Common use of Security Options Clause in Contracts

Security Options. (a) As security for the performance of its obligations under this Agreement, the Training Provider may, subject to Clause 9.1(b), elect to provide either of the following forms of security package: (i) an unconditional and irrevocable bond in the amount of ten per cent (10%) of the sum of the Base Payment and Performance Payment payable during the Initial Term, being an amount of SAR 4,859,500.00, in accordance with Clause 9.2, together with a parent company guarantee in accordance with Clause 10; or (ii) an unconditional and irrevocable bond in the amount of twenty per cent (20%) of the sum of the Base Payment and Performance Payment payable during the Initial Term, being an amount of SAR 9,719,000.00, in accordance with Clause 9.2, with no parent company guarantee. (b) The Training Provider shall be obliged to: (i) provide the form of security set out in Clause 9.1(a)(ii) if, in the opinion of the Procurer, the financial standing of the entity providing the parent company guarantee is not acceptable to the Procurer (as evidenced by the last three (3) years of audited financial accounts); or (ii) replace the form of security set out in Clause 9.1(a)(i) with the form set out in Clause 9.1(a)(ii) if, during the course of the Initial Term, the financial standing of the entity providing the parent company guarantee is reduced to a level which is not acceptable to the Procurer (as evidenced by the last three (3) years of audited financial accounts).