Queries on the Tender Document and Leave and Licence Agreement for 1, Man Singh Road

Transcription

1 Queries on the Tender Document and for 1, Man Singh Road 1. Clause , Annexure VII of the Tender Document Disclosure Schedule has been defined as Annexure VII of the Tender Document which contains the order of the Honourable Supreme Court of India dated April 20, 2017 permitting NDMC to hold the e-auction of the Property ( Order ). (a) The defined term Disclosure Schedule has not been used in the Tender Document except as the heading of Annexure VII. Please clarify the intended purpose, and usage in the Tender Document, of the term Disclosure Schedule. (b) As this issue is sub-judice before the Hon ble Delhi High Court, we would request that NDMC considers the deferment of the tender process to await the judgment of the Hon ble High Court since a decision on this issue is critical to the tender process. (c) Without prejudice to our contentions and rights in relation to the same, or the decision of the Hon ble High Court, we would request you to please clarify how the Order has been addressed and been taken into account in the Tender In particular, please confirm how the following provisions of the Order are being taken into consideration/ given effect to in the Tender Document and the bidding process as has been specified by the Honourable Supreme Court in the Order: After perusing the material available on record, we do not intend to pass any order on this Special Leave Petition except that we allow the respondent N.D.M.C. to hold the e-auction of the property in question, but at the time of holding such auction, they shall take into account the unblemished track record of the petitioner Hotel as well its capability. The respondent N.D.M.C. shall consider all these aspects, in the peculiar facts and circumstances of this case, when they use their power under Section 141 of the New Delhi Municipal Council Act, 1994 and take a final decision in the matter. (d) Without prejudice to our query in (c) above, at what stage of the bid process and in what manner does NDMC propose to give effect to the direction of the Order as extracted above? (e) Further, the definition in Clause states that it shall mean the Schedule attached as Annexure VII, wherein NDMC has disclosed all information available with it in relation to the Property. However, the Annexure VII is only a copy of the exact text of the Supreme Court Order. Please clarify as to how this gives out any information relating to the Property and its features? Further, please clarify as to why no information of the Property is disclosed in the Annexure VII, as per the definition? Page 1 of 20

2 Queries on the Tender Document and for 1, Man Singh Road 2. Clause of the Tender Document and Clause of the Clause be amended as follows: "Gross Revenue" of the Property for any Financial Year shall mean the total amount of revenue and receipts of every kind (from both cash and credit transactions) derived by the e from the operation of the Property and its facilities, as certified by the statutory auditors of the e, including receipts from room occupancy charges, telephone, telefax and telex charges, laundry, sale of food, beverages, liquor, recreational amenities (outdoor pool, health club, spa, sauna, fitness facility etc.), outdoor catering, receipts from vending machines; parking, commercial or other spaces on account of rent and / or fee from the sub-es of every description and kind, and the recovery in respect of any other service or facility provided by the e to the users / guests of the said Property, which are availed/ realized by the e from an outside party(ies) at a consideration BUT shall exclude and be arrived at after deducting the following: 3. Clause read with Clause , 3.1.2, and c of the Tender Document A. all statutory applicable indirect taxes such as luxury tax, sales tax, entertainment tax, expenditure tax, service tax, goods & services tax and the like by whatever name called now or in future, which the e has agreed to pay or is bound to pay; B. revenue on sale of assets of capital nature owned by the e; and C. interest income from investments made. D. commissions paid to travel agents, tour operators and credit card companies. E. Services Charges levied and/or collected by the e for distribution to the employees during the Period. F. Monies recovered from the hotel employees for subsidized facilities. During the Pre-Bid Conference, NDMC had categorically clarified that the eligibility terms had been discussed at the highest levels and would not be subject to any change. However, the eligibility criteria under the Tender Document has undergone a significant change. The revised eligibility criteria completely dilutes the tender process and treats bidders with owned brand on par with bidders who do not own the brand. This sudden and material dilution of eligibility condition would make it possible for entities, which lack the necessary capability required for operating a hotel property such as the property in question, to qualify for participating in the bid. Without there being a provision for giving added weightage/preference to the bidders having owned brand, this diluted eligibility criterion fails the test of equality (as it treats unequals as equals). The fact that the bidder, who is collaborating with a brand owner, needs to have a binding agreement with the brand owner only for 10 years, further exemplifies the unreasonableness of this provision which treats bidder who own the brand and those who don t, on par. Page 2 of 20

