No.

Subject

Traditional contract

Alliance contract

Material difference and trade-off between traditional contract and alliance contract

15

Termination for convenience

The standard form of the Contractor does not provide the Principal with a right to terminate the contract for convenience. However, rights to terminate for convenience may be negotiated between the parties.

The Owner may at any time terminate the alliance contract by written notice to the NOPs, in which case it must make a termination payment to the NOPs which will include:

payment for work carried out until termination and entitlement to compensation;

the cost of materials reasonably ordered by the NOPs which the NOPs are legally liable to accept, but only if the materials become the property of the Owner;

the reasonable costs of demobilisation; and

the reasonable cost of complying with any directions given by the Owner upon, or subsequent to, termination.

The termination payment will not include any allowance for any losses of the type of loss of profit or anticipated profit or loss of opportunity.

Under the standard form of traditional contract, the Principal does not have a right to terminate the contract for convenience.

Under an alliance contract, the Owner may at any time terminate the alliance contract for convenience. However, in doing so, the Owner must act in good faith* and in accordance with the Alliance Charter (including by being open and transparent with the NOPs and giving the NOPs the opportunity to respond). In addition, if the Owner terminates the alliance contract for convenience, it must make a termination payment to the NOPs (however, the termination payment will not include any allowance for any losses of the type of loss of profit or anticipated profit or loss of opportunity).