HARDWOOD TIMBER· TERM AGREEMENT ROMNEY PARK … · HARDWOOD TIMBER TERM AGREEMENT THIS AGREEMENT...
62
- J S T A T E FORESTS HARDWOOD TIMBER · TERM AGREEMENT ROMNEY PARK SAWMILL PTYLIMITED
Transcript of HARDWOOD TIMBER· TERM AGREEMENT ROMNEY PARK … · HARDWOOD TIMBER TERM AGREEMENT THIS AGREEMENT...
- J
S T A T E
FORESTS
HARDWOOD TIMBER· TERM AGREEMENT
ROMNEY PARK SAWMILL PTYLIMITED
TABLE OF CONTENTS
HARDWOOD TIMBER TERM AGREEMENT ... ... ..... ...... ... ................................. ...... ....... ....... ... .. .. ...... .. ......... ........ . 2 I. PARTIES ......... .... ......................... ....... ................ ... .... .. ...... ................................. .. .. ................. ... .................. ..... ... 2 2. DEFINITIONS AND INTERPRETATION ..... ..... .... .... ..... ................................................. ................. .... ... ... .... ... 2 3. SCOPE OF AGREEMENT ........... ................. .... .. ..... ..... ..... ..... .. .... ... ... .............. ..... ................... .. .. ........ ..... .. ...... .. 8 4. DURATION OF AGREEMENT ............... ..... ....... ................... ............... .. ..... .. .................. .............. ........ ............. 9 5. THE ALLOCATIONS ............ ............ ....... .. .. ... ... .............................................. ..... ........... ... .... ... ................... ... .. .. 9 6. METHOD OF SUPPLY ................................ ...... ........... ........ ......................... .... ................. ... ..... ..... .. .. ....... .... ... I 0 7. SHORTFALL ............... ..................... .. ... ........ .. ............... ....... .......... ............. ............ ........... .. .............. ....... .... .... I I 8. PLAN OF OPERATIONS ............ ............ ....... ....... ... ..... ...... ... ... ............... .... .... .. ........... .. ... ...... .... .............. .. ...... 13 9. HARVESTING PLAN ......... .................. .. ................... ... ..... ...... .. ........... ........ ............. ..... .. .. ...... .... .. ...... .......... ... 14 10. CONTRACT HARVESTING ...... ...... .... ........ .................................. .. .. ........... ............... .... .... ... ..... .......... ....... 14 11. ANNUAL DELIVERY PLAN AND MONTHLY DELIVERY SCHEDULES ..... ... .................. .. ... .. ..... ..... .. 15 12. AMENDMENT OF ANNUAL DELIVERY PLAN OR MONTHLY DELIVERY SCHEDULES .. ..... ....... .. 17 13. ACCEPTANCE OF DELIVERY ... ... .... ... ....... ...... ........... .. ................. ........ ..... ... ...... .............................. ....... . 18 14. TITLE AND RISK ......... ......... .. .... ......... .. ... .... .... .. .. ... ......... .. ... .... ... ....... .... .... .... .... ...... .. ... .... .. .................. ... ... 18 15. SPECIFJCATIONS ............. ...... .... ... ............ .... .. .... .... ... ..... .. .. ................. ... ...... ........... .... ......... .... .. ... ... ... ........ 19 16. DETERMINA TJON OF QUANTITY OF TIMBER .......................................................... ........ .. .................. 19 17. STUMPAGE PRICE .................... ............ ........ .. ... .............. ... ... ............................................ .. ............... ...... .. . 20 18. DELIVERED PRICES ..... .. ................... .... .... .. ..... .. ... ..... ........ .......................................... .... ......... ..... .... ......... 21 19. GOODS AND SERVICES TAX ................. ....................... .... ................................................................. ..... ... 24 20. PAYMENT .. .................. ..... ............................ .............. ......... .. ....... ...... ..... .. .... .. .... .......... .. ... .... ............... .... .... 27 21. COMPLIANCE AND WARRANTIES .... .. ....................... ... ... ................ .................. ... ... ........ ............. ....... .... 27 22. INDEMNITY AND INSURANCE ......... .... ................. ....... ...................... ................... ........ ..... ........ .... ..... ..... 28 23. SALE OF TIMBER TO OTHER PERSONS .... ....... ... ... ...... .... .. ... ............................... .. ........ ... ....... .. .... ....... .. 28 24. SECURITY ... .. ... ....... .... .. ........... ... ..... ............. ........ .......... ... ... ... ......... ........... ............. ..... ....... ....... ........ ..... .. ... 29 25. FORCE MAJEURE ..... ... ............ ............. .. ..... .......... ............ ........ ...... ..... ... ..... ...... ..... ..... ...................... .... ... ... 30 26. LEGAL RESPONSIBILITY AND LIMITATION OF LIABILITY .......................... .. ..... .. .. .. ... ...... .. ............. 32 27. DEFAULT OR INSOLVENCY .. ... ..... ................. ..... ..................................... ........................ ... ..... .. .... ........... 32 28. RESOLUTION OF DISPUTES - MANDATORY MEDIATION AND ARBITRATION .... ... .... ......... ..... .... 35 29. ASSIGNMENT ........ .............................. .... ....... ........ ... ... ... ..... ... .. .. ........ ........ ........... ....... .... .. .. ........... ...... ...... 37 30. MINISTER'S APPROVAL FOR AN ASSIGNMENT ........ ................... ......... .. ..... ........ .. .......... ... .............. ... 3 8 31 . VALUE ADDED PERFORMANCE ............... ..... .......... ....... ...... ........................ ............ ... .... ......... .... ...... .. .... .39 32. CHARGING THIS AGREEMENT ... ...... .... ... ... ..... ..... ........... ..................... .. ................. .. ... ..... ... ... .. .... .... .. .... . 40 33 . VARJATION ............................................. ..... .. ..... .................. .................... ....................... ... ...................... .... 41 34. INTEREST ....................... .... ........................ .. ............... .... .. ... ..................................... ..... ............ ... ........ ........ 41 35. NOTICE .. .. .. ....... ............ ......... ............ .... .. .............. ..... ...... ..... .. ... ... ... ... ........... ............... .... ..... ................... .. ... 41 36. GOVERNJNG LAW ........... .. ......................... ...... ..... ... ... ........ .............. ... ..... ... ..... ... ....... ..... ............... .... ... .. ... 42 37. SEVERABILITY ........ ... ........ ......... ...... .......... ............... .... .... ................. ................ .... ......... .......... ....... .. ... ... ... 42 38. GENERAL ........................................ .... ....... .. ..... ... ...... ... .. .......................................... ..... ...... ...... ..... .... ..... ...... 42 39. CONFIDENTIALITY .. ... ........... ............ ...... .. ........ ... .... ... .. ...... .. ........... .. ... ... ..................... ... ... ... .. ....... ... .. .... .. 42
SCHEDULE I: Specifications SCHEDULE 2: Allocations SCHEDULE 3: Map of Area of Supply SCHEDULE 4: Codes of Practice/Procedure SCHEDULE 5: Price Schedule SCHEDULE 6: Delivery Details SCHEDULE 7: Review of Delivery Charge SCHEDULE 8: Address for Service
HARDWOOD TIMBER TERM AGREEMENT
THIS AGREEMENT is made the '11.v&VH f,~ 2003
1. PARTIES
1.1 THE FORESTRY COMMISSION OF NEW SOUTH WALES a corporation
constituted under the Forestry Act 1916 (NSW) trading as STATE FORESTS ('State
Forests')
1.2 ROMNEY PARK SAWMILL PTY LIMITED (ACN 000 457 698) ('Company')
1.3 THE STATE OF NEW SOUTH WALES ('State of NSW')
2. DEFINITIONS AND INTERPRETATION
2.1 In this Agreement unless a contrary intention appears:
'Act' means the Forestry Act 1916 (NSW) and all regulations made under that Act;
'Allocation' means Allocation A, or Allocation Bas the case may be;
'Allocation A' means the volume of Hardwood Quota Sawlogs described as Allocation A
in Schedule 2 as may be amended in accordance with this Agreement;
'Allocation B' means the volume of Hardwood Small Sawlogs described as Allocation B
in Schedule 2 as may be amended in accordance with this Agreement;
'Annual Delivery Plan' means a schedule for the Year to which it applies setting out
indicative information regarding the supply of Contract Harvesting Timber particularly
the areas from which it is intended the Timber be harvested and the monthly volumes of
delivery of Timber to the Delivery Site;
Page 2
!A-
'Area of Supply' means the Crown -timber lands or other lands in respect of which State
Forests has the right to take Timber within South Coast Sub Region;
'Base Supply' of an Allocation means 90% of the Allocation;
'Business days' means the days Monday to Friday inclusive but excluding Public
Holidays;
'Code of Procedure' means State Forests Code of Procedure annexed as Schedule 4 as
amended from time to time;
'Codes' means the State Forests' Code of Procedure and Forest Practices Code;
'Commencement Date' means the date nominated by State Forests by not less than three
months notice in writing to the Company under clause 10.2 as. the commencement date
for Contract Harvesting;
'Company' means the Company and includes all employees, servants and agents of the
Company;
'Compartment' means an identified administrative area from which State Forests will
make a supply of Timber available to the Company in accordance with a Harvesting Plan;
'Contract Harvesting' includes the felling, extraction, sorting, processing, grading,
loading, hauling, and delivery of Timber to the Delivery Site and ancillary works
including roading, tracking, Jog dump construction and site rehabilitation by a Contractor
engaged by State Forests;
'Contract Harvesting Timber' means Timber to be made available to the Company in
the course of Contract Harvesting;
'Contractor' means a person under contract with State Forests to conduct forestry
operations and includes employees and agents of the Contractor;
'Delivered Price' means the price payable for Contract Harvesting Timber calculated in
accordance with clause 18.2;
'Delivery Charge' means State Forests' charges, costs and expenses per tonne or cubic
metre of Contract Harvesting Timber delivered to the Company calculated in accordance
with clause 18;
'Delivery ·Site' means the place specified in Schedule 6 as the Delivery Site and any
other site the parties agree upon in writing;
'Force Majeure' means an event (other than the payment of money) arising from an act
of God, industrial dispute, act or omission of government or government department or
instrumentality (other than State Forests), war, sabotage, riot, civil disobedience,
epidemic, disease, fire, explosion, failure of power supply, accident, natural disaster,
calamity or unlawful act by other person, or any similar cause which prevents a party
from performing its obligations (in whole or in part) under this Agreement;
'Forest Practices Code' means State Forests' Forest Practices Code annexed as
Schedule 5 as amended from time to time;
'Harvesting Approval Process' means any procedure to regulate, review or approve
Harvesting Plans or draft plans of operations;
'Harvesting Plan' means an operational plan for harvesting Timber from a specified
Compartment or Compartments prepared by State Forests;
'Hardwood Quota Sawlogs' means timber meeting the Specifications for Hardwood
Quota Sawlogs;
'Hardwood Small Sawlogs' means timber meeting the Specifications for Hardwood
Small Sawlogs;
• Integrated Operation' means a harvesting operation on Crown timber land in which
two or more types of Timber are harvested and sorted into discrete categories;
'Licensed Timber' means Timber taken by the Company under licence issued to the
Company under the Act including Timber taken in the course of Integrated Operations;
•Log Dump' means the location specified by State Forests where felled timber is stored
and serviced before delivery to a sawmill or processing plant;
'Management Area' means an area ofland designated as a 'Management Area' on the
plan prepared by State Forests;
'Minister' means the Minister for Forestry or any other Minister administering the Act;
'Monthly Delivery Schedule' means a schedule stating the volume of Timber to be
delivered to the Delivery Site under Contract Harvesting and the areas from which the
Timber will be harvested during the month to which it applies together with any special
delivery requirements the Company may have for that month. The volume and area will
be based on, but not bound to, the indicative information in the Annual Delivery Plan for
that month, and should take into account the need for the Company to stockpile Timber to
make provision for weather preventing Contracting Harvesting.