3 Queries on the Tender Document and for 1, Man Singh Road Please clarify the rationale for such a change despite the decision having already been taken at the highest levels, as earlier represented by NDMC. Further, please clarify as to how this change incorporates the Order, which binds NDMC to take into account the unblemished track record and capability of IHCL while conducting the e-auction. As this issue is sub-judice before the Hon ble Delhi High Court, we would request that NDMC considers the deferment of the tender process to await the judgment of the Hon ble High Court since a decision on this issue is critical to the tender process. 4. Clause of the Tender Document We understand that the will be granted for the purpose of operating a hotel of 5 Star rating and the license also includes expansion of the property in the case of increase in FAR of the Property (as provided under Clause 14.1 of the ) with the prior permission of NDMC. Further, the Tender Document does not specify the minimum number of rooms that the licensee will be required to operate at the Property. Please confirm the minimum number of rooms at the Property to be operated by the licensee. Accordingly, we recommend clause be replaced with the following definition: shall mean the license granted by NDMC to the Successful Bidder, to refurbish, operate, maintain, renovate, expand and manage the Property, as the case may be, during the Period including for the purpose of carrying out all activities in relation to the operation and management of the Property as a 5 star hotel not having less than 250 guest rooms with minimum of 5 food and beverage outlets, minimum of 10,000 sq.ft of banqueting and the appurtenant services and facilities conforming to the minimum standards laid down by the Director General of Tourism, Ministry of Tourism, Government of India, for 5 star classification by the Successful Bidder granted by the NDMC in accordance with the terms of the Tender Document and the Definitive Documents. Page 3 of 20

4 Queries on the Tender Document and for 1, Man Singh Road 5. Clauses 2.4, 2.8, 7.1.1(i), and (ii) of the Tender Document We note that the basis of shortlisting the Qualified Bidder for the e-auction is the initial price offer which is linked to a percentage of the Gross Revenue. The process would make it possible for a Bidder to quote a high initial price offer (and therefore qualify as a Qualified Bidder) but not, in fact, provide NDMC with a higher license fee, in the event its Gross Revenue is not high. For example, a Bidder A may quote the initial price offer as 25% of the Gross Revenue assuming the Gross Revenue to be INR 150 Crores and the Bidder B may quote the initial price offer as 20% assuming a Gross Revenue of INR 250 Crores. Although the initial price offer quoted by B would be higher in spite of quoting a lesser percentage than A, A would qualify for the financial bid since the percentage quoted by A is higher than B and B would be ranked lower than A with a higher chance of disqualification. A similar issue will arise during the course of submission of the Financial Bid. As this issue is sub-judice before the Hon ble Delhi High Court, we would request that NDMC considers the deferment of the tender process to await the judgment of the Hon ble High Court since a decision on this issue is critical to the tender process. While this issue is subject to the decision of the Honourable High Court of Delhi, without prejudice to our rights and contentions, we would request NDMC to reconsider their model since the criterion to decide on the Qualified Bidders is flawed and it would not only adversely impact bidders who have a more effective revenue model, but also result in revenue loss for the NDMC. That would militate against the objective of the present tender. Page 4 of 20

5 Queries on the Tender Document and for 1, Man Singh Road 6. Clause of the Tender Document During the Pre-Bid Conference, a specific query was raised on point of cross holding of 5% being prohibited under the Previous Tender Document and it was specifically clarified by NDMC that the Conflict of Interest clause would not be amended. However, the said clause has now been amended, increasing the cross holding cap to 20%. In the said context, the change is inconsistent with the test of reasonableness, as the said query, in spite of having been categorically denied in the Pre-Bid Conference, has been addressed in the Tender Document by significantly modifying the cross holding cap. Kindly clarify the rationale for this change. Furthermore, the affirmative change in response to the queries on cross holding cap is in contrast to the fact that IHCL s query on incorporation of/compliance with the Order has not been addressed at all. 7. Clause (ii) of the Tender Document 8. Clause 7.3 of the Tender Document The Clause (ii) provides that if the e is unable to, for any reasons whatsoever, make the Property fully operational within a period not exceeding 18 months from the Effective Date, the Minimum Guaranteed Fee shall be subject to revisions in the form of escalation at the simple rate of 3% monthly (i.e. 36% per annum), commencing from the expiry of 18 months from the Effective Date. In case of IHCL being declared as the Successful Bidder, we understand that this clause will not be applicable since the Property will continue to be operational without any interruption and renovations can be done in a phased manner. Kindly confirm our understanding in this regard. We understand that the Auction process will commence at 11 AM. Kindly confirm the duration of the Auction Process and the end time. Please refer to Annexure X of the Tender Page 5 of 20

