Guidelines for determination of tariff & SBD for ... - Ministry of Power

Standard PPA for … [Insert ‘medium’ or ‘long’, as applicable] term power procurement under Case -1
Provided that it shall not constitute a Procurer Event of Default, where such
dissolution or liquidation of Procurer or such Procurer is for the purpose of a
merger, consolidation or reorganization and where the resulting entity has
the financial standing to perform its obligations under this Agreement and
has creditworthiness similar to Procurer or such Procurer and expressly
assumes all obligations of Procurer or such Procurer under this Agreement
and is in a position to perform them; or;
(vii) occurrence of any other event which is specified in this Agreement to be a
material breach or default of the Procurer(s).
11.3 Procedure for cases of Seller Event of Default
11.3.1 Upon the occurrence and continuation of any Seller Event of Default under Article 11.1,
[Insert “the Procurer” or “Majority Procurers, through the Lead Procurer” in case of
multiple Procurers](s)shall have the right to deliver to the Seller a notice with a copy to
the Appropriate Commission and the Lenders’ Representative(if substitution rights
agreed to be provided) [To be inserted if subsititution rights are demanded to be provided
by the Seller] , of their intention to terminate this Agreement (Procurer Preliminary
Default Notice), which shall specify in reasonable detail, the circumstances giving rise to
the issue of such notice.
11.3.2 Following the issue of Procurer Preliminary Default Notice, the Consultation Period of
ninety (90) days or such longer period as the Parties may agree, shall apply and it shall be
the responsibility of the Parties to discuss as to what steps shall have to be taken with a
view to mitigate the consequences of the relevant Event of Default having regard to all
the circumstances.
11.3.3 During the Consultation Period, the Parties shall, save as otherwise provided in this
Agreement, continue to perform their respective obligations under this Agreement.
11.3.4 Within a period of seven (7) days following the expiry of the Consultation Period unless
the Parties shall have otherwise agreed to the contrary or the Seller Event of Default
giving rise to the Consultation Period shall have ceased to exist or shall have been
remedied, the Procurer(s) may terminate this Agreement by giving a written Termination
Notice of thirty (30) days to the Seller with a copy to the Appropriate Commission.
[Insert further in case the Seller chooses the option of Lender’s substitution rights] A
copy of the Termination Notice shall be given to the Lenders’ Representative. The
Lenders may exercise or the Procurer(s) may require the Lenders to exercise their
substitution rights and other rights provided to them, if any, under Financing Agreements
and the Procurer(s) would have no objection to the Lenders exercising their rights if it is
in consonance with provisions of Schedule 12. Alternatively, in case the Lenders do not
exercise their rights as mentioned herein above, the Capacity Charge of the Seller shall be
reduced by twenty percent (20%) for the period of Seller Event of Default.
11.3.5 Further, in addition to the reduction in Capacity Charges as per the provision in Article
11.3.4, the Seller shall be liable to pay to the Procurer(s), charges equivalent to twelve
(12) months Capacity Charges calculated at Normative Availability. Such payment shall
be made by the Seller to the Procurer(s) within thirty (30) days of the termination of the
Agreement. In case of inability of the Seller to make such payment within the stipulated
time period of thirty (30) days, the Procurer(s) shall have the right to encash the Contract
…….[Insert name of Procurer(s)] 69