A project agreement is a legal document outlining the terms and conditions between two parties as they enter into a business partnership focusing on a particular project. They are typically used between contractors and companies or between companies and trade unions to determine the rights and responsibilities of parties involved.
A project agreement typically covers terms such as the scope of the work involved, project budgets, pricing for services rendered, and any supply and material requirements. Project agreements are also sometimes used to develop real estate projects between the developer and the construction company.
Below is a list of common sections included in Project Agreements. These sections are linked to the below sample agreement for you to explore.
TEMPLATE PROJECT SERVICES AGREEMENT
EXXARO RESOURCES LIMITED
Dated as of 15 June 2012
Annexure 1— Additional Conditions.
Annexure 2—Scope of Work and Project Services
Annexure 3—Drawings and Specifications.
Annexure 4 —Timetable/Delivery Dates.
Annexure 5—Price and Payment Terms.
Annexure 6—Service Recipient Supplied Amenities, Facilities and Services.
Annexure 7—Project Budget.
Annexure 8—Personnel and Project team.
Annexure 9—Composition of the Steering Committee and Process.
Annexure 10—Proof of Insurance.
Annexure 11—Governance Framework
The Parties to this Agreement are:
Tronox Limited, a corporation organized and existing under the laws of Australia with registration number ACN153348111; and
Exxaro Resources Limited, a company organized and existing under the laws of the Republic of South Africa with registration number 2000/011076/06;
THE PARTIES RECORD AND AGREE
A. Pursuant to the Transaction Agreement, Exxaro has sold its mineral sands business, including its interest in the Tiwest Joint Venture, to Tronox in exchange for newly issued Tronox common shares (the Transaction ).
B. In connection with the Transaction, the Service Recipient, being a South African Acquired Entity, desires to obtain from Exxaro the Project Services described herein after the completion of the Transaction in accordance with the terms and conditions of this Project Services Agreement
C. This Agreement forms a template to be used by the Parties in respect of Project Services. As Exxaro and the Service Recipient agree the nature of the Project Services to be provided by Exxaro in respect of each Project, the Parties, using their best endeavors, will agree the content and populate the Annexure and Schedules in respect of the specific project requirement. Notwithstanding anything to the contrary in this Template Project Services Agreement, signature by the Parties of this Template Project Services Agreement records this obligation only.
D The projects which are envisaged as being subject to an Agreement of this nature are:
| 1. | The Fairbreeze Project, which is to provide ilmenite feed for the smelter operation located at KZN Sands central processing plant at Empangeni, producing titanium slag; and |
| 2. | The co-generation of power at the Namakwa Sands operation, in terms of which furnace off-gas is combusted to produce electrical power; and |
| 3. | Any additional project the Parties agree from time to time as being subject to this template form of Agreement. |
| 1. | DEFINITIONS AND INTERPRETATION |
| 1.1 | For purposes of this Agreement, the following terms have the meanings set forth or as referenced below: |
“ Affiliate ” means, as to any Person, any other Person which, directly or indirectly, controls, or is controlled by, or is under common control with, such Person. For purposes of this definition, the term “control” (including the correlative terms “controlling,” “controlled by” and “under common control with”) means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities, by contract or otherwise.
“ Agreement ” shall include the terms and conditions set out in this agreement, any purchase order placed or contract awarded subsequent to the award of the Agreement by the Service Provider and the annexures, appendices and documents attached to this Agreement;
“ Annexure ” means any Annexure attached to Schedule 1 and is to be regarded as part of this Agreement
.” Business Day ” means a day (other than a Saturday or Sunday or public holiday) on which banks are generally open for business in each South Africa.
“ Closing Date ” has the meaning given to such term in the Transaction Agreement.
“ Contract ” means any written or oral agreement to create rights and/or obligations which are legally binding, contract, lease, sublease, indenture, mortgage, instrument, guaranty, loan or credit agreement, note, bond, customer order, purchase order, sales order, franchise, dealer and distributorship agreement, supply agreement, development agreement, joint venture agreement, promotion agreement, license agreement, contribution agreement, partnership agreement or other arrangement, understanding, permission or commitment.
“ Exxaro ” means Exxaro Resources Limited, a company organized and existing under the laws of the Republic of South Africa with registration number 2000/011076/06.
“ Exxaro’s Representative ” means the representative appointed by Exxaro or any replacement thereof appointed in accordance with Schedule 1, Annexure 9.
“ Exxaro Sands ” means Exxaro Sands Proprietary Limited, a company incorporated in the Republic of South Africa, with registration number: 1987/001627/07.
“ Exxaro TSA Sands ” means Exxaro TSA Sands Proprietary Limited, a company organized and existing under the laws of the Republic of South Africa with registration number: 1998/001039/07.