6 Queries on the Tender Document and for 1, Man Singh Road 9. Annexure VI, Paragraph (f) and Paragraph (g); Affidavit to be submitted by Bidder as per the Tender Document Since IHCL is a large operating company, it is proposed that Paragraph (f) and (g) of Annexure VI be modified as follows: (f) There are no material actions, suit, proceedings or investigations pending or to the knowledge of the Bidder threatened against the bidder before any court or judicial authority/ quasi-judicial authority, which may result in a breach of the Deed; (g) The Bidder has no knowledge of any material violation or default with respect to any order, writ, injunction or any decree of any court or any legally binding order of any Governmental Authority related to undisputed claims or dues which may breach the terms of the Deed Annexure VIII and Clause of the Tender Document Please confirm that at the time of submission of the technical bid, only the Bidder would be required to sign the Integrity Pact. At the time of submission of Technical Bid only the Bidder will be required to sign the Integrity Pact. The authorized signatory of NDMC will sign the Integrity Pact at the time of Opening of Technical Bids as mentioned in Clause 7.3 of the Tender 11. NA There are more than 800 direct and indirect staff working in the Hotel. In the event of IHCL not being the successful bidder, there is no indication in the Tender document on the future employment of the said staff, who have put in long years of service in the Hotel. It is a socio-economic issue, which needs to be addressed in the Tender document. Please clarify. 12. Clause ; Clause ; Clause 7.3 of the The Schedule for Bidding Process in Clause 7.3 gives an estimate of the Effective Date as Monday, December 31, However, this Effective Date and all other dates referred in Clause 7.3 must be firm/mandatory, to allow any new incumbent to refurbish the property and commence operations within the stipulated timeline. NDMC will need to ensure that the current incumbent vacates the premises at least one month before the Page 6 of 20

7 Queries on the Tender Document and for 1, Man Singh Road Tender Document Effective Date. 13. Clauses , and 7.1.4; of the Tender Document 14. Clause of the Tender Document along with Clause of the 15. Clause (viii) of the Tender Document 16. Clause of the Tender Document It is recommended that this Escalation Rate be fixed at a rate of 5% every 3 years, and not link it to the WPI. Further, for a new incumbent, the escalation should be applicable only after a period of 30 months after the Effective Date, to cognize for stabilisation of the hotel operations While the said fee may be collected in the form of a non-refundable amount as mentioned in Clause ; It is recommended that Clause of the License should be deleted along with; the following portion of Clause During the refurbishment period of eighteen (18) months, the Fee shall be adjusted against the Upfront Fee, as below Clause should read as: The Licensor shall notify any change in the aforesaid bank account details to the e in writing. The Fee shall accrue on a daily basis, beginning from the first day of the month in which the Effective Date falls, but shall be payable in advance on the Due Date of the relevant month. During the refurbishment period of eighteen (18) months, the Fee shall be adjusted against the Upfront Fee. Upon the occurrence of a e Event of Default the Licensor shall be entitled to appropriate the entire balance Upfront Fee and the Performance Security. The Licensee agrees that the amounts so forfeited represent genuine estimate of losses and damages suffered by the Licensor due to the e Event of Default. Proviso to Clause (viii) of the tender document states that where the total number of Technically Qualified Bidders is less than three (3), then no Technically Qualified Bidder shall be considered to be a Qualified Bidder and the e-auction process shall be annulled. It is submitted that this condition be withdrawn provided the defined e-auction process has been followed. It is recommended that the bid validity is limited to 6 months which shall correlate with the timelines of execution of the Definitive documents, i.e. December 31, Page 7 of 20

