TaxTMI 
TaxTMI 
2020 (5) TMI 742
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....gy (Cairn), ONGC and the Government of India in respect of exploration of the Rajasthan Block RJ-ON-90/1, which produces a substantial portion of petroleum in India. 2. In order to operationalize the production, a global tender was floated by the Company for fast-tracking the development of "end-to-end integrated Oil Well Construction (including drilling, completion and associated Well Services), development of surface facilities (well-pad, intra-field network and evacuation facilities/ pipelines specific to EOR development) and application of Enhanced Oil Recovery Technologies for enhancing the ultimate recovery" (hereinafter, "Project") from three fields called `Mangala', `Bhagyam' and `Aishwarya' (hereinafter collectively referred to as the "MBA fields" or by their individual names). 3. Pursuant to the global tender, competitive bidding took place and the Petitioner - Halliburton Offshore Services Inc. (hereinafter, "Contractor")- a group company of Halliburton Company, USA which runs one of the world's largest oil fields services was selected for the execution of the Project. Contract dated 25th April, 2018 was accordingly executed between the parties. The total value of the ....
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....n taken pursuant to the same till the present Petition and / or disputes arising under the Agreement between the Petitioner and the Respondent No. 1are decided and adjudicated by the Arbitral Tribunal to be constituted in due course; b) in the alternative the Respondent No. 1 be directed to strictly act in terms of the Agreement including recovering whatever amounts that can be actually deducted and not the entire bank guarantee amounts till the present proceedings and / or the disputes between the Petitioner and the Respondent No. 1 are settled either by way of reconciliation of the accounts or through the adjudication by the Arbitrator ; and / or c) direct the payment of the outstanding invoiced amount (as of date) of USD 6.6 million, unreasonably held by the Respondent No.1; d) pass any order to secure the amount recoverable in arbitration including the unbilled amounts of the variations carried out by the Petitioner company ; e) pass interim/ ad interim ex parte orders in respect of prayers (a) to (e) above; f) pass any other order (s) which this Hon'ble Court may deem fit proper, just and convenient in the facts and circumstances of the present case" On the sa....
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.... government itself has, after imposition of the lockdown, being issuing instructions, from time to time, seeking to mitigate the rigours and difficulties that have resulted, unavoidably, as a result of the imposition of the lockdown. There is no reason, therefore, by the petitioner ought not to be given limited protection, till the next date of hearing, subject to orders which may be passed in these proceedings thereafter. 28. In the circumstances, let notice issue on the present petition, returnable on 11th May, 2020. Notice is accepted, on behalf of the respondents, by Ms. Anuradha Dutt, and is permitted to be served on Respondent No. 2 by e-mail. It shall be the responsibility of the petitioner to obtain the email id of Respondent No. 2, for effecting service. Affidavit of service on Respondent No. 2, with proof thereof, be filed by the petitioner prior to the next date of hearing. Counter-affidavit, if any, may be filed by the respondents within two weeks, with advance copy to the petitioner, who may file rejoinder thereto, if any, within one week thereof. List before the appropriate bench, as per roster. 29. There shall be an ad interim stay on invocation and encashment ....
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....ent date is 17th January, 2018 concluding only on 16th January, 2020. As per clause 2.1(b) the Company had an option to extend the term of the contract for a further period upto one year. Thus, he submits that the Company had agreed to extend the contract initially till 31st March, 2020 and thereafter till 30th June, 2020. 11. Emphasis is laid by the Ld. Sr. Counsel on the variation order no.3 dated 16th January, 2020. According to Mr. Subramanium, the said variation order no.3 changed the contract expiry date to 30th June, 2020. This was meant to facilitate completing of unfinished work by the Contractor. Since the contract itself stands extended as per the variation order and time has been granted to the Contractor to complete the unfinished work, the Bank Guarantees cannot be invoked. 12. It is argued that the Contractor had been giving the continuous progress reports or the work carried out in the three fields. Reliance is placed on three progress reports that gave complete statistics of progress of work and showed the extensions till 30th April, 2020. 13. Ld. Sr. Counsel submits that in view of the unfinished work, which required personnel to travel from foreign countries a....
