Standard Power Purchase Agreement. For

Transcription

1 Standard Power Purchase Agreement For Procurement of Power on a Long-Term basis from the (insert capacity in MW) Ultra Mega Power Project to be set up at (specify location, district and State) sourcing coal from the allocated coal linkage [Issued by the [*] 1 as per the Bidding Guidelines No. [*] Dated [*] issued by the Ministry of Power in terms of Section 63 of the Electricity Act, 2003] 1 Insert the name of the Distribution Licensee, nominated as the Lead Procurer. 1

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3 TABLE OF CONTENTS DEFINITIONS AND INTERPRETATIONS Definitions Interpretations SCOPE OF THE PROJECT TERM OF THE AGREEMENT Effective Date and Term of the Agreement Phased Implementation of the Project PERFORMANCE GUARANTEE AND ADDITIONAL WEEKLY PERFORMANCE GUARANTEE Performance Guarantee Additional Weekly Performance Guarantee Validityof the Performance Guarantee Encashment of Performance Guarantee Reduction in the amount of the Performance Guarantee Return of the Performance Guarantee Deemed Performance Guarantee Appropriation of Deemed Performance Guarantee References to Performance Guarantee CONDITIONS SUBSEQUENT Satisfaction of the Conditions Subsequent by the Seller Satisfaction of the Conditions Subsequent by the Procurers Consequence of Mutual Extension of the Seller s Conditions Subsequent Period Consequences of non-fulfillment of the Seller s Conditions Subsequent Consequences of failure to satisfy the Conditions Subsequent by the Procurer

4 5.6 Consequences of non-fulfillment of the Conditions Subsequent by the Procurer or the Seller on account of Force Majeure Event(s) Progress Reports OBLIGATIONS OF THE PROCURERS General Obligations of the Procurers Procurer s obligations with regard to appointment of the Lead Procurer and the Alternate Lead Procurer OBLIGATIONS OF THE SELLER General Obligations of the Sellers Resettlement & Rehabilitation Obligation of the Sellers with regard to Equity Lock-in Sole purpose of the Seller Obligations relating to Taxes CONSTRUCTION OF THE POWER STATION Commencement of Construction of the Power Station The Power Station Land Procurement of Land Quality of Workmanship Applicable Permits Type Test Reports Co-ordination of Construction Activities and the Role of the Independent Engineer.. 52 SYNCHRONISATION, COMMISSIONING AND COMMERCIAL OPERATION Synchronisation Commissioning Commercial Operation Costs Incurred

5 9.5 Timeline for Commissioning Consequences of delay in fulfilling the Project Milestones and Commissioning OPERATION AND MAINTENANCE O&M Obligations of the Seller DECLARED CAPACITY Declared Capacity and Dispatch Purchase and sale of Declared Capacity Third Party Sales and Sale to other Procurers Auxiliary Consumption Unscheduled Interchange Grid Disturbance Ramp-up Despatch Compensation for Lower Dispatch REPEAT PERFORMANCE TESTS Repeat Performance Tests Derating METERING INSURANCE Insurance Application of Insurance Proceeds Effect on liability of the Procurers TARIFF Tariff Monthly Fixed Charge Payment

6 15.3 Monthly Variable Charge Payment Alternate Sourcing of Coal Incentive Payment Penalty for Low Availability Infirm Power Taxes and Duties BILLING AND PAYMENT General Monthly Bill Supplementary Bills Designated Accounts Disputed Bills Annual Reconciliation Foreign Exchange Fluctuations PAYMENT SECURITY MECHANISM Letter of Credit Default Escrow Account andhypothecation Credit Rating of the Procurers THIRD PARTY SALES ON PAYMENT DEFAULT Payment Default Sale of Default Electricity Enhancement of the Letter of Credit and the Collateral Arrangement Enhancement of Default Electricity Adjustment of Surplus Revenue Fixed Charge Payment by the Defaulting Procurers

7 18.7 Restoration of Supply to the Defaulting Procurer(s) FORCE MAJEURE Force Majeure Force Majeure Exclusions Notification of the Force Majeure Event Duty to perform and Duty to Mitigate Available Relief for a Force Majeure Event Consequences of a Force Majeure Event Limitation Additional Compensation and Procurers' Subrogation Dispute resolution EVENTS OF DEFAULT Seller s Event Of Default Procurer s Event Of Default CHANGE IN LAW Meaning of Change in Law Exclusions to the Change in Law Notification of Change in Law Increase in Cost Reduction in Cost Tariff Adjustment LIABILITY AND INDEMNITY Indemnity Monetary Limitation of liability

8 22.3 Procedure for claiming indemnity Indemnifiable Losses Limitation on Liability ASSIGNMENTS AND CHARGES Restriction on assignment and charges by the Seller Permitted Charges Assignment by the Procurers REPRESENTATION AND WARRANTIES Representations and Warranties of the Procurers Representations and Warranties of the Seller Disclosure DISPUTE RESOLUTION Adjudication by the Commission Arbitration Parties to Perform Obligations MISCELLANEOUS PROVISIONS Governing Law and Jurisdiction Amendment Third Party Beneficiaries No Waiver Entirety Affirmation Severability No Partnership Successors and assigns

