DATED THIS          DAY OF             20….

 

BETWEEN

……………………………………….

(Company No. …………)

(“…………………..”)

 

AND

 

…………………………………………..

(Company No. …….)

(“………………”)

______________________________________

 SETTLEMENT AGREEMENT

______________________________________

 

THIS SETTLEMENT AGREEMENT is made this            day of                      20…

BETWEEN

……… (Company No. …….), a company incorporated in Malaysia and having its registered office at ………. (hereinafter referred to as “[COMPANY A]”) of the one part;

 

AND

 

……….. (Company No. ……….), a company incorporated in Malaysia and having its registered office at ……. (hereinafter referred to as “[COMPANY B]”) of the other part. 

WHEREAS :-

(A)       By a turnkey contruction cum development agreement dated the       day of …. (hereinafter referred to as “the Development Agreement”) entered into between [COMPANY A] of the one part, …… of the second part and [COMPANY B] of the last part, [COMPANY A] and [COMPANY B] have, with the consent of Usahasewa Sdn Bhd, agreed to participate in the development of all that piece of land held under …measuring approximately …. hectares (hereinafter referred to as “the Said Land”) into an integrated development in the manner and upon the terms and conditions therein contained.

 

(B)       It is an express term under the Development Agreement that the Said Land referred to in Recital (A) forms part of the development being developed, managed and supervised by [COMPANY A] on six (6) pieces of land held under six (6) separate issue documents of title and measuring approximately 600 acres located in the Mukim …… (hereinafter refered to as “the Project”) and that [COMPANY B] as turnkey contractor shall be responsible in carrying out the construction works and the development of the Said Land at its own costs and expenses and shall be liable to:-

 

(i)    contribute to [COMPANY A] a stipulated sum (hereinafter referred to as “the Infrastructure Contribution”) towards the External Infrastructure Works (as therein described) carried out by [COMPANY A] in respect of the Project to be payable in accordance with the payment schedule as set out therein; and

  (ii) as security for its due performance and observance of all the terms and conditions of the Development Agreement, pay the Security Deposit (as therein described) to [COMPANY A],

not later than eighteen (18) months from the date of the Development Agreement unless mutually extended by [COMPANY B] and [COMPANY A].

 

(C)       By those letters of acceptance more particularly set out in the First Schedule hereto, [COMPANY B] has been appointed the contractor to carry out those construction works which include but are not limited to  the External Infrastructure Works subject to the terms and conditions therein contained. Details of the letters of acceptance, construction works and contract sums are more particularly set out in the First Schedule hereto.

(D)       Pursuant to the terms of the letters of acceptance and the construction contracts to be executed for the construction works  (“Construction Agreements”), payment of the respective construction costs shall become due and payable by [COMPANY A] to [COMPANY B] progressively against the issuance of the interim or progress certificates by the respective consultants under the respective Construction Agreements certifying the value of the works completed from time to time and in accordance with the terms of the respective Construction Agreements.

(E)       By virtue of the mutuality of respective amounts that will become due and payable to each of the parties under the Development Agreement and the Construction Agreements, the parties hereto mutually agree to set-off progressively the aforesaid amounts in the manner set out herein subject to the terms and conditions hereinafter contained.

NOW THIS SETTLEMENT AGREEMENT WITNESSETH as follows:-

 

1.         PAYABLE SUMS 

1.1      [COMPANY B] hereby acknowledges and agrees that pursuant to the terms of the Development Agreement the following amounts shall be payable by [COMPANY B] to [COMPANY A]:-

1.1.1     the sum of Ringgit Malaysia …. (RM…) being [COMPANY B]’s contribution to the External Infrastructure Works (hereinafter referred to as “the Infrastructure Contribution”); and

1.1.2     the sum of Ringgit Malaysia … (RM…) being the security deposit payable by [COMPANY B] to [COMPANY A] as security for its performance of the terms and conditions of the Development Agreement (hereinafter referred to as “the Security Deposit”).

 1.2       [COMPANY A] hereby acknowledges and agrees that pursuant to the terms of the Construction Agreements, the respective construction costs set out in the First Schedule hereto (hereinafter referred to as “the Contract Sums”) shall be payable to S C by [COMPANY A] upon the issuance of the respective certification of works done by the respective consultants under the terms of the respective Construction Agreements.

2.        SET-OFF 

2.1       By virtue of the mutuality of the amount of the Contract Sums which will be payable by [COMPANY A] to [COMPANY B] under the terms of the Construction Agreements and the Infrastructure Contributions and Security Deposit which will be payable by [COMPANY B] to [COMPANY A] under the terms of the Development Agreement, [COMPANY A] and [COMPANY B] hereby mutually agree to set off the Contract Sums against the Infrastructure Contributions and Security Deposit in the following manner:-

(i)                 as and when an amount is duly certified by the respective consultants under the respective Construction Agreements as being payable by [COMPANY A] to [COMPANY B] for the progress of work done (“the Interim Certificates”), the following proportion of the amount stipulated in the Interim Certificates (“Certified Sum”) shall be deemed to be set-off against a proportionate amount of the Infrastructure Contribution and Security Deposit payable by [COMPANY B] to [COMPANY A] in the following proportions:-

Security Deposit                                  –           40%

Infrastructure Contributions               –           60%

 

(ii)               [COMPANY B] shall furnish to [COMPANY A] a monthly statement setting out the following details:-

(a)                the total amount of the Certified Sums for that month; and

(b)                the amount of the Infrastructure Contribution and Security Deposit which are deemed to be set off by the Certified Sums

The respective Interim Certificates and, as the case may be, the final account certificates in support of the respective Certified Sums must accompany the respective monthly statements. Save for any manifest error, the amounts stated in each monthly statement shall be binding on [COMPANY B] and [COMPANY A] unless otherwise disputed by [COMPANY A] in writing within fourteen (14) days from the date of its receipt of such statement.

