annexure i (a) - bharat petroleum · purchase of the said lubricant ... franchisee to effect...

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ANNEXURE I (a) DRAFT AGREEMENT BETWEEN BPCL AND PRIMARY LUBE DISTRIBUTOR (PLD) MEMORANDUM OF AGREEMENT made at ______, the ____ day of _____ 2010 by and between BHARAT PETROLEUM CORPN. LTD., a Corporation incorporated under the Indian Companies Act, 1956 and having its Registered Office at Bharat Bhavan, 4 & 6 Currimbhoy Road, Mumbai 400001 and its Regional Office at “A” Installation, 2nd Floor, Sewree Fort Road, Sewree-East, Mumbai-400015 (hereinafter called “The Corporation” which expression shall unless inconsistent with the context include its successors and assigns) on the One Part and Mr. ____________________ S/o __________________, resident of _______________________________________ (hereinafter called “the FRANCHISEE”) of the other part WHEREBY, IT IS MUTUALLY AGREED AND DECLARED AS FOLLOWS : 1. (a) The Corporation hereby appoints the FRANCHISEE and the Franchisee hereby accepts the appointment as Primary Lube Distributor, initially for a period of _____________ commencing from ___________ and renewable ____________________________ at the sole discretion of the Corporation, for sale of the Corporations Lubricating Oil in packed and Bulk (hereinafter called „LUBES) in the Revenue Districts of ------------------------------------------------------------------------------------------ ---------------------------------------------------------------------------------------------------------------------. (b) The aforesaid appointment is subject to the following conditions : i) The Franchisee shall either purchase or take on lease for the tenure of the agreement a showroom and office space with telephone and necessary fixtures and fittings and along with sufficient space for storage of Lubes at his cost after taking due approval of the Corporation in writing. ii) The franchisee shall, from time to time, place written orders with the Corporation for purchase of the said Lubricant and the Corporation shall, having regard to the availability of the said Lubricant and of transport accept in writing such order or part thereof or act upon the same as may be possible. iii) The Corporation shall sell the said Lubes to the Franchisee at the Corporations net prices as applicable at the Corporations respective storage point, from time to time. iv) The Franchisee shall invest adequate funds and maintain adequate staff with a technical knowledge and salesmanship for promoting sales of the said Lube within his area of operation in the Bazaar.

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ANNEXURE I (a)

DRAFT AGREEMENT BETWEEN BPCL AND PRIMARY LUBE DISTRIBUTOR (PLD)

MEMORANDUM OF AGREEMENT made at ______, the ____ day of _____ 2010 by and between BHARAT PETROLEUM CORPN. LTD., a Corporation incorporated under the Indian Companies Act, 1956 and having its Registered Office at Bharat Bhavan, 4 & 6 Currimbhoy Road, Mumbai – 400001 and its Regional Office at “A” Installation, 2nd

Floor, Sewree Fort Road, Sewree-East, Mumbai-400015 (hereinafter called “The Corporation” which expression shall unless inconsistent with the context include its successors and assigns) on the One Part and Mr. ____________________ S/o __________________, resident of _______________________________________ (hereinafter called “the FRANCHISEE”) of the other part WHEREBY, IT IS MUTUALLY AGREED AND DECLARED AS FOLLOWS : 1. (a) The Corporation hereby appoints the FRANCHISEE and the Franchisee hereby accepts the appointment as Primary Lube Distributor, initially for a period of _____________ commencing from ___________ and renewable ____________________________ at the sole discretion of the Corporation, for sale of

the Corporation‟s Lubricating Oil in packed and Bulk (hereinafter called „LUBES‟) in the

Revenue Districts of ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------. (b) The aforesaid appointment is subject to the following conditions : i) The Franchisee shall either purchase or take on lease for the tenure of the agreement a showroom and office space with telephone and necessary fixtures and fittings and along with sufficient space for storage of Lubes at his cost after taking due approval of the Corporation in writing. ii) The franchisee shall, from time to time, place written orders with the Corporation for purchase of the said Lubricant and the Corporation shall, having regard to the availability of the said Lubricant and of transport accept in writing such order or part thereof or act upon the same as may be possible.

iii) The Corporation shall sell the said Lubes to the Franchisee at the Corporation‟s net

prices as applicable at the Corporation‟s respective storage point, from time to time.

iv) The Franchisee shall invest adequate funds and maintain adequate staff with a technical knowledge and salesmanship for promoting sales of the said Lube within his area of operation in the Bazaar.

v) The franchisee shall deal exclusively with the products of the Corporation and shall not deal with any other products including Lubricants of other companies. The Franchisee shall not tamper with the packaging / labelling of the products supplied by the Corporation.

vi) The Franchisee shall promote the sales of the Corporation‟s product to the

satisfaction of the Corporation and will achieve the target as may be fixed by the Corporation from time to time. vii) The Corporation reserves the right, without any reference to or consent of the Franchisee to appoint one or more additional franchisee (s) in the same territory referred to in Clause 1(a) above and such additional Franchisee (s) shall be entitled to make sales of LUBES in the same territory without any objection from the Franchisee and the Franchisee shall not be entitled to any claim. viii) Without prejudice to the above, the Corporation shall also be entitled to require the Franchisee to effect minimum sales of LUBES in accordance with the policy of the Corporation and at its sole discretion to reduce, restrict, modify or alter the area of the

Franchisee‟s Territory and the decision of the Corporation shall be final and binding on

the Franchisee. The Corporation shall further be entitled to notify, without any legal obligation to do so, from time to time to the Franchisee in writing the minimum quantity of LUBES which the Franchisee shall be required to uplift in each month. The Corporation shall also be entitled to require the Franchisee to maintain during the duration of the

Agreement such minimum stock as to meet the customers‟ requirements.

ix) The Franchisee will during the continuance of this Agreement confine himself to effect the sales in the area or territory specified hereinabove, but the Corporation shall be entitled without the consent of the Franchisee to enlarge, reduce, increase or modify such area or territory to such other place as may from time to time be authorized by the Corporation in writing. x) The Franchisee shall make his best efforts for enrolling customers and canvassing business and for developing and increasing the sale of LUBES within the area allotted to him. xi) During the continuance of this Agreement, the Franchisee shall not directly or indirectly engage or interest himself in any other business competing with the business of the Corporation. xii) The Franchisee shall be at liberty to operate exclusive MAK Lubeshoppe(s) within his area of operation with the written consent of the Corporation. Such outlets shall be handling only the Lubes sold to the Franchisee by the Corporation.

xiii) The Franchisee shall not make any sale of lubricants to, or cause any hindrance in the operation of, any of the Retail Outlets (Petrol pumps), LPG distributors, e-choppal, or the Primary Lube Distributors and their Exclusive MAK Lubeshoppes or other franchisees of the Corporation. 2. The Franchisee shall adhere to the code of marketing discipline laid down by Corporation, which will be explained and advised to Franchisee from time to time. 3. The Franchisee shall allow the Corporation to draw samples from the stock of Lubes maintained by the Franchisee or his representative and have the same tested at the

Corporation‟s laboratories. In case the sample fails to meet the specifications of the

product supplied by the Corporation, the Franchisee shall be held liable for all consequential damages, and this agreement would stand terminated. 4. The Corporation shall not be liable for any loss or damage for any delay in shipping or delivering or from failure to ship or deliver LUBES order whatever may be the cause of such failure or delay. The Corporation shall further be entitled to refuse any order to orders and at any time to treat any order or orders accepted or acknowledged as cancelled. Every order placed by the Franchisee under this agreement shall constitute a firm order not subject to cancellation or revision by the Franchisee unless and until the Corporation intimates to the Franchisee in writing its intention to treat such order as cancelled. 5. The Corporation shall be entitled at any time and from time to time, and without any previous notice to the Franchisee to change all or any of the prices which may be fixed for the Franchisee. The Corporation shall not in the event of any such change be bound to make any allowance or pay any compensation to the Franchisee. The Franchisee undertakes to sell and supply the LUBES at the rates so fixed and the Franchisee shall not sell at retail prices exceeding those fixed by the Corporation from time to time and shall sell LUBES upon such terms and conditions as may be indicated by the Corporation and shall execute and procure the execution of such warranties, indemnities and writings from himself and/or from any consumer or buyer as the Corporation may from time to time prescribe. 6. The Corporation may, at its discretion, entrust any product, document, fixtures, and any other equipment/ material from time to time to the Franchisee in connection with the business and the Franchisee shall exercise due and proper care for the protection of all such properties so committed to his care, without claiming any lien or right to retain possession of the same in any circumstances whatsoever, and on demand deliver up to the Corporation in the same good order in which it was received all property of the Corporation, due allowance being made by the Corporation for fair wear and tear of which the Corporation shall be the sole judge. The Franchisee shall pay forthwith on demand to the Corporation at its Head Office at Bombay or at any Regional/Territory Office of the Corporation whenever desired by the Corporation the value of any property entrusted to him, which may be lost, broken, damaged or depreciated or used for

purposes other than those for which it was supplied, of which the Corporation shall be the sole judge. The Franchisee shall be required to submit to the Corporation at its office at _______________________or at any of its office as desired by the Corporation, periodically as may be indicated by the Corporation, a signed inventory of all property of the Corporation which has been so entrusted to him. Moreover, these equipment/property so supplied will be used only for the purposes for which they are meant and the Corporation shall not be responsible for any liability due to misuse of the

Corporation‟s equipment.

7. The Franchise (a) Is responsible for the maintenance and safe keeping of all sales promotional materials which is to be returned on demand from the corporation. Any loss, injury and death caused by this material to man or material is not the responsibility of the corporation. The Franchisee undertakes to sell and deliver to customer only products of the Corporation without any modification and shall not mix the LUBES with any other oil/greases or substandard product or adulterate or cause adulteration in any manner. (b) Shall not add to or alter or modify or shift the said showroom / go-down including the lube outlets referred in 1 (b) xii, any of the Boards / signages except with the prior consent of the Corporation. (c) Shall ensure that the name, sign board of Corporation appears on the said lube showroom/ go-down as per the design approved by the Corporation. 8. The Franchisee shall provide adequate facilities duly licensed by Government or any other statutory authority for receiving and storing LUBES. Such storage facilities shall be exclusively used by the Franchisee for storing LUBES and for no other purpose. The construction, maintenance and upkeep of storage facilities as per the conditions of Permit / License would be the sole and exclusive responsibility of the Franchisee who will also be liable to pay and discharge the entire expenditure for the same. 9. The Franchisee will not, during the currency of this Agreement, distribute / sell or be in any way concerned in distributing similar products of any other Corporation or product without the previous consent in writing of the Corporation. Infringement of this Clause will entitle the Corporation to terminate the Agreement as well as claim any compensation for loss of sales, of which the Corporation shall be the sole judge. 10. The Franchisee shall, at all times, sell LUBES obtained by him only from the Corporation at price / tariffs fixed by the Corporation from time to time and shall faithfully carry out the directions of the Corporation. The price/tariffs shall not exceed the maximum imposed by the Corporation. 11. The Franchisee must use the Billing supply chain solution as recommended by

BPCL time to time (currently „Forum‟ SCM solution from SIFY is recommended) for

carrying out all invoicing of BPCL lubricants products and other related activities for their customers and upload data to a central data repository on regular basis. The PLD also has to provide the PC/Printer and Internet connectivity required for operating such an IT solution. BPCL reserves the right to administer selective sales incentive schemes

exclusively through this IT solution and to access data in this application at PLD‟s end.