'Overcut' means the amount by which the actual quantity of Timber of a type comprising
an Allocation taken by the Company in any Year is greater than the Allocation for that
Timber;
'Plan of Operations' means a plan scheduling the various Compartments from which
State Forests intends to provide each Allocation reviewed and approved in accordance
with a Harvesting Approval Process;
'Price Schedule' means a schedule for calculating the Stumpage Price of Timber
prepared by State Forests in accordance with the principles of The Price System and
annexed as Schedule 5;
'Salvage' means the taking of windthrown timber or damaged timber, pushed over or
felled for purposes other than timber harvesting, including road construction, powerline
construction and extraction of forest materials;
'Specifications' means the specifications for the hardwood timber set out in Schedule 1;
'Stumpage Price' means the price set out in the Price Schedule for Timber as amended
from time to time in accordance with this Agreement. The Stumpage Price is the royalty
which would be payable by a person pursuant to section 30A of the Act if the Timber was
taken by the person under a timber licence issued under the Act.
'Term' means the term of this Agreement;
'The Price System' means a state wide system for determining the price of timber in
accordance with particular methodologies and principles adopted by State Forests and as
may be varied from time to time;
'Threshold Supply' of an Allocation means 80 % of the Allocation;
'Timber' means the timber detailed in the Specifications;
'Total Allocation' for an Allocation means the total of the Allocation for each Year of
this Agreement;
'Total Annual Allocation' for a Year means the total volume of Timber in Allocation A
and Allocation B in that Year;
'South Coast Sub Region' means the area described as the South Coast Sub Region on
the map annexed as Schedule 3;
'Undercut' means the amount by which the actual quantity of Timber of a type
comprising an Allocation taken by the Company in any Year is less than the Allocation;
'value added criteria' means criteria either regarding the sawing, drying, dressing or
other processing of Timber, or regarding the marketing of Timber, which adds value to
the Timber;
'Year' means a period of twelve months commencing on 1 July in any year.
2.2 In this Agreement, unless the context requires otherwise:
2.2. l a reference to the Act includes all amendments, regulations, rules, by-laws and
proclamations under the Act;
2.2.2 words and phrases defined in the Act will have the same meanings attributed to
those words and phrases in the Act unless the word or phrase is defined in this
Agreement in which case the word or phrase will h_ave the meaning attributed to
it in this Agreement;
2.2.3 headings are for convenience only and do not affect the interpretation of this
Agreement;
2.2.4 words importing the singular include the plural and vice versa;
2.2.5 words importing a gender include any gender;
2.2.6 a reference to a person includes a company, partnership, joint venture,
association, corporation or other body corporate and any governmental agency;
2.2. 7 a reference to any thing includes a part of that thing;
2.2.8 a reference to a Clause, party, annexure, exhibit or schedule is a reference to a
Clause of and a party, annexure, exhibit and schedule to this Agreement;
2.2.9 a reference to a document includes all amendments or supplements or
replacements or novations of that document;
2.2.10 a reference to a party to a document includes that party's successors and
permitted assigns;
2.2.11 no rule of construction applies to the disadvantage of a party because that party
was responsible for the preparation of this agreement or any part of it;
2.2.12 a reference to dollars or$ is a reference to the lawful currency of the
Commonwealth of Australia.
2.2.13 a reference to the Minister is a reference to the Minister acting in his capacity as
representative of the Crown in the right of the State of New South Wales but
not as a statutory officer under the Act.
2.2.14 a reference to State Forests making Timber available is a reference to making
Timber available by either of the methods described in clause 6.1.
2.2.15 a reference to the Company taking Timber is a reference to the Company either
taking Timber from Crown-timber land under licence or accepting delivery of
Timber delivered by State Forest to the Company in the course of State Forests
conducting Contract Harvesting.
3. SCOPE OF AGREEMENT
3.1 The Company carries on the business of sawmilling and the processing of hardwood
timber and requires supplies of Timber to conduct its business.
3.2 State Forests will make available supplies of Timber to the Company and the Company
must take and pay for the supplies of Timber made available upon the terms and
conditions set out in this Agreement.
3.3 The Company must pay State Forests the prices calculated in accordance with clause 17
or clause 18 (as the case may be) for the Timber taken by the Company.
3.4 The State ofNSW undertakes to ensure that State Forests has sufficient resources and the
necessary capacity to make Timber available to the Company and will cause State Forests
to perform its obligations as required by the provisions of this Agreement. The State of
NSW will only be excused for any failure to perform its undertakings set out in this
clause if prevented from doing so by Force Majeure. For the purposes of this clause the
words 'act or omission of government or government department or instrumentality' in
the context of Force Majeure will be deemed to mean 'act or omission of a government or
government department or instrumentality other than the government or a department or
instrumentality of the State ofNSW'.
4. DURATION OF AGREEMENT
4.1 This Agreement will take effect from 1 January 2003 and will operate until 31 December
2020 unless determined at an earlier date under a provision of this Agreement.
5. THE ALLOCATIONS
5.1 State Forests must make available to the Company each of the Allocations in each Year
from the Area of Supply.
5.2 In any Year the Company may take more or less than an Allocation in accordance with
the following conditions:
5.2.1 in any Year the quantity of Timber taken by the Company must not exceed
110 percent of the Allocation;
5.2.2 in any Year the minimum quantity of Timber taken during that Year must not
be less than 90 percent of the Allocation;
5.2.3 at the end of any Year the aggregate of Overcuts must not exceed the aggregate
of Undercuts by greater than 10% of the Allocation;
5.2.4 at _the end of any Year the aggregate of Undercuts must not exceed the
aggregate of Overcuts by greater than 10% of the Allocation;
Page 9
~~
5.2.5 the Company gives:
(a) not less than 6 months advance notice in writing to State Forests of an
intended Overcut; and
(b) not less than 3 months advance notice in writing to State Forests of an
intended Undercut.
5.3 The Company is not entitled to an Undercut or Overcut except in accordance with the
conditions set out in clause S.2. Despite any Undercut or Overcut the Company must not
take, and State Forests is not required to make available, more than the Total Allocation
for an Allocation less any deduction made under clause 7.1.
6. METHOD OF SUPPLY
6.1 State Forests may make Timber available by either:
6.1.1 Issuing licences under the Act enabling the Company or a Contractor to take
Timber;
6.1.2 Conducting Contract Harvesting and delivering the Timber to the Delivery
Site; or
6.1.3 Making the Timber available for harvesting by the Company or a Contractor
from land either owned by State Forests (other than Crown-timber land) or in
relation to which State Forests has a right to the Timber.
6.2 The provisions of clauses 8 and 9 shall only apply in relation to Timber made available
to the Company by State Forests issuing licences to the Company.
6.3 The provisions of clauses 11, 12, 13 and 18 shall only apply in relation to Timber made
available to the Company by State Forests conducting Contract Harvesting.
6.4 The Company must take the Timber as directed by State Forests from time to time from
any source including (without limitation):
6.4.1 Standing trees;
6.4.2 Log Dumps;
6.4.3 Integrated Operations;
Pag°?s; ,«ff,, ~
6.4.4 Contract Harvesting; and
6.4.5 Salvage.
7. SHORTFALL
7.1 Any quantity of Timber forming part of an Allocation which the Company fails to take
in any Year and which is not part of an Undercut allowed under the conditions of
clause 5.2 may be forfeited by the Company at the election of State Forests. State
Forests may sell any Timber forfeited under a separate agreement. The quantity of
Timber which the Company fails to take will be calculated by State Forests and
deducted from the Total Allocation. State Forests must notify the Company by written
notice within 3 months after the end of the Year of the quantity of timber which has
been deducted from the Total Allocation.
7.2 If for reasons other than default on State Forests part or Force Majeure the Company
takes less than the Base Supply of an Allocation for two consecutive Years during the
term of this Agreement State Forests may, after prior consultation with the Company
amend the Allocation to the average taken during those two Years.
7.3 If for reasons other than default on State Forests part or Force Majeure the Company:
7 .3. I takes less than 80% of an Allocation for two consecutive Years during the term
of this Agreement; or
7 .3.2 takes less than 70 % of an Allocation in any Year,
State Forests may terminate this Agreement under the provisions of clause 26.
7.4 If for reasons other than default on State Forests part or Force Majeure the Company fails
in any Year to take at least the Base Supply of an Allocation and State Forests does not
elect to have the Company forfeit Timber under clause 7.1 and does not terminate this
Agreement under clause 7.3:
7.4.1 the Company must pay State Forests within 90 days after the end of the Year
the sum of money equal to the difference between the Stumpage Price that
would have been payable had the Company taken the Base Supply of the
Allocation and the Stumpage Price paid or payable for the quantity of Timber
forming part of the Allocation actually taken by the Company for that Year.
Any sum payable by the Company under this clause is payable as pre-estimated
and liquidated damages and not as a penalty;
7.4.2 if in any Year in which the Company makes a payment under clause 7.4.1 the
Company takes a quantity of Timber in excess of the Base Supply of the
Allocation, the Stumpage Price payable by the Company for the quantity of
Timber above the Base Supply for that Year will be reduced to take account of
any sum paid or payable under clause 7.4.1; and
7.4.3 the amount of any reduction in price allowed under clause 7.4.2 must not
exceed the sum that would have otherwise been payable for the quantity of
Timber above the Base Supply at the price applicable for that Year.
7.5 If in any Year for reasons other than default on State Forests part or Force Majeure the
Company takes less than the Threshold Supply of an Allocation the Company must pay
State Forests within 90 days after the end of the Year the sum of money equal to 35% of
the difference between the Delivery Charges that would have been payable had the
Company taken the Threshold Supply of the Allocation and the Delivery Charges paid or
payable for the quantity of Timber forming part of the Allocation actually taken by the
Company in that Year.
