(BSHB) Government of Bihar SCHEDULES Grant of Lease for Commercial Development of approx. 1.70 acres of Land at L- Sector in Kankarbagh, Patna in Public Private Partnership (PPP) mode BY AND BETWEEN BIHAR STATE HOUSING BOARD AND NAME & ADDRESS OF THE SPV DEVELOPER June 2013 Development of Commercial Property at L- Sector in Kankarbagh, Patna 0
SCHEDULE - I PART A SITE DESCRIPTION AND SITE PLAN The land area for the site admeasures approx. 1.70 Acres. The location of the proposed site for commercial development lies in the south central part of Patna in Kankarbagh. The site forms part of the locality of Lohianagar. The Main Road No.2 (indicated below), Main Road No. 3 (indicated below) and two other peripheral roads of Mithapur Road and Bhoonath Road provide connectivity to the region. Provided below is a location map for the site location: The site has a frontage of over 450 ft., and a depth of over 150 ft., and bears a rectangular shape. The site is bound on all sides as discussed below: North: The site lies on the Main Road No 4, joining the Main Road No. 1 in the North and Main Road No. 3 in the east. The site has frontage on this main road. The width of the site from front is in excess of 450 ft. The Kankarbagh tempo stand and the Patna Indoor and Outdoor Stadium are situated near the site region. South: Thakurji Anukulchandra Mutt is located on the south side of the site. The Chattrapati Shivaji Park is located adjacent to this shrine on the southern side of the site. A small children s park is also located further Development of Commercial Property at L- Sector in Kankarbagh, Patna 1
south east of the site. The residential colonies of RMS Colony, Ashok Nagar Colony, and Ramakrishna Nagar are located further south. Main Road No. 3, located south west of the site, connects the site to the new bypass road. East: The eastward boundary of the site is open. There is a residential development; a multi-storied apartment complex of a local private builder; located opposite the eastern boundary. There is an internal 60 ft. wide road that runs parallel to the eastern periphery of the site. West: Abutting the western periphery of the site is a 40 ft. wide road. Presently, there are LIG residential houses situated on the west of the site. The residential agglomeration of Defence colony is located nearby. The Kankarbagh Haat area is located opposite the western corner of the site. Provided below is a representative map of the Site and its vicinity areas/surroundings: PART B SITE INVENTORY It may be noted that the Nagar Nigam Office building is located in the central part of the site. The eastern corner of the site has houses a pump house forming part of the subject site. These structures may be Development of Commercial Property at L- Sector in Kankarbagh, Patna 2
demolished by the Developer as its sole discretion and as per the requirement of the Project at its own cost. PART C SITE DIMENSIONS & LAYOUT PLAN Attached herewith is the key plan for indicative purposes only. Development of Commercial Property at L- Sector in Kankarbagh, Patna 3
SCHEDULE - II COMPLETION CERTIFICATE On the basis of certifications procured by the Developer from various relevant governmental agency including BSHB, permitting the Developer to commence utilization of the Assets and Project Utilities constructed upon the Site, We, under and in accordance with the terms of the Development Agreement dated *** (the Agreement ), for development of undertaking commercial development over a land area of approx. 17,200 Square Meters of Land at L - Sector in Kankarbagh, Patna, the undersigned hereby certifies that the Assets and Project Utilities can be safely and reliably placed in commercial service of the Users thereof on this the *** day of *** 20**. SIGNED, SEALED AND DELIVERED For and on behalf of the by: (Signature) (Name) (Designation) (Address) Development of Commercial Property at L- Sector in Kankarbagh, Patna 4
SCHEDULE III PERFORMANCE BANK GUARANTEE The Managing Director, Patna WHEREAS: (A).. (the Developer ) and the Managing Director, (the BSHB ) have entered into a Development Agreement dated.. (the Development Agreement ) whereby the BSHB has agreed to the Developer undertaking commercial development over a land area of approx. 17,200 Square Meters of Land at L - Sector in Kankarbagh, Patna, India, subject to and in accordance with the provisions of the Development Agreement. (B) The Development Agreement requires the Developer to furnish a Performance Bank Guarantee to the BSHB in a sum of Rs. 2,99,00,000/- (Two Crores Ninety Nine Lakhs only) (the Guarantee Amount ) as security for due and faithful performance of its obligations, under and in accordance with the Development Agreement, during the Construction Period (as defined in the Development Agreement). (C) We,.. through our Branch at. (the Bank ) have agreed to furnish this Bank Guarantee by way of Performance Bank Guarantee. NOW, THEREFORE, the Bank hereby, unconditionally and irrevocably, guarantees and affirms as follows: 1. The Bank hereby unconditionally and irrevocably guarantees the due and faithful performance of the Developer s obligations during the Construction Period, under and in accordance with the Development Agreement, and agrees and undertakes to pay to the BSHB, upon its mere first written demand, and without any demur, reservation, recourse, contest or protest, and without any reference to the Developer, such sum or sums upto an aggregate sum of the Guarantee Amount as the BSHB shall claim, without the BSHB being required to prove or to show grounds or reasons for its demand and/or for the sum specified therein. 2. A letter from the BSHB, under the hand of an Officer not below the rank of Managing Director in the, that the Developer has committed default in the due and faithful performance of all or any of its obligations under and in accordance with the Development Agreement shall be conclusive, final and binding on the Bank. The Bank further agrees that the BSHB shall be the sole judge as to whether the Developer is in default in due and faithful performance of its obligations during the Construction Period under the Development Agreement and its decision that the Developer is in default shall be final, and binding on the Bank, notwithstanding any differences between the BSHB and the Developer, or any dispute between them pending before any court, tribunal, arbitrators or any other authority or body, or by the discharge of the Developer for any reason whatsoever. 