLANEOUS
22.1 Organization Structure
Both Parties shall provide the project organization structure chart; confirm the project
manager, daily coordinator and other pivotal members as well as their contact details.
Subcontractor shall build related organization for this Project according to Sub-clause 3.2.2.
22.2 Notice
Notices under this Agreement must be in writing, sent via regular post with postage prepaid,
or by overnight courier service, personal delivery, or confirmed facsimile. If sent by
confirmed facsimile, notice will be effective after being sent. If sent by confirmed personal
delivery, notice will be effective at the time of delivery. If sent by overnight courier service,
notice will be effective upon the actual time of delivery. If sent by regular post, notice will be
effective five (5) Days after being sent.
22.3 No Waiver

MENT NO.
The failure of either Party to insist upon strict adherence to any term or condition of this
Agreement on any occasion shall not be considered as a waiver of any right to insist upon
strict adherence to that term or condition or any other terms or conditions of this Agreement.
22.4 Survival
Any termination of this Agreement for any reason shall be without prejudice to any rights or
remedies to which a Party may be entitled to under this Agreement or provided by law or in
equity. Any such termination shall not affect any accrued rights or liabilities of either Party
nor the coming into force or the continuance in force of any provision of this Agreement,
which is expressly or by implication intended to come into or continue in force on or after
such termination. The provisions of Articles of Indemnifications, Confidentiality, Intellectual
Property Right, Governing Law and Dispute Settlement, Term and Termination, and any
other provisions of this Agreement, which expressly or by implication is intended to come
into or remain in force on or after expiry or termination of this Agreement, shall continue in
full force and effect notwithstanding any such expiry or termination.
22.5 Severability
It is mutually agreed that in case any one or more of the provisions of this Agreement shall be
invalid or unenforceable in any respect, such invalidity or unenforceability shall not affect the
validity or enforceability of the other provisions of this Agreement.
22.6 Language
This Agreement is concluded in English. In case of a translation of this Agreement into any
other language, the English version shall prevail. The day-to-day language of communication
and document transfer between the Parties shall be English.
22.7 Changes
This Agreement may not be altered, modified, amended, changed, rescinded or discharged in
whole or in part, except by a written Agreement executed by both Parties.

MENT NO.
22.8 Independent Party
The relationship of Contractor and Subcontractor established by this Agreement is that of

independent contractors and nothing contained herein will be deemed or construed as creating
a joint venture, partnership or other relationship between Contractor and Subcontractor.
Neither Party is authorized to: (i) enter into contracts for or on behalf of the other; (ii) create
any obligation or responsibility, expressed or implied, for or on behalf of the other; or (iii)
bind the other in any manner. Each Party will be responsible for its own costs and expenses
with respect to all negotiations and activities in performing under this Agreement. All
employees, representatives engaged by the Subcontractor in connection with the performance
of this Agreement shall be under the complete control of such Parties and shall not be deemed
to be employees of the Contractor.
22.9 Interpretation
The following rules of construction and interpretation apply to this Agreement:
a) References in the singular shall include references in the plural and vice versa and words
denoting any gender shall include any other gender;
b) The words “include” and “including” are to be construed without limitation;
c) All headings, index and titles used in this Agreement are for convenience only and are not
to be used in the interpretation or construction of this Agreement;
d) References to any statute, statutory provision or statutory instrument include a reference to

that statute, statutory provision or statutory instrument as from time to time amended,
consolidated or re-enacted, together with all rules and regulations made under it all;
e) Any agreement or other document includes that agreement or other document as varied or
replaced from time to time;
f) Any party includes that party’s successors and assigns;

MENT NO.
g) The words "hereof", "herein" and "hereunder" and words of like import used in this
Agreement shall refer to this Agreement as a whole and not to any particular provision of
this Agreement.
h) Except otherwise stipulated or defined herein, “year”, “month” and “day” used in this
Agreement shall mean Gregorian calendar year, month and day.
22.10 Assignment
Neither Party shall assign the whole or part of this Agreement or any benefit or interest in or
under this Agreement.
22.11 Attachment
The following attachments shall be deemed to form and be read and construed as part of this
Agreement:
a) Annex 1 Technical Specification
b) Annex 2 Scope of Work
c) Annex 3 Price List
d) Annex 4 Payment Flow Chart
e) Annex 5 Quality Check List(Will be updated according to Employer requirement)
f) Annex 6 Non-Disclosure Agreement
g) Annex 7 Subcontractor Code of Conduct
h) Annex 8 Data Processing Agreement
i) Annex 9 Quality Assurance Commitment
j) Annex 10 HSW Compliance Commitment

MENT NO.
k) Annex 11 Accident Classify and Report Module
l) Annex 12 Default Penalty Form
This Agreement is executed in four originals, each of which, when executed and delivered, shall be
an original, and all the counterparts together shall constitute one and the same instrument.
IN WITNESS WHEREOF, this Agreement has been duly signed by the Parties hereto, in
quadruplicate, on the day written above.
For and on behalf of: For and on behalf of:
ZTE PHILIPPINES, INC.
By By
__________________________ __________________________
Name Name
Date Date
Place Place

With Comments Framework Subcontract Agreement-TI

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AGREE S1PH2020012519WBF1

ZTE PHILIPPINES, INC.

