Submission of Payment Security Deposit. The Distribution Franchisee shall secure the payment security deposit by providing Letter of Credit to the satisfaction of DISCOM from any nationalized bank or Scheduled Bank for an amount equivalent to two months’ estimated amount payable to DISCOM at any Bank in Bhubaneswar / Burla by Distribution Franchisee based on energy input at Input Points in Franchise Area and Input Energy Rate quoted by the Distribution Franchisee alongwith two months average collection of all other applicable charges in addition to Input charges as per Article 7 during the base year for first year of Franchisee term and subsequent year thereafter at the beginning of each year. DISCOM and Distribution Franchisee shall also sign a Default Escrow Agreement for the purpose of collateral arrangement. This payment security mechanism shall be governed as per conditions stipulated in Article-11 of this Agreement. The Xxxxxxx Money Deposit shall be refunded by DISCOM on submission of Security Deposit by the Franchisee.
Appears in 4 contracts
Samples: Distribution Franchisee Agreement, Distribution Franchisee Agreement, Distribution Franchisee Agreement