9 26.10 Survival Notices Breach of Obligations Nomination Restriction Commercial Acts Delayed Payments Fraudulent and Corrupt Practices Schedule Power Station Land Schedule Land Schedule Land Schedule Initial Consents Schedule Allocated Contracted Capacity Schedule Escalation Index Schedule Commissioning Tests Schedule Tariff Schedule

10 Functional Specifications Schedule Independent Engineer Schedule Project Milestones Schedule Substitution of the Seller Schedule Letter of Credit Schedule Quoted Tariff SCHEDULE Scheduled COD and Contracted Capacity Annexure Letter of Assurance Annexure Land Lease Agreement

11 This Agreement is entered into on this [*] day of 20[*] By and Between 1. [*] 2, having its registered office at [*], represented by [*]( Procurer 1, which expression shall unless repugnant to the context or meaning thereof, include its successors, administrators and assigns); and 2. [*] 3, having its registered office at [*], represented by [*] ( Procurer 2, which expression shall unless repugnant to the context or meaning thereof, include its successors, administrators and assigns); and 3. [*] 4, having its registered office at [*], represented by [*]( Procurer n, which expression shall unless repugnant to the context or meaning thereof, include its successors, administrators and assigns); and 4. [*] 5, being an entity incorporated under the Companies Act, [*] having its registered office at [*], represented by [*] ( Seller, which expression shall unless repugnant to the context or meaning thereof, include its successors, administrators and assigns); WHEREAS: Procurer 1, Procurer 2 and Procurer n shall be collectively hereinafter referred to as the Procurers ; the Procurers and the Seller shall be individually referred to as the Party and collectively referred to as the Parties. A. The Procurers have resolved to procure the power from the Power Station with an Installed Capacity of [*] MW to be developed by the Seller as an Ultra Mega Power Project (UMPP), on a Build, Own and Operate (BOO) basis, based on Supercritical Technology on the land admeasuring [*] located at [*] 6 ( Power Station Land, as further described, delineated and shown in Schedule 1), sourcing coal from the Allocated Coal Linkage in accordance with the provisions contained herein ( Project ). B. The Procurers have initiated and completed the following activities, for the benefit of the Seller and for ensuring the smooth and expeditious development of the Project: (i) Incorporated the Operating SPV through (**) 7, under the Companies Act, 2013 with its registered office at [*]; (ii) Incorporated [*] 8, under the Companies Act, 2013 with its registered office at [*] ( Infrastructure SPV ) and have obtained an award in terms of the Applicable Law, 2 Insert the name of the Distribution Licensee 1 3 Insert the name of the Distribution Licensee 2 4 Insert the name of the Distribution Licensee n 5 Insert the name of the Operating SPV 6 Insert the location of the power plant 7 Insert the name of the entity authorised by the Procurers 11

12 for a portion of the Power Station Land admeasuring [*] 9 ( Land-1, as further described, delineated and shown in Schedule 2 ) in the name of the Infrastructure SPV to be utilized for the purpose of the construction of the Power Station in accordance with the Applicable Laws, with the balance portion of the Power Station Land ( Land-2 as further described, delineated and shown in Schedule 3) to be acquired by the Seller in accordance with the terms of this Agreement; (iii) (iv) Obtained the Letter of Assurance, dated [**] issued by [**] 10 ( Coal Supplier ) in the name of the Seller for the supply on a linkage basis, [**] tonnes per annum of [**] grade coal for the entire Term of this Agreement ( Letter of Assurance appended herein as Annexure 1) for the purposes of the Project; obtained the consents as tabulated in Schedule 4 (collectively referred to as the Initial Consents ) in the name of the Operating SPV/Infrastructure SPV. C. In accordance with the Bidding Guidelines, the Procurers had initiated a two stage competitive bidding process entailing the issuance of the Request for Qualification (RFQ) and the Request for Proposal (RFP) for the purpose of selecting the Successful Bidder for undertaking the Project through the Seller and supplying the power therefrom to the Procurers; D. Pursuant to the said bidding process and the evaluation of the Bids received, the Procurers have accepted the Bid of [*] 11 ( Successful Bidder ) and issued it the Letter of Award no [*] dated [*] (hereinafter referred to as the LOA ), following which, the Successful Bidder has executed the share purchase agreement in the format provided in the RFP and has acquired 100% (hundred percent) Equity of the Operating SPV. E. Pursuant to the issuance of the LOA, the following documents have also been executed between the parties concerned: (i) (ii) (iii) The Default Escrow Agreement Agreement to Hypothecate Cum Deed of Hypothecation; and Land Lease Agreement-1.. F. The Parties have now agreed to sign this Agreement setting out the terms and conditions for the development of the Project; the sale of power from the Power Station from the Seller to the Procurers. Now therefore, in consideration of the premises and mutual agreements, covenants and conditions set forth herein, it is hereby agreed by and between the Parties as follows: 8 Insert the name of the Infrastructure SPV 9 This portion should be not less than the area necessary for the setting-up of the Power Station 10 Insert the name of the coal company 11 Insert name of the Successful Bidder 12

