Draft Concession Agreement

ARTICLE 3
GRANT OF CONCESSION

3.1 The Concession

3.1.1 Subject to and in accordance with the provisions of this Agreement, the Applicable
Laws and the Applicable Permits, the Authority hereby grants to the
Concessionaire the concession set forth herein including the exclusive right,
license and authority to demand, collect and appropriate Fee, operate, manage and
maintain the Project Highway (the “Concession”) subject to and in accordance
with terms hereof, for a period of 30 (thirty years) commencing from the
Appointed Date (the “Concession Period”) and the Concessionaire hereby accepts
the Concession and agrees to implement the Project subject to and in accordance
with the terms and conditions set forth herein.

Notwithstanding anything to the contrary in this Agreement, the Parties expressly

agree that the Concession Period shall not be reduced by more than 5 (five) years,
or shall not be increased by more than 10 (ten) years on any account or for any
reason whatsoever.

3.1.2 Subject to and in accordance with the provisions of this Agreement, the
Concession hereby granted shall oblige or entitle (as the case may be) the
Concessionaire to:

(a) Right of Way, access and license to the Site for the purpose of and to the
extent conferred by the provisions of this Agreement;

(b) manage, operate and maintain the Project Highway and regulate the use
thereof by third parties in accordance with terms hereof;

(c) demand, collect and appropriate Fee from vehicles and Users liable for
payment of Fee for using the Project Highway or any part thereof and
refuse entry of any vehicle if the Fee due is not paid;

(d) perform and fulfill all of the Concessionaire’s obligations under and in
accordance with this Agreement;

(e) bear and pay all costs, expenses and charges in connection with or
incidental to the performance of the obligations of the Concessionaire
under this Agreement; and

(f) neither assign, transfer or sublet or create any lien or Encumbrance on this
Agreement, or the Concession hereby granted or on the whole or any part
of the Project Highway nor transfer, lease or part possession thereof, save
and except as expressly permitted by this Agreement.

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 Draft Concession Agreement

ARTICLE 24
Effect of variation in Toll collection

24.1 Variation in Toll collection

The Authority and the Concessionaire acknowledge that the toll collections in the
month of March 2029 (the “Target Point 1”) is estimated to be
Length(km) Revenue (Rs.
Stretch Crores)
Siddhantham to Gundugolanu section (from km 950+542 to km 1022+494) 71.95
98
of NH5 in the State of Andhra Pradesh
Diwancheruvu to Siddhantham section (from km 901+500 to km 950+542) 49.04
104
of NH5 in the State of Andhra Pradesh;
Annavaram to Diwancheruvu section (from km 830+525 to km 901+500) 70.98
200
of NH5 in the State of Andhra Pradesh;
Ankapalli to Annavaram (Tuni) section (from km 741+255 to km 88.53
380
830+525) of NH5 in the State of Andhra Pradesh;
Icchapuram to Narasannapeta section (from km 484+000 to km 580+700) 96.70
201
of NH5 in the State of Andhra Pradesh;
Puintola to Icchapuram section (from km 419+600 to km 484+000) of NH5 64.40
165
in the State of Odisha and Andhra Pradesh;
Bamanbore to Garamore section (from km 182+600 to km 254+537) of 71.94
166
NH8A in the State of Gujarat;
Garamore to Samakhiyali section (from km 254+537 to km 306+000) of 51.46
377
NH8A in the State of Gujarat
Porbandar - Jetpur section (from km 001+960 to km 117+600) of NH8B in 115.64
110
the state of Gujarat

Rs 1,801 cr (Rupees One Thousand Eighteen Hundred and One Crores) (the
“Target Fee 1”) and the toll collections in the month of March 2039 (the “Target
Point 2”) is estimated to be
Length(km) Revenue (Rs.
Stretch Crores)
Siddhantham to Gundugolanu section (from km 950+542 to km 1022+494) 71.95
251
of NH5 in the State of Andhra Pradesh
Diwancheruvu to Siddhantham section (from km 901+500 to km 950+542) 49.04
265
of NH5 in the State of Andhra Pradesh;
Annavaram to Diwancheruvu section (from km 830+525 to km 901+500) 70.98
680
of NH5 in the State of Andhra Pradesh;
Ankapalli to Annavaram (Tuni) section (from km 741+255 to km 88.53
976
830+525) of NH5 in the State of Andhra Pradesh;
Icchapuram to Narasannapeta section (from km 484+000 to km 580+700) 96.70
511
of NH5 in the State of Andhra Pradesh;
Puintola to Icchapuram section (from km 419+600 to km 484+000) of NH5 64.40
422
in the State of Odisha and Andhra Pradesh;
Bamanbore to Garamore section (from km 182+600 to km 254+537) of 71.94
315
NH8A in the State of Gujarat;
Garamore to Samakhiyali section (from km 254+537 to km 306+000) of 51.46
941
NH8A in the State of Gujarat
Porbandar - Jetpur section (from km 001+960 to km 117+600) of NH8B in 115.64
260
the state of Gujarat

