CONTRACT

FOR

“THE CONSTRUCTION OF SUPER DIVERSION CANAL, AND

RELATED STRUCTURES AND SUPPLY AND INSTALLATION
OF GATES FOR CASECNAN MULTIPURPOSE IRRIGATION
AND POWER-IRRIGATION COMPONENT”
(CONTRACT NO. 05-03)

KNOW ALL MEN BY THESE PRESENTS:

This Contract is executed and entered into this 12th day of January,
2003 at Quezon City, Philippines, by and between:

XYZ ADMINISTRATION, a government-owned and

controlled corporation created and existing under Republic Act
No. 3601, as amended by Presidential Decree Nos. 552 and
1702, with principal office address at XYZ Building, EDSA,
Diliman, Quezon City, Metro Manila, represented herein by
Administrator, Juan de la Cruz, who duly authorized to represent
it in this Contract, hereinafter referred to as the XYZ;

-and-

A-B-C JOINT VENTURE, a joint venture which are duly

organized and existing individual corporations under and by
virtue of the laws of Japan , represented herein by the
Authorized Representative, Kimono Kimono, General Manager
of Philippine Branch, A-B-C who is duly authorized to represent
said joint venture in this Contract, hereinafter referred to as the
CONTRACTOR.

WITNESSETH, THAT

WHEREAS, XYZ, in its Invitation to Bid no._ called for tenders for the
Construction of Super Diversion Canal and Related Structures and Supply
and installation of Gates for Casecnan Multipurpose Irrigation and Power
Project-Irrigation Component, in accordance with the Bid Documents;

WHEREAS, in the public bidding held on January 12, 2003 the

CONTRACTOR submitted the lowest evaluated bid for the above-mentioned
works in the total contract amount of One Hundred Eighty Eight Million Five
Hundred Seventy Four and 44/100 Pesos (P188,000,574.44);

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WHEREAS, XYZ finds the offer of the CONTRACTOR to be fair,
reasonable and most advantageous to XYZ;

NOW, THEREFORE, for and in consideration of the foregoing premises,

the parties have mutually agreed and by these presents do hereby agree
hereto as follows:

C-01 CONTRACT DOCUMENTS

The following pertinent documents, attached to this Contract or on file
with XYZ, are hereby incorporated and expressly made integral parts of this
Contract, as though fully written out and set forth herein;

1. Invitation to Bid No. 01-03

2. Instructions to Bidders
3. General Conditions
4. Special Conditions
5. Local Conditions
6. Technical Specifications
7. Drawings
8. Supplemental Notice Nos. 1, 2 & 3
9. Contractor’s Bid Proposal
10. Resolution No. CI-02-03 of the Committee on Prequalification,
Bids and Awards recommending Award of Contract
11. XYZ Board Resolution No. 7162-03, Series of 2003 approving
PBAC Resolution No. CI-02-03
12. Notice of Award
13. Credit Line
14. Contractor’s Performance Security
15. Bid Form including the following annexes:
a) Authority of the Signing Official
b) Bid Prices in the Bill of Quantities
c) Detailed breakdown of Estimates
d) Construction Schedule
e) Construction Methods
f) Project Organizational Chart
g) Manpower Schedule
h) Equipment Utilization Schedule
i) Cash Flow and Payment Schedule
j) Certificate of Site Inspection

16. Prequalification Statements

17. XYZ’s Certificate of Availability of Funds
18. Minutes of Clarification Meeting dated June 27, 2003
19. All correspondence/Notices between XYZ and the
CONTRACTOR among others:
a. A-B-C-JV letter Ref. No. TOU-200307-004 dated 28 July
2003
b. XYZ letter dated 25 July 2003
c. A-B-C-JV letter Ref. No. TOU-200307-003 dated 25 July 2003
d. XYZ letter dated 22 July 2003.
e. A-B-C- JV letter Ref. No. TOU-20030- dated 15 July
2003

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 f. XYZ letter dated 23 June 2003 (received by JV dated 14 July
2003)
g. A-B-C-JV letter Ref. no. TOU-200307-001 dated 07 July 2003
h. XYZ letter dated 01 July 2003
i. A-B-C- JV letter Ref. No. TOU-200306-004 dated 30 June
2003
j. A-B-C- JV letter dated 26 June 2003
k. XYZ letter dated 25 June 2003
l. A-B-C-jv. Letter Ref. No. TOU-200306-003
dated 25 June 2003.
m. XYZ letter dat ed 23 June 2003
n. A-B-C-JV. Two (2) letter dated 19 June 2003

20. Minutes of Classification Meeting dated July 29, 2003.

All codes, designations, standards, standard specifications, and similar

materials which are referred to in the General Conditions, Technical
Specifications and Drawings are hereby made integral parts of this Contract.