13 ARTICLE 1 DEFINITIONS AND INTERPRETATIONS 1.1 Definitions In this Agreement, the following words and expressions shall, unless repugnant to the context or meaning thereof, have the meaning hereinafter assigned to them: Acquisition Notice shall mean the notice issued by the Lead Lenders/ Lenders/Procurers to the Seller in accordance with Articles 5.4 and 5.5 as the case may be; Additional Weekly Performance Guarantee(s) shall mean the additional performance guarantee(s) to be furnished by the Seller in terms of Article 4.2; Application shall mean the response to RFQ submitted by the Successful Bidder; Agreed Form shall mean in relation to any document, the form of the said document most recently agreed to by the Parties and initialed by them for identification; Agreement shall mean this Power Purchase Agreement including its recitals, schedules and annexures, as amended or modified from time to time in accordance with the terms hereof; Agreement to Hypothecate Cum Deed of Hypothecation shall have the meaning as set forth in Article ; Affected Party shall have the meaning as set forth in Article 19.1; Allocated Contracted Capacity shall mean a portion of the Contracted Capacity allocated to each of the Procurers as provided in Schedule 5 hereof, subject to adjustment pursuant to the terms of this Agreement; Alternate Lead Procurer shall have the meaning as set forth in Article as replaced from time to time in accordance with the provisions thereof; Applicable Law shall mean in relation to this Agreement, all laws in force in India and any statute, ordinance, regulation, notification or code, rule, or any interpretation of any of them by an Indian Governmental Instrumentality and having force of law and shall further include all applicable rules, regulations, orders, notifications by an Indian Governmental Instrumentality pursuant to or under any of them; Applicable Permits shall have the meaning set forth in Article 7.1(i); Associate shall in relation to a Party mean a person who controls, is controlled by, or is under the common control with the Party. As used in this definition, the expression control means, with respect to a person which is a company or corporation, the ownership, directly or indirectly, of more than 50% (fifty per cent) of the voting shares of such person, and with respect to a person which is not a company or corporation, the power to direct the management and policies of such person by operation of law; 13

14 Availability shall, in relation to the Power Station, for any period, mean the average of the daily Declared Capacities, for all the days during that period, expressed as a percentage of the Contracted Capacity in MW; Bid shall mean the response to the RFP submitted by the Successful Bidder; Bidder shall mean the Bidding Company and the Bidding Consortium as the case may be; Bidding Company shall mean the reference to a single company, if the Bid has been submitted by a single company; Bidding Consortium shall mean the reference to the group of companies, each being a Member, if the Bid has been submitted jointly by more than one company; Bidding Guidelines shall mean the guidelines for determination of tariff through transparent process of bidding for procurement of power from UMPPs based on allocated coal linkage and to be set up on BOO basis on supercritical technology issued by the Ministry of Poweron [*]; as amended from time to time till Bid Due Date; Bidding Period shall have the meaning as set forth in Article 9.6.1(B) and Article (B); Bid Due Date shall mean the last date for submission of the Bid, in response to the RFP; Bidding Documents shall mean the RFQ and RFP along with all its attachments and any amendments thereto or clarifications thereof; Bill shall mean either a Monthly Bill, or a Supplementary Bill, as the case may be; Bill Dispute Notice shall have the meaning set forth in Article ; BTG Contract shall mean the contract(s) executed by and between the Seller and the BTG Contractor or separate contractors for boiler/turbine/generator in relation to the boiler, turbine and generator for Power Station; BTG Contractor shall mean the contractor(s) with whom the Seller has executed the BTG Contract; Capital Cost shall mean the lower of the following as certified by the Lenders: (a) actual capital cost of the Project on a relevant date which shall not be later than 6 (six) months from the Commercial Operation Date of the Power Station; or (b) capital cost of the Project as set forth in the Financing Agreements, Provided that the Capital Cost shall always exclude cost overruns arising due to a Seller Event of Default, or costs due to events for which compensation has been received by Seller from the Procurers or insurers or any third parties; Provided further that the Capital Cost in relation to a Unit shall be the Capital Cost allocated in proportion to the Contracted Capacity of the said Unit; 14