7.6 The parties acknowledge that the Company's obligation to pay liquidated damages under
clause 7.5 has been inserted in this Agreement to offset a reciprocal liability State Forests
may have under Contract Harvesting agreements with its Contractors. State Forests will
use reasonable endeavours to limit its said reciprocal liability under the relevant Contract
Harvesting agreements as a result of the Company's failure to take Timber under this
Agreement. Despite clause 7.5 the Company's liability under that clause may not exceed
the reciprocal liability State Forests has under the relevant Contract Harvesting
agreements for the same relevant Year.
7.7 Any sum payable by the Company under clause 7.5 (subject to clause 7.6) is payable in
addition to the obligation to pay damages under clause 7.4, and as pre-estimated and
liquidated damages and not as a penalty.
7.8 In the calculation of any liquidated damages under th.is clause 7 it must be assumed that
the Stumpage Price or the Delivery Charge due on the Timber not taken during the
relevant Year is the average Stumpage Price or the average Delivery Charge as the case
may be, paid or payable for the Timber which was taken during that Year.
7.9 Notwithstanding any provision of this clause 7 where State Forests undertakes Contract
Harvesting the Company must take all Timber delivered to it in accordance with the
Monthly Delivery Schedules.
8. PLAN OF OPERA TIO NS
8.1 No later than 31 May in each Year, State Forests will prepare and supply to the Company
a draft plan of operations for the next two Years. Any draft plan of operations will:
8.1.1 specify the various Compartments intended to be made available for supply;
8.1.2 specify the forest types in the various Compartments and the expected yields of
Timber; and
8 .1.3 provide details of the proposed type of operations to be conducted and other
relevant planning information.
8.2 State Forests will lodge the draft plan of operations for approval in accordance with the
required Harvesting Approval Process applicable from time to time.
8.3 State Forests will provide the Company with a copy of the Plan of Operations when
approved and any Plan of Operations as may be varied from time to time.
8.4 State Forests must use its best endeavours to implement the Plan of Operations in
accordance with its terms.
8.5 From time to time during the term of this Agreement the Company may request State
Forests by notice in writing to consider any modification or change to a Plan of
Operations which the Company believes is necessary to enable or facilitate the taking of
any Timber. If State Forests is satisfied that the requested modification or changes are
necessary it may amend or vary the Plan of Operations and seek approval through the
Harvesting Approval Process
8.6 Where any Timber in a Compartment has been damaged or destroyed by fire, disease or
other natural cause or access to the Compartment is otherwise effected by Force Majeure
State Forests must review any Plan of Operations to evaluate whether it is possible to
harvest Timber from the damaged forest by way of Salvage operations or whether any
other Compartments are able to be made available. If State Forests considers a variation
of a Plan of Operations is necessary, State Forests will consult with the Company and
take into account its views and may modify or vary the Plan of Operations and where
necessary seek approval through the Harvesting Approval Process for a variation of the
Plan of Operations.
9. HARVESTING PLAN
9.1 State Forests must prepare and issue to the Company Harvesting Plans to meet the
Allocations including any intended Undercut or Overcut permitted under the conditions
of clause 5.2. A Harvesting Plan must detail conditions relevant to the supply of Timber
under this Agreement as determined by State Forests.
9.2 The Company must not conduct any harvesting operations except in accordance with a
Harvesting Plan issued by State Forests.
10. CONTRACT HARVESTING
10.1 At any time during the term of this Agreement State Forests may elect to undertake
Contract Harvesting.
10.2 If State Forests elects to undertake Contract Harvesting it must prior to commencing these
operations give the Company not less than 3 months written notice of its intention, the
Commencement Date and the details and extent of the prospective operations.
10.3 The Company must not engage the services of a Contractor to harvest Timber for a period
in excess of 3 months during the term of this Agreement without first obtaining the
written consent of State Forests.
10.4 Any decision by State Forests to undertake Contract Harvesting will be subject to the
policies and directions of the State ofNSW. State Forests will provide the Company with
an opportunity for comment and consultation and will take into account any comments of
the Company before commencement of Contract Harvesting operations.
10.5 State Forests may after consultation with the Company vary any Plan of Operations to
allow it to undertake Contract Harvesting operations and must where necessary or
appropriate to do so submit any varied Plan of Operations to the Harvesting Approval
Process for approval or endorsement.
10.6 Prior to commencing Contract Harvesting State Forests must provide a copy of any Plan
of Operations as varied to the Company and State Forests may commence the Contract
Harvesting operations at any date after the expiration of the period of notice given to the
Company under clause 10.2.
11. ANNUAL DELIVERY PLAN AND MONTHLY DELIVERY SCHEDULES
11.1 Each Annual Delivery Plan must in respect of the Year to which it applies:
11.1.1 specify the quantities of Timber to be delivered, which must be the Allocations
or such greater or lesser quantity of each of the Allocations that, in accordance
with this Agreement the Company requests be delivered;
11.1.2
11.1.3
specify indicative information regarding the monthly quantities (for each
Allocation) of Timber; and
must take into account the need for the Company to stockpile Timber at the
Mill to make provision for weather conditions preventing delivery of Timber
by State Forests.
11.2 The parties must confer as soon as practicable after the giving of the notice referred to in
clause 10.2 and negotiate in good faith to reach agreement on an Annual Delivery Plan
for the remainder of the Year of the Commencement Date. In default of agreement by 21
days prior to the Commencement Date the Annual Delivery Plan will be determined by
State Forests.
11.3 No later than 30 April in each Year of this Agreement the parties must confer in good
faith and reach agreement on an Annual Delivery Plan for the Allocations for the
following Year. The Annual Delivery Plan must make provision for stockpiling by the
Company to make provision for wet weather preventing Contract Harvesting. In default
of agreement by that date the Annual Delivery Plan will be determined by State Forests.
t t .4 Any determination of an Annual Delivery Plan by State Forests must be in accordance
with the matters set out in clause 11.1 and otherwise providing for the Timber involved to
be delivered in approximately equal monthly quantities.
11.5 Any Monthly Delivery Schedule must in relation to the month to which it applies:
11.5.1 must state the quantity of Timber to be delivered which must be based on, but
not bound to, the indicative information in the Annual Delivery Plan for that
month;
11.5.2
11.5.3
must take into account the need for the Company to stockpile Timber at the
Mill to make provision for weather conditions preventing delivery of Timber
by State Forests; and
must include any special delivery requirements the Company may have for that
month, as agreed between the parties.
11.6 No later than 7 days prior to the commencement of each calendar month the parties must
confer in good faith and reach agreement on a Monthly DeJivery Schedule for that month.
In default of agreement the Monthly Delivery Schedule for that month will be determined
by State Forests.
11. 7 Any determination of a Monthly Delivery Schedule by State Forests must be in
accordance with the matters set out in clause 11.5 and otherwise providing for deliveries
of the Timber involved to be distributed evenly throughout the month.
Page 16
11.8 If the Company has any special requirements regarding delivery of Timber in any
particular week not already provided for in a Monthly Delivery Schedule, it may request
State Forests to comply with the special requirements by giving not less than one weeks
notice in writing.
1 I .9 Having due regard to the practicalities State Forests will use reasonable endeavours to
comply with any request under clause 11.8.
11.10 State Forests must use its best endeavours to ensure that the Allocations for each Year are
delivered substantially in accordance with the Monthly Delivery Schedules for that Year
and otherwise at regular intervals and in regular volumes.
I 2.11 Agreement by State Forests to an Annual Delivery Plan or MontWy Delivery Schedule or
amendment thereto which provides for less than the Base Supply being taken by the
Company in any Year will not constitute a waiver of any obligation imposed or right
given by this Agreement.
I I .12 For the purposes of determining whether State Forests has complied with its obligations
to make Timber available (and determining whether the Company has complied with its
obligations to take Timber) State Forests will be deemed to have made available that
quantity of Timber it is ready and able to deliver to the Delivery Site and not any lesser
quantity which it actually makes available:
11.12.1 at the request of the Company;
11.12.2 as a consequence of lawful suspension of deliveries under this Agreement.
12. AMENDMENT OF ANNUAL DELIVERY PLAN OR MONTHLY DELIVERY SCHEDULES
12. I Where any timber in a Compartment has been damaged or destroyed by fire, disease or
other natural cause or access to a Compartment intended to supply an Allocation is
otherwise prevented by Force Majeure, State Forests may, after consultation with the
Company, amend any Annual Delivery Plan or Monthly Delivery Schedule as it deems
Page 17." PJ
/1((,, ;ti--
necessary to facilitate Salvage operations or to adjust to the unavailability of timber in
Compartments.
13. ACCEPTANCE OF DELIVERY
13.1 The Company must accept Timber delivered by State Forests:
13.1.1 to the Delivery Site substantially in accordance with the Monthly Delivery
Schedule; and
13.1.2 during the hours specified in Schedule 6 as the delivery hours.
13.2 The parties acknowledge the benefits in terms of transport efficiency in allowing delivery
of Timber over longer hours than specified in Schedule 6. The parties agree to cooperate
to facilitate extended delivery hours wherever possible.
13.3 The Company must promptly unload timber delivered to it in accordance with this
Agreement.
13.4 The Company must ensure that all unloading operations at the Delivery Site are
performed in a safe manner in accordance with the NSW WorkCover's Code of Practice
for the Safe Loading and Unloading of Logs ( 1995).
14. TITLE AND RISK
14.1 Ownership of the Timber taken by the Company will pass to the Company on payment
for the Timber by the Company to State Forests.
14.2 The risks of ownership of the Timber will pass to the Company:
14.2.l where the Timber is harvested by the Company or a contractor engaged by the
Company, when the Timber has been felled; and
14.2.2 where the Timber is harvested by Contract Harvesting, when the Company
takes delivery in its own right or through the agency of its Contractor; and
14.2.3 where the Timber is harvested by Integrated Operations when the Company or
its Contractor takes delivery.
15. SPECIFICATIONS
15.1 The Company must accept any timber which conforms with the Specifications and forms
part of an Allocation.
15.2 Timber will be deemed to conform to the Specifications if the Company has accepted
delivery of the Timber.
15.3 The Company will not be entitled to dispute that it has accepted delivery of the Timber if:
15.3.1
15.3.2
in the case of the Licensed Timber the Company or its contractor loads the
Timber onto a vehicle for haulage purposes (including in the course of
Integrated Operations); or
in the case of Contract Harvesting Timber the Timber is delivered to the
Company and accepted at the gate of the Mill and the Company does not
dispute it conforms to the Specifications in accordance with clause 15.4.