8 Queries on the Tender Document and for 1, Man Singh Road 17. NA Force majeure events are not covered in the Tender Document and must be included. Please refer to Clause 15 of the. 18. NA We understand that the Licensed Premises will be handed over to the Successful Bidder, being a new incumbent, free of any encumbrances and dues etc. for the period prior to the Effective Date. Confirmation of the same is required from the NDMC. 19. NA We understand that the Successful Bidder, being a new incumbent, will not be liable for any past issues of the current incumbent, including (but not limited to) any litigations, dues, etc. for the period prior to the Effective Date. In this context we also understand that the successful bidder shall have no liability towards any existing or past employees of the current incumbent. Confirmation from NDMC is requested with regard to this matter. 20. NA We understand that the new incumbent will not, under any circumstances be liable for dues of Property Taxes, Ground Rent, Municipal Taxes, House Tax, Ground Rent, Fees etc. payable for the period prior to the Effective Date. 21. NA We request for details with respect to the Premises being d on As is where is basis, including specific, detailed list of assets to be handed over to the new incumbent, by location. e.g.: the floor tiles, marbles, tiles/tapestries on the walls, etc. Please refer to Clause and Clause of the Tender Please refer to Clause and Clause of the Tender Document Please refer to Clause and Clause of the Tender Document Page 8 of 20

9 Queries on the Tender Document and for 1, Man Singh Road 22. NA It is understood that the any alterations that are made by the new incumbent which are, in any manner attached to the floors, walls or ceilings, the removal of which shall cause any damage to the d Premises, shall remain upon the d Premises and be surrendered to the Licensor at the expiration or early termination of the. No compensation of the same shall be made by the NDMC. It is recommended that NDMC should consider payment of compensation for immovable improvements to be left behind by the e at an appropriate value. 23. NA It was observed that Clause 8 in the on e s Covenants and Undertaking has a lot of clauses that are repetitive in nature and many of the clauses can be replaced by an omnibus clause that the e shall be responsible for compliance with all Applicable Laws. 24. Clause of the Tender Document 25. Clause of the Tender Document 26. Clause of the Tender Document Given that a new incumbent will only commence operations post the initial 18 months refurbishment period without a revenue stream, it is recommended that the License Fee be payable only after 18 months from the Effective Date, i.e. with the Effective Date as December 31, 2018 the License Fee should be payable starting from July 1, At best a nominal fee may be charged during this period, as the payment of fee during the refurbishment period shall give an undue advantage to the current incumbent as they shall not be required to undertake this refurbishment activity. Given that a new incumbent will only commence operations post the initial 18 months refurbishment period without a revenue stream, it is recommended that Period be extended for at least 34.5 years from the Effective Date, for the Successful Bidder, being a new incumbent. Ideally, the may be granted for a period of at least 50 years, from a feasibility perspective for any new incumbent given the large upfront investment such a property will demand. It is recommended that, for a new incumbent, the said penal interest be made applicable only post 24 months from the date all statutory approvals/ permits are received. Considering a 6 month grace period. Further, it is recommended that the Property should be exempted from any levies including Property Tax during the refurbishment period. Page 9 of 20

10 Queries on the Tender Document and for 1, Man Singh Road 27. NA Will a new incumbent have access to the Premises during the handover period; post the date of Letter of Award till issue of Occupation Letter to the new e, to facilitate planning and execution of the refurbishment? The Successful Bidder will be allowed to access the property after the Effective Date. 28. Clause of the Tender Document It is recommended that NDMC facilitate a Single Window Clearance mechanism, for a new incumbent, for transfer/grant of all approvals/ licences (including but not limited to Fire, Pollution, Water, etc) to complete the refurbishment activity and commence operations as per the stipulated timelines, including the necessary Security Clearance. Since, as per the tender document any structural change (Clause and of the ) is not permissible NDMC is requested to facilitate NOCs/s/approvals as applicable to the original structure including but not limited to fire/life safety, sewage disposal, basement usage etc. It is further requested that all the existing arrangements/agreements/licences/mous etc between NDMC and the current incumbent are shared with us for carrying out due diligence. 29. NA NDMC is requested to share the details of ownership etc. with respect to the land on which the Premises have been constructed. NDMC is also requested to confirm that no other person other than NDMC shall have any recourse on the land/ property. 30. NA The potential bidders should be provided with data on historical financial performance of the hotel. This would be necessary for the bidder to benchmark estimated revenue and hence provide realistic bids. This is also in view of the fact that IHCL, one of the bidders, is already in possession of such information and hence there is information asymmetry in the bidding process. 31. NA It is requested to confirm that the only criteria for selection of a Successful bidder is based only on the Financial Bid submitted by a Technically Qualified Bidder. The Licensor of the property is NDMC. Please refer to Clause Page 10 of 20

