The monthly account statement of the escrow account

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The monthly account statement of the Escrow Account shall be provided to the Government and the Contractor by the Escrow Bank. 3.2 The Contractor shall, at the time of opening the Escrow Account, give irrevocable instructions, under the Escrow Agreement, to the Escrow Bank instructing, inter alia , that deposits in the Escrow Account shall be appropriated in accordance with Section 3.1 till no notice of occurrence of Event of Default under the Contract is issued by the Government and immediately upon the issuance, by the Government, of a notice of occurrence of Event of Defaultin the payment of the Government’s Revenue Share by the Contractor under the Contract and till such time as the Government issues a notice stating that such Event of Default by the Contractor has been cured and is no longer continuing, all transfers and withdrawals from the Escrow Account under Section 3.1 shall cease and all transfers and withdrawals from the Escrow Account shall be governed and carried out by the Escrow Bank in the following order based on the receipt of relevant demand or instructions: (a) amounts equal to all Royalty payments payable to the Government under this Contractshall be withdrawn when due and payable under applicable law
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92 to the account as instructed in writing (with a copy to the Contractor) by the Government; (b) amounts equal to Government’s Revenue Share payable to Government under the Contract shall be withdrawn when due and payable under this Contract to the account as instructed in writing (with a copy to the Contractor) by the Government; (c) amounts equal to all payments and Liquidated Damages certified by the Government as due and payable to it by the Contractor pursuant to the Contract shall be withdrawn when due and payable under this Contract to the account as instructed in writing (with a copy to the Contractor) by the Government; and (d) balance yet to be paid to the Government under the above three heads . It is clarified that: (i) If the Revenue in the Escrow Account is not sufficient to make the payments of the Government’s Revenue Share, then the payment shall be made directly by the Contractor in the form of a demand draft drawn in favour of “Pay and Account Officer, MoP&NG”, Shastri Bhavan, New Delhi or its successor (ii) if the Revenue in the Escrow Account is not sufficient to make the payments of the Taxes or Royalty or Liquidated Damages, then the payment shall be made directly by the Contractor to the Government . In the event of any dispute between the Government and the Contractor, the Parties shall have recourse under the dispute resolution provisions of the Contract; provided, that, pending the full and final resolution of such dispute, the Escrow Bank shall act strictly in accordance with the provisions of this Section 3.2 notwithstanding such dispute. After written notice from the Government that Contractor has cured its Event of Default in payment of Government’s Revenue Share and that no such Events of Default are then continuing, the Escrow Bankt shall cease the withdrawal and transfer of funds from Escrow Bank in accordance with Section 3.2
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  • Winter '14
  • Bijay K Behra
  • Government, Petroleum Operations, Contract Area

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