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....estion of encashing the guarantee to the liquidated damages does not arise. Further the Bank Guarantees are alive till 2021 i.e. the defect liability period and thus, the Company is fully secured. 17. Vehement reliance is placed on the variation order no.3 under which as per the Contractor, the Company had agreed for extended time period of contract dated 30th June, 2020. It is claimed that the variation order was issued by the Company and was duly counter signed by the Contractor. After placing of the variation order, meetings of the Project Management Committee were held in terms of clause 3.3(a). The progress reports have also been submitted. 18. It is also submitted that when the Company called for a `cure plan', the same was submitted on 5th December, 2019. There are two components of the work. (a) Drilling and completion and (b) surface activity. Insofar (a) is concerned, the entire work has been completed. Insofar (b) is concerned, very little work is outstanding. At best, if the work is to be carried out beyond the milestones, the liquidated damages can be enforced, however, there is no occasion invoking the Bank Guarantees as the Contractor has to recover more than 100 m....
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....m order already granted ought to be confirmed. Submissions of Mr. Harish Salve, Ld. Senior Counsel on behalf of the Respondent No.1 22. Mr. Salve, ld. Senior Counsel appearing for the Company at the outset submits that the law relating to Bank Guarantees is very well settled. The Bank Guarantees are independent contracts which are not subservient to the main contract. The standard that would be applied in such cases is whether the invocation is liable to be stayed on the ground of egregious fraud or special equities. A perusal of the Bank Guarantees shows that the same are completely unconditional and they are not connected in any manner with any dispute in respect of the underlying contract. The Bank Guarantees have been issued in terms of Clause 9 of the Contract in order to secure the advance payments and for effective performance of the contract. Thus, no restraint order ought to be granted. 23. Ld. Sr. Counsel further submits that a perusal of Exhibit-J attached to the contract would show that there were specific milestones fixed for the execution of the work in each of the fields. He submits that the Contractor is guilty of grossly delaying the execution of the Project si....
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....020, the Company would be compelled to use alternative sources to complete the Project. In response to this letter the Contractor submitted a 'cure plan' which gave projected completion dates in March and April which were not agreed to by the Company. Thus, notice dated 20th February, 2020 was served seeking a firm plan for completion which was a without prejudice notice. 26. It is submitted that under these circumstances when the Contractor was already in breach, it chose to serve letter dated 18th March, 2020 invoking the clause due to the outbreak of COVID-19. Vide this letter, the Contractor, in fact, failed to provide any concrete schedule for completing the Project. The Company then issued notice dated 31st March, 2020 clearly intimating the Contractor that it would now take recourse under the contract and get the balance activity completed through alternative sources. 27. The present petition was then filed by the Contractor on 13th April, 2020. By letter dated 13th April, 2020, the contract was terminated by the Company. On 23rd April, 2020, the Contractor invoked the arbitration clause. The Bank Guarantees were also invoked on the 13th April, 2020. 28. In the light of t....
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....he underlying contract itself. The contract is not challenged in this case and neither is the termination. COVID-19 according to Mr. Salve is not special equity. Relying upon the above judgments he submitted that the Supreme Court has made it clear that it was only in extreme situations where the Company and its financial standing is itself suspect or where the Company may become untraceable that an injunction on Bank Guarantees can be issued. The Company in the present case is a well-known company doing established businesses in India and if the Contractor wins in the arbitration proceedings, it can easily recover the money from the Company. Thus, there is no ground made out to stay encashment in the Bank Guarantee. 30. Mr. Salve urges that the pleadings are completely defective and do not even make out a case of egregious fraud or irretrievable injustice. The Contractor was conscious of its breaches. The Contractor has accepted the termination and has in fact invoked the arbitration clause. Thus, there is no relationship which survives between the parties. The mere mention of the word fraud in the pleading does not by itself result in egregious fraud. He emphasizes the fact that....