15.4 If the Company disputes timber delivered by State Forests conforms to the Specifications,
the Company will advise State Forests of the dispute as soon as practicable and within a
maximum of five (5) working days of delivery of the timber and set the timber aside for
inspection and adjudication by a suitably qualified State Forests officer.
15.5 In case of any dispute the determination of conformity by an appropriately qualified
officer of State Forests will be final and binding on the Company.
16. DETERMINATION OF QUANTITY OF TIMBER
16.1 The method of determination of the quantity of Timber upon which price is payable under
this Agreement will be as set out in the Code of Procedure. The Code of Procedure may
be amended by State Forests as may be considered necessary by State Forests from time
to time but State Forests will consult with and take into account any comments of the
Company before any amendments are effected or implemented.
Page 19
"if IL
16.2 If the Company provides a weighbridge or other measuring device approved by State
Forests, the Company must maintain and verify the weighbridge or other device as
required by the manufacturer's specifications.
16.3 State Forests may from time to time undertake an independent verification of the
operation and accuracy of the weighbridge or other device.
17. STUMP AGE PRICE
17 .1 The prices payable under this Agreement for Licensed Timber will be the Stumpage
Prices calculated by reference to the categories and quantities of the Timber taken by the
Company applied to the rates set out in the Price Schedule.
17.2 State Forests may amend or vary the Price Schedule from time to time following a review
by State Forests of the various components of the Price Schedule or following a review of
the Price System.
17.3 In conducting a review of the Price Schedule State Forests:
17.3.1
17.3.2
17.3.3
will be subject at all times to the requirements of the Act;
must conform with the methodologies and principles set out in The Price
System; and
may consider various pricing elements including (without limitation) the
commercial value and best prices reasonably obtainable for various types and
categories of available timber.
17.5 A Price Schedule which is varied or amended by State Forests following a review may be
implemented at any time during a Year provided State Forests gives not less than 28 days
prior written notice to the Company of the varied or amended Price Schedule.
17.6 State Forests may review and vary The Price System from time to time. In performing
any review of The Price System State Forests will at all times be subject to the policies
and directions of the State ofNSW.
17. 7 State Forests will provide to the Company a copy of The Price System as it applies at the
effective date of this Agreement and will promptly forward a copy of The Price System to
the Company if varied or amended following a review.
18. DELIVERED PRICES
18.1 The prices payable by the Company for Contract Harvesting Timber delivered to the
Company under this Agreement will be the Delivered Prices.
18.2 The Delivered Prices payable by the Company will be the total of:
I 8.2.1 the Stumpage Prices which would be payable if the Timber was Licensed
Timber; and
18.2.2 the Delivery Charges.
18.3 The Delivery Charges for the Year of the Commencement Date must determined in
accordance with clauses 18.4 and 18.5.
18.4 As soon as practicable after State Forests gives notice under clause 10.2 State Forests and
the Company must confer and negotiate in good faith to reach agreement on the Delivery
Charges to apply in the first Year of Contract Harvesting. In default of agreement prior to
the commencement of that Year State Forests will determine the Delivery Charges to
apply for remainder of the first Year of Contract after the Commencement Date.
18.5 Any agreement or determination of the Delivery Charges under clause 18.4 must take into
account the following factors:
18.5.1 the market rates for the various items of work comprising the Contract
Harvesting necessary to harvest and haul the Timber involved to the Delivery
Site provided:
(a) those rates are comparable, having regard to the type of Timber
produced, the yield per hectare, operation type, physical circumstances
of harvesting and haulage;
(b) the party tabling rates as relevant must verify them to the reasonable
satisfaction of the other;
18.5.2
(c) Any comparison with market rates must also take into account the cost
to State Forests of managing and administering Contract Harvesting
operations
the benefits to the Company which arise because State Forests' conduct of the
Contract Harvesting has relieved the Company of liabilities associated with its
conduct of harvesting and haulage operations including without limitation
liabilities related to Occupational Health and Safety obligations, workers
· compensation, environmental compliance obligations, and contractual
arrangements with harvesting and haulage contractors.
18.6 In each Year no sooner than April and no later than June State Forests and the Company
must confer to review the Delivery Charge and must negotiate in good faith to reach
agreement on amendments to the Delivery Charge to apply for the following Year. In
default of an agreement on the required amendments by one week prior to the
commencement of the following Year, State Forests may determine the amendments if
any to apply. State Forests must amend the Delivery Charge in accordance with the
agreement of the parties or the determination of State Forests as the case may be, and the
amended Delivery Charge will apply from the first day of the following Year. If the
review is not completed by that date any amendment or variation arising from the review
must be implemented retrospectively to that date.
18.7 Any review of the Delivery Charge by State Forests and the Company must take into
account:
18.7.1 changes in the level of the costs of conducting Contract Harvesting which have
occurred during the preceding I 2 month period, as determined by the
mechanism set out in Schedule 7; and
At the request of either party the review must also take into account:
18.7.2
18.7.3
Changes in the physical circumstances of harvesting, including yield per
hectare, timber piece size, slope and ground conditions, forecasted to apply in
the relevant Year when compared to those physical circumstances forecasted in
the last review to apply in the Year prior to the relevant Year;
Changes in the physical circumstances of haulage, including average lead
distance to the Delivery Site, delivery hours and unloading times at the
Delivery Site, forecasted to apply in the relevant Year when compared to those
physical circumstances forecasted in the last review to apply in the Year prior
to the relevant Year;
18.7.4 the market rates for the various items of work comprising the Contract
Harvesting under this Agreement provided:
(a) those rates are comparable, having regard to the type of Timber
produced and the physical circumstances of harvesting and haulage
referred to in clauses 18.7.2 and 18.7.3;
(b) the party tabling rates as relevant must verify them to the reasonable
satisfaction of the other party;
( c) any comparison between market rates and Delivery Charges must take
into account the cost to State Forests of administering and managing
Contract Harvesting associated with this Agreement,
18.8 ff the Company disputes that an amendment to the Delivery Charge determined by State
Forests is, when compared to the matters referred to in clause 18.7.4, fair reasonable and
competitive, the provision of clause 28 will apply to the dispute. The Company may not
dispute a Delivery Charge determined by State Forests unless it relies on information it
has provided to State Forests under clause 18.7.4 prior to State Forests making the
detenninati on.
18.9 In January of each of the 5th, I 0th, and 15th full Year after the Commencement Date the
parties must meet to review in good faith the matters set out under clause 18. 7 and to
reach agreement if possible regarding amendments to those matters (if any) necessary to
ensure they result in amendments to the Delivery Charge which are reasonable in relation
to the requirements of clause 18.11 including:
18.9.1
18.9.2
18.9.3
the addition of other matters to be taken into account;
the deletion or modification of existing considerations;
amendments to the mechanism set out in Schedule 7 to vary the weight given
to any cost factor or indicator by the mechanism;
18.9.4 amendments to the mechanism set out in Schedule 7 to include any cost factor;
18.9.5 the replacement of the mechanism set out in Schedule 7; or
18.9.6 Any or all of the above.
18. 10 In the event the parties are unable to reach agreement on appropriate amendments referred
to in clause 18.9 by the end of March following the commencement of the review State
Forests may determine the amendments it considers necessary and implement those
amendments in time to be taken in account in the review of the Delivery Charge Schedule
to apply in the following Year. If the Company disputes any such amendment clause 28
will apply and for the purposes of clause 28.6 the matters to be taken into account in
determining the amendments are whether they are reasonable relation to the requirements
of clause 18.11.
18.11 Delivery Charges determined under this clause 18 must be fair, reasonable and
competitive.
18.12 For the purposes of clauses 18.5.1 and 18.7.4:
18.12.1 rates payable to contractors engaged by State Forests to carry out Contract
Harvesting under this Agreement as the result of a competitive tender process
which included New South Wales wide advertising will be deemed to be market
rates for the various items of work comprising Contract Harvesting; and
18.12.2 unless otherwise agreed between the parties the market rates tabled by a party
must be based on mechanised falling where the harvesting machine operator is
protected from falling objects by an engineered structure.
18. 13 For the purposes of clauses 18.5.l(c) and 18. 7.4(c) the parties agree that at the
commencement of this Agreement $ per cubic metre is a reasonable cost to State
Forests of managing and administering Contract Harvesting operations.
18.14 State Forests must provide the Company with written advice regarding the Delivery
Charge as amended from time to time prior to applying the Delivery Charge.
19. GOODS AND SERVICES TAX
Page24 M l"(y~ fa
19. l Stumpage Prices, Delivery Charges, Delivered Prices and any other consideration for
supplies specified in this Agreement do not, subject to the operation of this clause,
include any amount in respect of GST unless provided otherwise.
19.2 If GST is or will be imposed on a supply made under or in connection with this
Agreement, the supplier may, to the extent that the consi~eration otherwise provided for
that supply under this agreement is not stated to already include an amount in respect of
GST on the supply:
19.2.1
19.2.2
increase the consideration otherwise provided for that supply under this
Agreement by the amount of that GST; or
otherwise recover from the recipient the amount of that GST.
19.3 The supplier must ensure that any invoice issued under this agreement in respect of a
taxable supply is a Tax Invoice or Adjustment Note as appropriate or, if no invoice is to
be otherwise issued under this Agreement, must issue a Tax Invoice or Adjustment Note
as appropriate within 7 days of GST being imposed on a taxable supply made under this
Agreement. Notwithstanding any other provision of this Agreement the payment of any
amount by the recipient in respect of a taxable supply is subject to the issuing of the
relevant Tax Invoice or Adjustment Note to the recipient .
19.4 The supplier must reduce the consideration provided for a supply under this Agreement
(excluding any amount in respect of OST on the supply) having regard alone to the direct
and indirect impact of the New Tax System changes in a manner consistent with Part VB
of the Trade Practices Act 1974 (Cth) and any guidelines made under that Act, whether or
not that Act and the guidelines would otherwise apply to the supplier.
19.5 Costs required to be reimbursed or indemnified under this Agreement must exclude any
amount in respect of GST included in the costs for which an entitlement arises to claim an
input tax credit provided that the reimbursement or indemnification does not amount to
consideration for a taxable supply.
19.6 If the consideration for a supply under this Agreement is calculated by reference to the
consideration or value of other supplies, in performing that calculation, the consideration
Page 25
,ff~~
or value for those other supplies excludes any amount in respect of GST payable on those
supplies.
19.7 If the consideration for a supply under this Agreement is to be adjusted by reference to
movements in any index, such as the Consumer Price Index:
19.7.1
19.7.2
19.7.3
19.7.4
19.7.5
any increase in the index attributable to the introduction or increase in the rate
of GST published by the Commonwealth Statistician or similar government
body is to be excluded from the index for the purposes of adjusting the
consideration;
if the Commonwealth Statistician or similar government body does not publish
the increase in the index attributable to the introduction or increase in the rate
of GST, the recipient may request the president for the time being of the
Institute of Chartered Accountants in Australia or an officer of another
Australian professional association agreed by the supplier and the recipient to
appoint a person to decide the increase in the index attributable to the
introduction or increase in the rate of GST for the purposes of this clause;
the person appointed will act as an expert and not an arbitrator;
the expert's decision is final and binding on the parties; and
the supplier and the recipient must each pay one half of the expert's fee
(including expenses) in relation to the decision.
