2.6 Prime Acquisition Contractor(s) Real Price Increases and Capital Equipment Quantities Required

Prime Contractor(s)

Price (Base) at

Equipment

Quantities at

Signature

30 Jun 09

Signature

30 Jun 09

Thales Australia

898.6

1,039.3

Upgraded Ships and concurrent refit

6

4

Ships Sets

6

6

Team Trainer

1

1

Warfare Systems Support Centre

1

1

Buildings 66, 67 and 80

3

3

Upgrade Software

1

1

Spares

0

(1)

Operator Training

2

4

Operator Trainer

0

3

Underwater Warfare System Recorder

0

1

Explanation

The original contract was structured requiring price increases to be agreed at the time for each ships major refit concurrent with Upgrade production. Contract price increases (Contract base date $) can be categorised as follows:

$59.8m (a)

$19.3m (b)

$(40.0)m (c)

$89.7m (d)

$128.8m Total

Note a. Concurrent maintenance refit HMA Ships Sydney, Melbourne, Darwin and Newcastle

Note b. Delay claims (in addition to the delay agreed under the May 2006 Deed of Settlement and release (global settlement).

Note c. $(40)m reduction for Partial Termination at Commonwealth Convenience under May 2006 Deed of Settlement and Release (global settlement).

Note d. Changes related to Commonwealth obligations for capability, capability enhancements, additional scope including spares packages and ship crew training.

Note1: $29.1 million worth of spares not originally included in the contract.