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....or damages is one which would be proved before the Arbitral Tribunal. The party alleging breach can, argue that the extension was granted without prejudice and the other party can argue that the extension was with prejudice and hence no claim for damages is made out. This is in itself an arbitrable dispute. Either way the dispute is to be resolved by the Arbitral Tribunal and not in a section 9 petition. 33. After the breach took place even if the work has continued, the question as to whether there is a waiver is also an arbitrable dispute. There are various possibilities in a contract of this nature. There can be partial breach. The question as to whether there is Force Majeure or not depends on the construct of the contract. The Bank Guarantees being unconditional and irrevocable the encashment thereof, does not depend upon the merits of the matter, thus, the Contractor is not entitled to any relief in this petition. Analysis and conclusions 34. The Project that was awarded to the Contractor was a time-sensitive one. Clause 25.3 provides that time is the essence of the contract. The said clause is extracted below: "25.3 Time of the Essence Time shall be of the essence i....
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....s' and `Parent Company guarantee' for the various agreed amounts as per the contract. 39. The completion dates for each of the fields was 12 months, 14 months and 17 months from the respective `call-out orders'. The completion dates for each of the fields were as under: a) Aishwarya -16th January, 2019 b) Bhagyam - 16th March, 2019 c) Mangala - 16th June, 2019 40. The Project Monitoring Committee (PMC) which was constituted from both sides met regularly to supervise the progress of the projects. The Contractor was to give monthly progress reports to show the actual progress in each of the fields. 41. The contract provided for various milestones dates as also liquidated damages in Exhibit - J as referred to in clause 6.2. The compensation schedule was also provided for in Exhibit - C of the contract. As per Exhibit - J, the specific milestones to be achieved in respect of each of the fields was stipulated in detail. The milestones were broken up into various components i.e., construction, drilling and surface facilities. The said exhibit clearly provided in respect of each of the fields that liquidated damages of 1.2% per month would be chargeable if there is any delay. ....
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....s letter dated 25th November, 2019 realised that the deadlines of November, 2019 would also not be fulfilled by the Contractor as there was considerable amount of work which was still pending, it demanded a `cure plan' on 25th November, 2019 in terms of clause 11.3, though it had the option of terminating the contract. 44. Thus, by this time, the Contractor was already in breach of its contractual deadlines. In response to the letter dated 25th November, 2019 seeking a 'cure plan' the Contractor submitted a 'cure plan' on 5th December, 2019 as per which it gave a staggered completion for each of the fields which is clear from entry no.3 in Table 2 below. This 'cure plan' proposed by the Contractor was not acceptable to the Company which was communicated on 9th December, 2019. The Company then called upon the Contractor to submit a modified 'cure plan' with completion dates for all fields on or before 31st January, 2020 and the Company reserved its right to take appropriate recourse. Again, in response to this communication, the Contractor continued to propose different completion dates vide its monthly progress reports submitted on 10th December, 2019 and 6th January, 2020. This w....
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....ces, the Contractor filed the present Section 9 petition. A perusal of the petition shows that the same simply alleges that the Company is in breach for not providing the work site, not clearing the outstanding amount and other pending invoices which led to the delay in the completion of the Project. It is, then claimed that since the Contractor could not mobilise its resources due to COVID-19 and that there is a threat of termination and invocation of the Bank Guarantees, an interim order restraining the invocation ought to be granted. The ld. Single Judge had passed an ad-interim order prior to completion of pleadings and at that stage restrained the Company from encashing the Bank Guarantees. The basis of the said order was that the Contractor was working on the Project till the lockdown on 22nd March, 2020. In the petition, no ground was taken that the contract stood extended till 30th June 2020. 48. The Company thereafter filed its reply and placed on record the correspondence as captured hereinabove. It is extremely relevant to point out that the documents filed with the reply were extremely relevant and were not filed with the petition. The petition itself, was completely s....