15 Capital Structure Schedule shall mean sources of finance used to finance the Capital Cost and as provided in the Financing Agreements; Change in Law shall have the meaning as set forth in Article 21.1; Coal Supplier shall have the meaning set forth in Recital B (iii); Collateral Arrangement shall have the meaning set forth in Article 17.2; Commercial Operation Date or COD or Commissioning or Commissioned shall mean, in relation to a Unit, the date, which is one day after the date, on which each of the Procurers and RPC and RLDC is informed by the Seller about the issuance of the Final Test Certificate of the Independent Engineer as per the provisions of Article 9.3.1; and in relation to the Power Station shall mean the date on which the issuance of such Final Test Certificates as per Article is informed by the Seller to each of the Procurers and RPC and RLDC for all the Units; Commission shall mean the State Electricity Regulatory Commission or the Central Electricity Regulatory Commission or such other succeeding authority or commission as may be notified by Indian Governmental Instrumentality from time to time having jurisdiction on the Project; Commissioning Tests shall mean the tests provided in Schedule 7 herein; Competent Court shall mean any court or tribunal or any similar statutory, judicial or quasi-judicial body in India that has jurisdiction to adjudicate upon issues relating to this Agreement; Conditions Subsequent shall collectively mean the Seller s Conditions Subsequent and the Procurers Condition Subsequent; Consideration shall have the meaning set forth in Articles 5.4, 5.5 and 5.6 as the case may be; Construction Contract shall mean the contract executed by and between the Seller and the Construction Contractor in relation to the design, engineering, supply, construction and commissioning of the Project; Construction Contractor shall mean one or more main contractors, with whom the Seller has executed the Construction Contract; Construction Period shall mean the period beginning from the date, the last of the Conditions Subsequent is either satisfied or waived as the case may be, up till the COD of the Unit in relation to a Unit and of all the Units in relation to the Power Station; Consultation Period shall have the meaning as set forth in Article 9.6.1(B), Article 9.6.2(D), Article (B) and Article (A); Contracted Capacity shall mean the rated Net Capacity expressed in MW, of each Unit and Power Station, specified by the Seller in terms of Schedule 15; or such rated capacities as may be determined in accordance with Article (Tested Capacity being less than the Contracted Capacity), Article (Tested Capacity being more than the Contracted Capacity) or Article 12.2 (Derating) of this Agreement; 15

16 Contractor shall mean the BTG Contractor, the EPC Contractor, Construction Contractor, the Operator as the case may be, or any other contractor with whom the Seller has executed material agreements for construction, operation and/or maintenance of the Power Station or matters incidental thereto, but shall not include a person with whom the Seller has executed contracts for the purpose of availing financial assistance; Contract Year shall mean the period beginning on the Effective Date and ending on the immediately succeeding March 31 and thereafter each period of 12 (twelve) months beginning on April 1 and ending on March 31 provided that: (a) in the financial year in which the COD of the Power Station would have occurred, a Contract Year shall end on the date immediately before the COD of the Power Station and a new Contract Year shall begin once again from the COD of the Power Station and end on immediately succeeding March 31; and (b) the last Contract Year of this Agreement shall end on the Expiry Date; Central Transmission Utility or CTU shall have the meaning ascribed thereto in the Electricity Act, 2003; Debt Due shall mean the aggregate of the following, expressed in Indian Rupees, outstanding on the relevant date: (a) the principal amount under the Financing Agreements excluding the principal amount that had fallen due for repayment 2 (two) years prior to the issuance of the Termination Notice by the Procurers and (b) Interest on Debt Provided that the amount payable in respect of any Debt Due expressed in foreign currency shall be computed at the Reference Exchange Rate for conversion into the relevant foreign currency as on the date of computation of Debt Due; Declared Capacity shall mean, in relation to the Power Station, the capability, declared by the Seller, to deliver ex-bus electricity in MW, in relation to any time block of the day as defined in the Grid Code or during whole of the day, duly taking into account the availability of fuel or water; Declared Price of the Power Station Land shall mean an amount of Rs [**] for the Power Station Land, comprising of the Declared Price of Land-1 and the Declared price of Land-2 as informed to the Bidders in terms of Clause 1.5 of the RFP; Declared Price of Land-1 shall mean an amount of Rs [**], being the cost of Land-1 as informed to the Bidders in terms of Clause 1.5 of the RFP; Declared Price of Land-2 shall mean an amount of Rs [**] being the estimated cost of Land-2 as informed to the Bidders in terms of Clause 1.5 of the RFP; Declared Price of the R&R shall mean an amount of Rs [**] comprising of the estimated cost as well as the cost approved by the Indian Governmental Instrumentality for the Resettlement &Rehabilitation with regard to the (a) Power Station Land as informed to the Bidders in accordance with Clause 1.5 of the RFP; Default Electricity shall have the meaning set forth in Article 18.2; 16

17 Default Escrow Account shall mean the escrow account opened by each of the Procurers in favour of the Seller under Article , in accordance with the terms and conditions as more fully detailed in the Default Escrow Agreement; Default Escrow Agreement shall have the meaning set forth in Article ; Delivery Point shall mean the switchyard bus bar of the Power Station 12 ; Direct Non-Natural Force Majeure Event shall have the meaning set forth in Article ; Dispatch Instructions shall mean the instructions issued by the Procurers through the respective SLDC and RLDC to the Seller, in accordance with applicable Grid Code and this Agreement; Dispute shall mean any dispute or difference of any kind between the Procurer(s) and the Seller, in connection with or arising out of this Agreement including, but not limited to, any issue on the interpretation and scope of the terms of this Agreement as provided in Article 25; Due Date shall have the meaning as set forth in Article 16.1; Effective Date shall mean the date of execution of this Agreement by all the Parties; Electrical Output shall mean the net electrical output of the Power Station at the Delivery Point, as expressed in kwh; Electricity Act, 2003 shall mean the Electricity Act 2003 including the rules and regulations framed thereunder by the Indian Governmental instrumentality; Encumbrance shall mean and include a mortgage, charge, pledge, lien or any other encumbrance securing any obligation of any person or any other type of preferential arrangement (including, without limitation, title transfer and retention arrangements) having a similar effect Entitled Procurer shall have the meaning as set forth in Article (A); EPC Contract shall mean the contract to be executed by the Seller with the EPC Contractor in order to design, engineer, supply, construct and commission the Project, in terms of this Agreement; EPC Contractor shall mean the contractor with whom the Seller has executed the EPC Contract; Equity shall mean the sum expressed in Indian Rupees representing the paid up equity share capital of the Seller including the convertible instruments or other similar forms of capital, which shall compulsorily convert into equity share capital of the Seller; Escalation Index shall mean the index specified in Schedule 6; Excess Tested Capacity shall have the meaning as set forth in Article 9.3.4(A); 12 The Procurers may change this taking into consideration the dedicated transmission lines (if any) to be set up by the Bidder. 17