3. In order to give effect to this Guarantee, the BSHB shall be entitled to act as if the Bank were the principal debtor and any change in the constitution of the Developer and/or the Bank, whether by their absorption with any other body or corporation or otherwise, shall not in any way or manner affect the liability or obligation of the Bank under this Guarantee. 4. It shall not be necessary, and the Bank hereby waives any necessity, for the BSHB to proceed against the Developer before presenting to the Bank its demand under this Guarantee. 5. The BSHB shall have the liberty, without affecting in any manner the liability of the Bank under this Guarantee, to vary at any time, the terms and conditions of the Development Agreement or to extend the time or period for the compliance with, fulfillment and/ or performance of all or any of the obligations of the Developer contained in the Development Agreement or to postpone for any time, and from time to time, any of the rights and powers exercisable by the BSHB against the Developer, and either to enforce or forbear from enforcing any of the terms and conditions contained in the Development Agreement and/or the Development of Commercial Property at L- Sector in Kankarbagh, Patna 5
securities available to the BSHB, and the Bank shall not be released from its liability and obligation under these presents by any exercise by the BSHB of the liberty with reference to the matters aforesaid or by reason of time being given to the Developer or any other forbearance, indulgence, act or omission on the part of the BSHB or of any other matter or thing whatsoever which under any law relating to sureties and guarantors would but for this provision have the effect of releasing the Bank from its liability and obligation under this Guarantee and the Bank hereby waives all of its rights under any such law. 6. This Guarantee is in addition to and not in substitution of any other guarantee or security now or which may hereafter be held by the BSHB in respect of or relating to the Development Agreement or for the fulfillment, compliance and/or performance of all or any of the obligations of the Developer under the Development Agreement. 7. Notwithstanding anything contained hereinbefore, the liability of the Bank under this Guarantee is restricted to the Guarantee Amount and this Guarantee will remain in force until 6 months after the issuance of the Completion Certificate by BSHB in terms of the Development Agreement and unless a demand or claim in writing is made by the BSHB on the Bank under this Guarantee, no later than 21 days from the date of expiry of this Guarantee, all rights of the BSHB under this Guarantee shall be forfeited and the Bank shall be relieved from its liabilities hereunder. 8. The Performance Bank Guarantee shall cease to be in force and effect when the BSHB shall have issued Completion Certificate in terms of the Development Agreement, and provided the Developer is not in breach of the Development Agreement. Upon request made by the Developer for release of the Performance Bank Guarantee along with the particulars required by BSHB, the BSHB shall release the Performance Bank Guarantee forthwith. 9. The Bank undertakes not to revoke this Guarantee during its currency, except with the previous express consent of the BSHB in writing, and declares and warrants that it has the power to issue this Guarantee and the undersigned has full powers to do so on behalf of the Bank. 10. Any notice by way of request, demand or otherwise hereunder may be sent by post addressed to the Bank at its above referred Branch, which shall be deemed to have been duly authorized to receive such notice and to effect payment thereof forthwith, and if sent by post it shall be deemed to have been given at the time when it ought to have been delivered in due course of post and in proving such notice, when given by post, it shall be sufficient to prove that the envelope containing the notice was posted and a certificate signed by an officer of the BSHB that the envelope was so posted shall be conclusive. 11. This Guarantee shall come into force with immediate effect and shall remain in force and effect until the expiry of 6 months after the issuance of the Completion Certificate by BSHB. Signed and sealed this. day of.., 20 at.. SIGNED, SEALED AND DELIVERED For and on behalf of the BANK by: (Signature) (Name) (Designation) (Code Number) (Address) Development of Commercial Property at L- Sector in Kankarbagh, Patna 6
NOTES: The bank guarantee should contain the name, designation and code number of the officer(s) signing the guarantee. The address, telephone number and other details of the Head Office of the Bank as well as of issuing Branch should be mentioned on the covering letter of issuing Branch. Development of Commercial Property at L- Sector in Kankarbagh, Patna 7
ANNEXURE A LEASE DEED This Lease Deed (hereinafter referred to as the "Lease Deed") made on this day of 2013 By And Between: 1) THE BIHAR STATE HOUSING BOARD, established under the Act, 1982, represented by its Managing Director and having its principal office at 6, Sardar Patel Marg, Patna - 800015(hereinafter referred to as "BSHB" or the "Lessor", which expression shall, unless repugnant to or inconsistent with the context or meaning thereof, mean and include its administrators, successors and assigns) of the FIRST PART; AND 2) (a)* M/s, a Company registered under the Companies Act, 1956 having its Registered Office at (mention full address) and Incorporation Certificate No. dt.. (hereinafter referred to as "Developer" or the "Lessee", which expression shall, unless repugnant to or inconsistent with the context or meaning thereof,mean and include its successors, liquidators and permitted assigns) of the SECOND PART. (BSHB and the Developer shall hereinafter individually be referred to as a "Party" and collectively as "Parties"). WHEREAS A. Pursuant to the Development Agreement dated [insert], BSHB granted to the Developer the right to undertake the development of Assets and Project Utilities upon the Site in accordance with the terms and conditions thereof. B. Therefore, for purposes of and in accordance with the provisions of the Development Agreement, the Developer proposes to take on lease from BSHB and BSHB proposes to lease to the Developer, the Site (as specified in Schedule - I of the Development Agreement) on the terms and conditions set out herein. NOW THEREFORE, in consideration of the foregoing and the respective covenants and agreements set forth in this Lease Deed and other consideration, the receipt, sufficiency and adequacy of which is hereby acknowledged, and intending to be legally bound hereby, the Parties agree as follows: Development of Commercial Property at L- Sector in Kankarbagh, Patna 8