All of the above documents are referred to herein as the Contract

Documents.

All Contract Documents are and shall remain the property of XYZ.

It is expressly agreed and understood that in case of any irreconcilable

conflict between this Contract and the provisions of any of the Contract
Documents, the former shall be the controlling.

C-02 ACCEPTANCE OF BID

XYZ has accepted the offer of the CONTRACTOR for the Construction
of Super Diversion Canal and Related Structure and Supply and Installation of
Gates for Casecnan Multipurpose irrigation and Power Project-Irrigation
Component, under Contract No.(hereinafter referred to as the PROJECT), in
conformity and in accordance with the subject to all terms and conditions of
the Contract Documents and as provided for in this Contract.

C-03 AGREEMENT
The CONTRACTOR agrees to furnish all equipment, supplies,
materials, labor, superintendence and other incidentals and to perform and
complete all of the Contract Works under this Contract and the XYZ agrees to
pay for such, as described in the Contract Document.

C-04 COMPLETION TIME

The CONTRACTOR agrees to satisfactorily complete all the Works

under this Contract within Nine Hundred Ten (910) calendar days from its
receipt of the Notice to Proceed.

C-05 CONSIDERATION OF THE CONTRACT

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 For and in consideration of the full and faithful performance by the
CONTRACTOR of all it obligations under this Contract, the total contract
amount is ONE HUNDRED EIGHTY EIGHT MILLION FIVE HUNDRED
SEVENTY FOUR AND 44/100 PESOS (P188,000,574.44) ONLY.

The consideration of this Contract as above stated hereof shall be

payable on the basis of each item of work to be accomplished by the
CONTRACTOR pursuant to the Notice of Award.

C-06 OBLIGATION OF CONTRACTOR

The CONTRACTOR agrees to perform well and faithfully all of the

Contract Works indicated in the Contract Documents described in Clause C-
01 hereinbefore, and to furnish all of the equipment, materials, supplies, labor
and superintendence and other facilities requisite for or incidental to the
successful completion of the Works and the carrying out of all the duties and
obligations imposed by the Contract Documents.

C-07 OBLIGATION OF THE XYZ

The XYZ agrees, subject to the terms and conditions in the Contract
Documents, to pay to the Contractor the total amount of OneHundred Eighty
Eight Million Five Hundred Seventy Four and 44/100 Pesos
(P188,000,574.44) at the rates and times and in the manner set forth in the
Contract Documents.

C-08 MUTUAL OBLIGATIONS

The XYZ and the Contractor mutually agree to perform, fulfill, abide by,
and submit to any and all of the provisions and requirements and all matters
and things contained or expressed in or reasonably to be inferred from the
Contract Documents.

C-09 LIQUIDATED DAMAGES

Time is of the essence for this Contract. If the CONTRACTOR fails or

refuses to satisfactorily complete the contract works covered by this Contract
within the time specified, plus any extension duly authorized by the XYZ, then
the CONTRACTOR expressly agrees to pay the XYZ, as liquidated damages
and not by way of penalty, the equivalent amount in accordance with the
formula as specified in GC-63, Liquidated Damages, of the General
Conditions of the Contract Documents.

C-10 PERFORMANCE SECURITY

In compliance with the conditions in the Contract Documents, the

CONTRACTOR posted his Performance Security in the form of Performance
Bank Guarantee (unconditional) issued by DEFG Bank limited, Tokyo Jpan,
and RCBC in the amount of Twenty million PESOS ( P 20,000,000.00)

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 which is valid and in effect until final acceptance of the works, including
any authorized extension.

The Performance Security shall be released by the XYZ after final

acceptance of the works provided liquidated damages and other claims, if
any, had been settled.

C-11 EXTENSION OF CONTRACT TIME

It is expressly agreed that no claim for extension of time provided

herein can be entertained unless the CONTRACTOR has, prior to the
expiration of contract time and within 30 calendar days after the occurrence of
circumstances lead XYZ could have the cause of extension investigated. XYZ
shall, on the basis of facts and circumstances and of the merits of the request,
grant or deny the request for extension as the case may be. The decision of
the XYZ on this matter shall be final and binding upon the CONTRACTOR.
Failure to provide such notice constitutes a waiver by the CONTRACTOR of
any claim regarding extension.

Notwithstanding the foregoing, no extension of the period of completion

shall be granted in any of the following instances (a) ordinary unfavorable
weather conditions; (b) non-availability of equipment or materials to be
furnished by the Contractor; (c) labor problems or disputes, or (d) when the
reason given for the request for extension had been considered in the
determination of the original contract time.

