Common use of Types of Financial Guarantees Clause in Contracts

Types of Financial Guarantees. The Contracted Party may provide ANP with the following types of financial guarantee of the compensatory penalty for default of the Minimum Exploration Program: letter of credit; performance bond; and Oil and Gas pledge agreement. The financial guarantees may be combined in order to total the amount guaranteed. The financial guarantees shall comply with the form indicated in the tender protocol. The financial guarantees may only be replaced or changed after approval by ANP. The amount of the financial guarantee for the Minimum Exploration Program shall be automatically subject to inflation adjustment on January 1 of each calendar year by the General Price Index – Internal Availability (IGP-DI) variation, published by Fundação Xxxxxxx Xxxxxx, of the immediately preceding year, except on the January 1 immediately following the publication of the tender protocol, in which case there shall be no adjustment. The Contracted Party shall submit the update of the financial guarantees to ANP up to January 31 of each calendar year. The annual update of the guarantee is hereby waived if the type of guarantee provided already contains a clause for automatic inflation adjustment by the IGP-DI.