18 Exit Notice shall mean the notice that may be issued by either Party in the event of a prolonged Force Majeure Event in terms of this Agreement putting forth their intention to exit from the Project; Expiry Date shall mean the 25 th anniversary of the Commercial Operation Date of the Power Station unless otherwise specified herein extended by the Parties in accordance with the terms of this Agreement; Final Test Certificate shall mean: (a) a certificate of the Independent Engineer as per the format provided in Schedule 16, certifying and accepting the results of a Commissioning Test(s) in accordance with Article of this Agreement; or (b) a certificate of the Independent Engineer as per the format provided in Schedule 1916 certifying the result of a Repeat Performance Tests in accordance with Article 12.2 of this Agreement Financial Closure shall mean the execution of all the Financing Agreements required for the Project and fulfilment of conditions precedents specified therein unless waived by the Lenders for the initial draw down of funds there under; Force Majeure Costs shall mean and include only the Interest on Debt, O&M Expenses, any increase in the cost of construction works on account of inflation and all other costs directly attributable to the Force Majeure Event, but shall not include loss of Tariff, revenues from sale of electricity to any third party or debt repayment obligations, and for determining such costs, information contained in the Financing Agreements may be relied upon to the extent that such information is relevant Force Majeure Event or Force majeure shall have the meaning as set forth in Article 19.1; Force Majeure Termination Payment shall mean 90% of the Termination Payment; Financing Agreements shall mean all the loan agreements, notes, indentures, security agreements, letters of credit and other documents relating to the financing of the Capital Cost of the Project, as may be amended, modified, refinanced or replaced from time to time, but without in anyway increasing the liabilities of the Procurers existing as on the date of the Financial Closure; Fixed Charge shall mean the charge payable for the Availability of the Power Station to the extent of Normative Availability as per the provisions of Schedule 8; Fuel Supply Agreement is the agreement to be executed between the Seller and the Coal Supplier in terms of the Letter of Assurance; Functional Specifications shall mean the technical requirements and parameters described in Schedule 9 and as provided in Grid Code relating to the operation, maintenance and dispatch of any Unit and the Power Station; Grid Code shall means the Indian Electricity Grid Code 2010 as notified by the Commission or any succeeding set of regulations or code; 18

19 Grid Disturbance shall mean tripping of one or more power system elements of the grid like a generator, transmission line, transformer, shunt reactor, series capacitor and Static VAR Compensator, resulting in total failure of supply at a sub-station or loss of integrity of the grid, at the level of transmission system at 220 kv and above (132 kv and above in the case of North-Eastern Region); Grid Incident shall mean tripping of one or more power system elements of the grid like a generator, transmission line, transformer, shunt reactor, series capacitor and Static VAR Compensator, which requires re-scheduling of generation or load, without total loss of supply at a sub-station or loss of integrity of the grid at 220 kv and above (132 kv and above in the case of North-Eastern Region); Grid System shall mean the Interconnection Facilities and Transmission System and any other transmission or distribution facilities through which the Procurers supply electricity to their customers or the Transmission Licensee transmits electricity to the Procurers; Indemnifiable Losses shall have the meaning as set forth in Article and Article ; Indemnified Party shall have the meaning as set forth in Article 22.2; Indemnifying Party shall have the meaning as set forth in Article 22.2; Independent Engineer shall mean an independent consulting engineering firm appointed mutually by the Parties in accordance with Schedule 10 to carry out the functions in accordance with this Agreement; Indian Governmental Instrumentality shall mean the Government of India, at the central or state level and any ministry, department, board, agency, or other regulatory or quasi-judicial authority in India and includes the Commission; Indirect Non-Natural Force Majeure Event shall have the meaning as set forth in Article ; Infirm Power shall mean any infirm injection of power from the Power Station prior to the COD of any Unit during testing and commissioning activities; Infrastructure SPV shall have the meaning set forth in Recital B (ii); Initial Consents shall have the meaning set forth in Recital B (v); Initial Performance Retest Period shall have the meaning set forth in Article 9.3.3; Inspection Report shall have the meaning set forth in Article 8.7.3; Installed capacity shall have the meaning as set forth in the CERC (Terms and Conditions of Tariff) Regulations, 2014; Insurance Cover shall mean the aggregate of the maximum sums insured under the insurances taken out by the Seller for the Project, and shall include all insurances required to be taken out by the Seller in terms of the Prudent Utility Practices but not actually taken, 19