C-12 CONTRACTOR’S LIABILITY

The parties likewise hereby agree that the employees of the

CONTRACTOR are not employee of XYZ; hence, XYZ shall not in any way
be liable or responsible for any personal injury, damages, including death
sustained by or caused by any of the employees of the CONTRACTOR
and/or his sub-contractor or agent supplier whether or not occurring during the
performance of their duties. The Contractor agrees and binds itself to
indemnify XYZ of whatever injuries or damages caused or occasioned or
contributed to by the failure, negligence or conduct of the Contractor and/or its
employees, sub-contractors, agent and supplier or consultants arising out of
or in connection with or on the occasion of the performance of the Contract.
The CONTRACTOR shall, at all times, stand solely liable and/or responsible
for the enforcement of, and compliance with all existing laws, rules and
regulations and binds itself to save and hold XYZ free and harmless from any
and all liability in respect thereof and/or arising therefrom and/or by reason of
the Contract and its implementation.

C-13 JURISDICTION

The parties hereby mutually agree that the venue of action for any
cause or causes of action, which may arise from this Contract, shall be the
proper court of Quezon City.

C-14 FOREIGN CURRENCY CLAIMS

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 All equipment and materials to be imported by the Contractor to be
used in the contract works, including importation documents, shall be subject
to verification by XYZ, to determine whether or not they are eligible for foreign
currency payment under the loan in accordance with the provisions of Article
SC-04 of the Special Conditions of the Contract Documents.

C-15 COUNTERPARTS

This Contract is executed in seven (7) identical counterparts: Five (5)

copies for the XYZ, one (1) copy for the CONTRACTOR and one (1) copy for
Japan Bank for International Cooperation (JBIC)

C-16 WARRANTY

The CONTRACTOR hereby represents that all documents it submitted

which form integral parts hereof are authentic and duly executed with all the
required formalities for the same, and that the facts and/or data contained
therein are true and correct. A breach of this representation including all his
representations in the documents or suppression of materials facts, therein,
which; if known, could have disqualified the CONTRACTOR such that the
Contract would not have been made and entered into, gives XYZ “moto
propio”, the immediate right or recourse to rescind, abrogate or otherwise,
terminate the Contract without need of judicial action.

The CONTRACTOR warrants that it has not given or promised to give

any money or gift to any official or employee of the XYZ and any violation of
this warranty shall be sufficient ground for XYZ to revoke or extra judicially
cancel this Contract.

C-17 NOTICES

All notices called for by the terms of this Contract shall become
effective only when received by the parties to whom they are addressed at the
following addresses:

XYZ : The Administrator

XYZ Building, EDSA, Quezon City, Metro Manila

CONTRACTOR : The Authorized Representative

A-B-C Joint Venture
Quezon City, Metro Manila

Any change in address by either party shall be made known to the

other who will acknowledge the change for purposes of this paragraph.

All notices called for by the terms of this Contract shall be in English
language and shall be sent thru messenger or registered mail or telegram.
However, telegram shall be confirmed by a letter on the same day.

C-18 INTEGRATION

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 XYZ and the CONTRACTOR agree that this Contract, including the
Contract Documents, expresses and integrates all the agreements,
understanding, premises and covenants of the parties and supersedes all
prior and contemporaneous negotiations, understandings and agreements,
whether written or oral and no modification or alteration of this Contract shall
be valid or binding to either party unless expressed in writing and executed
with the same formality as this Contract, except as may otherwise be
specifically provided in this Contract.

C-19 PROHIBITED TRANSACTION

The CONTRACTOR shall not, without XYZ’s prior written consent,

assign, transfer, pledge, sub-contract, or make any other disposition of any of
its obligations or interests under this Contract. Any such unapproved
assignment, transfer, pledge, sub-contract or disposition by the
CONTRACTOR shall be sufficient ground for NIA to rescind the Contract
without need of judicial action.

C-20 DOCUMENTATION EXPENSES

Notarial fees and documentary stamps in connection with this Contract

shall be for the account of the CONTRACTOR.

C-21 APPROVAL

This Contract shall be subject to the approval of proper higher

authorities in accordance with pertinent laws, rules and regulations.

IN WITNESS WHEREOF, the parties hereto have hereunto set their

hands on the date and the place first above-written.

XYZ A-B-C
ADMINISTRATION JOINT VENTURE
(EMPLOYER) (CONTRACTOR)

BY: BY:

JUAN DELA CRUZ KIMONO KIMONO

Administrator Authorized Representative

SIGNED IN PRESENCE OF:

Yourself as witness Your seatmate as witness

_________________________ ________________________

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Approved pursuant to Board Resolution No. 7162-03, Series of 2003.

APPROVED BY:

PEDRO DELA PEÑA

Secretary, Department of Agriculture