 2.2      It is hereby mutually agreed between [COMPANY B] and [COMPANY A] that the full amount of the Infrastructure Contribution and Security Deposit payable by [COMPANY B] be set-off or caused to be set-off against any construction costs or other payments payable by [COMPANY A] or its related companies to [COMPANY B] under the Construction Agreements and/or any other construction agreements entered into between them and in this respect, if, during the term of the Development Agreement, the total amount of the Certified Sums under the Construction Agreements are:-

(a)        insufficient to set off against the full amount of the Infrastructure Contribution and Security Deposit payable by [COMPANY B] to [COMPANY A] under the Development Agreement (“Shortfall”), [COMPANY B] will pay the Shortfall to [COMPANY A] on or before the      day of April 2004 failing which [COMPANY A] shall grant to [COMPANY B] a further period of twelve (12) months commencing from the      of April 2004 to pay the Shortfall. During the extended period of twelve (12) months, [COMPANY A] will:-

(i)                 procure additional construction work to be awarded to [COMPANY B] to enable such Shortfall or any part thereof to be set off against the certified payments under such additional construction contracts; and/or

(ii)               procure such other sums as shall be payable by [COMPANY A] or any of its related companies to be set off against such Shortfall.

Provided Always That if the provision under Clauses 2.2(a)(i) and/or (ii) shall become applicable and as at the expiry date of the extension period of twelve (12) months aforesaid the full amount of the Shortfall shall not have been fully set off then, notwithstanding that the full amount of the Shortfall has not been fully set off or settled, such Shortfall shall be deemed to be settled strictly for purposes of Clause 12.2(b) of the Turnkey Construction cum Development Agreement and accordingly, [COMPANY B] shall be entitled to notify [COMPANY A]’s Solicitors under Clause 12.2(b) of the Turnkey Construction and Development Agreement that [COMPANY B] has complied with Clauses 6.2(iv) and 6.2(v) under the Turnkey Construction cum Development Agreement.  For the avoidance of doubt, such notice shall not amount to a waiver by [COMPANY A] for the payment of such outstanding balance of the Shortfall by [COMPANY B] and shall remain a debt owing by [COMPANY B] until full payment or set-off thereof;

            (b)        in excess of the total amount of the Infrastructure Contribution and Security Deposit then such excess Certified Sums shall be payable by [COMPANY A] to [COMPANY B] in accordance with the terms of the respective Construction Agreements.

3.         TERMINATION

 3.1       The parties agree that in the event the Development Agreement and/or the Construction Agreements is terminated for whatsoever reason, all sums paid up to the date of such termination shall be deemed to be valid payments in accordance with the terms of the Development Agreement and the respective Construction Agreements. 

3.2       Accordingly, in the event of termination of the Development Agreement and/or Construction Agreements, all sums left unpaid under the Development Agreement and the respective Construction Agreements shall become due and payable under the terms of the respective agreements.

4.         NOTICES

4.1       Any notice request or demand required to be served by any party hereto to any other party under the provisions of this Agreement shall be in writing and shall be deemed to be sufficiently served:-

            (a)        if it is given by the party by post in a registered letter addressed to the party to be served at its address hereafter mentioned and in such a case it shall be deemed to have been received at the time when such registered letter would in the ordinary course of post be delivered; or

            (b)        if it is given by the party and despatched by hand to the party to be served at its address hereafter mentioned and in such a case it shall be deemed to have been received at the time when such letter is delivered; or

            (c)        if it is given by the party or the party to be served at its fax number hereinafter mentioned in which case it shall be deemed to have been received at the expiration of 48 hours after the time of transmission provided that a copy of the notice is despatched by post or by hand immediately thereafter.

4.2       The address and facsimile transmission number of the parties hereto shall be:-

            [COMPANY A]

[COMPANY B]

 

 

5.         MODIFICATIONS

No modification or amendment in connection with the subject matter of this Agreement shall be valid unless made in writing, mutually agreed and signed by all the Parties hereto. 

6.         COSTS AND EXPENSES

            The stamp duty for this Development Agreement shall be borne and paid by S C.  Each party shall however bear its own solicitors’ costs.

7.         TIME

Time wherever mentioned in this Agreement shall be of the essence.

8.         SUCCESSORS AND ASSIGNS

This Agreement shall bind the respective successors?in?title of the parties hereto. 

9.         ENTIRE AGREEMENT

This Agreement sets forth the entire agreement and understanding between the parties hereto as to the subject matter hereof and supersedes all prior agreements whether express or implied. 

10.       GOVERNING LAW AND JURISDICTION

This Agreement shall be governed by and construed in all respects in accordance with Malaysian Law and the parties irrevocably agree that the Courts of Malaysia shall have exclusive jurisdiction in respect of any dispute, suit action or proceedings which may arise out of or in connection with this Agreement

 

[THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK]

 IN WITNESS WHEREOF the parties hereto have hereunto caused their respective seals to be affixed the day and year first above written. 

 

The Common Seal of                                      )

                                                                        )

                                                                        )

was affixed in the presence of:-                      )

 

……………………………………..                          ……………………………………

Director                                                      Director/Secretary

The Common Seal of                                      )

                                                                    )

(Company No. )                                             )

was affixed in the presence of:-                      )

 

………………………………………..                      ……………………………..……

Director                                                     Director/Secretary

FIRST [COMPANY B]SHEDULE

 

CONSTRUCTION AGREEMENTS