20 and when used in the context of any act or event, it shall mean the aggregate of the maximum sums insured and payable or deemed to be insured and payable in relation to such act or event; Interconnection Facilities shall mean the equipment installed at the Delivery Point(i.e the connection site) in accordance with the CERC (Grant of Connectivity, Long-term Access and Medium-term Open Access in inter-state Transmission and related matters) Regulations, 2009; Interest on Debt shall mean the interest which is due under the Financing Agreements but excluding (a) any interest, fees or charges that had fallen due 1(one) year prior to the relevant computation date (b) any penal interest or charges payable under the Financing Agreements to any Lenders and (c) any pre-payment charges in relation to accelerated repayment of debt except where such charges have arisen due to a Procurer Event of Default; Land-1 shall have the meaning set forth in Recital B (ii); Land-2 shall have the meaning set forth in Recital B (ii); Land Lease Agreements shall mean collectively the Land Lease Agreement-1, the Land Lease Agreement(s)-2 and any other lease agreement executed between the Infrastructure SPV and the Seller in relation to the Power Station Land; Land Lease Agreement-1 shall mean the agreement for the transfer of Land-1, on a lease basis, by the Infrastructure SPV to the Seller for a period [*] 13 years commencing from the Effective Date annexed herein as Annexure 2; Land Lease Agreement(s)-2 shall mean the lease agreement(s) in relation to the lease of Land-2 in favour of the Seller by the Infrastructure SPV for a term which is co-terminus with that of the Land Lease Agreement-1 and which as and when executed shall be annexed to this Agreement; Late Payment Surcharge shall mean the interest to be paid by a Party for delayed payments to the other Party, at the rate given in Article (Delayed payments); Lead Procurer shall mean the Procurer who has been nominated by the Procurers in accordance with Article as the lead procurer, and such other Procurer who is nominated in accordance with the provisions of thereof; Lenders shall mean the banks, public financial institutions, multilateral agencies, trusts, Reserve Bank of India registered non-banking financial companies, mutual funds and agents or trustees of debenture / bond holders, including their successors and assignees, who have agreed as on or before COD of the Power Station to provide the Seller with the senior debt financing described in the Capital Structure Schedule, and any successor banks or financial institutions to whom their interests under the Financing Agreements may be transferred or assigned; Provided that, such assignment or transfer shall not relieve the Seller of its obligations to the Procurers under this Agreement in any manner and shall also does not lead to an increase in the liability of any of the Procurers; Lead Lender shall mean the lead Lender as defined under the Financing Agreements 13 Insert the term of the lease which should be the lower of (i) 99 years or (ii) the maximum period as may be permitted by the relevant State Government. 20

21 Lenders Acquisition Period shall have the meaning set forth in Article 5.4(b); Lenders Substitution or Acquisition Period shall have the meaning set forth in the proviso to Article 9.6.1(C), Article 9.6.3(E), Article (D), Article (C) as the case may be; Letter of Assurance shall have the meaning as set forth in Recital B(iii); Letter of Credit shall have the meaning as set forth in Article ; Letter of Credit Amount shall have the meaning as set forth in Article (ii); Liquidated Damages shall mean the damages payable by the Seller to the Procurers in terms of the provisions of this Agreement; LOA or Letter of Award shall have the meaning as set forth in Recital D; Maintenance Outage shall have the meaning as ascribed to this term as per the provisions of the Grid Code; Majority Procurers shall have the meaning as set forth in Article 6.2.6; Material Adverse Effect shall mean a material adverse effect of any act or event on the ability of either Party to perform any of their obligations under and in accordance with the provisions of this Agreement and which act or event causes a material financial burden or loss to either Party; Member shall mean each company in a Bidding Consortium; Monthly Bill shall mean a monthly invoice comprising of components as mentioned in Article (A) and to be delivered in accordance with Article (B); Mortgaged Assets shall have the meaning set out in Article ; Natural Force Majeure Event shall mean the events listed in Article ; Net Capacity shall mean the Installed Capacity minus the Normative Auxiliary Power Consumption at the Delivery Point; Non Natural Force Majeure Event shall mean the Direct Non Natural Force majeure Event and Indirect Non Natural Force Majeure Event; Normative Auxiliary Power Consumption shall mean the power consumption for auxiliaries of the Power Station equal to [5%] 14 of the Installed capacity; Normative Availability shall mean an Availability, equal to 90% (ninety percent) 15 Availability at the Delivery Point on Contract Year basis; 14 This level may be modified by the Procurers in line with the prevailing CERC Regulations, but in no case should it be higher than 5% of the Installed Capacity although additional margin may be provided by the Procurers for project specific requirement; 21