11 Queries on the Tender Document and for 1, Man Singh Road (iv) of the Tender 32. NA This to inform you that if the prospective bidder XYZ Ltd. becomes winner of the bid, then it would like to create a 50:50 Special Purpose Vehicle (SPV) or the majority of equity of such SPV shall be with XYZ Ltd. The SPV shall hold & operate the property at Plot No. 1, Man Singh Road, New Delhi. The shareholding of the SPV shall be maintained during the 33-year-old Leave &. The SPV will be made self-sustainable. The SPV will be a limited company incorporated under the Companies Act, XYZ Ltd. s group company shall have the control of the SPV & the SPV will follow all the conditions laid down by NDMC. We hope that this is permissible as per the guidelines of Planning Commission, Government of India on tendering of government properties or any other government approved tender documents. 33. NA We represent XYZ Ltd., a conglomerate of several 5 star hotel companies with pan India & Nepal presence. As a hotel company our experience in developing & operating hotel assets spans over 4 (four) decades. With respect to the financial eligibility conditions of the bidder as per Clause No.3 of the Tender Document No. NDMC/1-ManSinghRoad/18-19/ET/01 issued on 25th April, 2018 by NDMC, average of the turnover over the last 3 (three) financial years including financial year of the bidder should be at least Rs. 400 Crores. ABC Ltd., a part of our conglomerate & which owns & operates 3 (three) five star hotels namely Hotel A, Hotel B and Hotel C and has an average turnover greater than Rs. 400 Crores after considering the turnover for the last three financial years viz , & Clause (ii) of the In view of the above, we hope that ABC Ltd. is meeting the average turnover eligibility criteria as one of the prospective bidders. The Clause provides that if the e is unable to, for any reasons whatsoever, make the Property fully operational within a period not exceeding 18 months from the Effective Date, the Minimum Guaranteed Fee shall be subject to revisions in the form of escalation at the simple rate of 3% monthly (i.e. 36% per annum), commencing from the expiry of 18 months from the Effective Date. In case of IHCL being declared as the Successful Bidder, we understand that this clause will not be applicable since the Property will continue to be operational without any interruption and renovations can be done in a No Change in the Tender Page 11 of 20

12 Queries on the Tender Document and for 1, Man Singh Road phased manner. Kindly confirm our understanding in this regard. 35. Clause 4.4.4, Clauses 16.1 and of the of the 36. Clause of the We propose Clause (i) be modified as follows: breach of any of the terms or conditions of the and/or the Definitive Documents, including occurrence of a e Event of Default and expiry of cure period of 30 days as specified in Clause ; It is standard in agreements of such nature for a carve out to be made in relation to indirect or consequential losses. Accordingly, please consider modifying the clause as follows: The e hereby indemnifies and shall at all times keep fully and effectually saved, harmless and indemnified the Licensor, its employees, officers, consultants, advisors, representatives, and agents (collectively "Indemnified Parties"), from and against all actions, claims, demands, proceedings, losses, damages, costs, charges and expenses which the Licensor may incur, sustain or suffer by reason of non-payment or delayed payment by the e of the amounts or any part thereof in respect of or relating to the d Premises payable by the e under this. Provided that the obligations of the e pursuant to this Clause shall be limited to all direct costs, losses, damages or claims incurred by the Licensor and shall not extend to any indirect or consequential losses. No Change in the Tender No Change in the Tender Page 12 of 20