ARTICLE I 1.1 Definitions In this Lease Deed, the following words and expressions shall, unless repugnant to the context or meaning thereof, have the meaning hereinafter respectively assigned to them: "Development Agreement" shall mean the agreement dated [insert] entered into between BSHB and the Developer. "Appointed Date" shall mean the date of execution of this Lease Deed. "Lease Period" shall have the meaning ascribed to the term in Section 5.1.1. "Parties" shall have the meaning ascribed to the term in the preamble to this Lease Deed. "Party" shall have the meaning ascribed to the term in the preamble to this Lease Deed. "Possession" shall have the meaning ascribed in Section 2.1.2; "Site" shall have the meaning ascribed to the term in Section 2.1.1; The words and expressions beginning with or in capital letters used in this Lease Deed and not defined herein and defined in the Development Agreement shall, unless repugnant to the context, have the meaning respectively assigned to them in the Development Agreement. 1.2 Interpretation In this Lease Deed, unless the context otherwise requires, the rules of interpretation as specified in Section 1.2 of the Development Agreement shall apply. In case of any inconsistency between the provisions of this Lease Deed and the provisions of the Development Agreement, the provision of Development Agreement shall prevail. The Development Agreement executed on. form part integral part of this Lease Deed and shall govern the inter-se relations of the Parties hereto. 1.3 The terms and conditions contained in the Development Agreement executed on, in so far as they relate to the Site and the lease thereof, shall mutatis mutandis, apply to this Lease Deed. 2. GRANT OF LEASE 2.1 Lease of the Site ARTICLE II 2.1.1 The Lessor, in accordance with the terms and conditions set forth herein, hereby, demise, grant to the Lessee, commencing from the date hereof, the Lease Rights on the land (along with any immovable assets, if any, thereon) which is described, delineated, and shown in the Schedule hereto (hereinafter referred to as the "Site") to hold the said Site, together with all and singular rights, liberties, privileges, easements, appurtenances and encumbrances what so ever to the said Site, hereditaments or premises or any part thereof belonging to or in any way appurtenant Development of Commercial Property at L- Sector in Kankarbagh, Patna 9
thereto or enjoyed therewith strictly on an as is where is basis, for the duration of the Lease Period for the sole purpose as provided in the Development Agreement and the Lessee's obligations there under, and for such other purposes as are permitted under this Lease Deed. 2.1.2 Handing over of the Site by BSHB to the Developer shall be governed as specified in the Development Agreement. Notwithstanding such handover of possession, the Developer shall not have any claim whatsoever against BSHB with respect to the Site or any change in the Site from the date of such handing over. 2.2 Subject to and in accordance with the terms of this Lease Deed and those set out in the Development Agreement, the Lessee shall have the right and be at liberty to develop, construct, erect, renovate, repair, alter, or otherwise deal with the Site in accordance with the provision of the Development Agreement. 2.3 The grant of Lease in terms of this Deed shall entitle the Developer to develop the Project in terms of the Development Agreement. 2.4 It is hereby expressly understood and recorded between the Parties that mining rights cannot, and do not, form part of the lease granted to the Lessee under this Lease Deed and the Lessee hereby acknowledges that it does not, and shall not, have any mining rights under this Lease Deed or any interest in the underlying minerals, if any. 2.5 The Parties agree that BSHB further reserves to itself, provided that the same is not inconsistent with the development in accordance with this Lease Deed, the right to grant any easements over or rights of access or rights of way on, over, under, through or across the Site for: i. the purpose of supply of electricity, gas, telecommunication cables, water, sewerage, drainage or other services and utilities; or ii. the provision of transport or other services to the public. 3. USAGE ARTICLE III The Lessee hereby expressly covenants and agrees that, throughout the Lease Period, it shall only use the Site strictly in accordance with the terms and conditions of the Development Agreement and this Lease Deed. ARTICLE IV 4. CONSIDERATION In consideration for the grant of the Lease by the Lessor to the Lessee under this Lease Deed, the Lessee shall pay to the Lessor Annual Lease Rent at the rate of Rs. 1,50,000/- (Rupees One Lakh Fifty Thousand only) annually to the BSHB in accordance with Clause 6.2 of Development of Commercial Property at L- Sector in Kankarbagh, Patna 10
Development Agreement. The Annual Lease Rent for the initial year shall be paid before execution of this Deed, and for every subsequent year the Annual Lease Rent shall be payable by the end of the first month (i.e. January) of the year failing which penal interest at the rate of 18% shall be charged for the period of default. The Annual Lease Rent shall be paid by the Developer till the expiry of the Lease Period of the Lease Deed. ARTICLE V 5. LEASE PERIOD, LEASE PREMIUM, LEASE RENT AND REVERSION AND RE-ENTRY 5.1 Lease Period 5.1.1 The Lease in pursuance of this Lease Deed shall be for a period of 30 (Thirty) years as specified in the Development Agreement and to be reckoned from the Appointed Date as defined in the Development Agreement (the "Lease Period"). Notwithstanding anything contained in this Lease Deed, lease shall be terminated upon expiry of the Lease Period automatically or early termination of the Development Agreement without requiring any act, deed or thing on part of either Party. The lease under this Lease Deed shall neither be renewed nor extended in under any circumstance whatsoever save and except in the manner provided in the Development Agreement i.e. renewable for further period 30 (thirty) years subject to payment of Renewal Premium. 