Rs 4,620 cr (Rupees Four Thousand Six Hundred and Twenty Crores) (the
“Target Fee 2”) and hereby agree that for determining the modifications to the
Concession Period under this Clause, the monthly toll collection at Target Points 1
or 2, as the case may be, shall be derived from the average of the toll collection as

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 Draft Concession Agreement

determined using traffic sampling to be undertaken, in accordance with Clause 19,

in the month that falls one year prior to the Target Points 1 or 2 as the case may be,
during the month of the Target Points 1 or 2 as the case may be, and on the first
anniversary of the Target Points 1 or 2 as the case may be (the “Actual Fee 1” and
the "Actual Fee 2"). For the avoidance of doubt, it is agreed that traffic sampling
shall be undertaken for a continuous period of at least 7 (seven) days during the
month specified herein and the average thereof shall be deemed to be the actual
traffic. It is further agreed that if the Project Highway shall have 2 (two) or more
Toll Plazas, the average traffic thereof shall be computed for determining the
actual traffic hereunder.
24.2 Modification of Concession period due to variation in Target Fee 1
Subject to the provisions of Clause 14, in the event that the Actual Fee 1 shall have
fallen short of or exceeded the Target Fee 1 by more than 20% (twenty percent)
thereof, the Concession Period shall be deemed to be modified in accordance with
Clause 24.5.1. For the avoidance of doubt, in the event of any Dispute, the Dispute
Resolution Procedure shall apply.
24.3 Modification of Concession period due to variation in Target Fee 2
Subject to the provisions of Clause 14, in the event that the Actual Fee 2 shall have
fallen short of or exceeded the Target Fee 2 by more than 30% (thirty percent)
thereof, the Concession Period shall be deemed to be modified in accordance with
Clause 24.5.2. For the avoidance of doubt, in the event of any Dispute, the Dispute
Resolution Procedure shall apply.
24.4 Capacity Augmentation
It is hereby acknowledged and agreed by and between the Concessionaire and the
Authority that the Target Point(s) shall not be revised in the event the Authority
undertakes Capacity Augmentation pursuant to Clause 14.

24.5 Quantum of modification in the Concession Period

24.5.1 Subject to the provisions of Clause 24.2 and Clause 3.1, in the event Actual Fee 1
shall have fallen short of or exceeded the Target Fee 1 by more than 20% (twenty
percent), then for every 1% (one percent) shortfall or increase as compared to the
Target Fee 1, the Concession Period, subject to fulfillment of terms of this
Agreement, shall be increased by 1.5% (one and a half percent) or decreased by
0.75% (point seven five percent) thereof; provided that such increase or decrease in
Concession Period shall not in any case exceed not more than limits specified in
Clause 3.1. For the avoidance of doubt, and by way of illustration, it is agreed that
in the event of a shortfall or increase by 30% (thirty percent) in Target Fee 1, the
Concession Period shall be increased by 15% (fifteen percent) or decreased by
7.5% (seven and a half percent) thereof.
24.5.2 Subject to the provisions of Clause 24.3 and Clause 3.1, in the event Actual Fee 2
shall have fallen short of or exceeded the Target Fee 2 by more than 30% (thirty
percent), then for every 1% (one percent) shortfall or increase as compared to the
Target Fee 2, the Concession Period, subject to fulfillment of terms of this
Agreement, shall be increased by 1.5% (one and a half percent) or decreased by
0.75% (point seven five percent) thereof; provided that such increase or decrease in

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Concession Period shall not in any case exceed not more than limits specified in
Clause 3.1. For the avoidance of doubt, and by way of illustration, it is agreed that
in the event of a shortfall or increase by 40% (forty percent) in Target Fee 2, the
Concession Period shall be increased by 15% (fifteen percent) or decreased by
7.5% (seven and a half percent) thereof.

24.5.3 Subject to the provisions of this Article 24 and clause 3.1, the effect of change in
Concession Period due to Target Fee 1 and 2 be additive in nature.

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