22 Normative Annual Plant Load Factor (NAPLF) shall mean Plant Load Factor at Normative Availability on an annual basis; Notice to Proceed or NTP shall mean the notice to proceed issued by the Seller to the EPC Contractor/BTG Contractor in accordance with the provisions of the EPC Contract/ BTG Contract; O&M shall mean the operation and maintenance of the Power Station including all matters connected with or incidental to such operation and maintenance, and for the provision of generation and transmission services and facilities in accordance with the provisions of this Agreement; O&M Contract shall mean the contract(s) entered into by the Seller with the Operator(s), if any, for undertaking the O&M; O&M Expenses shall mean the expenses incurred by the Seller, for O&M including (a) cost of salaries and other compensation to employees, (b) cost of materials, supplies, utilities and other services, (c) premia for insurance, (d) all taxes, duties, cess and fees due and payable for O&M, (e) all repair, replacement, reconstruction, reinstatement, improvement and maintenance costs, (f) payments required to be made under the O&M Contract or any other contract in connection with or incidental to O&M, (g) water charges and (h) all other expenditure required to be incurred under Applicable Laws, Initial Consents, Applicable Permits or this Agreement; Operations Period shall mean, in relation to the Unit, the period from its COD and in relation to the Power Station, the date from which all the Units achieve COD, until the expiry or earlier termination of this Agreement in accordance with this Agreement; Operating SPV shall mean the Seller prior to the acquisition of the Equity by the Successful Bidder; Operator shall mean one or more contractors appointed as the operator of the power generation facilities of the Power Station pursuant to an O&M Contract, if any; Party and Parties shall have the meaning ascribed thereto in the recital to this Agreement; Payment Security Mechanism shall mean the payment security to be arranged by the Procurers in terms of Article 17; Performance Guarantee shall mean the irrevocable, unconditional bank guarantee, submitted, by the Successful Bidder on behalf of the Seller, to the Procurers in accordance with the Bidding Documents read with Article 4 and which shall also include the Additional Weekly Performance Guarantee(s) that may be furnished by the Seller in terms of this Agreement; Performance Test shall have the meaning as set forth in Article 9.3.1; Permits shall collectively mean the Initial Consents and the Applicable Permits; 15 This level may be modified but in no case should it be lower than 90% or the level specified in the Tariff Regulations of the CERC prevailing at the time of the bidding process, whichever is higher 22

23 Phase I shall have the meaning as set forth in Article 3.2.1; Phase II shall have the meaning as set forth in Article 3.2.1; Plant Load Factor or (PLF) for a given period shall mean the total sent out energy corresponding to scheduled generation during the period, expressed as a percentage of sent out energy corresponding to the Contracted Capacity in that period and shall be computed in accordance with the following formula: N PLF = x ΣSGi/ {N x CC)}% i=1 Where, CC = Contracted Capacity of the Power Station or the Unit in MW, SGi= Scheduled Generation in MW for the ith time block of the period, and N = Number of time blocks during the period Power Station shall mean the following excluding the Power Station Land: (a) The power generation facility comprising of all the Units [including the corridors for water intake pipeline, MGR for coal transportation and railway siding and ash corridors] 16, located on the Power Station Land; (b) any water supply, treatment or storage facilities required for the operation of the power generation facility referred to in (a) above; (c) township area for the staff colony; and (d) bay(s) for the Transmission System in the switchyard of the power station; (e) all the other assets, buildings/structures, equipments, plant and machinery, facilities and related assets required for the efficient and economic operation of the power generation facility; whether completed or at any stage of development and construction, or intended to be developed and constructed as per the provisions of this Agreement; Power Station Land shall have the meaning set forth in Recital A; Procurer s Acquisition Period shall have the meaning as set forth in Article 5.4(c); Procurers Condition Subsequent shall have the meaning set forth in Article 5.2; Procurers Condition Subsequent Period shall have the meaning set forth in Article 5.2; Procurer s Designated Account shall have the meaning as set forth in Article ; 16 To be modified as per Project requirements 23

24 Procurer s Event of Default shall mean the Procurer s default events listed in Article 20.2; Procurers Preliminary Default Notice shall mean the notice issued by the Procurer to the Seller in terms of this Agreement, following a Seller s Event of Default; Procurers Takeover shall have the meaning set forth in the proviso to Article 9.6.1(D) and 9.6.3(F); Project shall have the meaning set forth in Recital A; Project Milestones shall mean the project milestones as set forth in Schedule 11; Project Documents shall mean: (a) Construction Contracts/EPC Contract/BTG Contract; (b) O&M Contract(s); (c) RFP and RFP Project Documents; (d) Fuel Supply Agreement and the Fuel Transportation Agreement, (e) Land Lease Agreements, and (f) any other agreement(s) designated in writing as such, from time to time, by the Lead Procurer and the Seller jointly Prudent Utility Practices shall mean the practices, methods and standards that are generally accepted internationally from time to time by electric utilities or coal mining entities for the purpose of ensuring the safe, efficient and economic design, construction, commissioning, operation and maintenance of power stations and coal mines and power generation equipment and mine of the type specified in this Agreement and which practices, methods and standards shall be adjusted as necessary, to take account of the: (a) operation and maintenance guidelines recommended by the manufacturers of the Power Station and equipment to be incorporated in the Project; (b) the requirements of Applicable Law; and the (c) physical conditions at the Power Station Land; Quoted Fixed Charge shall mean the fixed charge in Rs/kWh quoted by the Successful Bidder for each Contract Year after the COD of the first Unit for the supply of Contracted Capacity based on Normative Availability as specified in Schedule 14; Quoted Variable Charge shall mean the charges in Rs/kWh quoted by the Successful Bidder as specified in Schedule 14; Quoted Tariff shall mean the Quoted Fixed Charge and the Quoted Variable Charge as specified in Schedule 14; 24

