Common use of Optional Development Clause in Contracts

Optional Development. I. The Concessionaire shall, subject to Applicable Laws, Applicable Permits, prior written approval of the Authority, be entitled to undertake in accordance with terms herein, and at its sole risk, and cost the development, operation and maintenance of the additional beds and/ or any non-obligated specialty service(s) at the Hospital, and / or, a Medical College, and/or additional housing blocks for doctors and paramedical staffs and Students, at the Site as set forth in the Schedule A ; which Concessionaire to be developed in conformity with the Specification and Standards set forth in the Schedule B (referred in this Agreement as "Optional Development"). For avoidance of doubt, in regard to the Option al Development, the Parties hereby unconditionally agree, confirm and understand that the Concessionaire shall, subject always to terms herein and full compliance with Applicable Laws, be entitled to undertake the development of optional component of the Medical College at any time during the Concession Period. The Parties further in this regard agree that Authority shall solely for the purpose of meeting part(s) of the capital cost of the Medical College, upon written request by Concessionaire clearly demonstrating its complete compliance with Applicable Laws and terms herein, disburse (in tranches) an interest bearing (viz, highest G Sec Rate as per latest RBI published bulletin) repayable loan facility to Concessionaire of the value equivalent to lower of:- (i) 50% of the then Authority’s estimated capital cost of development of Medical College, as would be determined by Authority in its discretion; and (ii) the sum of INR 00 (Xxxxxxx Xxxx) Xxxxxx; (hereinafter the “Loan Facility”) in accordance with terms hereof; provided, that, prior to the commencement of such disbursement(s) of any tranche the Concessionaire shall furnish relevant bank guarantee(s) of value equivalent to 110% of the relevant amount being disbursed in such tranche, to be issued by a Scheduled Bank in India as per the format enclosed herein as Schedule V (“Optional Development Guarantee”)1, each having respective validity period till expiry of corresponding repayment timeline as set out later at S. No (III) below. II. The Concessionaire shall prior to undertaking the commencement of development of Medical College in accordance with this Agreement prepare, submit and procure approval of Independent Engineer on the detailed project report (DPR) prepared in respect of development of the Medical College; such DPR shall also incorporate and take into account the following disbursement schedule : the Loan Facility shall be disbursed 1 For the avoidance of doubt, Concessionaire shall be obligated to provide a separate bank guarantee against each tranche of payment of the Loan Facility with each bank guarantee having separate validity period. in five equated installment upon the start of following milestones but upon completion of the immediately prior milestone as applicable, and as duly certified by Independent Engineer industry expert appointed by Authority in its sole discretion: 20% Medical College development ,40% Medical College development, 60% Medical College development, 80% Medical College development and 100% Medical College development. For avoidance of doubt, the Parties agree that all provisions of this Agreement related to inter alia inspection, tests of construction milestones and operation and maintenance mutatis mutandis apply to the construction, completion, operation and maintenance of the Medical College. It is hereby understood that each of the relevant tranches of the Loan Facility shall be deposited by the Authority in accordance with the terms hereof by way of credit to the Escrow Account upon the requisite certification by the Independent Engineer, as described herein above. III. Regardless of the status of development of Medical College but without any prejudice to Concessionaire’s obligations in relation to mandatory phases, the Concessionaire shall repay the Loan Facility (along with applicable interest as aforesaid) maximum in ten equated annual instalments starting from achievement of COD of Medical College (“COD-MC”) in accordance with terms hereof; repayment to be made on or before expiry of ten years from COD of Medical College, as per the following repayment schedule: -