The agreement can be renewed for additional years as mutually agreed by the parties. The agreement shall be renewed on the same terms and conditions. If either party wishes to renew the agreement, it shall inform the other party at least 6 months before the expiration of the term.
S&P Energy Solutions has an obligation to conduct an environmental impact assessment and deliver the report within 3 months of execution of the agreement
S&P Energy Solutions is obliged to take good care of the leased land and the natural resources on it, with particular obligations to (a) conserve tree plantations that have not been cleared for earth works, (b) apply appropriate work methods to prevent soil erosion in "slopping" areas, and (c) observe and implement all legislation regarding natural resource conservation
The Government undertakes to provide special investment privileges such as exemptions from taxation, import duties of capital goods, and repatriation of capital and profits granted under the investment laws of Ethiopia
There shall be a 5-year grace period for the land rent, where the rent during this period will be prorated over the remaining years annually. After the first 5 years, the annual lease rate shall be birr 7,175,000 (or birr 143.4 per hectare). The total amount payable under the agreement shall be birr 358,750,000. S&P Energy Solutions is required to make a 1-year down payment to the Government. Following the land development, the annual lease rate stated in art. 2.2.2 will be revised without any precondition upon mutually marking the center of the investment area in such a way that the decrease or increase in the rate will be birr 4.05 for every kilometer. The Government reserves the right to revise the lease payment rate after 10 years of such last fixation as they need may arise and in consultation with S&P Energy Solutions. However, if there is an increase in the rate of the lease, it shall not exceed 20% of the existing rate.
S&P Energy Solutions has the right to build infrastructure such as dams, water boreholes, power houses, irrigation system, roads, bridges, offices, residential buildings, fuel/power supply stations/outlets, health/hospitals/dispensaries and education facilities at its discretion upon consultation and submission of permit request with the Government and subject to the type and size of the investment project.
Upon the expiry or termination of the agreement, S&P Energy Solutions shall remove all assets installed on the leased land within 1 year. However, where the agreement is terminated upon expiry of the term or for one of the reasons in article 9, the Government has the priority right to purchase properties over the land in negotiation with S&P Energy Solutions.
The Ministry of Agriculture and Rural Development is obliged to arrange access and use of facilities of the Ethiopian government and the Regional State Research centers for soil testing and mapping, for a fee
The Government shall ensure that S&P Energy Solutions shall, during the period of the lease, enjoy peaceful and trouble free possession of the premises and shall be provided adequate security, free of cost, for carrying out its activities, against any riot, disturbance or other turbulent time other than force majeure, as and when requested by S&P Energy Solutions. The Government shall protect the right of S&P Energy Solutions to the peaceful possession, use and quiet enjoyment of the leased area.
S&P Energy Solutions is expected to start developing the land within 6 months from the date of execution of the agreement, or from the date that it receives final clearance from the Government, whichever is later. S&P Energy Solutions shall develop at least 10% (5,000 hectares) of the land within the first year, and the entire leased land within 5 years from the date of signing or receipt of all clearances from the Government, whichever is later.
Upon entering into the agreement, S&P Energy Solutions shall submit an advance action plan with regards to the use of the leased land to the Ministry of Agriculture. S&P Energy Solutions shall not make any unauthorized use of the leased land beyond the purpose stated in art. 3 (including developing the land for biofuel, value added crops and plantations) without the prior written consent of the Ministry of Agriculture and Rural Development
In the event of dispute, both parties will do their utmost to resolve the dispute amicably and to their mutual satisfaction through negotiation. If they are unable to achieve such a settlement within 3 months, the dispute shall be referred to the International Center for Settlement of Investment Disputes under the rule governing Additional Facilities for Administration of Proceeding by the Secretariat of the Center. These proceedings shall be in the English language.
Unless 75% of the land is developed, S&P Energy Solutions has no right to transfer the land or properties developed on the land to other persons. Upon developing 75% of the land, S&P Energy Solutions can transfer the land or properties to other persons with the prior permit of the Ministry of Agriculture and Rural Development.
The Government has the right to terminate the land lease agreement subject to at least 6 months' prior written notice (i) on the grounds of failure to develop the land within the time limits in accordance the contract obligation, (ii) on the grounds of any damage on the natural resources, or (iii) on the grounds of non-performance of due payment of lease charge. If S&P Energy Solutions does not address these issues, the Government may extend the time period for such compliance or terminate the agreement. The land lease agreement may be terminated for a number of reasons, including upon (9.3) failure of the Government to fulfill or observe any of its obligations or covenants in the lease after S&P Energy Solutions has given a written notice of 6 months and the Government fails to perform, (9.4) failure of S&P Energy Solutions to settle annual rental and other relevant tax payments for 2 consecutive years, (9.5) failure of S&P Energy Solutions to perform its obligations in the lease after the Government has given 6 months' written notice calling upon them to observe and perform such obligations. The Government has the right to restore any land which is not developed with 6 months' advance notice and after S&P Energy Solutions has not cured the failure within 1 year. The Ministry of Agriculture and Rural Development shall issue 6 months' written notice prior to termination of the agreement on the grounds of failure to develop the land within the time limits set by the agreement. If the issue is not addressed, the Ministry of Agriculture and Rural Development may either extend the time period for compliance or terminate the agreement.
If the agreement is terminated by S&P Energy Solutions for failure of the Government to fulfill its obligations, the Government shall pay to S&P Energy Solutions the value of improvements made by S&P Energy Solutions on the land at the market price after setting off any dues on account of rentals or taxes
S&P Energy Solutions shall not make any unauthorized use of the leased land beyond the purpose stated in art. 3 (including developing the land for biofuel, value added crops and plantations) without the prior written consent of the Ministry of Agriculture and Rural Development
S&P Energy Solutions shall provide correct data and investment activity reports upon request by the Ministry of Agriculture and Rural Development. The Government has the right to monitor and establish the fact that S&P Energy Solutions is discharging and accomplishing its obligations diligently. This monitoring must be done in a manner that does not cause any hindrances to the work and activities of S&P Energy Solutions.