Common use of Demand Guarantee Clause in Contracts

Demand Guarantee. 12.3.1 The Public Partner guarantees the allocation of funds for the Project Period in the amount that will allow the Private Partner to achieve the Break-Even Point in completion of Services and Operations at the end of each Operational Year (the “Demand Guarantee”). 12.3.2 The Break-Even Point shall be determined for each type of Identity Documents as 80% against the estimated volumes of the relevant Identity Documents set in Annex “Annex No. 3: Estimated services’ volumes“ of Technical Requirements (the “Target Volumes”) for the relevant Operational Year. 12.3.3 If the Private Partner does not achieve the Break-Even Point at the end of the Operational Year for all or some types of Identity Documents, the Public Partner shall make payments to the Private Partner to reach the Break-Even Point (the “Demand Guarantee Payments”), which shall be determined as follows: ∑DGPn = ((TVn x 0,8) - Vn) x PID, where DGPn – Demand Guarantee Payments for the relevant type of Identity Documents, TVn – the Target Volume of the relevant type of Identity Documents (as per Annex 3 of Technical Requirements) for the relevant Operational Year, Vn – the number of the relevant type of Identity Documents produced by the Private Partner in the Operational Year. PID – the price (in AMD) of the relevant type of Identity Documents (as per the Winner’s Bid and ANNEX 2 (Prices for Identity Documents) of the Agreement) produced by the Private Partner in a month of the Operational Year. 12.3.4 The total amount of the Demand Guarantee Payments for the Project Period shall be [the fixed amount to be added]. This total amount shall not be subject to any increase. 12.3.5 In each case the Demand Guarantee Payments are due, the Private Partner shall provide to the Public Partner 12.3.5.1 the written calculation of Demand Guarantee Payments for each type of Identity Documents and the full amount of all Demand Guarantee Payments in accordance with Clause 12.3.3; 12.3.5.2 the requested compensation for the relevant Operational Year. 12.3.6 The Public Partner shall ensure the transfer of the corresponding amount of the Demand Guarantee Payments in AMD to the bank account of the Private Partner by: 12.3.6.1 approving the allocation of the corresponding amount of the Demand Guarantee Payments from the Escrow Account within available amounts accumulated at the Escrow Account; and 12.3.6.2 allocating the outstanding debt under the Demand Guarantee Payments directly from the state budget if the amount of the Demand Guarantee Payments allocated from the Escrow Account under Clause 12.3.6.1 is not enough to fulfill the obligations on Demand Guarantee Payments in full. 12.3.7 The Public Partner shall transfer the corresponding amount of the Demand Guarantee Payments to the bank account of the Private Partner not later than the thirtieth (30th) of the first month of the Operational Year following the Operational Year for which the Demand Guarantee Payments are made (the "Demand Guarantee Payments Date"). In case of changes in the Private Partner’s account details for the Demand Guarantee Payments, the Private Partner shall notify the Public Partner about such changes no later than ten (10) Business Days prior to the Demand Guarantee Payments Date. 12.3.8 The Public Partner shall provide the Private Partner with the documents confirming the payment of the Demand Guarantee Payments on the date of the payment or no later than two (2) Business Days after payment of the Demand Guarantee Payments. 12.3.9 In case the Private Partner has exceeded the Target Volume of the relevant type of Identity Documents in relevant Operational Year the Public Partner shall be entitled to set off any payments to the Private Partner against the previously allocated Demand Guarantee Payments for such type of Identity Documents in accordance with Clause 12.4.

Demand Guarantee. 12.3.1 The Public Partner guarantees the allocation of funds for the Project Period in the amount that will allow the Private Partner to achieve the Break-Even Point in completion of Services and Operations at the end of each Operational Year (the “Demand Guarantee”). 12.3.2 The Break-Even Point shall be determined for each type of Identity Documents as 80% against the estimated volumes of the relevant Identity Documents set in Annex “Annex No. 3: Estimated services’ volumes“ ” of Technical Requirements (the “Target Volumes”) for the relevant Operational Year. 12.3.3 If the Private Partner does not achieve the Break-Even Point at the end of the Operational Year for all or some types of Identity Documents, the Public Partner shall make payments to the Private Partner to reach the Break-Even Point (the “Demand Guarantee Payments”), which shall be determined as follows: ∑DGPn = ((TVn x 0,8) - Vn) x PID, where DGPn – Demand Guarantee Payments for the relevant type of Identity Documents, TVn – the Target Volume of the relevant type of Identity Documents (as per Annex 3 of Technical Requirements) for the relevant Operational Year, Vn – the number of the relevant type of Identity Documents produced by the Private Partner in the Operational Year. PID – the price (in AMD) of the relevant type of Identity Documents (as per the Winner’s Bid and ANNEX 2 (Prices for Identity Documents) of the Agreement) produced by the Private Partner in a month of the Operational Year. 12.3.4 The total amount of the Demand Guarantee Payments for the Project Period shall be [the fixed amount to be added]. This total amount shall not be subject to any increase. 12.3.5 In each case the Demand Guarantee Payments are due, the Private Partner shall provide to the Public Partner 12.3.5.1 the written calculation of Demand Guarantee Payments for each type of Identity Documents and the full amount of all Demand Guarantee Payments in accordance with Clause 12.3.3; 12.3.5.2 the requested compensation for the relevant Operational Year. 12.3.6 The Public Partner shall ensure the transfer of the corresponding amount of the Demand Guarantee Payments in AMD to the bank account of the Private Partner by: 12.3.6.1 approving the allocation of the corresponding amount of the Demand Guarantee Payments from the Escrow Account within available amounts accumulated at the Escrow Account; and 12.3.6.2 allocating the outstanding debt under the Demand Guarantee Payments directly from the state budget if the amount of the Demand Guarantee Payments allocated from the Escrow Account under Clause 12.3.6.1 is not enough to fulfill the obligations on Demand Guarantee Payments in full. 12.3.7 The Public Partner shall transfer the corresponding amount of the Demand Guarantee Payments to the bank account of the Private Partner not later than the thirtieth (30th) of the first month of the Operational Year following the Operational Year for which the Demand Guarantee Payments are made (the "Demand Guarantee Payments Date"). In case of changes in the Private Partner’s account details for the Demand Guarantee Payments, the Private Partner shall notify the Public Partner about such changes no later than ten (10) Business Days prior to the Demand Guarantee Payments Date. 12.3.8 The Public Partner shall provide the Private Partner with the documents confirming the payment of the Demand Guarantee Payments on the date of the payment or no later than two (2) Business Days after payment of the Demand Guarantee Payments. 12.3.9 In case the Private Partner has exceeded the Target Volume of the relevant type of Identity Documents in relevant Operational Year the Public Partner shall be entitled to set off any payments to the Private Partner against the previously allocated Demand Guarantee Payments for such type of Identity Documents in accordance with Clause 12.4.