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....was malicious, that there were various delays by the Company including in closure of variation orders etc., that only 2.4% of the work in respect of 'Aishwarya', 5.5% of the work in respect of 'Bhagyam' and 2.1% of the work in respect of 'Mangala' is outstanding, that the Contractor is facing financial difficulties. b) That the deadline of 31st March, 2020 was agreed to subject to resolution of all the hindrances and other issues. c) That it is entitled to claim USD 91 Million towards variations, unbilled amounts, billed amounts after adjusting unrecovered advances against BGs, from the Company. d) That the Contractor is still willing to negotiate the same in good faith. 50. The correspondence between the parties did not abate. Letter dated 23rd April, 2020 was written by the Company reiterating its position. It was claimed by the Company that it has suffered huge losses of 4.3 million barrels of crude oil leading to losses of USD 250 million. The milestone dates were breached by the Contractor which resulted in such losses, as per the Company. 51. On 23th April, 2020 the Contractor invoked the arbitration clause and appointed its nominee Arbitrator. On 4th May, 2020 a ....
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....wn. 54. As the saying goes `a picture speaks a thousand words'. As per the monthly progress reports tabulated and extracted above, it is prima facie visible that the Contractor did not adhere to the deadlines for completion of the Project and was, thus, in breach. The Contractor seeks to justify the same by laying the blame on the Company and the Company does the exact opposite. However, this Court is clear that the reasons for the delay are not to be gone into at this stage as both parties blame each other. The Contractor for whatever reasons, gave estimated completion dates which it did not adhere to. The Contractor argues that the outstanding work on the Project in all the three fields is between 2-5%. On the other hand, the Company argues that the outstanding work is 26%. This is a factual dispute which would have to be adjudicated. At this stage, this Court cannot arrive at a finding on this aspect. 55. A perusal of the pleadings and the documents filed by the parties and an analysis of the chronology of events clearly reveals that the original contractually stipulated dates for completion have not been achieved. The parties have negotiated from time to time. The Contractor ....
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.... to be applied narrowly. j) A mere rise in cost or expense does not lead to frustration. k) If there is an alternative mode of performance, the Force Majeure clause will not apply. l) The terms of the contract, its matrix or context, the knowledge, expectation, assumptions and the nature of the supervening events have to be considered. m) If the Contract inherently has risk associated with it, the doctrine of frustration is not to be likely invoked. n) Unless there was a break in identity between the contract as envisioned originally and its performance in the altered circumstances, doctrine of frustration would not apply. 58. The principles as laid down in Energy Watchdog (supra) by the Supreme Court have to be applied to the facts of the present case in order to assess as to whether the performance of the Contractor was prevented by the Force Majeure condition. Did COVID-19 prevent the Contractor from bringing the work on the three fields to completion and conclusion? If so, is the encashment of Bank Guarantees liable to be injuncted? 59. The contract has a Force Majeure clause which reads as under: "15. FORCE MAJEURE 15.1 Notification If either Party is....
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....d Party or, in the case of Contractor, any of its Subcontractors; and (iii) significant archaeological discoveries in the Block officially recognised by a relevant Governmental Authority, and (iv) natural events, including: (A) acts of God, including earthquake, volcanic activity, hurricane, cyclone, flood or lightning and the consequences arising thereform; (B) explosion or chemical contamination (other than resulting from the act of war); and (C) epidemic or plague (b) Force Majeure will expressly not include the following conditions except and to the extent that they result from an event or circumstance otherwise constituting Force Majeure (i) unavailability late delivery or changes in cost of machinery, equipment, materials, spare parts or consumables; (ii) prevailing weather conditions in the Block, including during monsoon periods; (iii) failure or delay in performance by any Subcontractor and (iv) normal wear and tear or flaw in materials and equipment or breakdowns in equipment (c) Compensation during Force Majeure If an event of Force Majeure prevents Contractor from performing Services under a Callout Order that require the use of ....
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....f Courts to provide a shelter for justifying nonperformance. There has to be a 'real reason' and a 'real justification' which the Court would consider in order to invoke a Force Majeure clause. 64. It is not in dispute between the parties that the two years' term commenced on 17th January, 2018 which is hereinafter referred to as the commencement date. As per clause 2.1(b), the Contractor had the option to extend the term on the same terms and conditions for a period of one year. The said extension would be by a notice which would be served by the Company before the expiry of the term. 65. In response to the Force Majeure argument of the Contractor, the Company's stand is that activity related to petroleum projects were exempted as per the letter of DGH Hydrocarbon dated 26th March, 2020. The Contractor's stand is that only petroleum production is exempted and not other construction/ project completion activity. However, there is nothing on record to show as to what steps the Contractor took toward mitigation, which was necessary as per the Force Majeure clause. 66. The Contractor in this case was in breach in September, 2019 itself. The Company had issued notice dated 25th Nov....