BPCL would bear the cost of licensing / AMC / support of this software. 12. The Franchisee shall not commit any act or omit to do or thing whereby the

Corporation‟s rights in the trade mark and /or brand-name of LUBES or any other trade

mark or brand-name of the Corporation is in any way jeopardized. The franchisee shall not claim or have any right in such trade marks or brand-names of the Corporation and shall promptly confide to the Corporation any information obtained or received by him of any infringement thereof or of passing of any goods by any person, firm, or body as and for those of the Corporation. 13. The design, paint work etc., of all vehicles used by Franchisee shall be such, as have been previously approved of by the Corporation. The Franchisee shall also comply with all directions given and/or requisitions made by the Corporation in connection with such recommendations. The Franchisee shall comply with all laws, rules, regulations and requisitions of the Central and/or State Governments and of all authorities appointed by them or either of them including the Chief Controller of Explosives, Government of India, Weights & Measure Authorities and/ or Municipal and/or any other local authority with regard to vehicles and the storage and transport of LUBES and connected equipment and vehicles. The Franchisee shall obtain/renew all licenses and/or permits required for the erection and/or use of the storage accommodation and/or for the storage therein of the LUBES supplied by the Corporation, and shall comply with the terms and conditions of such licenses or permits and hereby undertakes not to do or permit to be done any act or thing which may be contrary to the terms thereof. The Franchisee shall be solely responsible for all consequences of any breach of provisions of this Clause. 14. The Franchisee shall at his own cost maintain adequate trained and competent staff, to do sales/ supply of LUBES to the customers in accordance with the general instructions given or laid down by the Corporation. 15. In all contracts or engagements entered into by the Franchisee with the customers for sale of LUBES, the Franchisee shall act and shall always be deemed to have acted, as a principal and not as an Franchisee or on account of the Corporation, and the Corporation shall not, in any way, be liable in any manner in respect of such contracts and/or engagements and/or in respect of any act or omission on the part of the

Franchisee, his servants, Franchisee‟s workmen in regard to such sale, distribution or

otherwise. The Franchisee shall be bound to inform the customers in writing of this provision, through correspondence. 16. The Corporation shall not be responsible for any liabilities financial, legal or any other kind whatsoever of the Franchise, the staff employed by Franchisee or the operator(s) and the staff of the lube outlets referred in 1(b)xii. Franchisee shall comply with all the statutory rules and regulations from time to time of all the applicable laws including those relating to PF & Employee State Insurance and shall absolve the Corporation and shall indemnify against any claim or demand arising out of the non compliance by the Franchisee, his agents and representatives of such rules and regulations. 17. The following provisions relating to indemnity by the Franchisee in respect of all claims including third party claims shall apply to this Agreement during the duration of

this agreement and even after the termination thereof in respect of any transaction arising in respect of the dealings between the parties hereto under this Agreement. For the purpose of this clause the expression “Franchisee” shall include a sub-Primary

Lubeshoppe Operator, Franchisee‟s servant, licensee or any person nominated or

appointed by the Franchisee or otherwise having any direct or indirect interest in this Agreement for storing, licensing, handling, loading, unloading, delivering, selling marketing, distributing or transporting LUBES – whether packed or loose – relating thereto: a) The Franchisee shall at all times fully and effectively indemnify and keep indemnified the Corporation, its estates and effects from and against all losses, damages, claims, suits, legal proceedings and otherwise howsoever arising from or in connection with any loss or injury to person or property in connection with any of the matters covered by this Agreement or arising in the course of any of the contingencies referred to above or otherwise howsoever. b) Without effecting the generality of the indemnity referred to hereinabove, the Franchisee shall fully and effectively indemnify and keep indemnified the Corporation, it successors, assigns, estate and effects, officers, employees from and against all losses of LUBES or otherwise howsoever on account of non implementation, no observance or non-performance of the instructions issued by the Corporation from time to time, or by reason of the breach, non-observance or non-conformation with the provisions of the Petroleum Act, 1934, Indian Explosives Act, 1884, Weights & Measurement Act and all other Rules, Regulations and Bye-laws made thereunder or any other Statute, Rules, Bye-laws or Acts in respect thereof or in relation to any Municipal license or permission issued for the purpose of storage by any Central or State Government or legal or statutory public body or authority as may be applicable from time to time or otherwise

howsoever arising to the end and intent that the Franchisee‟s indemnity to the

Corporation shall be enforceable by the Corporation under all circumstances envisaged including any loss or damage that may have resulted on account of any negligence or irregular use or handling by any person for an on behalf of the Franchisee or by the customer or any person for and on behalf of the customer and such indemnity shall be unconditional and irrevocable and shall not be discharged absolved or relieved on the ground that the loss or damage has arisen on account of any act or omission of any person over whom the Franchisee has no control. 18. NO WARRANTY BY THE CORPORAITON

a) It is specifically agreed and declared between the Corporation and the Franchisee that the Corporation has not given nor shall be deemed to have given or agreed to any express or implied warranty as b) The Corporation shall, under no circumstances, be liable or responsible for any loss, injury or damage to the Franchisee or to the customers, their servants, employees and Franchisees or any other person whosoever arising on account of any transaction under this agreement or as a result of the LUBES being in any way defective or in unfit condition.

18. The Franchisee will, at all times, fully indemnify the Corporation from and against all losses, damages, claims suits and otherwise arising from on in connection with injury to person or property, short deliveries or otherwise howsoever in connection with matters covered by the Agreement. 19. The Franchisee shall not sell, assign, mortgage, or part with or otherwise transfer his interest in the Franchisee/ship or the right interest or benefit conferred on him by this agreement to any person. In the event of the Franchisee being a Partnership form any charge in the constitution of the firm, whether by retirement, introduction of new partners or otherwise howsoever will not be permitted without the previous written approval of the Corporation notwithstanding that the Corporation may have dealings with such reconstituted firms or impliedly waived or condoned the breach or default mentioned hereinabove by the Franchisee. In the event of the death of any of the partners, the Franchisee shall immediately inform the Corporation giving the necessary particulars of the heirs and legal representatives of the deceased partner and it shall be the option of the Corporation either to continue the Franchisee ship with any reconstituted firm or to terminate the Franchisee agreement and the decision of the Corporation in that behalf shall be final and binding on all the parties concerned. No claim on premature termination for compensation or otherwise will be made or sustainable against the Corporation on account of such termination. 20. The Franchisee undertakes that he, his servants and sub agents will observe and perform the provisions of the Petroleum Act, 1934 or any statutory re-enactment or modification thereof for the time being in force and all rules and regulations made thereunder and all other Government or Municipal Local or such like Acts, laws, regulations and bye-laws, as may be in force from time to time. If there is any violation on the part of the Franchisee of the aforesaid provisions or statutory rules and regulations the Corporation will have absolute right to discontinue the supplies and take any other action including the termination of this agreement as the Corporation may at its absolute discretion think fit. 21. a. The Franchisee undertakes faithfully and promptly to carry out, observe and perform all directions and orders or rules made from time to time by the Corporation or its representatives for the proper carrying on of the Franchisee ship of the Corporation. b. It shall be a paramount condition of the agreement that the Franchisee himself (if he

be an individual) or both the partners of the Franchisee‟s firm (if the Franchisee‟s is a

partner ship firm consisting of two partners only) or the majority of the partners of the

Franchisee‟s firm (if the Franchisee is a firm consisting of more than two partners) or the

majority of the Office bearers/Elected members of the Franchisee Cooperative Society (if the Franchisee is a Co-operative Society) Managing/Whole time or Elected Directors (if the Franchisee is a private limited Corporation) as the case may be shall take active part in the management and running of the Franchisee ship and shall personally supervise the same and shall not under any circumstances do so through any other person, firm or body. c. Except with the previous written consent of the Corporation : i) The Franchisee shall not enter into any arrangement, contract or understanding whereby the operations of the Franchisee hereunder are or may be controlled/carried

out any / or financed by any other person firm or Corporation, whether directly or indirectly and whether in whole or in part; ii) The franchisee himself (if he is an individual) or the partners themselves (if the Franchisee is a partnership firm) or the whole time Office Bearer/Elected Members (if the Franchisee is a Co-operative Society) shall not, (without prior permission in writing of the Corporation) take up any other employment to engage in any other business apart from the operation of the Franchisee ship which is the subject matter of this agreement. iii) The franchisee (if it be a firm or a Co-operative Society) shall not effect any change in its constitution whether in the identity of its partners or appointment of whole time Officer bearers of elected members or in the terms of the Deed of Partnership or of the Bye-laws as the case may be. iv) The franchisee (if it be a private limited Corporation) shall not cause or permit any group transfers or substantial change in its shareholding (transmission by death etc., excluded). In the event of the death of any partner of a firm/death of retirement of whole time Officer Bearers/Elected Members of Co-operative Society which has been appointed as Franchisee hereunder, the surviving partners/remaining members hereby agree to indemnify and keep indemnified the Corporation against any claims or demand which may be made by the heirs of the deceased/retired partner / members. 22. All correspondence, accounts, returns of stocks and sales, and such other documents as may be required by the Corporation shall be made written neatly in English or Hindi language and all accounts shall be produced for inspection of the

Corporation‟s representatives at any time when called upon by them to do so.

23. The Corporation by its Officers, representatives or servants shall have at all times and in any circumstances free and unrestricted access to all premises used in connection with the business of the Franchisee and to inspect and take account of all products in his possession and of all implements, tools, furniture, fitting books, bills, records and/or other property entrusted to the Franchisee by the Corporation. 24 a) The Franchisee shall display or cause to be displayed prominently upon any premises in or upon which the business in the said products is carried on, inscription notifying to the public as conspicuously as possible the fact that he is selling the said LUBES supplied by the Corporation.

b) The Franchisee agrees that upon the Corporation‟s premises in his use he will not

display advertisements which have not the approval of the Corporation. He shall also not display advertisements for petroleum products other than those of the Corporation upon his own premises used in connection with this Franchisee ship. 25. The Franchisee shall settle, in the event of termination of this agreement for any reason, all accounts within seven days of such termination and in the event of the Franchisee declining or neglecting or failing to settle accounts within such period, an

account certified by one of the Corporation‟s Officers, shall be absolutely final and

conclusive for all purposes.

26. Notwithstanding anything to the contrary herein contained, the Corporation shall also be at liberty at its entire discretion to terminate this agreement forthwith upon or at any time after the happening of any of the following events, namely : a) If the Franchise shall commit a delay, breach or default of any of the terms, conditions, covenants and stipulations contained in the agreement and fail to remedy such breach within four days of the receipt of a written notice from the Corporation in that regard ; b) Upon : i) the death or adjudication as insolvent of the Franchisee, if he be an individual

ii) the dissolution of the partnership of the Franchisee‟s firm or the death or adjudication

as insolvent of any partner of the fir, if the Franchisee be a firm; iii) the liquidation, whether voluntary or otherwise or the passing of an effective resolution for winding up, if the Franchisee be a Corporation or Co-operative Society; c) If any attachment is levied and continued to be levied for a period of seven days upon the effects of the Franchisee or an individual partner for the time being of the

Franchisee‟s firm or any elected member of the Franchisees Co-operative Society.

d) If the franchisee or any partner in the franchisee‟s firm or any whole time office

bearer of the Co-operative society appointed as franchisee hereunder shall be involved in any criminal offence relating to moral turpitude. e) If a Receiver shall be appointed of any property or assets of the franchisee or of the

any partner in the franchisee‟s firm or of the franchisee Co-operative society.

f) If the license issued to the Franchisee by the relevant authorities for the storage of LUBES products supplied by the Corporation is cancelled or revoked. g) If the franchisee shall for any reason made default in payment to the Corporation in

full or his outstanding as appearing in the Corporation‟s books of account beyond 4

days of demand by the Corporation. h) If the franchisee does not adhere to the instructions issued from time t time by the Corporation in connection with safe practices to be followed by him in the supply and

storage of the Corporation‟s products or otherwise.

i) If the franchisee shall deliberately contaminate or tamper with the quality of any of the

Corporation‟s products.

j) If the franchisee shall sell the corporation‟s products at prices higher/less than those

fixed by the Corporation.

k) If any information given by the Franchisee in his application for appointment as a franchisee shall be found to be untrue or incorrect in any material particular. l) If the lease tenancy of the franchisee (if the franchisee holds the site as lessee or tenant) shall be terminated or purported to be terminated or comes to an end for any reason whatsoever. m) If the franchisee shall either by himself or by his servants or franchisees commit or suffer to be committed any act which, in the opinion of the Executive Director (Lubes) / GM lubes of Corporation, for the time being at Mumbai, whose decision in that behalf shall be final is prejudicial to the interest or good name of the Corporation. Or its products; the Executive Director / GM lubes shall not be bound to give reasons for such decision.

The Corporation‟s right to terminate this agreement under the terms of this clause shall

be without prejudice to and without affecting any of its other rights and remedies against the Franchisee. In the event of the Corporation terminating this agreement under the provisions of this clause, it shall not be liable to pay for any loss or compensation in respect of such termination PROVIDED THAT the supply of any LUBES product by the Corporation to the Franchisee. Pending expiry of any notice of termination or after any act, contravention or omission by the Franchisee entitling the Corporation to terminate this agreement shall leave become known to the Corporation, shall not in any way prejudice or affect the right of the Corporation to revoke and or enforce the termination of this agreement and the licence granted hereunder. 27 Without prejudice to the foregoing provisions or any thing to the contrary herein contained, either of the parties hereto, namely, the Corporation or the Franchisee, shall be entitled terminate this Agreement on giving thirty days notice to the other party without assigning any reason for such termination. 28 Any acquiescence or waiver by the Corporation of any delay, breach of default committed by the Franchisee shall not be deemed to be or considered as estoppel against the Corporation or prevent the Corporation from effecting termination of this agreement under any of the aforesaid provisions in respect of any matter or transaction antecedent of whatsoever nature. 29 On termination of the agreement under any of the provisions herein contained, the rights and liabilities of the corporation as provided in the succeeding clause (s) shall apply. 30 a) Upon termination of this agreement, the franchisee shall be liable to immediately hand over, return and redeliver to the Corporation or any person nominated by the Corporation the entire property that may have been made available or entrusted or hired to the franchisee by the Corporation during the currency of this agreement. For this purpose the Corporation shall be entitled to take physical inventory or such stocks property lying in the possession or control of the franchisee from time to time belonging to the Corporation and the Corporation shall be entitled to enter upon the office, godown, premises etc., of the franchisee or any other place where the franchisee may be kept the same and take physical possession thereof.

b) The franchisee shall also hand over to the Corporation or the person nominated by it all the necessary records, reference books, other records which may be required by the Corporation for the purpose of enabling the Corporation or any other franchisee who may be appointed by the Corporation to effectively service, continue and maintain the supplies to the customers. c) The franchisee shall also be liable to account to the Corporation amounts payable in respect thereof to the Corporation and shall pay to the Corporation immediately the amounts due and payable by the Franchisee to the Corporation in respect thereof and the statement of account prepared and furnished by the Corporation in that behalf shall be final and binding on the franchisee. 31 If the franchisee is a firm, the persons named above as partners and the partners for the time being of the franchisee shall be jointly and severally liable in respect of all matters hereunder and the franchisee shall forthwith advise the Corporation by written notice addressed to the Corporation and delivered to the Corporation at its office at ______ of any change that may take place in the partnership and in the absence of such notice no partner shall be relieved from liability by public notice retirement or dissolution in accordance with the Indian Partnership Act, 1932 and all the persons who have been partners shall in such event nevertheless remain fully liable to the Corporation as if they had all continued to be partners. 32. The Corporation will supply the said products from the notified source of supply, and the franchisee shall arrange to take prompt delivery of the said products and shall be responsible for and shall pay all demurrage and/or other charges arising through his failure or delay to take such delivery promptly. The Franchisee shall also be liable for any loss or damage arising to the Corporation through his failure, neglect or delay to do so. 33. Any notice required to be given to the franchisee by the Corporation shall be deemed to be duly received and served on the Franchisee, if such notice has been addressed to the franchisee at his last known address as communicated to the Corporation and such notice shall be deemed to be validly given and will be binding and legal. Any notice required to be given to the Corporation by the Franchisee shall be deemed to be duly received by and served on the Corporation if such notice has been addressed to the Corporation at its office at ______ and has been sent by Registered Post. 34. It is in particular agreed that no failure or omission to carry out or observe an of the stipulation or conditions of this agreement shall give rise to any claim against the Corporation or be deemed a breach of this agreement if the same shall arise from any of the following causes, viz. The imposition or restrictions or onerous regulations, acts of God, insurrection, pirates, war declared or undeclared, strikes, lock outs, transport breakdown and or combination or workmen, shortage of railway wagons, accidents to plant or machinery, non delivery or supplies either on account of stoppage or reduction or production at refineries, bottlenecks in transport facilities, shortages in supply of LUBES etc., the Corporation shall not be responsible for any failure to fulfil any of the

terms of this agreement if such fulfilment has been delayed, hindered or prevented by any circumstances whatsoever beyond the control of the Corporation. 35. This agreement has been made in all respects in the local jurisdiction of ______ and the payments thereunder shall be due and made in supply location depot unless otherwise directed by the Corporation. The courts in the city of ______ alone shall have jurisdiction to entertain any suit, application or other proceeding in respect of any claim or dispute arising under this agreement. 36 a) Any dispute or difference of any nature whatsoever any claim, cross-claim, counter-claim or set off of the Corporation against the Franchisee or regarding any right, liability, act, omission or account of any of the parties hereto arising out of or in relation to this agreement shall be referred to the sole arbitration of the Director (Marketing) of the Corporation or of some Officer of the Corporation who may be nominated by the Director (Marketing). The Franchisee will not be entitled to raise any objection to any such arbitrator on the ground that the arbitrator is an Officer of the Corporation or that he has dealt with the matter to which the contract relates or that in the Corporation his duties as an Officer of the Corporation he had expressed views on and or any other matters in dispute or difference. In the even of the arbitrator to whom the matter is originally referred being transferred or vacating his officer or being unable to act for any reason, the Director (Marketing) as aforesaid at the time of such transfer, vacation of office or inability to act may in the direction of the Director (Marketing) designate another person to act as arbitrator in accordance with the terms of the agreement to the end and intent that the original Arbitrator shall be entitled to continue the arbitration proceedings notwithstanding his transfer or vacation of officer as an Officer of the Corporation if the Director (Marketing) does not designate another person to act as arbitrator on such transfer, vacation of office or inability of original arbitrator. Such person shall be entitled to proceed with the reference from the point at which it was left by his predecessor. It is also a term of this contract that no person other than the Director (Marketing) or a person nominated by such Director (Marketing) of the Corporation as aforesaid shall act as arbitrator hereunder. The award of the arbitrator so appointed shall be final conclusive and binding on all parties to the agreement subject to the provisions of the Arbitration Act 1940 or any statutory modification or re-enactment thereof and the rules made thereunder for the time being in force shall apply to the arbitration proceedings under this clause. b) The award shall be made in writing and published by Arbitrator within two year after entering upon the reference or within such extended time not exceeding further twelve months as the Sole Arbitrator shall by a writing under his own hands appoint. The parties hereto shall be deemed to have irrevocably given their consent to the Arbitrator to make and publish the award within the period referred to hereinabove and shall not be entitled to raise any objection or protest thereto under any circumstances whatsoever. c) The Arbitrator shall have power to order and direct either or the parties to abide by, observe and perform all such directions as the arbitrator may think fit having regard to the matters in difference i.e. dispute before him. The arbitrator shall have all summary powers and may take such evidence oral and/or documentary, as the arbitrator in his absolute discretion thinks fit and shall be entitled to exercise all powers under the Indian

Arbitration Act 1940 including admission of any affidavit as evidence concerning the matter in difference i.e. dispute before him. d) The parties against whom the arbitration proceedings have been initiated, that is to say, the Respondents in the proceedings, shall be entitled to prefer a cross-claim, counter-claim or set off before the Arbitrator in respect of any matter in issue arising out of or in relation to the Agreement without seeking a formal reference of arbitration to the Director (Marketing) for such counter-claim, cross-claim or set off and the Arbitrator shall be entitled to consider and deal with the same as if the matters arising therefrom has been referred to him originally and deemed to form part of the reference made by the Director (Marketing). e) The arbitrator shall be at liberty to appoint, if necessary any accountant or engineering or other technical person to assist him and to act by the opinion so taken. f) The arbitrator shall have power to make one or more award whether interim or otherwise in respect of the dispute and difference and in particular will be entitled to make separate awards in respect of claims or cross-claims of the parties. g) The arbitrator shall be entitled to direct any of the parties to pay the costs of the other party in such manner and to such extent as the arbitrator may in his discretion determine and shall also be entitled to require one or both the parties to deposit funds in such proportion to meet the arbitrators expenses, whenever called upon to do so. h) The parties hereby agree that the courts in the city of ______ alone shall have jurisdiction to entertain any application or other proceedings in respect of anything arising under the agreement and any award on awards made by the Sole arbitrator hereunder shall be filed in the concerned courts in the city of ______ only. 37. For the purpose of these presents, the expression “The Corporation” shall unless repugnant to the context or meaning thereof be deemed to include its successors and assigns, and the expression “the Franchisee” shall unless repugnant to the context or meaning thereof be deemed to include (i) where the Franchisee a single individual, his/her heirs, executors, administrators and permitted assigns (ii) where the Franchisee is a firm, the specified partners thereof at the date of these presents, their respective heirs, executors and administrators, the partners or partner for the time being of such firm, the survivor or survivors of such partners and the heirs, executors and administrators of the last surviving partner and (iii) where the Franchisee is a Corporation or other incorporated body, its successors and permitted assigns.

IN WITNESS WHERE OF the said parties have hereunto set their hands the day and year first hereinabove written. SIGNED by Bharat Petroleum Corporation Ltd. by Shri Its Constituted Attorney in the presence of SIGNED by Messrs. By its Partner / Constituted Attorney In the presence of

Annexure – I (b)

ILD AGREEMENT

MEMORANDUM OF AGREEMENT made at ______________, the ____ day of _________ by and between BHARAT PETROLEUM CORPN. LTD., a Corporation incorporated under the Indian Companies Act, 1956 and having its Registered Office at Bharat Bhavan, 4 & 6 Currimbhoy Road, Mumbai – 400001 and its Regional Office at ________________________________________ (hereinafter called “The Corporation” which expression shall unless inconsistent with the context include its successors and assigns) on the One Part and _________________, S/o _______________________, _________________________________(hereinafter called “the FRANCHISEE”) of the other part WHEREBY, IT IS MUTUALLY AGREED AND DECLARED AS FOLLOWS : 1. (a) The Corporation hereby appoints the FRANCHISEE and the Franchisee hereby accepts the appointment as Industrial Lube Distributor, initially for a period of two years commencing from ___________ and renewable every two years at the sole discretion of the Corporation, for sale of the Corporation‟s Lubricating Oil in packed and Bulk (hereinafter called „LUBES‟) in the Revenue Districts of ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

(b) The aforesaid appointment is subject to the following conditions :

i) The Franchisee shall either purchase or take on lease for the tenure of the agreement a showroom and office space with telephone and necessary fixtures and fittings and along with sufficient space for storage of Lubes at his cost after taking due approval of the Corporation in writing.

ii) The franchisee shall, from time to time, place written orders with the

Corporation for purchase of the said Lubricant and the Corporation shall, having regard to the availability of the said Lubricant and of transport accept in writing such order or part thereof or act upon the same as may be possible.

iii) The Corporation shall sell the said Lubes to the Franchisee at the

Corporation‟s net prices as applicable at the Corporation‟s respective storage point, from time to time.

iv) The Franchisee shall invest adequate funds and maintain adequate staff

with a technical knowledge and salesmanship for promoting sales of the said Lube within his area of operation in the Bazaar.

v) The franchisee shall deal exclusively with the products of the Corporation

and shall not deal with any other products including Lubricants of other companies. The Franchisee shall not tamper with the packaging / labelling of the products supplied by the Corporation.

vi) The Franchisee shall promote the sales of the Corporation‟s product to the satisfaction of the Corporation and will achieve the target as may be fixed by the Corporation from time to time.

vii) The Corporation reserves the right, without any reference to or consent of

the Franchisee to appoint one or more additional franchisee (s) in the same territory referred to in Clause 1(a) above and such additional Franchisee (s) shall be entitled to make sales of LUBES in the same territory without any objection from the Franchisee and the Franchisee shall not be entitled to any claim.

viii) Without prejudice to the above, the Corporation shall also be entitled to

require the Franchisee to effect minimum sales of LUBES in accordance with the policy of the Corporation and at its sole discretion to reduce, restrict, modify or alter the area of the Franchisee‟s Territory and the decision of the Corporation shall be final and binding on the Franchisee. The Corporation shall further be entitled to notify, without any legal obligation to do so, from time to time to the Franchisee in writing the minimum quantity of LUBES which the Franchisee shall be required to uplift in each month. The Corporation shall also be entitled to require the Franchisee to maintain during the duration of the Agreement such minimum stock as to meet the customers‟ requirements.

ix) The Franchisee will during the continuance of this Agreement confine

himself to effect the sales in the area or territory specified hereinabove, but the Corporation shall be entitled without the consent of the Franchisee to enlarge, reduce, increase or modify such area or territory to such other place as may from time to time be authorized by the Corporation in writing.

x) The Franchisee shall make his best efforts for enrolling customers and

canvassing business and for developing and increasing the sale of LUBES within the area allotted to him.

xi) During the continuance of this Agreement, the Franchisee shall not

directly or indirectly engage or interest himself in any other business competing with the business of the Corporation.

xii) The Franchisee shall be at liberty to operate exclusive MAK

Lubeshoppe(s) within his area of operation with the written consent of the Corporation. Such outlets shall be handling only the Lubes sold to the Franchisee by the Corporation.

xiii) The Franchisee shall not make any sale of lubricants to, or cause any

hindrance in the operation of, any of the Retail Outlets (Petrol pumps), LPG distributors, e-choppal, or the Primary Lube Distributors and their Exclusive MAK Lubeshoppes or other franchisees of the Corporation.

2. The Franchisee shall adhere to the code of marketing discipline laid down by

Corporation, which will be explained and advised to Franchisee from time to time.

3. The Franchisee shall allow the Corporation to draw samples from the stock of Lubes maintained by the Franchisee or his representative and have the same tested at the Corporation‟s laboratories. In case the sample fails to meet the specifications of the product supplied by the Corporation, the Franchisee shall be held liable for all consequential damages, and this agreement would stand terminated.

4. The Corporation shall not be liable for any loss or damage for any delay in

shipping or delivering or from failure to ship or deliver LUBES order whatever may be the cause of such failure or delay. The Corporation shall further be entitled to refuse any order to orders and at any time to treat any order or orders accepted or acknowledged as cancelled. Every order placed by the Franchisee under this agreement shall constitute a firm order not subject to cancellation or revision by the Franchisee unless and until the Corporation intimates to the Franchisee in writing its intention to treat such order as cancelled.

5. The Corporation shall be entitled at any time and from time to time, and without

any previous notice to the Franchisee to change all or any of the prices which may be fixed for the Franchisee. The Corporation shall not in the event of any such change be bound to make any allowance or pay any compensation to the Franchisee. The Franchisee undertakes to sell and supply the LUBES at the rates so fixed and the Franchisee shall not sell at retail prices exceeding those fixed by the Corporation from time to time and shall sell LUBES upon such terms and conditions as may be indicated by the Corporation and shall execute and procure the execution of such warranties, indemnities and writings from himself and/or from any consumer or buyer as the Corporation may from time to time prescribe.

6. The Corporation may, at its discretion, entrust any product, document, fixtures,

and any other equipment/ material from time to time to the Franchisee in connection with the business and the Franchisee shall exercise due and proper care for the protection of all such properties so committed to his care, without claiming any lien or right to retain possession of the same in any circumstances whatsoever, and on demand deliver up to the Corporation in the same good order in which it was received all property of the Corporation, due allowance being made by the Corporation for fair wear and tear of which the Corporation shall be the sole judge. The Franchisee shall pay forthwith on demand to the Corporation at its Head Office at Bombay or at any Regional/Territory Office of the Corporation whenever desired by the Corporation the value of any property entrusted to him, which may be lost, broken, damaged or depreciated or used for purposes other than those for which it was supplied, of which the Corporation shall be the sole judge. The Franchisee shall be required to submit to the Corporation at its office at _____________________________________________________________ or at any of its office as desired by the Corporation, periodically as may be indicated by the Corporation, a signed inventory of all property of the Corporation which has been so entrusted to him. Moreover, these equipment/property so supplied will be used only for the purposes for which they are meant and the Corporation shall not be responsible for any liability due to misuse of the Corporation‟s equipment.

7. The Franchisee (a) Is responsible for the maintenance and safe keeping of all sales promotional

materials which is to be returned on demand from the corporation. Any loss, injury and death caused by this material to man or material is not the responsibility of the corporation. The Franchisee undertakes to sell and deliver to customer only products of the Corporation without any modification and shall not mix the LUBES with any other oil/greases or substandard product or adulterate or cause adulteration in any manner.

(b) Shall not add to or alter or modify or shift the said showroom / godown including the lube outlets referred in 1 (b) xii, any of the Boards / signages except with the prior consent of the Corporation.

(c) Shall ensure that the name, sign board of Corporation appears on the said lube showroom/ godown as per the design approved by the Corporation.

8. The Franchisee shall provide adequate facilities duly licensed by Government or

any other statutory authority for receiving and storing LUBES. Such storage facilities shall be exclusively used by the Franchisee for storing LUBES and for no other purpose. The construction, maintenance and upkeep of storage facilities as per the conditions of Permit / License would be the sole and exclusive responsibility of the Franchisee who will also be liable to pay and discharge the entire expenditure for the same.

9. The Franchisee will not, during the currency of this Agreement, distribute / sell or

be in any way concerned in distributing similar products of any other Corporation or product without the previous consent in writing of the Corporation. Infringement of this Clause will entitle the Corporation to terminate the Agreement as well as claim any compensation for loss of sales, of which the Corporation shall be the sole judge.

10. The Franchisee shall, at all times, sell LUBES obtained by him only from the

Corporation at price / tariffs fixed by the Corporation from time to time and shall faithfully carry out the directions of the Corporation. The price/tariffs shall not exceed the maximum imposed by the Corporation.

11. The Franchisee shall not commit any act or omit to do or thing whereby the

Corporation‟s rights in the trade mark and /or brand-name of LUBES or any other trade mark or brand-name of the Corporation is in any way jeopardized. The franchisee shall not claim or have any right in such trade marks or brand-names of the Corporation and shall promptly confide to the Corporation any information obtained or received by him of any infringement thereof or of passing of any goods by any person, firm, or body as and for those of the Corporation.

12. The design, paint work etc., of all vehicles used by Franchisee shall be such, as

have been previously approved of by the Corporation. The Franchisee shall also comply with all directions given and/or requisitions made by the Corporation in connection with such recommendations. The Franchisee shall comply with all laws, rules, regulations and requisitions of the Central and/or State Governments and of all authorities appointed by them or either of them including the Chief Controller of Explosives, Government of India, Weights & Measure Authorities and/ or Municipal and/or any other local authority with regard to vehicles and the storage and transport of LUBES and connected equipment and vehicles. The

Franchisee shall obtain/renew all licenses and/or permits required for the erection and/or use of the storage accommodation and/or for the storage therein of the LUBES supplied by the Corporation, and shall comply with the terms and conditions of such licenses or permits and hereby undertakes not to do or permit to be done any act or thing which may be contrary to the terms thereof. The Franchisee shall be solely responsible for all consequences of any breach of provisions of this Clause.

13. The Franchisee shall at his own cost maintain adequate trained and competent

staff, to do sales/ supply of LUBES to the customers in accordance with the general instructions given or laid down by the Corporation.

14. In all contracts or engagements entered into by the Franchisee with the

customers for sale of LUBES, the Franchisee shall act and shall always be deemed to have acted, as a principal and not as an Franchisee or on account of the Corporation, and the Corporation shall not, in any way, be liable in any manner in respect of such contracts and/or engagements and/or in respect of any act or omission on the part of the Franchisee, his servants, Franchisee‟s workmen in regard to such sale, distribution or otherwise. The Franchisee shall be bound to inform the customers in writing of this provision, through correspondence.

15. The Corporation shall not be responsible for any liabilities financial, legal or any

other kind whatsoever of the Franchise, the staff employed by Franchisee or the operator(s) and the staff of the lube outlets referred in 1(b)xii. Franchisee shall comply with all the statutory rules and regulations from time to time of all the applicable laws including those relating to PF & Employee State Insurance and shall absolve the Corporation and shall indemnify against any claim or demand arising out of the non compliance by the Franchisee, his agents and representatives of such rules and regulations.

16. The following provisions relating to indemnity by the Franchisee in respect of all

claims including third party claims shall apply to this Agreement during the duration of this agreement and even after the termination thereof in respect of any transaction arising in respect of the dealings between the parties hereto under this Agreement. For the purpose of this clause the expression “Franchisee” shall include a sub-Industrial Lubeshoppe Operator, Franchisee‟s servant, licensee or any person nominated or appointed by the Franchisee or otherwise having any direct or indirect interest in this Agreement for storing, licensing, handling, loading, unloading, delivering, selling marketing, distributing or transporting LUBES – whether packed or loose – relating thereto:

a) The Franchisee shall at all times fully and effectively indemnify and keep

indemnified the Corporation, its estates and effects from and against all losses, damages, claims, suits, legal proceedings and otherwise howsoever arising from or in connection with any loss or injury to person or property in connection with any of the matters covered by this Agreement or arising in the course of any of the contingencies referred to above or otherwise howsoever.

b) Without effecting the generality of the indemnity referred to hereinabove, the Franchisee shall fully and effectively indemnify and keep indemnified the Corporation, it successors, assigns, estate and effects, officers, employees from

and against all losses of LUBES or otherwise howsoever on account of non implementation, no observance or non-performance of the instructions issued by the Corporation from time to time, or by reason of the breach, non-observance or non-conformation with the provisions of the Petroleum Act, 1934, Indian Explosives Act, 1884, Weights & Measurement Act and all other Rules, Regulations and Bye-laws made thereunder or any other Statute, Rules, Bye-laws or Acts in respect thereof or in relation to any Municipal license or permission issued for the purpose of storage by any Central or State Government or legal or statutory public body or authority as may be applicable from time to time or otherwise howsoever arising to the end and intent that the Franchisee‟s indemnity to the Corporation shall be enforceable by the Corporation under all circumstances envisaged including any loss or damage that may have resulted on account of any negligence or irregular use or handling by any person for an on behalf of the Franchisee or by the customer or any person for and on behalf of the customer and such indemnity shall be unconditional and irrevocable and shall not be discharged absolved or relieved on the ground that the loss or damage has arisen on account of any act or omission of any person over whom the Franchisee has no control.

17. NO WARRANTY BY THE CORPORAITON

a) It is specifically agreed and declared between the Corporation and the Franchisee that the Corporation has not given nor shall be deemed to have given or agreed to any express or implied warranty as

b) The Corporation shall, under no circumstances, be liable or responsible for any loss, injury or damage to the Franchisee or to the customers, their servants, employees and Franchisees or any other person whosoever arising on account of any transaction under this agreement or as a result of the LUBES being in any way defective or in unfit condition.

18. The Franchisee will, at all times, fully indemnify the Corporation from and against

all losses, damages, claims suits and otherwise arising from on in connection with injury to person or property, short deliveries or otherwise howsoever in connection with matters covered by the Agreement.

19. The Franchisee shall not sell, assign, mortgage, or part with or otherwise transfer his

interest in the Franchisee/ship or the right interest or benefit conferred on him by this agreement to any person. In the event of the Franchisee being a Partnership form any charge in the constitution of the firm, whether by retirement, introduction of new partners or otherwise howsoever will not be permitted without the previous written approval of the Corporation notwithstanding that the Corporation may have dealings with such reconstituted firms or impliedly waived or condoned the breach or default mentioned hereinabove by the Franchisee. In the event of the death of any of the partners, the Franchisee shall immediately inform the Corporation giving the necessary particulars of the heirs and legal representatives of the deceased partner and it shall be the option of the Corporation either to continue the Franchisee ship with any reconstituted firm or to terminate the Franchisee agreement and the decision of the Corporation in that behalf shall be final and binding on all the parties concerned. No claim on premature termination for compensation or otherwise will be made or sustainable against the Corporation on account of such termination.

20. The Franchisee undertakes that he, his servants and sub agents will observe and perform the provisions of the Petroleum Act, 1934 or any statutory re-enactment or modification thereof for the time being in force and all rules and regulations made thereunder and all other Government or Municipal Local or such like Acts, laws, regulations and bye-laws, as may be in force from time to time. If there is any violation on the part of the Franchisee of the aforesaid provisions or statutory rules and regulations the Corporation will have absolute right to discontinue the supplies and take any other action including the termination of this agreement as the Corporation may at its absolute discretion think fit.

21. a. The Franchisee undertakes faithfully and promptly to carry out, observe and

perform all directions and orders or rules made from time to time by the Corporation or its representatives for the proper carrying on of the Franchisee ship of the Corporation.

b. It shall be a paramount condition of the agreement that the Franchisee himself (if he be an individual) or both the partners of the Franchisee‟s firm (if the Franchisee‟s is a partner ship firm consisting of two partners only) or the majority of the partners of the Franchisee‟s firm (if the Franchisee is a firm consisting of more than two partners) or the majority of the Office bearers/Elected members of the Franchisee Cooperative Society (if the Franchisee is a Co-operative Society) Managing/Whole time or Elected Directors (if the Franchisee is a private limited Corporation) as the case may be shall take active part in the management and running of the Franchisee ship and shall personally supervise the same and shall not under any circumstances do so through any other person, firm or body.

c. Except with the previous written consent of the Corporation :

i) The Franchisee shall not enter into any arrangement, contract or

understanding whereby the operations of the Franchisee hereunder are or may be controlled/carried out any / or financed by any other person firm or Corporation, whether directly or indirectly and whether in whole or in part;

ii) The franchisee himself (if he is an individual) or the partners themselves (if the Franchisee is a partnership firm) or the whole time Office Bearer/Elected Members (if the Franchisee is a Co-operative Society) shall not, (without prior permission in writing of the Corporation) take up any other employment to engage in any other business apart from the operation of the Franchisee ship which is the subject matter of this agreement.

iii) The franchisee (if it be a firm or a Co-operative Society) shall not effect any change in its constitution whether in the identity of its partners or appointment of whole time Officer bearers of elected members or in the terms of the Deed of Partnership or of the Bye-laws as the case may be.

iv) The franchisee (if it be a private limited Corporation) shall not cause or permit any group transfers or substantial change in its shareholding (transmission by death etc., excluded).

In the event of the death of any partner of a firm/death of retirement of whole time Officer Bearers/Elected Members of Co-operative Society

which has been appointed as Franchisee hereunder, the surviving partners/remaining members hereby agree to indemnify and keep indemnified the Corporation against any claims or demand which may be made by the heirs of the deceased/retired partner / members.

22. All correspondence, accounts, returns of stocks and sales, and such other documents as may be required by the Corporation shall be made written neatly in English or Hindi language and all accounts shall be produced for inspection of the Corporation‟s representatives at any time when called upon by them to do so.

23. The Corporation by its Officers, representatives or servants shall have at all times

and in any circumstances free and unrestricted access to all premises used in connection with the business of the Franchisee and to inspect and take account of all products in his possession and of all implements, tools, furniture, fitting books, bills, records and/or other property entrusted to the Franchisee by the Corporation.

24 a) The Franchisee shall display or cause to be displayed prominently upon any

premises in or upon which the business in the said products is carried on, inscription notifying to the public as conspicuously as possible the fact that he is selling the said LUBES supplied by the Corporation.

b) The Franchisee agrees that upon the Corporation‟s premises in his use he will

not display advertisements which have not the approval of the Corporation. He shall also not display advertisements for petroleum products other than those of the Corporation upon his own premises used in connection with this Franchisee ship.

25. The Franchisee shall settle, in the event of termination of this agreement for any

reason, all accounts within seven days of such termination and in the event of the Franchisee declining or neglecting or failing to settle accounts within such period, an account certified by one of the Corporation‟s Officers, shall be absolutely final and conclusive for all purposes.

26. Notwithstanding anything to the contrary herein contained, the Corporation shall

also be at liberty at its entire discretion to terminate this agreement forthwith upon or at any time after the happening of any of the following events, namely :

a) If the Franchise shall commit a delay, breach or default of any of the

terms, conditions, covenants and stipulations contained in the agreement and fail to remedy such breach within four days of the receipt of a written notice from the Corporation in that regard ;

b) Upon : i) the death or adjudication as insolvent of the Franchisee, if he be

an individual ii) the dissolution of the partnership of the Franchisee‟s firm or the

death or adjudication as insolvent of any partner of the fir, if the Franchisee be a firm;

iii) the liquidation, whether voluntary or otherwise or the passing of an effective resolution for winding up, if the Franchisee be a Corporation or Co-operative Society;

c) If any attachment is levied and continued to be levied for a period of seven days upon the effects of the Franchisee or an individual partner for the time being of the Franchisee‟s firm or any elected member of the Franchisees Co-operative Society.

d) If the franchisee or any partner in the franchisee‟s firm or any whole time office bearer of the Co-operative society appointed as franchisee hereunder shall be involved in any criminal offence relating to moral turpitude.

e) If a Receiver shall be appointed of any property or assets of the franchisee or of the any partner in the franchisee‟s firm or of the franchisee Co-operative society.

f) If the license issued to the Franchisee by the relevant authorities for the storage of LUBES products supplied by the Corporation is cancelled or revoked.

g) If the franchisee shall for any reason made default in payment to the Corporation in full or his outstanding as appearing in the Corporation‟s books of account beyond 4 days of demand by the Corporation.

h) If the franchisee does not adhere to the instructions issued from time t time by the Corporation in connection with safe practices to be followed by him in the supply and storage of the Corporation‟s products or otherwise.

i) If the franchisee shall deliberately contaminate or tamper with the quality of any of the Corporation‟s products.

j) If the franchisee shall sell the corporation‟s products at prices higher/less than those fixed by the Corporation.

k) If any information given by the Franchisee in his application for appointment as a franchisee shall be found to be untrue or incorrect in any material particular.

l) If the lease tenancy of the franchisee (if the franchisee holds the site as lessee or tenant) shall be terminated or purported to be terminated or comes to an end for any reason whatsoever.

m) If the franchisee shall either by himself or by his servants or franchisees commit or suffer to be committed any act which, in the opinion of the Executive Director (Lubes) / GM lubes of Corporation, for the time being at Delhi, whose decision in that behalf shall be final is prejudicial to the interest or good name of the Corporation. Or its products; the Executive Director / GM lubes shall not be bound to give reasons for such decision.

The Corporation‟s right to terminate this agreement under the terms of this clause shall be without prejudice to and without affecting any of its other rights and remedies against the Franchisee. In the event of the Corporation terminating this agreement under the provisions of this clause, it shall not be liable to pay for any loss or compensation in respect of such termination PROVIDED THAT the supply of any LUBES product by the Corporation to the Franchisee. Pending expiry of any notice of termination or after any act, contravention or omission by the Franchisee entitling the Corporation to terminate this agreement shall leave become known to the Corporation, shall not in any way prejudice or affect the right of the Corporation to revoke and or enforce the termination of this agreement and the licence granted hereunder.

27 Without prejudice to the foregoing provisions or any thing to the contrary herein contained, either of the parties hereto, namely, the Corporation or the Franchisee, shall be entitled terminate this Agreement on giving thirty days notice to the other party without assigning any reason for such termination.

28 Any acquiescence or waiver by the Corporation of any delay, breach of default

committed by the Franchisee shall not be deemed to be or considered as estoppel against the Corporation or prevent the Corporation from effecting termination of this agreement under any of the aforesaid provisions in respect of any matter or transaction antecedent of whatsoever nature.

29 On termination of the agreement under any of the provisions herein contained,

the rights and liabilities of the corporation as provided in the succeeding clause (s) shall apply.

30 a) Upon termination of this agreement, the franchisee shall be liable to immediately hand over, return and redeliver to the Corporation or any person nominated by the Corporation the entire property that may have been made available or entrusted or hired to the franchisee by the Corporation during the currency of this agreement. For this purpose the Corporation shall be entitled to take physical inventory or such stocks property lying in the possession or control of the franchisee from time to time belonging to the Corporation and the Corporation shall be entitled to enter upon the office, godown, premises etc., of the franchisee or any other place where the franchisee may be kept the same and take physical possession thereof.

b) The franchisee shall also hand over to the Corporation or the person nominated by it all the necessary records, reference books, other records which may be required by the Corporation for the purpose of enabling the Corporation or any other franchisee who may be appointed by the Corporation to effectively service, continue and maintain the supplies to the customers.

c) The franchisee shall also be liable to account to the Corporation amounts payable in respect thereof to the Corporation and shall pay to the Corporation immediately the amounts due and payable by the Franchisee to the Corporation in respect thereof and the statement of account prepared and furnished by the Corporation in that behalf shall be final and binding on the franchisee.

31 If the franchisee is a firm, the persons named above as partners and the partners for

the time being of the franchisee shall be jointly and severally liable in respect of all matters hereunder and the franchisee shall forthwith advise the Corporation by written notice addressed to the Corporation and delivered to the Corporation at its office at Chennai of any change that may take place in the partnership and in the absence of such notice no partner shall be relieved from liability by public notice retirement or dissolution in accordance with the Indian Partnership Act, 1932 and all the persons who have been partners shall in such event nevertheless remain fully liable to the Corporation as if they had all continued to be partners.

32. The Corporation will supply the said products from the notified source of supply, and

the franchisee shall arrange to take prompt delivery of the said products and shall be responsible for and shall pay all demurrage and/or other charges arising through his

failure or delay to take such delivery promptly. The Franchisee shall also be liable for any loss or damage arising to the Corporation through his failure, neglect or delay to do so.

33. Any notice required to be given to the franchisee by the Corporation shall be deemed

to be duly received and served on the Franchisee, if such notice has been addressed to the franchisee at his last known address as communicated to the Corporation and such notice shall be deemed to be validly given and will be binding and legal. Any notice required to be given to the Corporation by the Franchisee shall be deemed to be duly received by and served on the Corporation if such notice has been addressed to the Corporation at its office at Chennai and has been sent by Registered Post.

34. It is in particular agreed that no failure or omission to carry out or observe an of the

stipulation or conditions of this agreement shall give rise to any claim against the Corporation or be deemed a breach of this agreement if the same shall arise from any of the following causes, viz. The imposition or restrictions or onerous regulations, acts of God, insurrection, pirates, war declared or undeclared, strikes, lock outs, transport breakdown and or combination or workmen, shortage of railway wagons, accidents to plant or machinery, non delivery or supplies either on account of stoppage or reduction or production at refineries, bottlenecks in transport facilities, shortages in supply of LUBES etc., the Corporation shall not be responsible for any failure to fulfil any of the terms of this agreement if such fulfilment has been delayed, hindered or prevented by any circumstances whatsoever beyond the control of the Corporation.

35. This agreement has been made in all respects in the local jurisdiction of Mumbai

and the payments thereunder shall be due and made in Mumbai a unless otherwise directed by the Corporation. The courts in the city of Mumbai alone shall have jurisdiction to entertain any suit, application or other proceeding in respect of any claim or dispute arising under this agreement.

36 a) Any dispute or difference of any nature whatsoever any claim, cross-claim, counter-claim or set off of the Corporation against the Franchisee or regarding any right, liability, act, omission or account of any of the parties hereto arising out of or in relation to this agreement shall be referred to the sole arbitration of the Director (Marketing) of the Corporation or of some Officer of the Corporation who may be nominated by the Director (Marketing). The Franchisee will not be entitled to raise any objection to any such arbitrator on the ground that the arbitrator is an Officer of the Corporation or that he has dealt with the matter to which the contract relates or that in the Corporation his duties as an Officer of the Corporation he had expressed views on and or any other matters in dispute or difference. In the even of the arbitrator to whom the matter is originally referred being transferred or vacating his officer or being unable to act for any reason, the Director (Marketing) as aforesaid at the time of such transfer, vacation of office or inability to act may in the direction of the Director (Marketing) designate another person to act as arbitrator in accordance with the terms of the agreement to the end and intent that the original Arbitrator shall be entitled to continue the arbitration proceedings notwithstanding his transfer or vacation of officer as an Officer of the Corporation if the Director (Marketing) does not designate another person to act as arbitrator on such transfer, vacation of office or inability of original arbitrator. Such person

shall be entitled to proceed with the reference from the point at which it was left by his predecessor. It is also a term of this contract that no person other than the Director (Marketing) or a person nominated by such Director (Marketing) of the Corporation as aforesaid shall act as arbitrator hereunder. The award of the arbitrator so appointed shall be final conclusive and binding on all parties to the agreement subject to the provisions of the Arbitration Act 1940 or any statutory modification or re-enactment thereof and the rules made thereunder for the time being in force shall apply to the arbitration proceedings under this clause.

b) The award shall be made in writing and published by Arbitrator within two year

after entering upon the reference or within such extended time not exceeding further twelve months as the Sole Arbitrator shall by a writing under his own hands appoint. The parties hereto shall be deemed to have irrevocably given their consent to the Arbitrator to make and publish the award within the period referred to hereinabove and shall not be entitled to raise any objection or protest thereto under any circumstances whatsoever.

c) The Arbitrator shall have power to order and direct either or the parties to abide

by, observe and perform all such directions as the arbitrator may think fit having regard to the matters in difference i.e. dispute before him. The arbitrator shall have all summary powers and may take such evidence oral and/or documentary, as the arbitrator in his absolute discretion thinks fit and shall be entitled to exercise all powers under the Indian Arbitration Act 1940 including admission of any affidavit as evidence concerning the matter in difference i.e. dispute before him.

d) The parties against whom the arbitration proceedings have been initiated, that is

to say, the Respondents in the proceedings, shall be entitled to prefer a cross-claim, counter-claim or set off before the Arbitrator in respect of any matter in issue arising out of or in relation to the Agreement without seeking a formal reference of arbitration to the Director (Marketing) for such counter-claim, cross-claim or set off and the Arbitrator shall be entitled to consider and deal with the same as if the matters arising therefrom has been referred to him originally and deemed to form part of the reference made by the Director (Marketing).

e) The arbitrator shall be at liberty to appoint, if necessary any accountant or

engineering or other technical person to assist him and to act by the opinion so taken.

f) The arbitrator shall have power to make one or more award whether interim or

otherwise in respect of the dispute and difference and in particular will be entitled to make separate awards in respect of claims or cross-claims of the parties.

g) The arbitrator shall be entitled to direct any of the parties to pay the costs of the

other party in such manner and to such extent as the arbitrator may in his discretion determine and shall also be entitled to require one or both the parties to deposit funds in such proportion to meet the arbitrators expenses, whenever called upon to do so.

h) The parties hereby agree that the courts in the city of Mumbai alone shall have

jurisdiction to entertain any application or other proceedings in respect of

anything arising under the agreement and any award on awards made by the Sole arbitrator hereunder shall be filed in the concerned courts in the city of Mumbai only.

37. For the purpose of these presents, the expression “The Corporation” shall unless

repugnant to the context or meaning thereof be deemed to include its successors and assigns, and the expression “the Franchisee” shall unless repugnant to the context or meaning thereof be deemed to include (1) where the Franchisee a single individual, his/her heirs, executors, administrators and permitted assigns (2) where the Franchisee is a firm, the specified partners thereof at the date of these presents, their respective heirs, executors and administrators, the partners or partner for the time being of such firm, the survivor or survivors of such partners and the heirs, executors and administrators of the last surviving partner and (3) where the Franchisee is a Corporation or other incorporated body, its successors and permitted assigns.

IN WITNESS WHERE OF the said parties have hereunto set their hands the day and year first hereinabove written. SIGNED by Bharat Petroleum Corporation Ltd. by Shri Its Constituted Attorney in the presence of SIGNED by Messrs. By its Partner / Constituted Attorney in the presence of

Annexure – I (c)

LUBE BUSINESS ASSOCIATE MEMORANDUM OF AGREEMENT made at …….. the…..day of ……..20 - by and between BHARAT PETROLEUM CORPN. LTD., a Corporation incorporated under the Indian Companies Act, 1956 and having its Registered Office at Bharat Bhavan, 4 & 6 Currimbhoy Road, Mumbai – 400001 and its Area Office at “……………………………………………………….. (Hereinafter called “The Corporation” which expression shall unless inconsistent with the context include its successors and assigns) on the One Part and (Name and address of the LBA) (hereinafter called “the Lube Business Associate ( LBA) other part WHEREBY, IT IS MUTUALLY AGREED AND DECLARED AS FOLLOWS : The Corporation hereby appoints the LBA and the LBA hereby accepts the appointment as Lube Business Associate , initially for a period of 6 months on probation commencing from ………. and renewable for two years (including probation period) at the sole discretion of the Corporation, for facilitating the sale of MAK Lubricants of the Corporation‟s in packed and Bulk (hereinafter called „LUBES‟) in the Revenue Districts of ……and or to nominated customers or as advised by the Territory Manager from time to time or to the customers canvassed by themselves .

The aforesaid appointment is subject to the following terms and conditions:

1) CATEGORISATION OF LBA:

i) LBA may work as facilitator and assists the corporation in coordinating with

customers, canvass for new customers where in the representative of the corporation shall deal with the customer directly for supply of the products and decide the commercial terms as well the reconciliation of accounts. The LBA coordinates with the customer and does all liaison work including collection of purchase orders and collection of payments. Ex. PSUs, MNCs, OEMs, Railway, Defence, Corporate Industries etc.

ii) LBA may also work as direct selling agent to the customers he has

canvassed independently in addition to the above or exclusively work on small customers, SSI units, etc. In such cases all the responsibility and accountability shall be of LBA for selling the product as well all commercial transaction including collection of payments thereof. The corporation shall only deliver the product as advised by the LBA.

2) GENERAL TERMS AND CONDITIONS:

i) The contract shall be for a period of 2 years after the satisfactory work during

probation and period includes probation period also. During the probation the contract may be terminated without assigning any reasons by the corporation on its sole discretion. The contract shall be renewed every two years there after words subject to the satisfaction of job assigned to him.

ii) The LBA shall promote the sales of the Corporation‟s MAK Lubricants to the satisfaction of the Corporation and will achieve the target as may be fixed by the Corporation from time to time.

iii) The Corporation reserves the right, without any reference to or consent of the

LBA to appoint one or more additional LBA (s) in the same territory and such additional LBA (s) shall be entitled to make sales of LUBES in the same territory without any objection from the LBA and the LBA shall not be entitled to any claim.

iv) Without prejudice to the above, the Corporation shall also be entitled to

require the LBA to effect minimum sales of LUBES in accordance with the policy of the Corporation and at its sole discretion to reduce, restrict, modify or alter the area of the LBA and the decision of the Corporation shall be final and binding on the LBA.

v) The LBA shall make his best efforts for enrolling customers and canvassing

business and for developing and increasing the sale of LUBES within the area allotted to him.

vi) The LBA shall take utmost care while canvassing the business that if on

approaching the new customer he finds that the customer is already enrolled by BPCL or by any other LBA of the corporation, he shall not further entertain the customer for business or any commercial offer for the lubricants.

vii) During the continuance of this Agreement, the LBA shall not directly or

indirectly engage or interest himself in any other similar business / brand competing with the business of the Corporation.

viii) The LBA shall be at liberty to operate exclusive MAK Lubeshoppe(s) within

his area of operation with the written consent of the Corporation. Such outlets shall be handling only the Lubes sold to the LBA by the Corporation.

ix) The LBA shall not make any sale of lubricants to, or cause any hindrance in

the operation of, any of the Retail Outlets (Petrol pumps), LPG distributors, e-choppal, or the Primary Lube Distributors and their Exclusive MAK Lubeshoppes or other LBAs of the Corporation.

x) The LBA shall liaise with the customer for Tenders, Purchase orders, supply,

payment, reconciliation and any other activity related to lube business with the customer.

3) BANK GAURANEE:

All the LBAs who would be doing the sales transaction directly to their customers shall have to either make payment in advance or shall have to submit a Bank Guarantee equivalent to the credit exposure for such sales transaction at any given time cumulatively for all such customers and shall be valid for a period of at least six months after the due date of validity of contract period. The estimation of such amount shall be worked out by the TM and credit shall be offered to such LBA for the

amount of Bank Guarantee submitted and supply shall be restricted to that amount of Bank Guarantee only. In case of any payment of the LBA‟s customer is not effected after due credit period the Bank Guarantee shall be invoked for the payment outstanding as well the penalty and interest payment for delayed period.

4) REMUNERATION TO THE LBA:

i) The remuneration for the business shall be decided on customer to customer basis by the resective TM of the territory and the LBA shall abide by the same. The remuneration shall be within the frame of corporation‟s policy.

ii) The remuneration to the LBA shall be paid only after the payment for the

transaction from the concern customer is received and the account is reconciled from time to time for any discrepancy of payments or supply and for the convenience of both the parties it shall be paid as of every month.

iii) The deduction of payment towards any statutory requirement for the services

provided by the LBA shall be made and the same shall be informed to LBA. 5) OTHER TERMS AND CONDITIONS:

i) The LBA shall adhere to the code of marketing discipline laid down by Corporation, which will be explained and advised to LBA from time to time.

ii) The LBA shall allow and arrange the representative of the Corporation to visit

their customers dealt by them directly by the employee of corporation or any representative authorised by the corporation

iii) The Corporation shall not be liable for any loss or damage for any delay in

shipping or delivering or from failure to ship or deliver LUBES order whatever may be the cause of such failure or delay. The Corporation shall further be entitled to refuse any order to orders and at any time to treat any order or orders accepted or acknowledged as cancelled. Every order placed by the LBA under this agreement shall constitute a firm order not subject to cancellation or revision by the LBA unless and until the Corporation intimates to the LBA in writing its intention to treat such order as cancelled.

iv) The Corporation shall be entitled at any time and from time to time, and

without any previous notice to the LBA to change all or any of the prices which may be fixed for the specific customer of LBA. The Corporation shall not in the event of any such change be bound to make any allowance or pay any compensation to the LBA. The LBA undertakes to sell and supply the LUBES at the rates so fixed and the LBA shall not sell at retail prices exceeding those fixed by the Corporation from time to time and shall sell LUBES upon such terms and conditions as may be indicated by the Corporation and shall execute and procure the execution of such warranties, indemnities and writings from himself and/or from any consumer or buyer as the Corporation may from time to time prescribe.

v) The Corporation may, at its discretion, entrust any product, document,

fixtures, and any other equipment/ material from time to time to the LBA in

connection with the business and the LBA shall exercise due and proper care for the protection of all such properties so committed to his care, without claiming any lien or right to retain possession of the same in any circumstances whatsoever, and on demand deliver to the Corporation in the same good order in which it was received all property of the Corporation, due allowance being made by the Corporation for fair wear and tear of which the Corporation shall be the sole judge. The LBA shall pay forthwith on demand to the Corporation at its Corporate Office at Bombay or at any Regional/Territory Office of the Corporation whenever desired by the Corporation the value of any property entrusted to him, which may be lost, broken, damaged or depreciated or used for purposes other than those for which it was supplied, of which the Corporation shall be the sole judge. .

vi) The LBA is responsible for the maintenance and safe keeping of all sales

promotional materials, which is to be returned on demand from the corporation. Any loss, injury and fatality caused by this material to man or material is not the responsibility of the corporation.

vii) The LBA undertakes to sell and deliver to customers only products of the

Corporation without any modification and shall not mix the LUBES with any other oil/greases or substandard product or adulterate or cause adulteration in any manner.

The LBA will not, during the currency of this Agreement, distribute / promote / sell or be in any way concerned in selling of similar products of any other competitor /brand without the previous consent in writing of the Corporation. Infringement of this Clause will entitle the Corporation to terminate the Agreement as well as claim any compensation for loss of sales, of which the Corporation shall be the sole judge.

viii) The LBA shall not commit any act or omit to do or thing whereby the

Corporation‟s rights in the trademark and /or brand name of LUBES or any other trade mark or brand name of the Corporation is in any way jeopardized. The LBA shall not claim or have any right in such trade marks or brand-names of the Corporation and shall promptly confide to the Corporation any information obtained or received by him of any infringement thereof or of passing of any goods by any person, firm, or body as and for those of the Corporation.

The LBA shall at his own cost maintain adequate trained and competent staff, to do sales/ canvass of LUBES to the customers in accordance with the general instructions given or laid down by the Corporation.

ix) In all contracts or engagements entered into by the LBA with the customers

for sale of LUBES, the LBA shall act and shall always be deemed to have acted, as a principal and not as an LBA or on account of the Corporation, and the Corporation shall not, in any way, be liable in any manner in respect of such contracts and/or engagements and/or in respect of any act or omission on the part of the LBA, his servants, LBA‟s workmen in regard to such sale, distribution or otherwise. The LBA shall be bound to inform the customers in writing of this provision, through correspondence.

x) The Corporation shall not be responsible for any liabilities financial, legal or

any other kind whatsoever of the Franchise, the staff employed by LBA. The LBA shall comply with all the statutory rules and regulations from time to time of all the applicable laws including those relating to PF & Employee State Insurance and shall absolve the Corporation and shall indemnify against any claim or demand arising out of the non-compliance by the LBA, his agents and representatives of such rules and regulations.

xi) The following provisions relating to indemnity by the LBA in respect of all

claims including third party claims shall apply to this Agreement during the duration of this agreement and even after the termination thereof in respect of any transaction arising in respect of the dealings between the parties hereto under this Agreement. For the purpose of this clause the expression “LBA” shall include LBA‟s servant, licensee or any person nominated or appointed by the LBA or otherwise having any direct or indirect interest in this Agreement for, selling, marketing, distributing or transporting LUBES – whether packed or loose – relating thereto:

xii) The LBA shall at all times fully and effectively indemnify and keep indemnified

the Corporation, its estates and effects from and against all losses, damages, claims, suits, legal proceedings and otherwise howsoever arising from or in connection with any loss or injury to person or property in connection with any of the matters covered by this Agreement or arising in the course of any of the contingencies referred to above or otherwise howsoever.

xiii) Without effecting the generality of the indemnity referred to hereinabove, the

LBA shall fully and effectively indemnify and keep indemnified the Corporation, it successors, assigns, estate and effects, officers, employees from and against all losses of LUBES or otherwise howsoever on account of non implementation, no observance or non-performance of the instructions issued by the Corporation from time to time, or by reason of the breach, non-observance or non-conformation with the provisions of the Petroleum Act, 1934, Indian Explosives Act, 1884, Weights & Measurement Act and all other Rules, Regulations and Bye-laws made thereunder or any other Statute, Rules, Bye-laws or Acts in respect thereof or in relation to any Municipal license or permission issued for the purpose of storage by any Central or State Government or legal or statutory public body or authority as may be applicable from time to time or otherwise howsoever arising to the end and intent that the LBA‟s indemnity to the Corporation shall be enforceable by the Corporation under all circumstances envisaged including any loss or damage that may have resulted on account of any negligence or irregular use or handling by any person for an on behalf of the LBA or by the customer or any person for and on behalf of the customer and such indemnity shall be unconditional and irrevocable and shall not be discharged absolved or relieved on the ground that the loss or damage has arisen on account of any act or omission of any person over whom the LBA has no control.

6) NO WARRANTY BY THE CORPORATON

i) It is specifically agreed and declared between the Corporation and the LBA that the Corporation has not given nor shall be deemed to have given or agreed to any express or implied warranty as the Corporation shall, under no circumstances, be liable or responsible for any loss, injury or damage to the LBA or to the customers, their servants, employees and LBAs or any other person whosoever arising on account of any transaction under this agreement or as a result of the LUBES being in any way defective or in unfit condition.

ii) The LBA shall not sell, assign, mortgage, or part with or otherwise transfer his

interest in the LBA/ship or the right interest or benefit conferred on him by this agreement to any person. In the event of the LBA being a Partnership form any charge in the constitution of the firm, whether by retirement, introduction of new partners or otherwise howsoever will not be permitted without the previous written approval of the Corporation notwithstanding that the Corporation may have dealings with such reconstituted firms or impliedly waived or condoned the breach or default mentioned hereinabove by the LBA. In the event of the death of any of the partners, the LBA shall immediately inform the Corporation giving the necessary particulars of the heirs and legal representatives of the deceased partner and it shall be the option of the Corporation either to continue the LBA ship with any reconstituted firm or to terminate the LBA agreement and the decision of the Corporation in that behalf shall be final and binding on all the parties concerned. No claim on premature termination for compensation or otherwise will be made or sustainable against the Corporation on account of such termination.

iii) The LBA undertakes faithfully and promptly to carry out, observe and perform

all directions and orders or rules made from time to time by the Corporation or its representatives for the proper carrying on of the LBA ship of the Corporation.

iv) It shall be a paramount condition of the agreement that the LBA himself (if he

be an individual) or both the partners of the LBA‟s firm (if the LBA‟s is a partner ship firm consisting of two partners only) or the majority of the partners of the LBA‟s firm (if the LBA is a firm consisting of more than two partners) or the majority of the Office bearers/Elected members of the LBA Cooperative Society (if the LBA is a Co-operative Society) Managing/Whole time or Elected Directors (if the LBA is a private limited Corporation) as the case may be shall take active part in the management and running of the LBA ship and shall personally supervise the same and shall not under any circumstances do so through any other person, firm or body.

v) Except with the previous written consent of the Corporation:

a. The LBA shall not enter into any arrangement, contract or understanding

whereby the operations of the LBA hereunder are or may be controlled/carried out any / or financed by any other person firm or Corporation, whether directly or indirectly and whether in whole or in part;

b. The LBA himself (if he is an individual) or the partners themselves (if the LBA is a partnership firm) or the whole time Office Bearer/Elected Members (if the LBA is a Co-operative Society) shall not, (without prior permission in writing of the Corporation) take up any other employment to engage in any other business apart from the operation of the LBA ship which is the subject matter of this agreement.

c. The LBA (if it be a firm or a Co-operative Society) shall not effect any change in its constitution whether in the identity of its partners or appointment of whole time Officer bearers of elected members or in the terms of the Deed of Partnership or of the Byelaws as the case may be.

d. The LBA (if it be a private limited Corporation) shall not cause or permit any group transfers or substantial change in its shareholding (transmission by death etc., excluded).

e. In the event of the death of any partner of a firm/death of retirement of whole time Officer Bearers/Elected Members of Co-operative Society which has been appointed as LBA hereunder, the surviving partners/remaining members hereby agree to indemnify and keep indemnified the Corporation against any claims or demand which may be made by the heirs of the deceased/retired partner / members.

vi) All correspondence, accounts, returns of stocks and sales, and such other

documents as may be required by the Corporation shall be made written neatly in English or Hindi language and all accounts shall be produced for inspection of the Corporation‟s representatives at any time when called upon by them to do so.

vii) The Corporation by its Officers, representatives or servants shall have at all

times and in any circumstances free and unrestricted access to all premises used in connection with the business of the LBA and to inspect and take account of all products in his possession and of all implements, tools, furniture, fitting books, bills, records and/or other property entrusted to the LBA by the Corporation.

7) TERMINATION OF AGREEMENT:

i) Notwithstanding anything to the contract herein contained, the Corporation

shall also be at liberty at its entire discretion to terminate this agreement forthwith upon or at any time after the happening of any of the following events, namely:

ii) If the LBA shall commit a delay, breach or default of any of the terms,

conditions, covenants and stipulations contained in the agreement and fail to remedy such breach within four days of the receipt of a written notice from the Corporation in that regard; Upon: a. the death or adjudication as insolvent of the LBA, if he be an individual b. the dissolution of the partnership of the LBA‟s firm or the death or

adjudication as insolvent of any partner of the fir, if the LBA be a firm c. the liquidation, whether voluntary or otherwise or the passing of an

effective resolution for winding up, if the LBA be a Corporation or Co-operative Society

d. If any attachment is levied and continued to be levied for a period of seven days upon the effects of the LBA or an individual partner for the time being of the LBA‟s firm or any elected member of the LBAs Co-operative Society.

e. If the LBA or any partner in the LBA‟s firm or any whole time office bearer of the Co-operative society appointed as LBA hereunder shall be involved in any criminal offence relating to moral turpitude.

f. If a Receiver shall be appointed of any property or assets of the LBA or of the any partner in the LBA‟s firm or of the LBA Co-operative society.

g. If the license issued to the LBA by the relevant authorities for the storage of LUBES products supplied by the Corporation is cancelled or revoked.

h. If the LBA shall for any reason made default in payment to the Corporation in full or his outstanding as appearing in the Corporation‟s books of account beyond 4 days of demand by the Corporation.

i. If the LBA does not adhere to the instructions issued from time to time by the Corporation in connection with safe practices to be followed by him in the supply and storage of the Corporation‟s products or otherwise.

j. If the LBA shall deliberately contaminate or tamper with the quality of any of the Corporation‟s products.

k. If the LBA shall sell the corporation‟s products at prices higher/less than those fixed by the Corporation.

l. If any information given by the LBA in his application for appointment as a LBA shall be found to be untrue or incorrect in any material particular.

m. If the lease tenancy of the LBA (if the LBA holds the site as lessee or tenant) shall be terminated or purported to be terminated or comes to an end for any reason whatsoever.

n. If the LBA shall either by himself or by his servants or LBAs commit or suffer to be committed any act which, in the opinion of the Executive Director (Lubes) / GM lubes of Corporation, for the time being at Mumbai, whose decision in that behalf shall be final is prejudicial to the interest or good name of the Corporation. Or its products; the Executive Director / GM lubes shall not be bound to give reasons for such decision.

iii) The LBA shall settle, in the event of termination of this agreement for any

reason, all accounts within seven days of such termination and in the event of the LBA declining or neglecting or failing to settle accounts within such period, an account certified by one of the Corporation‟s Officers, shall be absolutely final and conclusive for all purposes.

iv) The Corporation‟s right to terminate this agreement under the terms of this

clause shall be without prejudice to and without affecting any of its other rights and remedies against the LBA. In the event of the Corporation terminating this agreement under the provisions of this clause, it shall not be liable to pay for any loss or compensation in respect of such termination PROVIDED THAT the supply of any LUBES product by the Corporation to the LBA. Pending expiry of any notice of termination or after any act, contravention or omission by the LBA entitling the Corporation to terminate this agreement shall not in any way prejudice or affect the right of the Corporation to revoke and or enforce the termination of this agreement and the licence granted hereunder.

v) Without prejudice to the foregoing provisions or any thing to the contrary herein contained, either of the parties hereto, namely, the Corporation or the LBA, shall be entitled terminate this Agreement on giving thirty days notice to the other party without assigning any reason for such termination.

vi) Any acquiescence or waiver by the Corporation of any delay, breach of

default committed by the LBA shall not be deemed to be or considered as estoppel against the Corporation or prevent the Corporation from effecting termination of this agreement under any of the aforesaid provisions in respect of any matter or transaction antecedent of whatsoever nature.

vii) On termination of the agreement under any of the provisions herein

contained, the rights and liabilities of the corporation as provided in the succeeding clause (s) shall apply.

viii) Upon termination of this agreement, the LBA shall be liable to immediately

hand over, return and redeliver to the Corporation or any person nominated by the Corporation the entire property that may have been made available or entrusted or hired to the LBA by the Corporation during the currency of this agreement.

ix) The LBA shall also hand over to the Corporation or the person nominated by

it all the necessary records, reference books, other records which may be required by the Corporation for the purpose of enabling the Corporation or any other LBA who may be appointed by the Corporation to effectively service, continue and maintain the supplies to the customers.

x) The LBA shall also be liable to account to the Corporation amounts payable

in respect thereof to the Corporation and shall pay to the Corporation immediately the amounts due and payable by the LBA to the Corporation in respect thereof and the statement of account prepared and furnished by the Corporation in that behalf shall be final and binding on the LBA.

xi) If the LBA is a firm, the persons named above as partners and the partners

for the time being of the LBA shall be jointly and severally liable in respect of all matters hereunder and the LBA shall forthwith advise the Corporation by written notice addressed to the Corporation and delivered to the Corporation at its regional office at ………. of any change that may take place in the partnership and in the absence of such notice no partner shall be relieved from liability by public notice retirement or dissolution in accordance with the Indian Partnership Act, 1932 and all the persons who have been partners shall in such event nevertheless remain fully liable to the Corporation as if they had all continued to be partners.

xii) Any notice required to be given to the LBA by the Corporation shall be

deemed to be duly received and served on the LBA, if such notice has been addressed to the LBA at his last known address as communicated to the Corporation and such notice shall be deemed to be validly given and will be binding and legal. Any notice required to be given to the Corporation by the LBA shall be deemed to be duly received by and served on the Corporation if

such notice has been addressed to the Corporation at its office at ………… and has been sent by Registered Post.

xiii) It is in particular agreed that no failure or omission to carry out or observe an

of the stipulation or conditions of this agreement shall give rise to any claim against the Corporation or be deemed a breach of this agreement if the same shall arise from any of the following causes, viz. The imposition or restrictions or onerous regulations, acts of God, insurrection, pirates, war declared or undeclared, strikes, lock outs, transport breakdown and or combination or workmen, shortage of railway wagons, accidents to plant or machinery, non delivery or supplies either on account of stoppage or reduction or production at refineries, bottlenecks in transport facilities, shortages in supply of LUBES etc., the Corporation shall not be responsible for any failure to fulfil any of the terms of this agreement if such fulfilment has been delayed, hindered or prevented by any circumstances whatsoever beyond the control of the Corporation.

xiv) This agreement has been made in all respects in the local jurisdiction of

………(city of TM‟s office).. and the payments thereunder shall be due and made in ……………( city of TM‟s office ) unless otherwise directed by the Corporation. The courts in the city of ……….. (RHQ) alone shall have jurisdiction to entertain any suit, application or other proceeding in respect of any claim or dispute arising under this agreement.

8) ARBITRATION:

i) Any dispute or difference of any nature whatsoever any claim, cross-claim, counter-claim or set off of the Corporation against the LBA or regarding any right, liability, act, omission or account of any of the parties hereto arising out of or in relation to this agreement shall be referred to the sole arbitration of the Executive Director (Lubes) of the Corporation or of some Officer of the Corporation who may be nominated by the Executive Director (Lubes). The LBA will not be entitled to raise any objection to any such arbitrator on the ground that the arbitrator is an Officer of the Corporation or that he has dealt with the matter to which the contract relates or that in the Corporation his duties as an Officer of the Corporation he had expressed views on and or any other matters in dispute or difference. In the even of the arbitrator to whom the matter is originally referred being transferred or vacating his officer or being unable to act for any reason, the Executive Director (Lubes) as aforesaid at the time of such transfer, vacation of office or inability to act may in the direction of the Executive Director (Lubes) designate another person to act as arbitrator in accordance with the terms of the agreement to the end and intent that the original Arbitrator shall be entitled to continue the arbitration proceedings notwithstanding his transfer or vacation of officer as an Officer of the Corporation if the Executive Director (Lubes) does not designate another person to act as arbitrator on such transfer, vacation of office or inability of original arbitrator. Such person shall be entitled to proceed with the reference from the point at which his predecessor left it. It is also a term of this contract that no person other than the Executive Director (Lubes) or a person nominated by such Executive Director (Lubes) of the Corporation as aforesaid shall act as arbitrator hereunder. The award of the

arbitrator so appointed shall be final conclusive and binding on all parties to the agreement subject to the provisions of the Arbitration Act 1940 or any statutory modification or re-enactment thereof and the rules made thereunder for the time being in force shall apply to the arbitration proceedings under this clause.

ii) The award shall be made in writing and published by Arbitrator within two

year after entering upon the reference or within such extended time not exceeding further twelve months as the Sole Arbitrator shall by a writing under his own hands appoint. The parties hereto shall be deemed to have irrevocably given their consent to the Arbitrator to make and publish the award within the period referred to hereinabove and shall not be entitled to raise any objection or protest thereto under any circumstances whatsoever.

iii) The Arbitrator shall have power to order and direct either or the parties to

abide by, observe and perform all such directions as the arbitrator may think fit having regard to the matters in difference i.e. dispute before him. The arbitrator shall have all summary powers and may take such evidence oral and/or documentary, as the arbitrator in his absolute discretion thinks fit and shall be entitled to exercise all powers under the Indian Arbitration Act 1940 including admission of any affidavit as evidence concerning the matter in difference i.e. dispute before him.

iv) The parties against whom the arbitration proceedings have been initiated,

that is to say, the Respondents in the proceedings, shall be entitled to prefer a cross-claim, counter-claim or set off before the Arbitrator in respect of any matter in issue arising out of or in relation to the Agreement without seeking a formal reference of arbitration to the Executive Director (Lubes) for such counter-claim, cross-claim or set off and the Arbitrator shall be entitled to consider and deal with the same as if the matters arising therefrom has been referred to him originally and deemed to form part of the reference made by the Executive Director (Lubes).

v) The arbitrator shall be at liberty to appoint, if necessary any accountant or

engineering or other technical person to assist him and to act by the opinion so taken.

vi) The arbitrator shall have power to make one or more award whether interim

or otherwise in respect of the dispute and difference and in particular will be entitled to make separate awards in respect of claims or cross-claims of the parties.

vii) The arbitrator shall be entitled to direct any of the parties to pay the costs of

the other party in such manner and to such extent as the arbitrator may in his discretion determine and shall also be entitled to require one or both the parties to deposit funds in such proportion to meet the arbitrators expenses, whenever called upon to do so.

viii) The parties hereby agree that the courts in the city of …………(RHQ) alone

shall have jurisdiction to entertain any application or other proceedings in respect of anything arising under the agreement and any award on awards

made by the Sole arbitrator hereunder shall be filed in the concerned courts in the city of Mumbai only.

For the purpose of these presents, the expression “The Corporation” shall unless repugnant to the context or meaning thereof be deemed to include its successors and assigns, and the expression “the LBA” shall unless repugnant to the context or meaning thereof be deemed to include (1) where the LBA a single individual, his/her heirs, executors, administrators and permitted assigns (2) where the LBA is a firm, the specified partners thereof at the date of these presents, their respective heirs, executors and administrators, the partners or partner for the time being of such firm, the survivor or survivors of such partners and the heirs, executors and administrators of the last surviving partner and (3) where the LBA is a Corporation or other incorporated body, its successors and permitted assigns. IN WITNESS WHERE OF the said parties have hereunto set their hands the ……..day and year ………..first hereinabove written. SIGNED by Bharat Petroleum Corporation Ltd. by Regional Manager Lubes It‟s Constituted Attorney in the presence of In the presence of – Name Signature 1) 2) SIGNED by Messrs. By its Partner / Constituted Attorney In the presence of –

Name Signature 1)

2)