19.8 In this clause:
19.8.1
19.8.2
19.8.3
19.8.4
19.8.5
Adjustment Note includes any document or record treated by the
Commissioner of Taxation as an adjustment note or as enabling the claiming of
an input tax credit for which an entitlement otherwise arises;
GST includes any replacement or subsequent similar tax;
GST Act means A New Tax System (Goods and Services Tax) Act 1999 (Cth);
New Tax System changes has the same meaning as in the Trade Practices Act
1974 (Cth); and
Tax Invoice includes any document or record treated by the Commissioner of
Taxation as a tax invoice or as enabling the claiming of an input tax credit for
which an entitlement otherwise arises.
19.8.6 Terms defined in the GST Act have the same meaning in this clause unless
provided otherwise.
20. PAYMENT
20.1 State Forests will issue monthly invoices for the Timber taken by the Company in
accordance with this Agreement. Invoices issues in relation to Contract Harvesting
Timber must itemise the Stumpage Prices and Delivery Charges separately.
20.2 The Company must pay each invoice within 14 days of its issue.
20.3 If the Company fails to pay an invoice on the due date, State Forests may suspend the
Company's right to obtain Timber under this Agreement until payment is made.
20.4 If the Company does not accept delivery of Timber harvested in accordance with the
· Monthly Delivery Schedule or agreed changes to the Monthly Delivery Schedule, and
State Forests has no alternative sale for the Timber, State Forests may estimate the
quantity of that Timber and issue an invoice to the Company for the costs incurred by
State Forests up to and including the date where the Timber is rejected. Any such invoice
will be deemed to be an invoice for Timber delivered to the Company and the provisions
of clauses 20.2 and 20.3 will apply to it.
21. COMPLIANCE AND WARRANTIES
21.1 The Company must comply with:
21.1.1 the provisions of the Act and other Acts of the State ofNSW;
21.1.2 conditions of licences issued to the Company under the Act;
21.1.3 the Harvesting Plans;
21.1.4 the Codes;
21.1.5 Acts of the Commonwealth of Australia; and
21.1.6 the requirements of any person acting in the exercise of statutory powers (State
or Commonwealth) enabling them to give directions in connection with or
affecting the availability, taking, supply or delivery of Timber.
21.2 The Company must ensure that:
21.2.1
21.2.2
22.2.3
its agents, Contractors or other persons under the Company's control or
direction engaged in obtaining Timber pursuant to this Agreement comply with
clause 21.1;
no person under the control or direction of the Company is engaged in a
harvesting operation without a current Contractor's or Operator's licence issued
under the Act; and
the Company's Contractors and their employees-or subcontractors are insured
and are kept insured under an insurance policy pursuant to the Workers'
Compensation Act 1987.
22. INDEMNITY AND INSURANCE
22.1 The Company indemnifies State Forests against all actions, proceedings, claims, demands
and expenses by any person in respect of or arising out of the performance by the
Company of its obligations under this Agreement other than any action, proceedings,
claims, demands or expenses arising out of any negligent act or omission of State Forests.
22.2 The Company will take out and maintain Public Liability Insurance under a policy
approved by State Forests in an amount not less than $10 million.
22.3 State Forests indemnifies the Company against all actions, proceedings, claims, demands
and expenses by any person (other than a party to this Agreement) in respect of or arising
out of the performance by State Forests of its obligations under this Agreement other than
any action, proceedings, claims, demands or expenses arising out of any negligent act or
omission of the Company.
23. SALE OF TIMBER TO OTHER PERSONS
23.1 State Forests reserves the right to:
23.1. I supply Timber and other timber from within the Area of Supply; or
23.1.2 issue licences to obtain Timber, timber, products or forest materials within the
Area of supply;
to any other person.
23 .2 The Company may from time to time sell Timber which it owns to any person without the
need for processing the Timber.
23.3 If the Company sells Timber under clause 23.2 the Company must provide State Forests
with details in writing of the volume by log category of sales and the identity of the
purchaser within 60 days after the end of each Year.
24. SECURITY
24.1 State Forests may at its sole discretion require the Company to provide security for the
purpose of ensuring the due and proper performance of the Company's obligations under
this Agreement ('security').
24.2 If State Forests requires the Company to provide security the Company must provide the
security in the amount determined by State Forests from time to time which must not
exceed a sum equivalent to 15% of the price of the Total Annual Allocation for the Year
then being ('secured amount').
24.3 If State Forests undertakes Contract Harvesting operations in any Year the secured
amount may at State Forests sole discretion be increased by an amount determined by
State Forests. That amount determined by .State Forests must not exceed a sum
equivalent to 15% of the amount State Forests estimates will be its total Delivery Charges
for that Year.
24.4 State Forests will give the Company written notice of any amount determined or
redetermined under clause 24.2 or 24.3 or any adjustment to or variation of the secured
amount that may be determined by State Forests under the provisions of this clause 24
including any additional security required under clause 24.9 to maintain the level
determined under this clause 24.
Page29 ;>:1
,,,1j· ~
24.5 The Company must lodge, adjust or vary the secured amount or provide additional
security within 14 days of the receipt of a notice from State Forests under clause 24.4.
24.6 The security must
24.6.1
25.6.2
be in the form of cash, bonds or inscribed stock issued by the Australian
Government or the Government of a State or Territory of Australia, an
unconditional undertaking in a form approved by State Forests given by a
financial institution or insurance company approved by State Forests; and
be lodged within fourteen (14) days of the execution of this Agreement.
24. 7 If the security is not transferable by delivery, it must be accompanied by an executed
transfer or other documentation sufficient to effect transfer of the security. The costs
(including stamp duty) of any transfer or retransfer must be borne by the Company.
24.8 State Forests may at any time and without notice to the Company, draw upon the secured
amount to meet any loss or damages arising from the Company's failure to perform any of
its obligations under this Agreement.
24.9 If State Forests draws on the secured amount under this Agreement but does not terminate
this Agreement as a result of any breach, then the Company must provide additional
security so that the secured amount is maintained at the level determined under this
clause 24.
24.10 State Forests may suspend the Company's rights to take any Timber if the Company fails
to lodge the security or provide additional security or to vary or adjust the secured
amount within the time required by any notice to the Company under this clause 24.
24.11 State Forests must release the security to the Company within six months of the date of
termination of this Agreement if no money is then due to State Forests or any earlier date
that may be otherwise agreed.
25. FORCE MAJEURE
25.1 If the Company is prevented from taking or accepting Timber or from carrying on
production of sawn timber by Force Majeure and:
(a) the Force Majeure was not caused by any act or omission on the part of the
Company or any employee or agent of the Company;
(b) the Company had taken all practicable precautions to prevent the Force
Majeure; and
(c) the Company has made all reasonable efforts to contain the effect of the Force
Majeure;
then the Company may apply to State Forests for suspension or modification of its
obligations under this Agreement to the extent that its ability to meet its obligations have
been adversely affected by the Force Majeure.
25.2 Where the Company makes an application under clause 25.1, State Forests will negotiate
with the Company in good faith to review the Allocations taking into account the
functions and obligations of State Forests under this Agreement and the Act and the
requirements for the Company to do all things practicable to mitigate the effect of the
Force Majeure.
25.3 If State Forests is prevented from performing all or any of its obligations under this
Agreement by reason of Force Majeure:
25.3.1
25.3.2
25.3.3
the Company will have no claim against State Forests under this Agreement, to
the extent that the non-performance is due to the Force Majeure;
if State Forests is unable to resume the performance of its obligations within a
period of 12 months from the date of the occurrence of the Force Majeure or
the date when the occurrence of the Force Majeure first became apparent (the
'relevant date') either party may terminate this Agreement by written notice.
The right to give notice under this clause must be exercised within a period of
15 months from the relevant date and in this regard time will be of the essence;
and
State Forests may allocate any Timber which is available to the Company and
other persons in a manner which reflects State Forests functions and
obligations under the Act and accords with any directions of the Minister.
25.4 A party affected by Force Majeure must give initial notice of the existence or occurrence
of the Force Majeure as soon as is practicable to do so and in any case it must provide a
more detailed notice within 28 days of the Force Majeure being apparent which provides
clear details of the event or occurrence claimed as Force Majeure and setting out
particulars of the likely effects of the event or occurrence in question.
26. LEGAL RESPONSIBILITY AND LIMITATION OF LIABILITY
26.1 Where the Company is prevented from taking Timber as a result of any breach of this
Agreement:
26.1.1
26.1.2
26.1.3
by an act or omission of State Forests, then State Forests and not the State of
NSW will be the party, if any, responsible to the Company for any loss
suffered; or
by an act or omission of the State ofNSW, the State ofNSW and not State
Forests will be the party, if any, responsible to the Company for any loss
suffered; or
by an act or omission or law of the Commonwealth of Australia, then neither
State Forests nor the State ofNSW will be in any way responsible to the
Company for any loss suffered.
26.2 Where State Forests or the State ofNSW is in breach of this Agreement by reason of any
failure to make Timber available any loss suffered by the Company will be limited to the
lesser of;
26.2.1 the loss, damage or expense which would be incurred by the Company as a
direct result of obtaining the Timber (which State Forests failed to make
available) from the most economic alternative source; or
26.2.2 the Company's loss of profits, but may not otherwise include consequential
losses.
27. DEFAULT OR INSOLVENCY
Page 32
~ J
27. l If the Company or State Forests breaches or repudiates this Agreement, nothing in this
clause will prejudice the right of either party to recover damages or exercise any other
right.
27.2 If the Company commits a material breach of this Agreement and State Forests considers
that damages may not be an adequate remedy, State Forests may give the Company a
written notice to show cause. Material breaches include without limitation:
27.2.1
27.2.2
27.2.3
failing to take Timber as directed in breach of clause 6.4;
failing to take the quantities of Timber set out -in clause 7.3;
commencing any harvesting operations prior to receipt of a Harvesting Plan or
a Plan of Operations in breach of clause 9.2;
27.2.4 failing to accept Timber in breach of clause 13 or clause 15;
27.2.5 failing to make payments in breach of clause 20;
27.2.6 failing to take out and maintain any insurance in breach of clauses 21.2.3 or
21.2;
27.2.7
27.2.8
27.2.9
failing to meet the requirements of clause 21;
failing to provide security or additional security or to adjust or vary the secured
amount in breach of clause 23;
purporting to assign the whole or any part of this Agreement without the
approval of the Minister in breach of clauses 29 and 30;
27 .2.10 failing to comply with conditions imposed by the Minister pursuant to clause
30 of this Agreement.