25 R&R Package shall mean the resettlement and rehabilitation package which the Procurers have got approved from the relevant Indian Governmental Instrumentality with regard to the Power Station Land; Reference Exchange Rate shall mean, in respect of any one currency that is to be converted into another currency in accordance with the provisions of this Agreement, the buying rate of such currency as of (twelve) noon on the relevant date quoted in Delhi by the State Bank of India, and in the absence of such rate, the average of similar rates quoted in Delhi by the Bank of India and the Bank of Baroda; Regional Energy Accounts or REA shall have the meaning as defined in the Grid Code and issued and by the relevant RPC secretariat or other appropriate agency for each week and for each month (as per their prescribed methodology), including the revisions and amendments thereof); Request for Proposal or RFP shall mean the request for proposal dated [*] along with all schedules, annexures and RFP Project Documents attached thereto, issued by the Procurers for tariff based bidding process for procurement of power on long-term basis from the Power Station, and shall include any modifications, amendments or alterations thereto; Repeat Performance Test shall have the meaning set forth in Article ; Request for Qualification or RFQ shall mean the request for qualification dated [*] along with all its schedules, annexures attached thereto, issued by the Procurers for tariff based bidding process for procurement of power on long-term basis from the Power Station, and shall include any modifications, amendments or alterations thereto; Revenues shall mean all of the present and future funds, payment obligations, monies, claims, bills and any other property whatsoever which may from time to time be derived from or accrue to or be offered or due to the Procurers in the form of cash receipts or receivables from any and all sources, save and except any capital receipts of the Procurers for and in relation to any capital expenditure for creation of assets; RFP Project Documents shall mean the following documents: (a) Default Escrow Agreement; (b) Agreement to Hypothecate cum Deed of Hypothecation; (c) Share Purchase Agreement; and (d) any other agreement(s) designated as such, from time to time by the Procurers; RLDC shall mean the relevant Regional Load Dispatch Centre as defined in the Electricity Act, 2003, in the region in which the Project is located; Scheduled Commercial Operation Date or Scheduled COD shall, for each of the Unit/Power Station mean the dates specified by the Seller in terms of Schedule 15; Scheduled Energy shall means scheduled generation as defined in the CERC (Terms and Conditions of Tariff) Regulations, 2014; Scheduled Outage shall have the meaning ascribed to this term as per the provisions of the Grid Code; 25

26 Scheduled Sychronisation Date shall mean in relation to a Unit, the date, which shall be maximum of 6 (six) months prior to the Scheduled COD of the respective Unit; Selectee shall mean a company identified by the Lenders/ Procurers to either substitute the Seller or acquire the equity share capital of the Seller in accordance with the provisions of this Agreement; Seller s Event of Default shall mean the Procurer s default events listed in Article 20.1; Seller s Preliminary Default Notice shall mean the notice issued by the Seller to the Procurer(s) in terms of this Agreement, following a Procurer s Event of Default; Seller s Conditions Subsequent shall have the meaning set forth in Article 5.1; Seller s Conditions Subsequent Period shall have the meaning set forth in Article 5.1; Seller s Designated Account shall have the meaning as set forth in Article ; Share Purchase Agreement shall mean the share purchase agreement executed between the Seller, the Successful Bidder along with the shareholders of the Seller; SLDC shall mean the relevant State Load Dispatch Centre as defined in the Electricity Act, 2003, in the State where the Project is located; State Transmission Utility or STU shall have the meaning ascribed thereto in the Electricity Act, Substitution/Acquisition Notice shall mean the notice issued by the Lead Lender/Lenders/ Procurers to the Seller in terms of this Agreement, signifying its intention to identify the Selectee and require it to acquire the equity share capital of the Seller or the ownership of the Project along with all its assets and the Project Documents (except the Share Purchase Agreement) and this Agreement accordance with Articles 9.6.1(B), Article (B) as the case may be read with Schedule 12; Successful Bidder shall mean the Bidder selected pursuant to the bidding process to undertake the Project and supply the Contracted Capacity therefrom to the Procurers through the Seller pursuant to the terms of this Agreement and other RFP Project Documents; Supercritical Technology shall mean the technology in which a Unit is designed for main stream pressure more than the critical pressure (221.2 bars); Supplementary Bill shall mean a bill other than a Monthly Bill raised by any of the Parties in accordance with Article 16.3; Takeover Notice shall mean the notice furnished by the Procurers to the Seller in order to exercise the Procurers Takeover in accordance with the terms of this Agreement; Takeover Payment shall mean the payment to be made to the Lenders (if any) by the Procurers in the event of a Procurers Takeover; Tariff shall have the meaning as set forth in Article ; 26