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....l document. The disputes between the contracting parties are to be settled by arbitration in London but the banks are not party to that contract. Thus, what is sought to be restrained by filing the suit is payments to be made under the LC. .... 14. There is no doubt that clause 21 does provide for force majeure clause and the manner of its invocation and as to how it would come into force. That is, however, a dispute between the parties to the contract as to whether the force majeure clause stood properly invoked and whether respondent No. 3 should have still proceeded to load the goods for shipment. Such disputes have to be settled in terms of clause 22 of the contract, which is the arbitration clause. We may once again note that the arbitration clause providing for the proceedings to be conducted in accordance with the London Maritime Arbitrators Association stand already invoked by respondent No. 3 and it is in those proceedings that this aspect would be settled. ... 18. In the end, we may note that the Supreme Court itself has extended caution on various occasions through authoritative pronouncements of interfering with such international commercial transactions suppor....
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....hange in the milestone dates or the compensation payable. b) Upon receiving the Contractor's proposal, the Company shall as soon as practicable respond to the said proposal. c) If there is consensus between the parties, the milestone dates i.e., Exhibit J and C would be suitably amended. d) If there is a dispute as to the amendment to be carried out in the Exhibit J and C for compensation the same would be determined in terms of the clause 10.2. e) If both parties have agreed it then it is an "approved variation". f) Any variation or variation order request, in order to be effective has to be in terms of clause 10. The variation orders, if any, between the parties had to have specific timelines, milestones, milestone dates which are agreed upon. A counter signed copy of the alleged Variation order no.3, letter has been filed on record along with some e-mails of January, 2020. The annexures to these e-mails have not been placed on record. The variation order no.3 is claimed to have been counter signed on 3rd February, 2020. The subsequent letters, e-mails, project monitoring committee's (PMC) minutes do not refer to this variation order. The exact effect of the vari....
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....5,607.42 ICICI 0021BG00013018 30 June'20 Aishwarya FBG 4,086,363.00 ICICI 0544BG00013219 30 June'20 Bhagyam FBG 7,261,744.00 ICICI 0544BG00013119 30 June'20 Mangala FBG 7,607,873.00 ICICI 0544BG00012519 30 June'20 Aishwarya PBG 4,086,363.00 ICICI 0544BG00012919 24 Nov'21 Bhagyam PBG 7,261,744.00 ICICI 0544BG00012619 24 Nov'21 Mangala PBG 7,607,873.00 ICICI 0544BG00013019 24 Nov'21 75. The advance guarantees were to secure the advance payments which were made by the Company to the Contractor. The performance bond was for the purpose of securing the efficient performance of the contract and was to remain valid and enforceable throughout the performance of the contract including the defects liability period and 180 days thereafter. The financial bond was to secure any claim for liquidated damages by the Company. All these three bonds/ guarantees were to remain valid and enforceable as stipulated under clause 9.2 of the contract. If there was any breach by the Contractor, the Company could invoke the performance bond and apply the proceeds of the said bond for remedying any breach. For recovering liquidated damages, the Co....
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....6.6 million dollars has already been invoiced and is yet to be paid by the company. It is also claimed that the Contractor could not raise its final invoices. Further, a perusal of the 'Advance Bond' as per Exhibit-N pursuant to which the Advance Bank Guarantees have been furnished has a clause to the following effect: "... The Contract has been executed between the Contractor and the Company with one of the terms of the Contract requiring that the Contractor furnishes to the Company a bank guarantee to [INR/]_______________ (in figures & words) an amount equal to the advance being given by Company to the Contractor at the start of the execution of the Contract, which shall be adjusted against the running Invoices of the Contractor as per terms of the Contract." 77. The Contractor has clearly defaulted in performance despite repeated opportunities by the Company. The Bank Guarantees are unconditional and irrevocable. All the Bank Guarantees are valid. The language of the financial and performance Bank Guarantees makes it clear that simply on demand, the bank would have to make payment. Relevant extract of the text of the Bank Guarantees is as under: "ICICI (I) do hereby guara....