5.1.2. Lessee shall have right to transfer the Lease of built up area, grant Sub-Lease, License or enter into similar arrangements as prescribed in the Development Agreement. Such Sub-Lease, License or similar arrangements shall be co-terminus with the Lease Deed, Development Agreement. For the avoidance of doubt, it is clarified that the Developer shall enter into a sub-lease deed, on or after the achievement of Commercial Operation of the Project, with the sub-lessees according to the terms and condition of Development Agreement and as per BSHB rules. 5.1.3. Lessee shall pay the Lease Premium and Annual Lease Rent as provided in the Development Agreement. 5.1.2 The Lease and/ or Sub-leases shall be renewed on the terms and conditions of Development Agreement and upon payment of Renewal Premium, Lease Premium and enhanced lease rent and other conditions contained therein. 5.1.3 The Lease, Sub-Lease, License or similar arrangement for enjoyment of built up area shall be granted and transferable in a manner provided in the Development Agreement subject to payment of applicable Transfer Dividend as prescribed in the Development Agreement. 5.2. Reversion 5.2.1 On expiry of the Lease Period, in case the same is not renewed/ extended in terms of the provisions of Development Agreement or early termination of this Lease Deed, for any reason what so ever, Development of Commercial Property at L- Sector in Kankarbagh, Patna 11
the Site, together with all the Assets, buildings, Project Utilities, other utilities and services, fixtures, all or any singular rights, liberties, privileges, easements and appurtenances whatsoever to the Site, hereditaments or premises or any part thereof belonging to or in any-way appurtenant thereto or enjoyed therewith, shall revert to the Lessor or be treated in the manner set forth in the Development Agreement. 5.2.2 The Lessee shall have only leasehold interests in relation to the Site and shall have no title to the Site, and the Lessee agrees and acknowledges that it has only leasehold interests in the land, built-up structures and all other assets erected on the Site to carry out the Project as envisaged in the Development Agreement. ARTICLE VI 6. TAXES AND DUTIES 6.1 The Lessee shall, without any limitation, pay all Taxes and other charges, dues, assessments or outgoings payable in respect of the lease hereunder, the Site or the structures to be constructed thereon or in respect of the materials stored therein which may be levied by any Governmental Authority, local authority or other persons from time to time. Furthermore, any stamp duty, registration charges or other fees, taxes or charges of any kind whatsoever pertaining to this Lease Deed and execution thereof shall also be borne by the Lessee. 6.2 The Lessee hereby undertakes and confirms that it shall indemnify and keep indemnified the Lessor from and against all actions, demands, claims, liabilities, losses, damages, costs, expenses and other liabilities whatsoever brought against, suffered or incurred by the Less or resulting from or by reason of breach, non-observance or non-performance by the Lessee of any of its obligations set out in this Article VI. 6.3 The Lessee shall also pay any penalty or damages levied by the Lessor for any default or non-compliance of the terms and conditions of the Development Agreement and this Lease Deed by the Lessee. 7. LESSEE'S WARRANTIES ARTICLE VII 7.1 The Lessee hereby represents, warrants, acknowledges and undertakes, to and for the benefit of the Lessor, that: 7.1.1 Lessee is duly registered company under the provisions of the Companies Act, 1956 and authorized and competent to execute into Development Agreement and this Lease Deed and executed under the valid and proper resolution passed by its board of directors. 7.1.2 Throughout the Lease Period, it shall undertake the development in accordance with the provisions of the Development Agreement. 7.1.3 It shall use the Site only for the Project as provided in terms of the Development Development of Commercial Property at L- Sector in Kankarbagh, Patna 12
Agreement. 7.1.4 It shall obtain or cause to be obtained and shall maintain throughout the Lease Period all regulatory approvals, clearances, permits and consents, including any and all environmental approvals, clearances, permits or consents that may be required in order for the Lessee to undertake its obligations in accordance with the terms of the Development Agreement. 7.1.5 It shall not do or permit to be done on the Site or the structures thereon, any activities, which may be contrary to any Applicable Law and Applicable Permits and it shall in enjoyment of its rights hereunder and fulfillment of its obligations hereunder, shall always comply with the Applicable Law and Applicable Permits. 7.1.6 It shall regularly pay the Annual Lease Rent as provided for under Section 4.1 hereinabove and shall observe, abide by and fulfill each of its obligations and covenants set forth herein. 7.1.7 It shall indemnify the Lessor in respect of any applicable charges, deposits and other monies levied by third parties for and in relation to the provision by such third parties to the Lessee of water, electricity, telephone, communication facilities and other utilities and services. 7.1.7 It shall (i) keep and maintain the Site and the buildings and structures thereon in good and habitable condition at all times and(ii) shall ensure that the Site will be free from encroachments at all times. 7.1.8 It has conducted due diligence of the Site, along with all structures thereon, and confirms that the Site along with the structures thereon are fit for the Project. It acknowledges that it shall have no recourse against the Lessor if at any time, it is found that the Site along with the structures thereon are deficient in any manner whatsoever or not fit for the Project. 8. LESSOR'S WARRANTIES ARTICLE VIII 8.1 The Lessor hereby represents, warrants and undertakes, to and for the benefit of the Lessee, that: 8.1.1 BHSB has valid title to the Site and it has the power and authority to grant the lease. 8.1.2 Subject to the fulfillment of Lessee's obligations hereunder and under the Development Agreement, the Lessee shall, at all times during the Lease Period, hold and enjoy the Site and the rights specified in this Lease Deed without any interruption or disturbance by (i) the Lessor; or (ii) any person lawfully claiming through, under or in trust for the Lessor. 8.1.3 During the Lease Period, it shall not take or cause any action or engage in any activities that will interfere with the construction, installation, operation, inspection, maintenance, repair and business by the Lessee undertaken in accordance with the provisions of Development of Commercial Property at L- Sector in Kankarbagh, Patna 13