“ Fee ” means the amount set out in Annexure 5 to Schedule 1 (Price and Payment Terms) and Reimbursable Expenses as varied from time to time in accordance with the terms of this Agreement.
“ Force Majeure Event ” has the meaning specified in Section 15.
“ Governmental Entity ” means any national, supranational, provincial, municipal, regional or local governmental or regulatory authority, agency, commission, court, tribunal, or other governmental entity.
“ Losses ” means, collectively, any and all liabilities, losses, damages, diminutions, claims, judgments, awards, fines, penalties, interest, costs and expenses, including reasonable attorneys’ and accounting fees. .
“ Parties ” means the Service Recipient, Tronox and Exxaro each as a “ Party ” and collectively as the “ Parties” .
“ Person ” means any individual, corporation, company, limited liability company, partnership, association, trust, joint venture or any other entity or organization, including any government or political subdivision or any agency or instrumentality thereof.
“ Program ” means the work program referred to in Schedule 1, Annexure 2;
“ Project ” means the project identified in Annexure 1;
“ Project Services ” are the services required by the Service Recipient in terms of this Agreement and further detailed in Schedule 1 Annexure 2.
“ Project Budget ” means the agreed to budget which incorporates the estimated time and expenditures expected to be incurred by Exxaro in the execution of the Services. The Project Budget represents estimated amounts and will only become definitive on acquisition of definitive prices and final approval by Exxaro Sands in writing as set out in Annexure 1.
“ Rand ” and “ R ” means the South African rand, the lawful currency of the Republic of South Africa.
“Reimbursable Expenses” are the expenses (if any) payable by the Service Recipient to Exxaro in accordance with this Agreement as may be detailed in Schedule 1, Annexure 5.
“ Schedule ” means any schedule attached to this Agreement and is to be regarded as part of this Agreement
“ Service Recipient ” means either:
Exxaro TSA Sands; or
as further identified in Schedule 1.
“ Service Recipient Representative ” means the representative appointed by the Service Recipient or any replacement thereof appointed in accordance with Annexure 1, Annexure 9
“ Signature Date ” means the date of the last Party signing this in time.
“ Site ” means the site at which the Services are to be rendered by Exxaro as identified in Annexure 1;
“ South African Acquired Companies ” means Exxaro Sands and Exxaro TSA Sands.
“ Tax ” means (a) all taxes, charges, fees, imposts, levies or other assessments, including but not limited to all income, gross receipts, capital, sales, use, ad valorem, value added, transfer, transfer pricing, franchise, profits, inventory, capital stock, license, withholding, payroll, employment, social security, unemployment, excise, premium, severance, stamp, occupation, property and estimated taxes, customs duties, fees, assessments and charges of any kind whatsoever, (b) all interest, penalties, fines, additions to tax, amounts in respect of tax or additional amounts imposed by any Taxing Authority in connection with any item described in clause (a), (c) any transferee liability in respect of any items described in clause (a) or (b), and (d) and any liability for items described in clauses (a), (b) or (c) as a result either of being a member of a combined, consolidated, unitary or affiliated group or of a contractual obligation to indemnify any Person; in each case, with the exclusion of any Transfer Taxes.
“ Taxing Authority ” means any Governmental Entity responsible for the administration or collection of any Tax.
“ Tiwest Joint Venture ” has the meaning given to such term in the Transaction Agreement.
“ Term ” means the anticipated duration in which Exxaro is to provide Project Services to the Project, as set out in Schedule 1, Annexure 4.
“ Transaction ” has the meaning specified in the preamble hereto.
“ Transaction Agreement ” means the amended and restated transaction agreement entered into between inter alia Exxaro and Tronox on 20 April 2012.
“ Tronox ” means Tronox Limited, a corporation organized and existing under the laws of Australia with registration number ACN153348111.
A material increase, decrease or omission of any part of the Work.
A material changes to the character of quality of the Services.
Any other material changes to the scope of the Services.
Any material change to Exxaro’s documents.
“ Variation Order ” means a direction issued by the Service Recipient to Exxaro in terms of this Agreement to carry out a Variation.
“ VAT ” means the Value-Added Tax which is levied in respect of goods and services in terms of the VAT Act;
“ VAT Act ” means the Value-Added Tax Act 89 of 1991 ;
| 1.2 | Unless the context of this Agreement otherwise requires, the following rules of interpretation shall apply to this Agreement: |
| (a) | a “ clause ” and a “section” shall, subject to any contrary indication, be construed as a reference to a clause or a section, respectively, hereof; |
| (b) | “ law ” shall be construed as any law (including common or customary law), or statute, constitution, decree, judgment, treaty, regulation, directive, by-law, order or any other legislative measure of any government, supranational, local government, statutory or regulatory body or court; |
| (c) | a reference to any law, rule, ordinance enactment or regulation shall include any amendment, modification or re-enactment thereof, any regulations promulgated thereunder from time to time, and any interpretations thereof from time to time by any regulatory or administrative authority, whether or not having the force of law; |
| (d) | a reference to any agreement, instrument, contract or other document shall include any amendment, restatement, supplement or other modification thereto; |
| (e) | whenever the words “include,” “includes” or “including” (or similar terms) are used in this Agreement, they are deemed to be followed by the words “without limitation”; |
| (f) | the words “hereof,” “herein” and “hereunder” and words of similar import, when used in this Agreement, refer to this Agreement as a whole and not to any particular provision of this Agreement; |
| (g) | the use of “or” is not intended to be exclusive, unless expressly indicated otherwise; |
| (h) | If any provision in a definition is a substantive provision conferring rights or imposing obligations on any Party, notwithstanding that it is only in the definition clause, effect shall be given to it as if it were a substantive provision of this Agreement. |
| (i) | Unless the context dictates otherwise, an expression which denotes: |
| (i) | any one gender includes the other genders; |
| (ii) | a natural person includes an artificial person and vice versa and shall include its successors-in-title and assigns; and |
| (iii) | the singular includes the plural and vice versa . |
When any number of days is prescribed in this Agreement, same shall be reckoned exclusively of the 1 st (first) and inclusively of the last day unless the last day falls on a day which is not a Business Day, in which case the last day shall be the immediately following Business Day.
| 1.4 | In the event that the day for payment of any amount due in terms of this Agreement should fall on a day which is not a Business Day, then the relevant date for payment shall be the preceding Business Day. |
| 1.5 | Where any term is defined within the context of any particular clause in this Agreement, the term so defined, unless it is clear from the clause in question that the term so defined has limited application to the relevant clause, shall bear the same meaning as ascribed to it for all purposes in terms of this Agreement, notwithstanding that that term has not been defined in this interpretation clause. |
| 1.6 | Any reference to an enactment in this Agreement is to that enactment as at the Signature Date and as amended or re-enacted from time to time |
| 1.7 | The rule of construction that, in the event of an ambiguity, the contract shall be interpreted against the Party responsible for the drafting or preparation of the agreement, shall not apply in the interpretation of this Agreement. |
| 1.8 | The expiration or termination of this Agreement shall not affect such of the provisions of this Agreement as expressly provide that they will operate after any such expiration or termination or which of necessity must continue to have effect after such expiration or termination, notwithstanding that the clauses themselves do not expressly provide for this. |
| 1.9 | Save where the contrary is indicated, any reference in this Agreement to this Agreement or any other agreement or document shall be construed as a reference to this Agreement or, as the case may be, such other agreement or document as same may have been, or may from time to time be, amended, varied, novated or supplemented |
| 1.10 | In the event of any conflict between the provisions of this Agreement, Schedule or an Annexure, the provisions of this Agreement shall prevail. In the event of a conflict between the provisions of a Schedule and an Annexure, the provisions of the Schedule shall prevail. |
| 2. | PROJECT SERVICES |
The Project Recipient hereby appoints Exxaro to provide the Project Services, which appointment Exxaro hereby accepts subject to the provisions of this Agreement and as more specifically set out in Schedule 1, Annex 2.
| 3. | STANDARDS OF PERFORMANCE: LEVEL OF SERVICES |
| 3.1 | Exxaro shall perform the Project Services by exercising the same degree of care, at the same general level and at the same general degree of accuracy and responsiveness, as it exercises in performing the same or similar services for its own account, with priority equal to that provided to its own businesses where the services being provided are material to the Exxaro business (and in no event will the Services be provided in a less than diligent manner). Exxaro will ensure that all individuals performing any Project Services will have the education, training, knowledge, skill and capability necessary to perform the Project Services, in accordance with best industry practice. |
In no event shall the Service Recipient, with respect to the Project Services, be entitled to increase its use of such Project Services above that level of use specified in Schedule 1, Annexure 2 without the Steering Committee unanimously approving such increase. The increase shall be recorded in the approved minutes of the Steering Committee. Exxaro shall
| accommodate the Service Recipient, to the extent that it is commercially reasonable to do so in relation to any requests regarding an increase in the levels of use as specified in Schedule 1, Annexure 2. Notwithstanding anything to the contrary in this Agreement, Exxaro shall not be required to provide the Service Recipient with levels of Services above the levels that existed prior to the date hereof or with the advantage of systems, equipment, facilities, training, services or improvements procured, obtained or made after the date hereof. |
| 3.3 | Notwithstanding anything to the contrary contained herein, Exxaro may, but is not required to, make changes from time to time in the manner in which any Project Service is provided if (a) Exxaro is making similar changes in the manner in which the Project Services are provided to it, (b) Exxaro furnishes a notice to the Service Recipient with respect to such changes, and (c) such changes shall not create a substantial risk of a material disruption of the Service Recipient’s business or the Service Recipient incurring a material loss or liability. |
| 4. | STEERING COMMITTEE |
| 4.1 | With effect from the Signature Date the affairs of the Parties in connection with this Agreement shall be supervised on behalf of the Parties by a Steering Committee, subject to and in accordance with the provisions of this clause 4. |
| 4.2 | The role of the Steering Committee shall, inter alia, be to: |
| (a) | monitor, coordinate and facilitate implementation of the terms and conditions of this Agreement; |
| (b) | consider and approve, from time to time, the Project Services which shall, inter alia , include: |
| (i) | considering and approving the work plan for the Project, taking into account the matters provided for in this Agreement; and |
| (ii) | providing for a suitable and efficient administrative process to facilitate payments in accordance with the Project Budget. |
| (c) | facilitate communication on and address issues arising from the execution of the Project; |
| (d) | receive and consider periodical reports compiled by Exxaro advising on the progress of the Project; |
| (e) | monitor the achievement of the objectives related to the periodical reports referred to in 4.2(d) as contemplated in this Agreement including the Schedule of Services; and |
| (f) | discuss the projected budgetary requirements for the Project on an ongoing basis. |
| 4.3 | Without derogating from the generality of clause 4.2, the Steering Committee shall facilitate communication and monitor progress, as applicable, with regard to matters contemplated in this Agreement and the Project Services specifically. |
| 4.4 | The Steering Committee shall provide general oversight of the terms and conditions of this Agreement and shall work in good faith to resolve any disputes arising under this Agreement as set forth under clause 12. |
| 4.5 | The Steering Committee shall stay reasonably apprised of the activities of the employees, agents and contractors of the Parties who are providing or receiving the Project Services in order to maximize efficiency in the provision and receipt of the Project Services. |
| 4.6 | The Steering Committee shall be authorized to approve any expense reasonably incurred by Exxaro pursuant to the provisions of this Agreement. |
| 4.7 | The Steering Committee may develop a Governance Framework and authorize members’ approval authority accordingly. |
| 4.8 | Without derogating from the generality of the above clauses, all communications which relate to the provision of the Project Services and pertain to the following issues shall be directed, in writing, to the Steering Committee for approval:: |
| (a) | additional expenditure or a potential loss estimated to equal or exceed R80 000; or |
| (b) | conduct which may give rise to a breach of this Agreement or an agreement with a third party; or |
| (c) | any Variation in content of the Project Services; or |
| (d) | any Variation in manner in which the Project Services are to be provided; or |
| (e) | any fact, matter or circumstance of significance which could have a material effect on the provision of Project Services or on any provision or undertaking of this Agreement. |
| 4.9 | The composition of the Steering Committee and process to be followed shall be as set out in Schedule 1, Annexure 9. |
| 5. | RESOURCES |
| 5.1 | In connection with the Project Services, the Service Recipient shall make reasonably available for consultation with the Exxaro those retained employees and consultants or other service providers and employees of the Service Recipient reasonably necessary for the effective provision of such Services. Furthermore, the Service Recipient will provide the necessary access reasonably required by Exxaro to consult with the retained employees and consultants or other service providers and employees referred to above. The Service Recipient shall also make available to Exxaro timeously all or any relevant information and do all things reasonably required by Exxaro to enable it to provide the Project Services. |
| 5.2 | The Parties confirm nothing in this Agreement shall be construed as varying the provisions of Section 7.11 of the Transaction Agreement. To the extent that any provision of this TS Agreement conflicts with the provision of Section 7.11 of the Transaction Agreement such provision shall be void. |
The resources to be provided by the Service Recipient as associated with the Project are as set out in Schedule 1, Annexure 6.
| 6. | PERFORMANCE OF SERVICES ON THE SITE |
Exxaro shall comply with the Service Recipient’s reasonable directions, procedures and policies relating to occupational health, safety and security when performing any part of the Services on the Service recipient’s premises to the extent Project Services are performed on the Site.
| 7. | PAYMENT TO CONTRACTORS, VENDORS, SUPPLIERS |
Payment to contractors, vendors and suppliers (if any) are to be performed as set out in Schedule 1, Annexure 5.
| 8. | PERSONNEL AND SUBCONTRACTORS |
Personnel and subcontractors (if any) are as set out in Schedule 1, Annexure 8. .
| 9.1 | Performance of Project Services |