Our Ref: LJ/PJ/12/2004 Dated: …………
Re: Vetting of Education Joint Venture Agreement
We refer to your fax dated ………….on the above subject.
Pursuant to your request, we have examined the draft Education Joint Venture Agreement (the “Agreement”) to be executed between X and Y.
Our comments on the draft Agreement are as follows:
|1.||Address of X||Please ensure that the address given in the Agreement is the full address of X.|
|2.||Clause 3.1(a)||The Clause provides that an amount of US$ 22,000 is payable as Development Fee at the time of signing the Agreement. From the Clause, it appears that the amount is payable in lump sum. We therefore suggest that in line 1, the words “An amount” be replaced with “A lump sum amount”.|
|3.||Clause 3.2||For the sake of consistency, in the 3rd line, please replace the words “the Company” by “Y”.|
|4.||Clause 4.2||Please note that under this Clause, the revenue budget of the School shall inter aliaprovide for meeting the expenses on account of travel and stay of the expatriate personnel for attending the meeting of the Management Committee or of the Visiting Team as specified in Clause 2.5.4.It is also stated that X shall in no way be liable for the funds and loans raised for the School. Although these are commercial issues, please ensure whether Y is agreeable to the same.|
|5.||Clause 5.3||Again, though this is not a legal issue, please check whether Y is agreeable to the formation of the Management Committee as stated in the Clause.|
|6.||Clause 5.3.1||In line 1, after the words “or any other person nominated by the Chairman of X”, we suggest (if possible) insertion of the words “in consultation with Y”.|
|SS7.||Clause 5.3.5||For the sake of convenience, we suggest that the first sentence of the Clause be replaced as follows:“The Management Committee shall normally meet at least twice in a calendar year and if mutually agreed between the parties, one of the meetings may be held in India at New Delhi.”Please note that Y would have to bear the travelling and boarding expenses of the India based Members.|
|8.||Clause 5.4.3||It is stated that the Management Committee shall recruit and appoint Principal for the School on the recommendation of a Selection Committee duly constituted by X as per its Rules and Norms.Since the appointment and dismissal of the Principal is a very important issue, please ensure whether Y is agreeable to the contents of the Clause. If Y agrees, it is advisable that the procedure of formation of the Selection Committee and its Rules and Norms be carefully examined by Y.|
|9.||Clause 5.4.4||Under this Clause, the appointment and dismissal of teachers and administrative staff for the School including their remuneration and fringe benefits shall depend on the recommendation of a Selection Committee as per X Rules and Norms. Please ensure whether Y is agreeable to the same.|
|10.||Clause 5.4.6||The Clause provides that the Management Committee shall ensure strict compliance with financial discipline requirements of X. Please ensure beforehand whether the Management Committee would be able to meet the financial discipline requirements of X.|
|11.||Clause 6.2||Under this Clause, either party may terminate the Agreement without assigning any reason, which in our opinion may be prejudicial to the interests of Y since a huge amount of investment is involved. For protection of Y’s interests, we suggest that the Clause be re-phrased as follows:“This Agreement is not terminable by either party before expiry of the term as mentioned in Clause 6.1, unless there is a material breach on the part of either party in|
|Complying with any of the terms of this Agreement, in which case the non-defaulting party shall have the right to terminate the Agreement by giving 1 (one) year prior notice in writing to the party in default. In any event, termination shall take effect only at the close of the academic session underway at the end of the notice period”.|
|12.||Clause 6.3.2||In line 2, after the words “of whatsoever nature” please add “in connection with any event before the date of termination,”.|
|13.||Clause 7.3||Since the Agreement is being executed in Bangladesh in connection with a school to be established in Bangladesh, we suggest that the Agreement be governed by the laws of Bangladesh.|
|14.||Clauses 7.6 and 7.7||Please replace “STS” by “Y”.|
|15.||Clause 8||As stated in our comments to Clause 7.3 above, since the Agreement is being executed in Bangladesh in connection with a school to be established in Bangladesh, we suggest that the Clause be revised as follows:“Any question or difference or dispute arising out of or in relation to (including interpretation and meaning thereof) this Agreement, between the Parties, either during the subsistence of this Agreement or upon its termination, shall be amicably settled by mutual discussion between the Chairman of X and Chairman of Y. In the event the dispute cannot be resolved by negotiation within sixty (60) days of the date of dispute having arisen, such dispute shall be referred to arbitration and determined in accordance with the provisions of the Arbitration Act, 2001 as amended from time or modified or re-|
|Enacted from time to time and in effect in Bangladesh at the time of commencement of arbitration proceedings.The venue of the Arbitration shall be Dhaka, Bangladesh. Any arbitration proceedings begun pursuant to any reference made under this Agreement shall be conducted in English language. The Arbitration award shall be final and binding upon the parties.”|
|16.||Since the Agreement will be executed in Bangladesh, please ensure that it is printed on non-judicial stamp of Tk. 150.00.|
Subject to the above observations, the contents of the Agreement are otherwise in order.
If you have any query, please do not hesitate to contact the undersigned.
For: “The Lawyers & Jurists”
M.L.Hotel Tower Ltd,208,Shahid Syed Nazrul Islam Sarani,
Bijoy Nagar, Dhaka-1000.