the Development Agreement. ARTICLE IX 9. MISCELLANEOUS 9.1 Notices All notices, requests, demands or other communication required or permitted to be given under this Lease Deed and the provisions contained herein shall be written in English and shall be deemed to be duly sent by registered post, or transmitted by facsimile transmission or email to the other Parties if the same has been sent to the address and in the manner as provided in the Development Agreement. 9.2. All the terms and conditions of Development Agreement executed on between the Parties shall mutate mutandis apply to this Lease Deed. The provisions of Lease Deed and Development Agreement shall be construed harmoniously and in case of any contradiction provisions of Development Agreement shall prevail. 9.3 Dispute resolution Any dispute, difference or controversy of whatever nature howsoever arising under or out of or in relation to the Lease Deed (including its interpretation) between the Parties shall be resolved in accordance with the provision of the Development Agreement. This Section 9.2 shall survive the termination or expiry of the Lease Deed. 9.4 Governing Law and jurisdiction This Agreement shall be construed and interpreted in accordance with and governed by the laws of India, and subject to Article IX, the Courts at Patna alone shall have exclusive jurisdiction over all matters arising out of or relating to this Agreement. 9.5 Amendment No variation, waiver, amendment or modification of any of the terms of this Lease Deed shall be valid unless in writing and signed by both Parties. 9.6 No Waiver Waiver by any Party of a default by another Party in the observance and performance of any provision of or obligations under the Lease Deed: (a) (b) shall not operate or be construed as a waiver of any other or subsequent default hereof or of other provisions of or obligations under the Lease Deed; shall not be effective unless it is in writing and executed by a duly authorized representative of the Party; and Development of Commercial Property at L- Sector in Kankarbagh, Patna 14
(c) shall not affect the validity or enforceability of the Lease Deed in any manner. Neither the failure by either Party to insist on any occasion upon the performance of the terms, conditions and provisions of the Lease Deed or any obligation thereunder nor time or other indulgence granted by a Party to another Party shall be treated or deemed as waiver of such breach or acceptance of any variation or the relinquishment of any such right hereunder. 9.7 Severability The invalidity or enforceability, for any reason, of any part of this Lease Deed shall not prejudice or affect the validity or enforceability of the remainder. For abundant caution, it is expressly clarified that if any provision of this Lease Deed is declared to be invalid, unenforceable or illegal by any competent arbitral tribunal or court, such invalidity, unenforceability or illegality shall not prejudice or affect the remaining provisions of this Lease Deed, which shall continue in full force and effect. 9.8 Language The language and all documents, notices, waivers and any other written communication or otherwise between the Parties, in connection with the Lease Deed shall be in English. 9.9 Indemnity The Lessee hereby indemnifies and shall keep indemnified the Lessor from and against all actions, demands, claims, liabilities, losses, damages, costs, expenses and other liabilities whatsoever brought against, suffered or incurred by the Lessor resulting from or by reason of (i) any breach of any representation, warranty or covenant of the Lessee in this Lease Deed; and (ii) any breach, non-observance or non-performance by the Lessee of any of its obligations under this Lease Deed or those required in law in relation to the Site. In the event that the Lessor hereto receives a claims or demands from a third party in respect of which it is entitled to the benefit of an indemnity under Section 9.8 or in respect of which it is entitled to reimbursement (the "Indemnified Party"), it shall notify the Lessee of such claim hereunder (the "Indemnifying Party") within 15 (fifteen) days of receipt of the claim and/ or shall not settle or pay the claim/ demand without the prior approval of the Indemnifying Party, which approval shall not be unreasonably withheld or delayed. In the event that the Indemnifying Party wishes to contest or dispute the claim, it may conduct the proceedings in the name of the Indemnified Party and at its (Indemnifying Party's) risk, costs and expense. The Indemnified Party shall provide all cooperation and assistance in contesting any claim and shall sign all such writings and documents as the Indemnifying Party may reasonably require. 9.10 Assignment and sub-lease The Lessee shall not transfer, assign, sub-lease, part with possession of or Encumber the Site, structures thereon, Assets and its rights hereunder, to any person, except to the extent provided for in the Development Agreement. Lessee shall have the right to transfer the Commercial Property or part thereof on Sub-Lease, License or let-out on tenancy or similar relation basis. Sub-Lease Deed shall be executed (the Sub-Lease Deed ), on or after the achievement of Development of Commercial Property at L- Sector in Kankarbagh, Patna 15
Commercial Operation of the Project, with the sub-lessees in Annexure B. as per the key provisions contained 9.11 Power to inspect 9.11.1. The Lessee shall permit the Lessor and its duly authorized representative to enter upon the Site and the works or structures for the time being constructed or standing thereon to view and inspect the same without BSHB being obliged to do such inspection or to intimate any defect. 9.11.2. No such inspection or communication of comments or non-communication of comments by BSHB shall amount to validation or approval or acceptance by BSHB of the construction by the Developer or its confirmation to the Applicable Law, Applicable Permits and the terms of this Development Agreement or waiver by BSHB of any breach by the Developer. It shall be the obligation of the Developer alone to supervise the construction and to ensure that the construction is being carried out in conformity with the Applicable Law, Applicable Permits and the terms of the Development Agreement. 9.12 Lessee not Lessor's Agents Nothing in this Lease Deed, whether express or implied, constitutes the Lessee as the agent of the Lessor in respect of any matter or action taken, or vice-versa. IN WITNESS WHEREOF, the Parties hereto have executed this Lease Deed at the place and on the date first above written. Signed for and on behalf of the LESSOR Signed for and on behalf of the LESSEE Name: Designation: Witnesse Name: Designation Witnesses: Development of Commercial Property at L- Sector in Kankarbagh, Patna 16