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....has given the guarantee is immaterial and is of no consequence.There are however, exceptions to this Rule when there is a clear case of fraud , irretrievable injustice or special equities. The Court ordinarily should not interfere with the invocation or encashment of the bank guarantee so long as the invocation is in terms of the bank guarantee. ... 26. In our considered view, once the demand was made in due compliance of bank guarantees, it was not open for the Appellant bank to determine as to whether the invocation of the bank guarantee was justified so long as the invocation was in terms of the bank guarantee. The demand once made would oblige the bank to pay under the terms of the bank guarantee and it is not the case of the appellant bank that its defence falls in any of the exception to the rule of case of fraud, irretrievable injustice and special equities. In absence thereof , it is not even open for the Court to interfere with the invocation and encashment of the bank guarantee so long as the invocation was in terms of the bank guarantee and this what has been observed by the Division Bench of the High Court in the impugned judgment and that reflected the correct le....
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....on of the advance amount which the Company is entitled to retain, in terms of the clauses in the contract, they may instruct the bank to release the said amounts in favour of the Company. The remaining amounts be released to the Contractor. If the parties are unable to reconcile the same, they are free to approach the Arbitral Tribunal under Section 17 of the Act. The `Joint Account' as directed, shall be opened within three days and the amounts of the Advance Bank Guarantees shall be directly deposited in the said account. The reconciliation process shall be completed in two weeks. 84. Accordingly, the ad-interim order dated 20th April, 2020 (as modified on 24th April 2020), stands vacated in the above terms. The present petition and all pending applications are disposed of in the above terms. Copy of this judgment be communicated to Respondent No. 2 - ICICI Bank Ltd., MIDC Branch, 1st Floor, CIBD, Near Floral Deck Plaza and Seepz, MIDC, Andheri (East), Mumbai, Maharashtra-400093 by the High Court Registry as also by the parties, to ensure compliance. The same may be transmitted by the Registry via email at [email protected]. 85. Needless to add that the opinion render....
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.... party approvals. 2.3 Novation of Certain Agreements (a) Within 10 Business Days following the Effective Date or such other date as the Parties may agree, Company and Contractor may mutually agree to novate certain agreements to the Contractor and the Contractor will accept the novation of such agreements ("Novation Agreements"). (b) Contractor represents and warrants that it has satisfied itself in relation to the Novation Agreements, including that the goods, equipment, materials and services specified in the Novation Agreements are sufficient for the performance of the Services in accordance with the Agreement. Contractor will not be entitled to a Variation or for any other relief hereunder as a result of any failure or delay in performance under the Novation Agreements or for any failure of the goods, equipment, materials and services specified in the Novation Agreements to satisfy the requirements of this Agreement. 2.4 Commencement and Progress Contractor shall, on the Effective Date, commence and expeditiously and diligently perform the Services in accordance with this Agreement. 2.5 Conditions Precedent (a) The Parties' obligations under this Agreement a....
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....d in an amount equal to [o]1 and in the form set out in Exhibit N- Advance Payment Bond, issued by an Acceptable Bank (the "Advance Payment Bond"); (b) within 14 Days following Effective Date, a performance bond in an amount equal to the then effective Required Performance Bond Amount and in the form set out in Exhibit E - Performance Bond, issued by an Acceptable Bank (the "performance Bond"); a Financial Bond in an amount equal to the Required Financial Bond and in the form as set out in Exhibit E - Financial Bond, issued by an Acceptable Bank (the "Financial Bond")2 (c) on the Effective Date, a Comfort Letter as per Exhibit F. 9.2 Requirements (a) Contractor shall ensure that: (i) the Advance Payment Bond remains valid and enforceable until the Advance Payment is recovered in accordance with Section 8.9 (b); and (ii) the Performance Bond remains valid and enforceable throughout the performance of the Services and while any Defects Liability Period is in place and for a further 180 Days following the expiry of the last Defects Liability Period. (iii) the Bank Guarantee for security against Liquidated Damages shall be valid for the duration of contract ....
