PT INDOCEMENT TUNGGAL PRAKARSA Tbk. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Three Months ended March 31, 2005 and 2004 Expressed in rupiah, unless otherwise stated
41
21. TRANSACTIONS AND ACCOUNTS WITH RELATED PARTIES continued
Nature of relationship and type of transaction with the above related parties are as follows: No.
Related Parties Nature of Relationship
Type of Transaction 1. HCT Services Asia Pte., Ltd.,
Under Common Control Sale of finished goods and purchase of Singapore
raw materials 2. HC Finance B.V., Netherlands
Under Common Control Long-term debt 3. PT Cibinong Center Industrial Estate Associated Company
Rental of industrial estate and sale of water and electricity
4. Stillwater Shipping Corporation Associated Company
Transportation 5. PT Pama Indo Mining
Associated Company Mining service
6. WestLB AG, Tokyo Affiliated Company
Long-term debt 7. WestLB Asia Pacific Ltd., Singapore Affiliated Company
Long-term debt 8. Officers and employees
Employees Loan
22. SIGNIFICANT AGREEMENTS, COMMITMENTS AND CONTINGENCIES
a. On November 30, 2004, the Company entered into two contracts for the supply of Retrofit and automated laboratory system autolab, and the supply of services for erection supervision and
commissioning of autolab with ABB Switzerland Ltd. contractor. Based on these contracts, the contractor agreed to supply the equipment for the installation of the Company’s autolab and to
provide the supervision of the erection and commissioning of all parts of equipment purchased from the contractor. The total value of these contracts amounted to EUR1,510,000.
b. In June 2004, a group of fishermen in Rampa Village, Kotabaru, South Kalimantan, blockaded the Company’s jetty in Tarjun in protest for the loss of their livelihood due to the illegal dumping of
dredging materials. Based on the claims submitted to the Company, the fisherman alleged that the Company illegally dumped materials outside the approved dumping locations which resulted in
damage to their fishing equipment and the decrease in their catch. Accordingly, the Company has tried to pass on the claim to PT Boskalis International Indonesia
Boskalis, the contractor appointed by the Company to dredge the jetty for its alleged misconduct and improper dumping of dredging materials beyond the approved dumping location.
A fact-finding committee consisting of representatives from the Company, the association of fishermen and other related parties has been established to investigate the claim that Boskalis has
dumped the dredging materials beyond the approved dumping location. Also, according to the management, the Company has sent two warning letters to Boskalis due to its failure to fulfill the
“Safety, Security and Protection of Environment” clause as stated under the Contract Dredging of Berthing Pocket and Turning Basin Tarjun Port Facility. Thus, the management believes that the
claims and all costs, if any, of moving the dredging materials to the designated dumping site, should be borne by Boskalis. As of March 31, 2005, the Company was not able to determine the estimated
liability that would be borne by the Company.
c. On June 9, 2004, the Company entered into a “Prototype Carbon Fund Emission Reductions Purchase Agreement” Agreement with the International Bank for Reconstruction and
Development, in its capacity as a trustee “Trustee” of the Prototype Carbon Fund PCF. The PCF is a World Bank-administered fund representing six 6 governments and seventeen 17
companies.
PT INDOCEMENT TUNGGAL PRAKARSA Tbk. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Three Months ended March 31, 2005 and 2004 Expressed in rupiah, unless otherwise stated
42
22. SIGNIFICANT AGREEMENTS, COMMITMENTS AND CONTINGENCIES continued