27.2.11 failing to meet value added criteria in breach of clause 31.1;
27 .2.12 failing to comply with clause 31.3, 31.4, 31.5 or 31.6;
27 .2.13 failing to comply with clause 32.2 or 32.3;
27.2.14 failing to comply with clause 33.1 or 33.2.
27.3 A notice under clause 27.2 must:
state that it is a notice under clause 27.2 of this Agreement;
specify the alleged material breach;
27.3.1
27.3.2
27.3.3 require the Company to show cause in writing why State Forests should not
exercise its right to terminate under clause 27.4;
Page~
/'If· :.J-
27.3.4
27.3.5
specify the time and date by which the Company must show cause (which must
not be less than 14 days); and
specify the place at which cause must be shown.
27.4 Ifby the time specified in a notice under clause 27.2 the Company fails to show
reasonable cause why State Forests should not exercise its right of termination, State
Forests may by notice in writing to the Company terminate this Agreement.
27.5 If the Company:
27.5.l
27.5.2
27.5.3
27.5.4
27.5.5
informs State Forests in writing or its creditors generally that it is insolvent;
commits an act of bankruptcy;
has a bankruptcy petition presented against it;
is made bankrupt;
a meeting of creditors of the Company is called with a view to:
(a) entering a scheme of arrangement or composition with creditors; or
(b) placing the Company under administration;
27.5 .6 the Company enters a scheme of arrangement or composition with creditors;
27 .5. 7 a resolution is passed at a meeting of creditors to place the Company under
administration;
27.5.8
27.5.9
the Company is placed under administration;
an administrator of the property or part of the property of the Company is
appointed;
27.5.10 an application is made to a Court for the winding up of the Company and not
stayed within 14 days;
27.5 .11 a winding up order is made in respect of the Company; or
27 .5.12 execution is levied against the Company by creditors, debenture holders or
trustees or under a floating charge.
State Forests may, without giving a notice to show cause, terminate this Agreement by
notice in writing to the Company.
27 .6 If State Forests commits a material breach of this Agreement and the Company considers
that damages may not be an adequate remedy, the Company may give State Forests a
written notice to show cause. Material breaches include without limitation:
Page 34
~-!j
27.6.1
27.6.2
failing to make available an Allocation for each Year in breach of clause 5;
failing to process any application requesting an assignment of this agreement in
breach of clauses 29 or 30.
27.7 A notice by the Company under clause 27.6 must:
27.7.1
27.7.2
27.7.3
27.7.4
27.7.5
state that it is a notice under clause 27.6 of this Agreement;
specify the alleged material breach;
require State Forests to show cause in writing why the Company should not
terminate this Agreement;
specify the time and date by which State Forests must show cause (which must
not be less than I 4 days); and
specify the place at which cause must be shows.
27.8 Ifby the time specified in a notice under clause 27.6 State Forests fails to show
reasonable cause why the Company should not exercise its right of termination, the
Company may by notice in writing to State Forests terminate this Agreement.
28. RESOLUTION OF DISPUTES - MANDATORY MEDIATION AND ARBITRATION
28.1 If a dispute or difference between the parties arises out of or in connection with this
Agreement or concerning the interpretation or operation of any provision of this
Agreement (except clause 24) which cannot be settled by the parties within
fourteen (14) days, the parties agree that they must endeavour to settle the dispute or
difference by mediation before having recourse to arbitration. The mediator must be a
person agreed by the parties or failing agreement a party may request the Australian
Commercial Disputes Centre (ACDC) to appoint a mediator and the mediator will be so
appointed.
The mediator must conduct proceedings under this clause in accordance with the
Guidelines for Commercial Mediation of the ACDC. During the course of any mediation
each party must be represented by a person having authority to agree to a resolution of the
dispute.
Page35 ,96
l'f/f,,. .A
28.2 In the event that the dispute has not been settled within twenty eight (28) days or such
other period as agreed to in writing between the parties, after the appointment of the
mediator, the dispute or difference must be submitted to arbitration.
Any arbitration must be conducted by a person acceptable to the parties but if the parties
are unable to agree to the appointment of an acceptable person within fourteen ( 14) days
of one party giving the others a written nomination of a suitable person or persons, then a
party may request the President for the time being of the Institute of Arbitrators,
Australia, to appoint an arbitrator and the arbitrator will be so appointed. Any arbitration
must be undertaken in accordance with, and subject to, The lnstitute of Arbitrators
Australia Rules for the Conduct of Commercial Arbitration.
28.3 The Arbitrator or some person appointed on the Arbitrator's behalf may investigate the
Company's and State Forests' affairs and accounts so far as may be necessary to assist the
Arbitrator to determine any matter referred for arbitration. The Company and State
Forests must give the Arbitrator full access to all accounts and papers necessary for that
purpose and must afford the Arbitrator full information and assistance.
28.4 Any mediation or arbitration must be held in Sydney, NSW and either party may be
represented by a legal practitioner.
28.5 Nothing in this clause 28 shall prejudice the right of the party to seek urgent injunctive or
declaratory relief in a Court in respect of any matter arising under this Agreement.
28.6 In so far as the provisions of this clause 28 apply to clauses 17 and 18, the issue for
consideration by any arbitration or litigation is to be limited to whether the Delivered
Price, the Stumpage Price, the Delivery Charge, or the mechanism set out in Schedule 7
(as the case may be) in dispute (the "Disputed Item"), was a reasonable one considering
the factors and principles set out in those clauses to be taken into account in determining
the Disputed Item and, otherwise met the requirements for the Dispute Item set out in that
clause.
28.7 If an arbitration or litigation regarding a Disputed Item determines that State Forests
determination of a Disputed Item was unreasonable or did not comply with the
requirements for the Disputed Item set out in those clauses, then State Forests must:
28.7.1
28.7.2
promptly re-determine the disputed Delivered Price, Stumpage Price or other
such Disputed Item which will then apply from the first date the Disputed Item
was originally intended to apply; and
refund to the Company any over payment made under the Disputed Item with
interest calculated pursuant to clause 35.
29. ASSIGNMENT
29.1 The Company may not without the prior approval of the Minister assign its rights and
entitlements under this Agreement in whole or part to any person.
29.2 If the Company is a corporation, any change in control of the Company (or if the
Company is a subsidiary, any change in control of its holding company) will be deemed
to be an assignment of the Company's rights and entitlements under this Agreement. For
the purpose of this Clause •change in control' means control of more than 50% of the
shares with the right to vote in general meetings of the corporation.
29.3 If the Company wishes to assign the whole or any part of this Agreement it must make a
written application to State Forests requesting an assignment and must provide all details
and information concerning the assignee and the effect of the assignment as may be
reasonably required by State Forests.
29.4 The Company must pay all debts due and payable to State Forests under this Agreement
before any assignment (in whole or part) of this Agreement.
29.5 Upon receipt of any request for an assignment of the whole or any part of this Agreement,
State Forests must process the application in accordance with clause 30 provided the
Company has supplied any details and information required by State Forests under
clause 29.3.
29.6 The Company must ensure that any assignee executes all agreements and other documents
which State Forests may reasonably require to record or effect any assignment including
an undertaking to remedy or rectify any existing material breach.
30. MINISTER'S APPROVAL FOR AN ASSIGNMENT
30.1 State Forests must consider any application requesting an assignment of the whole or part
of this Agreement and recommend to the Minister the action that the Minister should take
on the application. The Minister will have regard to any recommendation of State Forests
but is not bound by any recommendation.
30.2 The Minister may determine an application requesting an assignment of the whole or part
of this Agreement by granting the application (either unconditionally or subject to
conditions of the kind set out in clause 30.3) or by refusing the application. An
application may only be refused on the following grounds:
30.2.1
30.2.2
30.2.3
30.2.4
the Company fails to satisfy such value added criteria as have been adopted by
the Minister;
such grounds as may be prescribed by regulations under the Act; or
such grounds as the Minister considers relevant having regard to the need to
promote a competitive timber industry and to prevent misuse of market power.
At the time the application is made the Company has committed a material
breach which has not been remedied or rectified including without limitation
any failure to make.payment to State Forests as required under clause 20 of this
Agreement.
30.3 The Minister may impose (without limitation) the following kinds of conditions on an
application requesting an assignment of the whole or part of this Agreement:
30.3.1
30.3.2
a condition requiring the Company or any assignee to take action to comply
with or satisfy value added criteria as have been adopted by the Minister;
a condition requiring the Company or any assignee to prepare, and submit to
the Minister, a business plan ('designated business plan') setting out the
Company's or any assignee's policies, practices and procedures for the
implementation or maintenance of any value added criteria;
Page 38
~ Aft,.~
30.3.3
30.3.4
a condition requiring the Company or any assignee to furnish to the Minister (at
the times and for the periods as the Minister may decide) information the
Minister may require to enable the Minister to determine whether or not the
Company or the assignee has satisfied or is complying with any value added
criteria or is conducting its business in accordance with a designated business
plan; and
in the event the Company has committed a material breach which has not been
remedied or rectified including without limitation any failure to make payment
to State Forests as required under clause 20 of this Agreement, a condition
requiring any assignee to undertake the rectification or remediation of the
material breach including the payment in full of any accrued debts due and
owing to State Forests.
31. VALUE ADDED PERFORMANCE
31.1 The Company must during the Term meet the value added criteria for the forestry
industry as have been adopted by the Minister from time to time and of which the
Company has received reasonable notice in order to meet the value added criteria. For
the purpose of this clause 31 notice of the value added criteria includes notice of any
guidelines issued on the Minister's behalf indicative of the type of value added criteria the
Minister is proposing to adopt.
31.2 The Company acknowledges that any strategic plan developed by the hardwood
sawmilling industry in NSW in conjunction with State Forests and the Forest Products
Association ofNSW during the Term, is likely to contain an over-riding aim to
continually improve the profitability of the hardwood industry in NSW. The Company
acknowledges that one of the means by which this may occur is by ensuring that quality
standards for the production and marketing of sawn hardwood products are developed and
adhered to by the hardwood sawmilling industry in NSW.
31.3 In accordance with the acknowledgments referred to in clause 31.2, the Company must
ensure in relation to sawn timber produced from Timber taken under this Agreement
(Timber Products) for do~estic markets:
31.3.1 that where required by the purchaser the Timber Products meet the relevant
requirements, including tolerances, specified in the relevant part(s) of
Australian Standard, Timber - Hardwood - Sawn and Milled Products, (AS
2796 Parts 1, 2 & 3) or Australian Standard, Timber-Hardwood-Visually Stress
Graded for Structural Purposes (AS 2082) as the case may be;
31.3 .2 that where the Timber Product is sold as conforming to a specified description
or standard, the Timber Product conforms to that description or standard; and
31.3.3 that otherwise the marketing (including delivery, presentation, promotion,
provision of services and pricing) of the Timber Products does not, in the
reasonable opinion of State Forests, bring the standing and value of sawn
hardwood products produced in NSW into disrepute.