13 Queries on the Tender Document and for 1, Man Singh Road 37. Clause 5.4 of the Sub-licensing of the premises within the d Property for the purpose of carrying out retail operations or utilizing the same for office space is ancillary to the operations and management of the d Premises carried out by the e in the ordinary course of business and is an integral part of the hotel operations. Accordingly, we suggest that Clause 5.4 be modified as follows: Assignment/ Sub-letting/ Mortgage, etc.: The e covenants and agrees that the e shall not, directly or indirectly, transfer, mortgage, pledge, assign, hypothecate, encumber, let or sublet or part with the occupation of the d Premises or any part thereof and/or the benefits arising out of this or any part thereof in any manner whatsoever to any Person, without the prior written consent of the Licensor. Provided that the sub- licensing or subletting or granting P of permission granted to any third party to operate permissible activities such as offices, retail areas, gymnasium, spa, restaurants, coffee shops, banquet halls, or any other facilities within the d Premises, shall not be subject to the given only after prior written approval from the Licensor. The contract shall be in compliance with the Applicable Laws and shall be expressly subject to the terms and conditions of the. Any sub-letting / sub-licensing / permission to third parties to operate or maintain the aforesaid facilities shall be co-terminus with or, less than the Period and upon expiry of the Period or, early termination of this by the Licensor, all permissions granted to third parties to operate or maintain any facility or amenities within the d Premises as aforesaid shall automatically cease and terminate forthwith and the e shall be obliged to handover vacant and peaceful occupation of the d Premises to the Licensor in terms of this. Such third party permissions shall not be in contravention of this and Applicable Laws. The e shall provide a copy of all such agreements executed with third parties to the Licensor within fifteen (15) days of execution of such third party agreement(s). 38. Clause of the 39. Clause (xix) (B) of the Leave and In order to ensure that there is no interruption in the continuity of operations with the respect to the d Premises, we request that the requirement to provide prior notice of 24 (twenty four) hours be replaced with 14 (fourteen) days. We suggest the following modifications to Clause (xix) (B): pay all Taxes (other than property tax, if leviable) relating to the d Premises on or before the due date of making such payments as set out in this or as provided under Applicable Laws. For avoidance of doubt, property tax in relation to the d Premises shall be borne by the Licensor; Page 13 of 20

14 Queries on the Tender Document and for 1, Man Singh Road 40. Clause (xviii) of the It is standard in agreements of such nature for a carve out to be made in relation to indirect or consequential losses. Accordingly, please consider modifying the clause as proposed: The e shall be liable for and shall indemnify, protect, defend and hold the Indemnified Parties, harmless and indemnified, from and against any and all demands, claims, suits and causes of action and any and all liability, costs, expenses, settlements and judgments out of or in relation to the failure or non-compliance with the terms of this or the discharge of its obligations under this or Applicable Laws or Applicable Permits. Provided that the e shall have no such obligation to indemnify the Indemnified Parties if such liability, costs, expenses, settlements, claims, demands, suits and causes of action arise out of the gross negligence, willful default or fraud by the Indemnified Parties or where such losses incurred are indirect or consequential losses. 41. Clause (xxv) of the 42. Clause 11.2 of the It is standard in agreements of such nature for a carve out to be made in relation to indirect or consequential losses and losses suffered due to gross negligence, willful default or fraud on part of the Indemnified Parties. Accordingly, please consider modifying the clause as follows: The e shall maintain harmony and good industrial relations among the personnel employed in connection with the performance of its obligations under this and shall be solely responsible for compliance with all labour laws and liable for all possible claims and employment related liabilities of the staff employed in relation with the operations and management of the Licensed Premises, and that in no case and for no purposes whatsoever, shall the Licensor be treated as the employer in this regard. The e hereby agrees to indemnify and keep and hold the Indemnified Parties, harmless and indemnified against any and all claims, damages, expenses or losses incurred or caused to be incurred or suffered by them in this regard only provided that the e shall have no such obligation to indemnify the Indemnified Parties if such claims, damages, expenses or losses are incurred by the Indemnified Parties on account of willful default, gross negligence or fraud by such Indemnified Parties or where such losses are indirect or consequential losses; Since the representation will be repeated on each day, it should be with reference to the facts and circumstances existing on such day. Accordingly, please consider the following modification: The e hereby represents and warrants to the Licensor, as on the date of this with reference to the facts and circumstances existing on the date when such representation and warranty is made, which representation and warranty shall continue on each day for the entire Period as if made on each such day of the Period with reference to facts and circumstances existing on the date of such repetition that: No Change in the Tender Page 14 of 20

