1. Preamble
The aforementioned companies have decided to jointly process the project for the building of a flotation deinking plant for OOOOOO Co. Ltd., Seoul/Korea (hereinafter called "Customer) on an exclusive basis. Based on the quotations worked out by the ABC/XYZ companies and submitted to the customer, a contract for the delivery of the aforementioned plant(flotation deinking plant-XXXXXX Mill) as well as for services (erection, supervision/start-up) bearing the codeword "XXXXXX DIP I" has been concluded between the customer and ABC/XYZ. This contract took effect beginning with the receipt of the downpayment and the opening of the L/C. The handling is carried out with reference to the codeword " XXXXXX DIP I".
The consortium consists of
XYZ Co., Ltd., Seoul/xxxxx
ABC GmbH, Heidenheim
(herinafter called "Members")
2. Deliveries and Service
2.1 Breakdown of the order splitting
The deliveries and services to be supplied on the basis of the contract dated Dec. 7, 1996 shall be shared by the
Members in the following manner :
1. ABC shall supply equipment and services to the value US $ ( )
2. XYZ shall supply equipment to the value of KRW ( )
Scope and limit of the deliveries and services are described in the Appendix #1 and #2
2.2 Completeness
The agreements, specifications, etc. which have been arranged and which still need to be arranged and which are based on the contract of Dec. 7, 1996 and on future agreements shall be authoritative with respect to the deliveries and the services to be supplied by the individual Members.
Each Member shall supply all the deliveries and services required for the proper fulfillment of his share in the order, even if these are not specified completely in the Appendix #1 and #2.
2.3 Subsequent changes
Insofar as changes in the distribution or the carrying out of the deliveries and services become necessary, these and the resulting consequences shall be agreed upon between the Members concerned.
3. Central Coordination/Consortium Meetings
As no central coordinator has been stipulated, no fee for central coordination has been agreed upon. Both companies represent the interest of the consortium toward third parties jointly, or one Member will do so after written agreement by the other Member has been obtained. The consortium meeting is the decisive authority for all decisions. If it is in the interest of all parties, decisions can also be made in writing, by telex, fax or telephone. Decisions reached on the phone require written confirmation.
4. General Obligations of the Members
4.1 By the conclusion of the contract of Dec. 7, 1996 with the Customer, the Members have assumed Joint and several liability toward the Customer. The Members agree that internally each Member is solely responsible for his order share and hence also bears the entire business and technological risk, including the financial for non-receipt or late receipt of the instalments agreed upon with the Customer.
4.2 The Member shall make every effort to support each other and they safeguard each other's interests as if they were their own.
4.3 Each Member shall inform the other Member of all the events which may affect the fulfillment of the entire project or the order share of the other Member.
4.4 Each Member shall provide the other Member with the data, documentation, and all the written material, information, instructions, plans, etc. required for his order share in the prescribed form and language in good time.
4.5 The deliveries and services of the Members shall be carried out according to the time schedule included in the contract with the customer.
4.6 Each Member shall himself bear all the costs and expenses connected with his deliveries and services.
5. Liability and Guarantee/Warranty
5.1 Liability based on Claims by the Customer
The Members agree that their mutual legal position with respect to the contractual deliveries and services is tantamount to each of them having concluded separate contracts for his respective share in the deliveries and services with the Customer.
5.1.1 The Members are jointly and severally liable to the Customer.
5.1.2 Delay
For claims by the customer arising from delay, the Member responsible for the delay shall be liable for up to five percent (5%) of the value of his order share corresponding to the contract of Des. 7, 1996 concluded with the customer.
5.1.3 Warranty
Defects and any resulting damage ther from shall be eliminated without delay by the Member in whose deliveries and services they occur.
The costs shall be borne by the Member whose deliveries and services were not in accordance with the contract and have caused the defects and damage.
5.1.4 Failure to comply with final acceptance values/guarantees
If the performance data and guarantees contained in the contracts with the Customer are not obtained/ not fulfilled, the responsible Member shall be solely liable.
5.1.5 All other claims of the Customer shall be satisfied by the Member who is responsible for the event causing the claim.
5.2 Liability in case of third-party claims.
In the case of third-party claims, the responsible Member is solely liable.
5.3 Claims of the Members against each other
Irrespective of any claims by the Purchaser or third parties, each Member shall be liable to the other Members for any loss or damage which is caused negligently by itself or persons employed by it to any other Members.
The liability of the Members under this chapter shall be restricted to damages caused to persons or property.
No Member shall be required to indemnify the others for indirect or consequential damages such as loss of profit, of interests or of production.
It is further understood that claims enforced by the Purchaser or a third party shall not be considered as indirect or consequential damages under this Article.
5.4 Recognition/exemption
No Member will recognize claims by the customer or third parties which have to be borne fully or in part by the consortium without the previous consent of the other Member.
If the customer or third parties advance claims directly to one Member who is not responsible, he shall inform the responsible Member without delay. This Member shall then immediately exempt the Member against whom a claim has been advanced.
6. Insurance
The Members agree to take out those insurance policies which are stipulated in the contracts with the customer.
Apart from this, the Members shall insure the impending risks to a sufficient amount on their own responsibility.
7. Processing of the Order
7.1 Each Member shall examine the technical data of the customer or of the other Member insofar as these concern his share of the order.
8. Financial statements and Payments
Each Member himself invoice the customer for his deliveries and services and assume the concomitant risk regarding the non-receipt or late receipt of payments.
9. Securities
The Members shall undertake to submit punctually the downpayment guarantees and the performance bonds according to the agreements laid down in the contract of Dec.7, 1996. Each Member shall himself bear the risk of the guarantees he submitted. Internally, XYZ, shall issue a performance bond in favor of ABC, in which XYZ declare themselves liable for the XYZ delivery in the same manner as if XYZ had concluded a contract for their share in the deliveries and services on the on the conditions of the contract with the customer.
10. Arbitration
10.1 Should any disputes or disagreements arise from the consortium agreement or from the agreements made with respect to its fulfilment, the Members shall make an effort to settle these amicably.
A settlement attempt is considered to have failed as soon as one of the Members informs the other Member by means of a written statement to that effect.
10.2 If a settlement attempt has failed, the Member who wants to apply to the court of arbitration must inform the other Member in writing. All disputes arising in connection with the present Agreement shall be finally settled according to the Rules of conciliation and Arbitration of the International Chamber of commerce in Paris by one or several arbitrators nominated according to these rules. The seat of the court of arbitration shall be Geneva
(Switzerland). The Law of the Federal Republic of Germany shall be applied.
10.3 The reasons for the arbitral award shall be atated in writing.
The court of arbitration has also decide on the payment of the costs for the arbitration proceedings.
11. Contractual Period
11.1 This consortium agreement shall take effect as soon as it is signed by the Members.
11.2 The consortium agreement shall terminate :
-after complete settlement of the contract of Dec. 7, 1996 and after all the claims/obligations of the consortium and of the Members towards each other which derive from this contract have been satisfied/fulfilled completely.
-after unanimous decision by the Members.
12. Concluding Remarks
12.1 Written form
Changes to the provisions of this agreement require written consent by the Members in order to take effect.
12.2 Partial ineffectiveness
Should any provisions of this agreement be or become invalid, no part of the remaining provisions of the agreement shall be affected. In such cases, the Members shall try to work out provisions whose economic results shall be as close as possible to those of the invalid provisions.
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