37.5  Rectification of Contractor Default

37.5.1  If a Contractor Default has occurred and the Authority wishes to terminate this Agreement, it must serve a Termination Notice on the Contractor.

37.5.2  The Termination Notice must specify:

(a)  the type and nature of Contractor Default that has occurred, giving reasonable details; and

(b)  that in the case of any Contractor Default falling within limb (a), (g), (h), (i) or (o) of the definition of Contractor Default this Agreement will terminate239 on the day falling forty (40) Business Days after the date the Contractor received the Termination Notice unless:

(i)  in the case of a breach under limb (a) of the definition of Contractor Default the Contractor puts forward an acceptable rectification programme within twenty (20) Business Days after the date the Contractor receives the Termination Notice (and implements such programme in accordance with its terms and rectifies the Contractor Default in accordance with the programme); or

(ii)  in the case of any Contractor Default falling within limbs (a), (g), (h), (i) or (o) of the definition of Contractor Default the Contractor rectifies the Contractor Default within forty (40) Business Days after the date on which the Contractor receives the Termination Notice; or

(c)  that in the case of any Contractor Default (not being limbs (a), (g), (h), (i) or (o)), this Agreement will terminate on the date falling [twenty (20)] Business Days after the date the Contractor receives the Termination Notice.

37.5.3  If the Contractor either rectifies the Contractor Default within the time period specified in the Termination Notice or implements the rectification programme (if applicable) in accordance with its terms the termination notice will be deemed to be revoked and this Agreement will continue.

37.5.4  If:

(a)  in the case of a Contractor Default within paragraph (a) of the definition of Contractor Default, no acceptable rectification programme has been put forward pursuant to clause 37.5.2(b)(i) (Rectification of Contractor Default) and the Contractor fails to rectify the Contractor Default within the time period specified in the Termination Notice; or

(b)  in the case of a Contractor Default within limb (g), (h), (i) or (o) of the definition of Contractor Default, the Contractor fails to rectify the Contractor Default within the time period specified in the Termination Notice,

the Authority may give notice stating that the Agreement will, subject to the terms of the Direct Agreement, terminate on the date falling [forty (40)] Business Days after the date of receipt of such notice.

37.5.5  If the Contractor fails to implement any rectification programme in accordance with its terms, the Agreement will, subject to the terms of the Direct Agreement, terminate on the date falling five (5) Business Days after the date of notification by the Authority to the Contractor of such failure to implement the rectification programme in accordance with its terms.

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239  In non-HRA projects, the drafting may need to be amended as the Authority will not own the Assets and be able to provide or procure the provision of the Services until the Assets are transferred.  The drafting in which case may need to allow for a preliminary termination date in advance of the date of actual termination of the Agreement.