31.4 The Company must consult with State Forests regarding the marketing (including
delivery, presentation, promotion, provision of services and pricing) of Timber Products
intended for international markets.
31.5 The Company agrees to work cooperatively with State Forests to continually identify and
investigate reasonable processing, networking and/or market development opportunities
that will increase the average value of Timber Products.
31.6 If requested by State Forests at any time during the Term, the Company must submit to
State Forests all records, information and data necessary to enable State Forests to assess
whether the Company has satisfied the value added criteria as have been adopted by the
Minister or its other obligations under this clause 31. The Company must afford State
Forests all reasonable assistance and must provide all further details as may be reasonably
required by State Forests.
32. CHARGING THIS AGREEMENT
32.1 The Company must not mortgage, charge or encumber this Agreement or any part thereof
including without limitation the proceeds of its sale, or any of the monies payable or to
become payable to State Forests under this Agreement, without the consent in writing of
State Forests, which subject to clause 32.2 may withhold consent in its absolute
discretion.
32.2 State Forests may not withhold its consent if the person ("the mortgagee") taking a
mortgage, charge or other encumbrance over this Agreement executes a Deed
acknowledging and agreeing that State Forests has a pre existing right to any money due
to State Forests under this Agreement which has not been paid by the Company and that
those monies must be paid prior to the mortgagee exerdsing any of its rights under its
mortgage, charge or other security in respect of this Agreement.
32.3 The Company must as soon as practicable after execution of this Agreement register this
Agreement on the Company's register of charges and must maintain the registration until
State Forests consents in writing to its removal.
33. VARIATION
33.1 This Agreement comprises the entire understanding of the parties.
33.2 None of the provisions of this Agreement may be varied, waived, discharged or released
either at law or in equity, unless by the express consent of the parties in writing.
34. INTEREST
34.1 In the event that the Company fails to pay any money due to State Forests when required
to do so by this Agreement, interest will accrue on all unpaid money from the date of
default until payment in full at the rate of interest per annum for the time being payable
under Schedule J of the Supreme Court Rules (NSW).
35. NOTICE
35.1 Any notice required to be served under this Agreement may be served at the address
specified for the party specified in Schedule 8.
Page 41
~ ~. v1'
35.2 The parties may change the address for service of notice from time to time by notice in
writing to the other party.
36. GOVERNING LAW
36.1 This Agreement is governed by the laws of New South Wales and the parties agree to the
jurisdiction of the Courts of New South Wales.
37. SEVERABILITY
3 7 .1 If any provisions of this Agreement are held to be invalid, illegal or unenforceable by a
Court or other tribunal of competent jurisdiction, the validity, legality and enforceability
of the remaining provisions will not in any way be affected or impaired thereby.
38. GENERAL
38.1 A party terminating this Agreement as a result of a failure or default of the other party
may only claim damages for any loss resulting from the failure or default if the claim for
damages is not excluded under this Agreement.
39. CONFIDENTIALITY
39.1 No party will disclose the contents or terms of this Agreement or any information or
documents received by it in connection with the negotiation of this Agreement or
pursuant to the provisions of this Agreement without the prior written consent of the other
parties, except to the extent that:
3 9 .1.1 the information is available to the public generally;
39.1.2 that party is required to make the disclosure by law or to make any filing,
recording or registration required by law;
3 9 .1.3 the disclosure is necessary or advisable for the purpose of obtaining any
consent, authorisation, approval or licence from any public body or authority;
39.1.4 it is necessary or expedient that the disclosure be made to any taxation or fiscal
authority;
39. l.5
39.1.6
the disclosure is made on a confidential basis to the professional advisers of
that party (including any industry association) for the purpose of obtaining
advice in relation to this Agreement or the enforcement of this Agreement or
otherwise for the purpose of consulting those professional advisers; or
the disclosure is required or desirable to be made in pursuance of any procedure
for discovery of documents and any proceedings before any court, tribunal or
regulatory body.
Page 43
~r
IN WITNESS whereof the parties hereto have executed this Agreement as a deed the day and
year first hereinbefore written.
I, ROBERT PATRICK SMITH the Commissioner for Forests have hereunto affixed the Seal of the FORESTRY COMMISSION OF NEW SOUTH WALES
) ) ) ) ) )
THE COMMON SEAL of ROMNEY ) PARK SAWMILL PTY LIMITED ) was hereunto affixed in accordance ) with its Articles of Association in the ) presence of: )
Secretary
SIGNED SEALED AND DELIVERED by THE HONOURABLE KIMBERLEY MAXWELL YEADON Minister for Forestry ) in and for the State of New South Wales for and on behalf of the Crown (but not so as to incur personal liability) in the ) presence of:
Page 44
~
Schedule 1
SPECIFICATIONS
Hardwood timber which contributes to the Total Allocations as set out in Schedule 2 being the combination of Allocations A and B.
Hardwood Quota Sawlogs and Hardwood Small Sawlogs:
SPECIES:
All species of the genera Eucalyptus, Corymbia, and Syncarpia suitable for sawmilling and meeting the specifications for size and defect set out hereunder:
LOG SPECIFICATION:
Species identified above having a minimum size and quality specifications as set out in the Compulsory Utilisation Schedule Attached.
Hardwood Quota Saw logs - Saw logs meeting the above specifications with a centre diameter underbark (cdub) equal to or greater than 40cm.
Hardwood Small Saw logs- Sawlogs meeting the above specifications with a centre diameter underbark (cdub) less than 40cm.
QUALITY:
The measurement of defect for the purpose of calculating the maximum defect percent will be in accord with the hardwood Log Measurement Manual as approved by State Forests.
COMPULSORY UTILISATION SCHEDULE FOR HARDWOOD SA WLOGS ON CROWN TIMBER LANDS
WITHIN NOWRA, BATEMANS BAY, NAROOMA, BADJA and QUEANBEY AN MANAGEMENT AREAS
GROSS LOG DIMENSIONS
Minimum Log Length (logs cdub > = 40 cm) Minimum Log Length (Logs cdub < 40 cm) Minimum cdub Minimum Toe Diameter (under bark)
- 2.4 metres - 3.0 metres - 30 cm -25 cm
- 24 4 23 92 58 62 26 6 25 94 60 62 28 8 28 96 62 62 30 10 31 98 64 62
100 64 63 32 12 34 102 66 63 34 14 37 104 68 63 36 16 40 106 68 63 38 18 42 108 70 63 40 20 44 110 72 64
42 22 46 112 74 64 44 22 47 114 74 64 46 24 48 116 76 64 48 26 50 118 78 64 50 28 52 120 80 64
52 30 52 122 80 64 54 30 53 124 82 64 56 32 54 126 84 64 58 34 55 128 84 64 60 36 56 130 86 65
62 38 56 132 88 65 64 38 57 134 90 65 66 40 57 136 90 65 68 42 58 138 92 65 70 42 58 140 94 65
72 44 58 142 94 65 74 46 59 144 96 65 76 48 59 146 98 65 78 48 59 148 JOO 65 80 50 60 150 JOO 65
82 52 60 152 102 65 84 54 61 154 104 65 86 54 61 156 104 65 88 56 62 158 106 65 90 58 62 160 108 65
180 122 65
Schedule 2
ALLOCATIONS
ALLOCATION A - HARDWOOD QUOTA SAWLOGS- FIXED VOLUME
a) Year ending 30 June 2003 and Year commencing 1 July 2020: b) In every other Year:
Quota Sawlogs Quota Sawlogs
ALLOCATION B - HARDWOOD SMALL SAWLOGS- FIXED VOLUME
a) Year ending 30 June 2003 and Year commencing I July 2020: b) In every other Year:
Small Sawlogs Small Sawlogs
2,74JmJ 5,486m3
20Qm3
4QQm3
Schedule 3
PLAN OF AREA OF SUPPLY
South Coast Region Area of Supply
\
Narooma
10
/! -, ---.., (
i- ,I 'la ,_ ' (
YIRAIY (, l ";, , '-.~
·,~
c:s .,.
,
-~ ,
··?( :Jr
N
A CJ State Forest• South Coast
National Parks and Nature Reserves
Major Roads
0 10 20 30 Kilometers
.. ·. · .
Schedule 4
CODES OF PRACTICE/PROCEDURE
BETWEEN
FORESTRY COMMISSION OF NEW SOUTH WALES (TRADING AS STATE FORESTS OF NSW]
AND
ROMNEY PARKSAWMILLPTYLTD
FOR
SALE OF HARDWOOD SA WLOGS BY GROSS VOLUME MEASUREMENT FROM WITHIN SOUTHERN REGIONS
Edition 2 ~ July 19-99 • . ·
1. Delivery Dockets shall be the basis of accounts for logs obtained from Crown Timber Lands.
2. Delivery Dockets shall be in a fonn approved by State Forests:
la] Delivery Docket Books shall be printed generally in triplicate with fifty dockets in each book which shall be sequentially numbered and will be accountable.
lb) The original of each docket is State Forests copy and the triplicate copy must be retained in the book.
3. Supply of Delivery Docket Books shall be arranged by the Company subject to the provisions of 2 above. A separate Docket Book shall be used for Crown and Private· Property operations.
4. Where a Delivery Docket Book for Crown operations is issued by the Company to a Contractor:
(a] The Company shall immediately submit to the Regional Manager, South Coast a "Delivery Docket Issue Advice", stationery for which shall be provided by State Forests.
(b] The Company shall maintain a Tally Sequence Control, in the fonn approved by State Forests and shall forward the originals of all control documents to the Regional Manager upon completion of each Delivery Docket Book.
fc) In the event of individual dockets or unused or partly used docket books being misplaced, cancelled, mutilated or otherwise destroyed, the Company shall immediately submit a declaration to the Regional Manager with a certification as to the number of the folios involved and details of any infonnation contained therein.
d] When an issued Delivery Docket Book is not used during any monthly accounting period the Company shall submit to the Regional Manager a Delivery Docket indicating a nil return within seven days of the close of the month.
5. For routine quota operations:
raJ The Company shall accept logs assessed by State Forests as being within the size and defect limits tabulated in the relevant Compulsory Utilisation Schedule [refer attached].
rhJ Logs that are outside of the limits of Clause 5 [a] shall be available to the Company as specifically identified and requested by the Company's representative. Such logs shall be identified at the dump and marked by a State Forests Officer with a numbered FC hammer and the symbol "Z" in blue lumber crayon or paint prior to loading and despatch to the sawmill.