15 Queries on the Tender Document and for 1, Man Singh Road 43. Clauses and of the Kindly confirm that the e shall be entitled to the cure period of 30 (thirty) days as provided under Clause before the Licensor exercises any of the rights or remedies given under Clause No Change in the Tender 44. Clause 33 of the 45. Clause 8 of the 46. Clause of the 47. Clause of the 48. Clause 16.2 of the The Licensed Premises shall be operated and maintained as a hotel under the brand of the e. Further, any naming/re-naming of the Licensed Premises shall be done in line with the e s brand architecture. Accordingly, we propose that Clause 33 be deleted in its entirety. It was observed that Clause 8 in the on e s Covenants and Undertaking has a lot of clauses that are repetitive in nature and many of the clauses can be replaced by an omnibus clause that the e shall be responsible for compliance with all Applicable Laws. It is recommended that in the above clause the word Commenced be replaced by Finally concluded against the e. Also the phrase other action has been presented to a court be deleted from the above mentioned clause. It is requested that since the title of the Licensor has not been shared, hence the clause be deleted from the. It is submitted that the clause be deleted except for the clause , as the same shall be unfair to the e. Page 15 of 20

16 Queries on the Tender Document and for 1, Man Singh Road 49. Clause and of the It is submitted that the above two clauses be deleted. 50. Clause(s) 2.3.1(ii), , 4.1.2, and of the 51. Clause 2.3 (vi) of the 52. Clause of the 53. Clause (v) of the It is recommended to have a definite time period within which the Licensor needs to grant the prior permission to e for carrying out Refurbishment Work at d Premises and in case there is a delay on the part of Licensor in granting such prior permission without any fault/reason attributable to e then the Minimum Guarantee Fee to be paid by e should not be subjected to the revisions in the form of escalation for such time period. Clause (vi) of the states that the Refurbishment Works shall not cause any nuisance, disturbance or inconvenience to any Person within the neighbourhood. It is suggested that this clause be deleted. Clause of the state that If any electric sub-station is located in the basement of Licensed Premises, the same shall be maintained and operated by the Licensor or the Licensor Representatives, who shall at all times have the access to the sub-station without any obstruction or hindrance and the e shall not claim any compensation from the Licensor for the space occupied for running the sub-stations. The Licensor shall be responsible for the maintenance of all electric installation and appliances up to the main electricity meter in the Licensed Premises. Any un-regulated access to the premises shall be a potential operational hindrance which will be unfair to the new incumbent at any point of time. It is requested that the clause is deleted as such from the. Clause (v) of the requires the e to obtain and maintain a comprehensive building policy prior to commencement of any Refurbishment Works. Since the ownership of the premises does not get transferred with the execution of the Definitive Documents, the responsibility of taking insurance for the premises should remain with the owners. Hence it is requested Page 16 of 20

17 Queries on the Tender Document and for 1, Man Singh Road that the e be relieved from complying with this covenant and the said clause be deleted. 54. Clause of the 55. Clause of the Clause of the state that The e has inspected the Licensed Premises and has satisfied itself in all respects in relation thereto including as to the covered area and carpet area of the Licensed Premises, FAR, location, area and state thereof. Since no detailed inspection has been done by the bidder nor is there any window available to carry out an inspection till the execution of the Definitive Documents, hence it is requested that the said clause be deleted from the agreement. Clause of the state that It is in compliance in all respects with all Applicable Laws and Applicable Permits including those which are necessary or desirable in respect of the conduct of its business, the ownership of assets, in relation to the Licensed Premises or for the development, operation and management of the Licensed Premises. Physical handover of the premises is required for obtaining many of the permits and ensuring the compliance of the applicable laws required for conduct of the business, the ownership of assets in relation to the Licensed Premises or for the development, operation and management of the Licensed Premises. Hence it is suggested that the clause shall be changed which should read as: The e shall ensure it is in compliance in all respects with all Applicable Laws and Applicable Permits including those which are necessary or desirable in respect of the conduct of its business, the ownership of assets, in relation to the Licensed Premises or for the development, operation and management of the Licensed Premises before the commencement of the refurbishment work or commencement of operation, as applicable. 56. NA We request NDMC to provide us the Structural Stability Certificate from a Government approved Architect meeting the current seismic requirement for the Premises. Building is an RCC framed structure having life expectancy of around 75 to 100 years depending on the maintenance. The licence Page 17 of 20