FUTONG INFORMATION INDUSTRY (PHILIPPINES) INC

PROPRIETARY AND CONFIDENTIAL PAGE 1 of 41

Agreement No.: S1PH2020012519WBF1

ARTICLE 2 PURCHASE ORDER ................................................................................................................... 8

ARTICLE 3 RESPONSIBILITY MATRIX .................................................................................................... 9

ARTICLE 4 TIME AND COMPLETION OF WORK ............................................................................... 15

ARTICLE 5 PRICE AND TERMS OF PAYMENT ................................................................................... 16

ARTICLE 6 COMMUNICATION AND MEETING ................................................................................. 20

ARTICLE 7 PROJECT QUALITY ................................................................................................................. 20

ARTICLE 8 MODIFICATIONS TO PROJECT AND DESIGN ............................................................. 21

ARTICLE 9 TEST AND ACCEPTANCE..................................................................................................... 22

ARTICLE 10 INSURANCE ............................................................................................................................. 23

ARTICLE 11 SOCIAL AND ENVIRONMENT RESPONSIBILITY (SER) ....................................... 24

ARTICLE 12 WARRANTIES ......................................................................................................................... 25

ARTICLE 13 FORCE MAJEURE .................................................................................................................. 27

ARTICLE 14 INTELLECTUAL PROPERTY RIGHT (IPR)................................................................... 28

ARTICLE 15 CONFIDENTIALITY .............................................................................................................. 29

PROPRIETARY AND CONFIDENTIAL PAGE 2 of 41

ARTICLE 16 LIQUIDATED DAMAGES .................................................................................................... 29

ARTICLE 17 INDEMNIFICATION .............................................................................................................. 30

ARTICLE 18 TERM AND TERMINATION ............................................................................................... 31

ARTICLE 19 GOVERNING LAW AND DISPUTE SETTLEMENT ................................................... 33

ARTICLE 20 PRIVACY PROTECTION AND GDPR ............................................................................. 33

ARTICLE 21 EXPORT CONTROL COMPLIANCE ................................................................................ 34

ARTICLE 22 MISCELLANEOUS ................................................................................................................. 37

This Agreement is entered into by and between

PROPRIETARY AND CONFIDENTIAL PAGE 3 of 41

FUTONG INFORMATION INDUSTRY (PHILIPPINES) INC, a company registered office at

A. The Subcontractor is engaged in the business of TI, RF and IBS Works.

PROPRIETARY AND CONFIDENTIAL PAGE 5 of 41

1.13 “PAC” or “Preliminary Acceptance Certificate” (or Provisional Acceptance certificate as

PROPRIETARY AND CONFIDENTIAL PAGE 6 of 41

1.26 “Other ZTE Matters” means

 any existing or potential business activity of the ZTE Group and

1.27 “Subcontractor Group” means, collectively or individually,

 the United Nations Security Council Sanctions List, as applicable,

1.29 “Restricted Regions” means

PROPRIETARY AND CONFIDENTIAL PAGE 7 of 41

 the information, representations, warranties, covenants and certifications (including any

1.31 “ZTE Group” means, collectively or individually, Zhongxing Telecommunications

ARTICLE 2 PURCHASE ORDER

PROPRIETARY AND CONFIDENTIAL PAGE 8 of 41

ARTICLE 3 RESPONSIBILITY MATRIX

3.1 Responsibility of Contractor

3.2 Responsibility of Subcontractor

3.2.1 Subcontractor’s General Responsibilities:

PROPRIETARY AND CONFIDENTIAL PAGE 9 of 41

e) Subcontractor shall, whenever required by the Contractor, submit details of the

i) Subcontractor shall be responsible for recording and promptly reporting problems

3.2.2 Subcontractor’s Personnel

a) Subcontractor shall appoint a Subcontractor’s Project Manager and shall fully

will be given to contractor

e) The Subcontractor’s Project Manager shall, on behalf of Subcontractor, receive

provides that failure to follow time limit results to suspension

PROPRIETARY AND CONFIDENTIAL PAGE 12 of 41

a) project implementation plan ;

PROPRIETARY AND CONFIDENTIAL PAGE 14 of 41

c) The Subcontractor’s construction teams, list of personnel, contact information and

ARTICLE 4 TIME AND COMPLETION OF WORK

ARTICLE 5 PRICE AND TERMS OF PAYMENT

5.3 Payment Proportions are as follows: