41.  BOND, DEED OF GUARANTEE AND COLLATERAL WARRANTIES

41.1.  The Service Provider shall procure the execution on or before the Agreement Date and as a condition of this Agreement of:-

41.1.1.  a Guarantee by the Guarantor in favour of the Authority substantially in the form annexed at Schedule 6 (Bond and Guarantee) to secure the due performance by the Service Provider of its obligations to the Authority;

41.1.2.  a Bond by the bank or insurance company which has executed the Bond undertaking in favour of the Authority substantially in the form annexed at Schedule 6 (Bond and Guarantee);

41.1.3.  the Collateral Warranties by the Key Sub-Contractors in favour of the Authority substantially in the form annexed at Schedule 5 (Collateral Warranty).

41.2.  As at the Agreement Date the Guarantor shall be [  ] and the Service Provider's group shall mean [  ];

41.3.  Unless and until otherwise agreed by the parties the forms of Bond and Guarantee set out in Schedule 6 (Bond and Guarantee) shall be the relevant specified forms for the purposes of this Agreement.

41.4.  If during the Contract Period the Guarantor shall cease to meet any of the Guarantee Criteria (as defined in clause 41.5) the Service Provider shall procure that another company within the Service Provider's group which at the relevant time and thereafter shall meet all the Guarantee Criteria shall become the Guarantor and shall provide a Guarantee substantially in the form referred to in clause 41.1 to secure due performance by the Service Provider of its obligations to the Authority;

41.5.  The Guarantee Criteria for the purposes of clause 41.4 shall be that in respect of the Guarantor the latest statutory accounts shall demonstrate that the Guarantor has:-

41.5.1.  consolidated net asset value of not less than [  ]; and/or

41.5.2.  consolidated interest bearing debt less cash balances to be no more than [  ] times consolidated shareholders' equity; and/or

41.5.3.  consolidated profit before interest, tax, goodwill, amortisation and exceptional items to be in excess of [  ] times consolidated net interest costs.  For the avoidance of doubt, cash interest costs exclude the elimination of provision discounts and non-cash coupons (for example the finance charges on convertible loan notes).

41.6.  In the event that the Service Provider shall have failed to comply with clause 41.4 within three (3) months of a written notice to do so, the Service Provider shall provide to the Authority such alternative form of security to a value of not less than [  ] (which may take the form (without limitation) of an alternative guarantee, the provision of funds or reserves by a third party (under guarantee performance bond cash deposit or escrow account) as the Authority may approve (such approval not to be unreasonably withheld or delayed).

41.7.  If the Service Provider shall provide alternative security under clause 41.6 and at any time thereafter the Service Provider can demonstrate that the Guarantor referred to in clause 41.2 or other company within the Service Provider's group meets the Guarantee Criteria the Service Provider shall have the right by notice to the Authority to provide a Guarantee by such company as aforesaid and if the Service Provider shall provide such Guarantee within twenty (20) Business Days of such notice the Authority shall accept such Guarantee in place of any then existing alternative security provided under clause 41.6.

41.8.  The Service Provider shall not engage any new Key Sub-Contractor in connection with the Project and/or the Services unless the relevant new Key Sub-Contractor has delivered to the Authority an agreement substantially in the form of the Collateral Warranty duly executed as a deed.