ANNEXURE B SUBSTITUTION AGREEMENT This substitution agreement (hereinafter referred to as "Substitution Agreement") is entered into on this the [ ] day of [ ], 2013 AMONGST 1) THE BIHAR STATE HOUSING BOARD, established under the Act, 1982, represented by its Managing Director and having its principal office at 6, Sardar Patel Marg, Patna - 800015 (hereinafter referred to as "BSHB", which expression shall, unless repugnant to or inconsistent with the context or meaning thereof, mean and include its successors and assigns) of the FIRST PART; 2) (a)* M/s, a Company incorporated under the Indian Companies Act, 1956 having its Registered Office at (mention full address) and Incorporation Certificate No. dt.. (hereinafter referred to as "Developer" which expression shall, unless repugnant to or inconsistent with the context or meaning thereof, mean and include its successors, liquidators and permitted assigns) of the SECOND PART; and 3) [insert name and particulars of Lenders' Representative] [description about incorporation]and having its registered office at [insert],acting for and on behalf of the Lenders listed in Appendix 1 hereto as their duly authorized agent with regard to matters arising out of or in relation to the Substitution Agreement (hereinafter referred to as the "Lenders' Representative", which expression shall, unless repugnant to or inconsistent with the context or meaning thereof, mean and include its successors and substitutes) of the THIRD PART. WHEREAS: (A) BSHB has entered into a Development Agreement dated [ ] and Lease Deed date..with the Developer(the Development Agreement"), whereby BSHB has granted to the Developer rights in terms of the Development Agreement to undertake the Project upon the Site as defined in the Development Agreement annexed hereto, as Appendix 2. (B) As per the provisions of the Development Agreement, it is agreed by and between BSHB and the Developer that BSHB shall grant Lease Rights of the Site to the Developer in accordance with the Development Agreement, with the execution of a separate lease deed (the "Lease Deed"). The Lenders have agreed to finance the Project in accordance with Development of Commercial Property at L- Sector in Kankarbagh, Patna 17
the terms and conditions set forth in the respective Financing Agreements. (C) (D) The Lenders have requested BSHB to enter into the Substitution Agreement for securing their interests through assignment, transfer of the Grant and substitution of the Developer by a Nominated Company in accordance with the provisions of the Substitution Agreement and the Development Agreement. In order to enable implementation of the Project including its financing and construction, BSHB has agreed and undertaken to transfer and assign the Grant to a Nominated Company in accordance with the terms and conditions set forth in the Substitution Agreement and the Development Agreement. NOW THEREFORE, in consideration of the mutual covenants, terms and conditions and understandings set forth in this Substitution Agreement and other good and valuable consideration (the receipt and adequacy of which are hereby mutually acknowledged), the Parties, with the intent to be legally bound, hereby agree as follows:- ARTICLE I DEFINITIONS AND INTERPRETATION 1.1 Definitions In the Substitution Agreement, the following words and expressions shall, unless repugnant to the context or meaning thereof, have the meaning hereinafter respectively assigned to them: "Claimant" shall have the meaning ascribed to the term in Section 8.4.2 hereof; "Financial Default" means occurrence of a material breach of the terms and conditions of the Financing Agreements or a continuous default in Debt Service by the Developer for 3 (three) months; "Development Agreement" shall have the meaning ascribed to the term in the foregoing Recitals; "Lenders" means financial institutions, banks, multilateral funding agencies, and similar bodies undertaking lending business or their trustees/agents including their successors and assignees, who have agreed to guarantee or provide finance to the Developer under any of the Financing Agreements for meeting the costs of the Developer in relation to the design, development and construction of the Assets and Project Utilities; "Lenders' Representative" means the person referred to as the Lenders' Representative in the foregoing Recitals; "Lenders' Substitution Notice" shall have the meaning ascribed to the term in Section 3.2.3; "Lenders' Substitution Representation" shall have the meaning ascribed to the term in Section 3.3.2; Development of Commercial Property at L- Sector in Kankarbagh, Patna 18
"Nominated Company" means a company, incorporated under the provisions of the Companies Act, 1956, selected in accordance with the provisions hereof by the Lenders' Representative, on behalf of the Lenders, and proposed to BSHB for assignment/transfer of the Grant as provided in the Substitution Agreement; "Notice of Financial Default" shall have the meaning ascribed thereto in Section 3.2.1; "Notice of Intent" shall have the meaning ascribed to the term in Section 8.4.2; "Novation" shall mean the process or the act of replacing the Developer in any agreement or Sub-Contract in respect of the Project by another party such that the contract transferred by the novation process transfers all rights, duties and obligations from the Developer, original obligor, to the new obligor. "Parties" means the parties to the Substitution Agreement collectively and "Party" shall mean any of the Parties to the Substitution Agreement individually. "Respondent" shall have the meaning ascribed to the term in Section 8.4.2; "Substitution" is the process of replacement of a Nominated Company in place of the