Logs set aside by contractors as potential Z logs, but which on inspection by State Forests supervisor are determined to be compulsory quality shall also be hammered as an acknowledgment of inspection having been undertaken, and the brand highlighted with a blue dot, but they shall not be marked with a blue "2'.
6. The length and centre diameter under bark of all logs shall be measured and hammered on each log by a person designated by the Company and species symbol chalked in blue lumber crayon. The designated person will then number each log with a sequential log number from a block of numbers allocated by the Company following approval from the Regional Manager.
7. Truck drivers shall only load logs which have been numbered and branded as in Clause 5 [b] and 6.
8. A Truck Delivery Docket is to be commenced for each new load. If more than 28 logs, two dockets are to be used for that load. The integrity of each load shall be maintained and a docket shall not contain logs from more than one load or fl-om more than one compartment, except in the case ofroadline salvage, bush clean up, or otherwise as approved by the Regional Manager.
9. The following information shall be entered on the Delivery Docket and signed by the truck driver before leaving the loading point:
• Destination of Load; After "Mill·Yard" insert name of sawmill
• Number of Dockets used per load
• Vehicle Registration Number
• Time and Date of Departure
• Management Area:
Compartment or Logging Number; or
Portion, Parish, County
• Log Number
• Log Length
• Log Diameter [c.d.u.b.]
• Species Symbol as per State Forests approved symbols
• A royalty group symbol against each log as follows:
For routine quota operations:
Q All Graded logs designated under 5 [a]
Z Salvage Grade logs designated under 5 [b]
For single rate parcel sales:
p
• Driver's Declaration [name and signature]
10. In cases of errors in recording, mistakes shall be crossed out and the correct figure[s] written on the next line and the corrections initialled by the driver.
I l. Once the loaded truck leaves the loading point, Delivery Dockets shall not be altered under any circumstances.
12. As each load of logs arrives at the mill the relevant Delivery Docket shall be signed by the Company or a representative, and the original retained by the Company for forwarding to the Regional Manager.
13. The original of each Delivery Docket utilised up to and including Wednesday of each week shall be forwarded with the appropriate Advice of Despatch to reach the Regional Manager not later than the Friday of that week. [n the week in which the last day of the month occurs, the day of despatch should be the first day of the next month.
14. State Forests Officers shall from time to time undertake checks of Delivery Dockets for correctness and completeness and will also effect check•measurement of log dimensions either at the loading point, en route to the sawmill, or in the mill yard. Where such check is undertaken the dockets shall be signed and noted with the time and date by the checking officer.
A record shall be kept at Forestry Offices of such checks and shall be available to the Company if required.
15. State Forests may also undertake random observation checks of the registration number of trucks loaded with logs for reconciliation with submitted delivery dockets .
The Forestry Commission of New South Wales am/ Romney Park Sawmill Pty Ltd as shown i11 title hereby agree to this Code of Procedure.
For 011d on behalf of Forestry Commission of NSW
Date:
For and on behalf of Romney Park Sawmill Pty Ltd
Date: ----------
S ies Mountain Gum Fastigata Monkey Gum Messmate Peppermint Shining Gum Sitvertop Ash Viminalis White Ash
s ecies Blackbutt Blue Gum Blueteaf Stringybarl< Bloodwood Fastigata Grey Box lronbarl< Monkey Gum Messmate Peppennint Forest Red Gum Red Mahogany Spotted Gum Silvertop Ash Turpentine Woollybutt White Stringybark Yellow Sirin bark
Batemans Ba
Blackbutt Blue Gum Blueleal Slringybark Bloodwood lronbark Peppermint Rad Mahogany Spotted Gum Silvartop Ash Turpentine Woolybutt White Stringybark Yellow Strin bark
Schedule 5
SOUTH COAST REGION Log Value Pricing Schedule ($/m3)
from 1 October 2002
Batemans Ba Outer Coastal Price Zone
S cies Blackbutt Blue Gum Blue Leaf Stringybark
Bloodwood Hardwood lronbark Monkey Gum Messmate Peppermint Red Mahogany
Spotted Gum Silvertop Ash Turpentine Woollybull White Stringybark Yellow Sirin bark
s les Blackbutt
Grey Box Hardwood lronbark Maidens Gum
Monkey Gum Messmate Peppermint Forest Redgum Smoothbark Apple Spotted Gum Silvertop Ash Woollybutt White Stringybark Yellow Sirin bark
Blue Leaf Stringybark Fastigata Grey Box Hardwood lronbark Maidens Gum Monkey Gum Messmate Peppermint Forest Redgum
Silvertop Ash While Ash
Species Blackbutt Blue Gum Blue Leal Stringybark Bloodwood Fastigata Grey Gum rronbark Monkey Gum Messmate Peppennint Whitetop Box Red Mahogany ScribblyGum Spotted Gum Silvertop Ash Turpentine Woollybutt White Shingybark Yellow Sirin bark
S ecles Mountain Gum Fastigala Hardwood Monkey Gum Messmate Peppermint Shining Gum Silvertop Ash Viminalis While Ash
Delivery Hours: Delivery Sites:
Schedule 6
DELIVERY DETAILS
7:00am to 5:00pm Milton NSW
Schedule 7
REVIEW OF DELIVERY CHARGE
Review of Delivery Charges
Part I Definitions and interpretation
In this Schedule unless the context indicates to the contrary:
Cost Item means a factor relevant to the cost of Contract Harvesting more particularly being any item set out in column I of Part 3;
Base Indicator Rate for a review means the Indicator Rate which was the Current Indicator Rate for the previous review except in the case of the first review where it means the Indicator Rate for the particular Indicator which applied 12 months before the date of the review;
Current Indicator Rate means the Indicator Rate at the time a review of the Delivery Charge is being conducted;
Indicator means an Indicator of a Cost Item more particularly being any Indicator set out in column 2 of Part 3;
Indicator Rate means the value or status ofan Indicator at a point in time;
Indicator Weighting means the weighting given to a Indicator for the purpose of calculating the weighted movement across all Indicators during a review more particularly being the weighting set out in column 4 of Part 3;
A reference to Part 3 means a reference to Part 3 of this Schedule as amended from time to time in accordance with this Agreement.
Part 2 Methodology
The following describes the method of assessing the variation in the cost of conducting Contract Harvesting over the relevant review period:
1. The infonnation set out in column 4 Part 2 Indicators and Weightings are the base figures to be applied in the first review of the Contract Harvesting Cost. The base figures for columns 3 and 4 in subsequent reviews are to be established in accordance with clauses 2 and 6 respectively
2. Ascertain the level of each indicator in column 2 of Part 2, expressed in dollars and cents, percentage or as an index (as the case may be) current at the time of the review (the Current Indicator Rate). The Current Indicator Rate will be the Base Indicator Rate for the next review.
3. Ascertain the movement in each Indicator during the relevant review period by establishing percentage increase (or decrease) in the Indicator Rate (by comparing the Current Indicator Rate (see clause 2) to the Base Indicator Rate (see definition) and applying any weighting specified in column 2 to that percentage change. An example of the methodology is shown in the example below: ► assume movement in harvesting wages Indicator Rate is from $500 (Base Indicator Rate) to $520
(Current Indicator Rate) ► harvesting wages Indicator Rate change is therefore + 4% ► weighting for harvesting wages is 90% (from column 2 of Part 2) ► 90% of+ 4% is + 3.6%.
Therefore +3.6 percent is the movement in the harvesting wages Indicator.
4. Calculate the weighted movement across all Indicators by applying the methodology below:
(a) multiply the movement in each Indicator (see clause 3) by the Indicator Weighting in column 4 of Part 2 (eg, the+ 3.6% for harvesting wages from clause 3 above is multiplied by the relevant weighting for harvesting wages, ie 10%, with the product being .36%)
(b) the sum of the products of each calculation referred to in clause 4(a) is the weighted movement across all Indicators.
5. The weighted movement across all Indicators calculated in accordance with clause 4 is the variation in the cost of conducting Contract Harvesting over the relevant review period for the purposes of this Agreement. The new Delivery Charge determined under this review mechanism is calculated by applying the weighted movement across all Indicators (from clause 4 above) to the current Delivery Charge as per the methodology in the example below: ► assume the weighted movement across all Indicators is +2.5%, and the existing Delivery Charge is
$25.00; ► the new Delivery Charge is $25.00 x 1.025 which equals $25.62.
6. For the purposes of the next Delivery Charge review ascertain new column 4 Part 2 Indicator Weightings for each Indicator by multiplying the then current column 4 Part 2 Weighting for each Indicator by the period movement in the relevant Indicator (see clause 3 above) and then dividing the result by the weighted movement across all Indicators (see clause 4 above). This will produce a new table of Indicator Weightings which sum to 100 percent. For example: ► assume harvesting wages movement (see clause 3 above) is +3.6%, the weighted movement across all
indicators is+ 2%, and the weighting for harvesting wages (from column 4 of Part 2) is 10%; ► then the new weighting for harvesting wages is calculated by the formula: ► 10% X 1.036 / 1.02 which equals 10.16%
Part 3 Indicators and Weightings
Column I Column 2 Column 3 Column 4
Cost Item Indicator Indicator Rate at I Weighting at 1 July
July 2001 2001
Item I : Logistics Harvesting Wages (inc R & M wages): 90% of the movement in base wage for a Timber and 27.00%
Wages Allied Industries Award 1999 Level 5 operator
Haulage Wages (inc R & M wages): 90% of the movement in the base wage for a Transport
13.00% Industry Interim (State) A ward - Transport
Worker Grade 7 Workers Compensation: l00% of the legislated movement in the applicable WorkCover NSW 6.00%
rate for native forest harvestin~ Superannuation: 100% of the legislated
movement in the employer superannuation 2.00% contribution rate
Item 2: Logistics I 00% of the movement in the Shell Wholesale List Price for diesel 500 in NSW
Fuel
Base Price* Plus Federal Excise
Less 30% of the Diesel Fuel Rebate Less 70% of the On Road Grant
Net Price 13.00% Item 3: Logistics
Parts: IO0% of the movement in the ABS Repairs and
Transportation vehicle parts index 5.00%
Maintenance Tyres: 100% of the movement in the Retail List Price ofa Goodyear G286 I IR22.5 radial truck 4.00%
tyre
Item 4: Logistics 90% of the movement in the ABS Consumer
Administration and Price Index for 8 capital cities
10.00% Overheads
Item 5: Logistics capital related items
No adjustment 20.00% (depreciation and
interest)
Total 100.00%
The Company:
State Forests of NSW:
Schedule 8
ADDRESS FOR SERVICE
The Manager Romney Park Sawmill Pty Ltd PO Box 20 MIL TON NSW 2538
General Manager Marketing Division State Forests of NSW Locked Bag 23 PENNANT HILLS NSW 2120
/