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.... (g) In addition to the other circumstances specified in this Agreement, Company has the right to draw down and, at Company's discretion, apply the proceeds in remedying any breach by Contractor of this Agreement, all or part of the value of the Performance Bond. Such recourse against the Performance Bond shall be without limitation to any other right or remedy of the Company in relation to the relevant Contractor breach. Further, in addition to the other circumstances specified in this Agreement, Company has the right to draw down and, at Company's discretion, apply the proceeds for recovering any Liquidated Damages or any payments due to the Company under this Agreement, all or part of the value of the Financial Bond. Such recourse against the Financial Bond shall be without limitation to any other right or remedy of the Company in relation to the relevant Contractor Breach'' CLAUSE 10 Relevant extracts from Clause 10 are hereinbelow: 10. VARIATION 10.1 Right to Vary (a) Company may, at any time and for any reason, instruct by Notice an addition, deletion, alteration and/or modification to or from the Services or to the timing thereof or to the conditions under which t....
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.... Optional Suspension by the Company; or (iii) a delay caused to Contractor's performance of the Services by Company's failure to perform any of its obligations under this Agreement or any negligent act or omission of Company, except to the extent that such act, omission, breach or default was due to a negligent act or omission of Contractor or any Subcontractor; provided, however, that : (A) the Contractor will not be entitled to such an adjustment to the Milestones or the Milestones Dates and/or the Required Commercial Operation Dates to the extent that the Contractor's achievement of the Milestones or the Milestone Dates would have been delayed notwithstanding the occurrence of the events specified in this Section 10.1(d) and (B) the Contractor will only be entitled to an increase in the compensation payable pursuant to Article 8 and Exhibit C - Compensation in the circumstances described in Sections 10.1(d)(ii) or 10.1(d)(iii) and will not be entitled to an increase in compensation in the circumstances described in Section 10.1(d)(i). (e) Notwithstanding that Contractor is not entitled to any adjustment to the Milestone Dates in respect of any act of prevention by Compa....
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.....1(a) or a Variation Order Request pursuant to Section 10.1(b); or (B) if the Contractor is requesting the instruction of a Variation in accordance with Section 10.1(d), within fourteen (14) Days of the start of event(s) described in such Section, submit a Variation Order Request which shall include: (i) a description of the work to be performed in order to carry out the addition, deletion, alteration or modification to or from the Services described in the Variation or the Variation Order Request; (ii) Contractor's proposal for any necessary adjustments to the Milestone Dates, together with appropriate supporting evidence including an analysis of the effect of the Variation on the critical path of the Services; and (iii) the Contractor's proposal for adjustment to the compensation payable pursuant to Article 8 and Exhibit C - Compensation. The Contractor' failure to give a Variation Order Request within the time prescribed under this Section 10.2(a) shall constitute a waiver of any entitlement to a change in the Milestone Dates or the compensation payable pursuant to Article 8 and Section 10.1(a) Exhibit C - Compensation. (b) Company shall, as soon as practicable af....
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....minates this Agreement or any portion of the Services pursuant to Section 11.1(a), Company will pay to Contractor (without double counting): (i) the amounts owing under Exhibit C- Compensation for any Services that have been duly completed in accordance with this Agreement as of the date of termination to the satisfaction of Company (which, in the case of any well(s), will occur when Company Contractor has accepted a Well Handover From in respect of such Well(s)) and to the extent not already paid; plus (ii) any direct and substantiated charges already incurred for cancellation of the procurement of third party goods or services from its Subcontractors which were to have been supplied by the Contractor in connection with the Services, substantiated by way of sufficient documentation to the satisfaction of the Company, provided that the Contractor shall use its best endeavours to minimise such charges provided the charges shall not exceed the Contract Price; minus (iii) 50% of any cumulative Holding Rate payable by Company in respect of any Optional Suspension preceding such termination in accordance with Section 12.3(a)(ii) 11.2 Termination of Extended Force Majeure ....