Developer by undertaking the following activities: a. Grant, to the Nominated Company, the right to develop, design, finance, construct, operate and maintain the Project (including entering into subcontracts), under and in accordance with the terms and conditions set forth in the Development Agreement and upon the execution of the Lease Deed in accordance thereof, for the remainder of the Lease Period, by the Novation of the Development Agreement in favour of the Nominated Company; b. Grant, to the Nominated Company, the leasehold interest over the Site together with the Assets and Project Utilities all or any singular rights, liberties, privileges, easements and appurtenances whatsoever to the Site, for the remainder of the Lease Period, by the Novation of the Lease Deed in the event of execution of the same in favour of the Nominated Company; c. Novation of the contracts and any other agreement needed to be novated for the purpose of implementing and operating the Project in accordance with the terms and conditions set forth in the Development Agreement and Lease Deed. d. The execution of a new Substitution Agreement with the Nominated Company for the remainder of the Lease Period on the same terms and conditions hereof; e. Transfer by the Developer all its rights and obligations as provided in the Development Agreement and in the event the Lease Deed is executed between the Developer and BSHB, transfer of all rights thereof including possession of all Assets and Project Utilities of the Project to the Nominated Company; f. Grant by BSHB to the Nominated Company of all approvals, clearances and permissions within BSHB's power and necessary for implementing and operating the Project, provided duly completed application in accordance with Applicable Law is Development of Commercial Property at L- Sector in Kankarbagh, Patna 19
submitted to BSHB; and g. Transfer by the Developer all sub-contracts and Sub-Lease Deeds including its rights and obligations thereof to the Nominated Company. "Substitution Agreement" means the Substitution Agreement and any amendment thereto made in accordance with the provisions contained in the Substitution Agreement; 1.2 Interpretation 1.2.1 References to Lenders' Representative shall, unless repugnant to the context or meaning thereof, mean references to the Lenders' Representative, acting for and on behalf of the Lenders. 1.2.2 References to Articles are, unless stated otherwise, references to Articles of the Substitution Agreement. 1.2.3 The words and expressions beginning with capital letters and defined in the Substitution Agreement shall have the meaning ascribed thereto herein, and the words and expressions used in the Substitution Agreement and not defined herein but defined in the Development Agreement shall, unless repugnant to the context, have the meaning ascribed thereto in the Development Agreement. 1.2.4 The rules of interpretation stated in Section 1.2 of the Development Agreement, Lease Deed shall apply, mutatis mutandis, to the Substitution Agreement. ARTICLE II ASSIGNMENT 2.1 Assignment of rights and title ARTICLE III The Developer hereby assigns the rights, title and interest in the Grant to, and in favour of, the Lenders' Representative pursuant to and in accordance with the provisions of the Substitution Agreement and the Development Agreement by way of security in respect of financing by the Lenders under the Financing Agreement. SUBSTITUTION OF THE DEVELOPER 3.1 Rights of substitution 3.1.1 Pursuant to the rights, title and interest assigned under Section 2.1, the Lenders' Representative shall be entitled to substitute the Developer by a Nominated Company under and in accordance with the provisions of the Substitution Agreement and the Development Agreement. Development of Commercial Property at L- Sector in Kankarbagh, Patna 20
3.1.2 BSHB hereby agrees to substitute the Developer by assignment of the Development Agreement in favour of the Nominated Company selected by the Lenders' Representative in accordance with the Substitution Agreement. For the avoidance of doubt, it is clarified that the Lenders or the Lenders' Representative, either individually or collectively, shall not be entitled to operate as the Developer. 3.2 Substitution upon occurrence of Financial Default 3.2.1 Upon occurrence of a Financial Default, the Lenders' Representative may issue a notice to the Developer (the "Notice of Financial Default") along with particulars thereof, and send a copy to BSHB for its information and record. A Notice of Financial Default under this Article III shall be conclusive evidence of such Financial Default and it shall be final and binding upon the Developer for the purposes of the Substitution Agreement. 3.2.2 Upon issue of a Notice of Financial Default hereunder, the Lenders' Representative may, without prejudice to any of its rights or remedies under the Substitution Agreement or the Financing Agreements, substitute the Developer by a Nominated Company in accordance with the provisions of the Substitution Agreement. 3.2.3 At any time after the Lenders' Representative has issued a Notice of Financial Default, it may make a representation to BSHB, stating that it intends to substitute the Developer by a Nominated Company ("Lenders' Substitution Notice"). The Lenders' Representative shall be entitled to undertake and complete the substitution of the Developer by a Nominated Company in accordance with the provisions of the Substitution Agreement and the Development Agreement within a period of 180 (one hundred and eighty) days from the date of Lenders' Substitution Notice, and BSHB shall withhold Termination due to any Developer Event of Default for the aforesaid period of 180 (one hundred and eighty) days, and the Developer shall continue to discharge its obligations thereunder for such period. Lenders' Representative shall forthwith send a copy of the aforesaid Lenders' Substitution Notice to the Developer. 3.3 Substitution upon occurrence of Developer Event of Default 3.3.1 Upon occurrence of a Developer Event of Default, BSHB shall, by sending a copy of the Termination Notice to the Lenders' Representative, inform of its intention to terminate the Development Agreement and grant 15 (fifteen) days time to the Lenders' Representative to make a representation, stating its intention to substitute the Developer by a Nominated Company. 3.3.2 In the event that the Lenders' Representative make a representation to BSHB within the period of 15 (fifteen) days specified in Section 3.3.1, stating that it intends to substitute the Developer by a Nominated Company ("Lenders' Substitution Representation"), the Lenders' Representative shall be entitled to undertake and complete the substitution of the Developer by a Nominated Company in accordance with the provisions of the Substitution Agreement and the Development Agreement within a period of 180 (one hundred and eighty) days from the date of issue of Lenders' Substitution Representation, and BSHB shall Development of Commercial Property at L- Sector in Kankarbagh, Patna 21