18 Queries on the Tender Document and for 1, Man Singh Road right of the property is offered on "As is where is Basis". 57. NA We request NDMC to clarify if the current incumbent received any NOC/approval for the withdrawal/usage of ground water? The successful bidder has to apply to NDMC for water connection as per the applicable norms. Same will be made available as per applicable policy and statutory provisions in this regard. Regarding usage of ground water, the provisions of applicable laws will be applied. Current occupant is having two licensed bore wells. 58. NA It is requested that NDMC provides the e a representation on the structural condition of the Hotel. Building is an RCC framed structure having life expectancy of around 75 to 100 years depending on the maintenance. The licence right of the property is offered on "As is where is Basis". 59. Clause of the As per clause of the, the terrace area will be a part of the Premises and will be an open area and shall not be used for commercial purposes. It is understood that the d Open terrace is not a part of FAR, therefore, cannot be Page 18 of 20

19 Queries on the Tender Document and for 1, Man Singh Road Premises consists of two rooftop restaurant areas (as mentioned in Schedule 1 of the ). It is hence requested to clarify that such space in use for the two rooftop restaurants are not included under this clause? used for commercial purpose. 60. Clause of the 61. Clause 1.1.7, Clause of the Tender Document 62. Clause (b) of the For a new incumbent to ensure structural stability at the time of planning the changes required in the premises, it shall require the information regarding existing structural condition. It is requested that the NDMC provides all the information relating to the existing structural stability/integrity to the bidder, so that the assessment of any change can be planned in an appropriate manner. IHCL is a company incorporated under the Indian Companies Act, 1882 (which was replaced by Companies Act, 1956) and has been existing for 115 years and it is possible that other bidders are also incorporated under previous enactments of the Companies Act. Accordingly, we propose that Clause and Clause 3.1.1, be modified as follows Bidder shall be a company incorporated under the Companies Act 1956/2013 or any earlier statute which has been replaced by the Companies Act 1956 / While the NDMC had, during the pre-bid conference held on December 27, 2017 ( Pre-Bid Conference ), in relation to the Tender Document No. NDMC/1-ManSinghRoad/17-18/ET/01 issued by the NDMC on December 9, 2017 ( Previous Tender Document ), clarified that the bidder could be an entity which has been established under any legislation which has been replaced by the Companies Act 1956/ 2013, no written clarification was issued to this effect and the discrepancy remains in the Tender Document as well. The clause provides that if the Licensee has paid any amounts to the Licensor in excess of the License Fees already paid on account of revision of the Minimum Guarantee Fees, as provided under Clause 4.1.6, such excess amounts would be adjusted against the amount due as License Fee on the first Due Date falling in the immediately following Measurement Period by reducing such License Fee by an amount equal to such excess Building is an RCC framed structure having life expectancy of around 75 to 100 years depending on the maintenance. The licence right of the property is offered on "As is where is Basis" For the purposes of demonstration of eligibility by any Bidder under this Tender Document, companies incorporated under any previous company law applicable in India prior to the notification of the Companies Act, 2013 will be construed to be covered under the ambit of the Companies Act, Please refer to the corrigendum issued. Page 19 of 20

20 Queries on the Tender Document and for 1, Man Singh Road amounts paid, and if the excess amount is greater that the License Fee due and payable on the first Due Date immediately following Measurement Period, such excess amount would be adjusted from the License Fee payable on subsequent Due Dates until such excess amount has been fully adjusted. The clause does not take into account excess amounts paid towards License Fee on account of Escalations, during the last Measurement Period, in which case such excess amounts cannot be adjusted during any subsequent Measurement Periods. Please confirm that such excess amounts would be repaid to the Licensee within a specific time period. Accordingly, we suggest the following Clause 4.1.5(c) be incorporated Provided that if any excess amounts have been paid by the Licensee to the Licensor over and above the amount of the License Fees already paid on account of revision of the Minimum Guaranteed Fees calculated in accordance with Clause for the last Measurement Period of the License Period, such excess amounts will be refunded to the Licensee within a period of 30 days of the Licensee submitting the amended and revised Schedule 5 in accordance with Clause Clauses and Clause 24 of the Existing leave and licence agreement has not been registered. Accordingly, please confirm that there would be no requirement to register the proposed leave and license agreement. Please amend Clause 24 and Clause accordingly. Other Comment 1. In the table provided under Clause 7.3 of the Tender Document the Estimated Date shall be read as Date Page 20 of 20