withhold Termination for the aforesaid period of 180 (one hundred and eighty) days, and the Developer shall continue to discharge its obligations there under for such period. Lenders' Representative shall forthwith send a copy of the Lenders' Substitution Representation to the Developer. 3.4 Procedure for substitution 3.4.1 BSHB and the Developer hereby agree that on or after the date of Lenders' Substitution Notice under Section 3.2.3 and/or Lenders' Substitution Representation Section 3.3.2, as the case may be, the Lenders' Representative may, without prejudice to any of the other rights or remedies of the Lenders under the Financing Agreements, invite, negotiate and procure offers for selection of the Nominated Company for the take over and transfer of the Grant to the Nominated Company upon such Nominated Company's assumption of the liabilities and obligations of the Developer towards BSHB under the Development Agreement and towards the Lenders under the Financing Agreements, subject to such Nominated Company conforming to the qualification criteria prescribed by BSHB at the time of selection of the Developer. The Nominated Company shall have to bear all the liabilities of the Developer in terms of the Development Agreement, Financing Agreement, Sub-Lease Deeds and contracts with the Sub-contractors which shall include but not be limited to overdue and future payments towards taxes to be paid to the Government, repayment or refunds to third parties, Annual Lease Rents to be paid to BSHB, Liquidated Damages to be paid to BSHB, payment to Subcontractors relating to the Project, expenses incurred and claims by BSHB on the Project due to the Developer's default in terms of the Development Agreement to be paid to BSHB, servicing of Debt Due to the Lenders. 3.4.2 Upon selection of a Nominated Company, the Lenders' Representative shall request BSHB to: (a) (b) transfer the Grant to the Nominated Company, on the same terms and conditions, for the remainder of the Lease Period of the Development Agreement; and enter into a new Substitution Agreement with the Lenders' Representative and the Nominated Company on the same terms as are contained in the Substitution Agreement. 3.4.3 If BSHB has any objection to the transfer of Grant in favour of the Nominated Company in accordance with the Substitution Agreement, it shall within a period of 30 (thirty) days from the date of receipt of proposal made by the Lenders' Representative, give a reasoned decision as regards the acceptability (or objection, as the case may be) of the Nominated Company. In the event the Nominated Company is acceptable to BSHB, BSHB shall transfer the Grant within 15 (fifteen) days of its acceptance of the Nominated Company; provided that in the event of an objection by BSHB, the Lenders' Representative may propose another Nominated Company whereupon the procedure set forth in this Section 3.4 shall be followed for substitution of such Nominated Company in place of the Developer. Provided that it is expressly agreed between the Parties hereto that in any event the process of Substitution of the Developer shall be completed within a period of 180 (one hundred and eighty)days from the date of Lenders' Substitution Notice or Lenders' Substitution Representation. Development of Commercial Property at L- Sector in Kankarbagh, Patna 22
3.5 Selection to be binding 3.5.1 The decision of BSHB in selection of the Nominated Company or the approval of the Nominated Company selected by the Lenders' Representative shall be final and binding on the Developer and shall be deemed to have been made with the concurrence of the Developer. The Developer irrevocably agrees and waives any right to challenge the actions of the Lenders' Representative or the Lenders or BSHB taken pursuant to the Substitution Agreement including the transfer/assignment of the Grant in favour of the Nominated Company. It is hereby acknowledged by the Parties that the rights of BSHB and the Lenders' Representative are irrevocable and the Developer shall have no right or remedy to prevent, obstruct or restrain BSHB or the Lenders' Representative from effecting or causing the transfer by substitution and endorsement of the Grant as requested by the Lenders' Representative or as undertaken by BSHB. No consultation, concurrence or approval with or of the Developer will be required for such substitution. 3.5.2 All actions of the Lenders' Representative and/or BSHB hereunder shall be deemed to be by and on behalf of, and expressly authorized by, the Lenders, and be binding upon them. 3.6 Substitution by Nominated Company in other agreements The Developer shall ensure and procure that each agreement or contract it enters with any third party in relation to the Grant contains provisions that entitle the Nominated Company to step into such agreement, in its discretion, in place and substitution of the Developer in the event of such Nominated Company's assumption of the liabilities and obligations of the Developer under the Development Agreement. The Nominated Company shall assume the rights and obligations of the Developer in all such agreements and contracts including Sub-Lease Deeds pursuant to its receiving the Grant from BSHB. ARTICLE IV LENDER'S REPRESENTATIVE'S FAILURE TO SUBSTITUTE 4.1 In the event that no company is nominated by the Lenders' Representative or the company selected by the Lenders' Representative in terms of Section 3.5 within the period of 180 (one hundred and eighty) days from the Lenders' Substitution Notice under Section 3.2.3 or the Lenders' Substitution Representation under Section 3.3.2, is not acceptable to BSHB, it shall be entitled to terminate the Development Agreement. ARTICLE V Deleted ARTICLE VI DURATION OF THE AGREEMENT 6.1 Duration of the Substitution Agreement Development of Commercial Property at L- Sector in Kankarbagh, Patna 23