1

APPROVED

by decision of Panevėžys City Council

No. 1-54-8 of 01-07-2010

PROCEDURE FOR THE SELECTION OF INVESTORS IN THE PANEVĖŽYSINDUSTRIAL PARK

PANEVĖŽYS

2010

1.GENERAL PROVISIONS

1.1. Whereas:

- the Panevėžys Industrial Park Project has been recognised as an economic project of national significance (by resolution of the Seimas of the Republic of Lithuania “Concerning approval of indicators of competitiveness of the national economy and of economic projects on knowledge and innovation infrastructure of national significance” No. X-1225 of 26 June 2007);

- LTL 17.5 million of the European Union Structural Funds’ assistance was allotted for the establishment of the Industrial Park (project "PanevėžysIndustrial Park", project code VP2-2.4-ŪM-01-V-01-002, financing and administration agreement No. S-VP2-2.4-ŪM-01-V-01-002 of 7 October 2009);

- private funds should be raised for further development of the Industrial Park.

1.2. Agreements on lease of land for the Industrial Park and investment agreements will be concluded with the Investors meeting the requirements set out in this Procedure, on the terms and conditions described below.

1.3. Terms used in this Procedure:

Investor / means a company, consortium, association, institution, organisation or an entity of any other legal form or type (except natural persons) which has been organised and operating under applicable laws of the Republic of Lithuania or a foreign state and to which the Granting Authority will lease, under the Land Lease Agreement, a land plot in the Industrial Park and which will enter into the Investment Agreement with the Granting Authority.
Procedure / means this document.
Minimal investment required / means a LTL 2 million investment to cover capital costs in the leased land plot and/or to acquire property in the leased land plot under financial lease agreements, per hectare of the leased land plot, to be made prior to start of operations.
Land Lease Agreement / means a land lease agreement between the Investor and the PanevėžysCityMunicipality, the draft of which is appended as Annex 4 to this Procedure.
Investment Agreement / means an investment agreement between the Investor and the PanevėžysCityMunicipality, the draft of which is appended as Annex 5 to this Procedure.
Application / means a set of written documents submitted by the Investor, expressing a wish to enter into the Investment Agreement and the Land Lease Agreement with the Granting Authority under this Procedure and other information made public by the Granting Authority.
Industrial Park /

means the land plots together with new streets and engineering systems’ corridors, totalling 46.9552 ha, contained in the detailed plan approved by the Panevėžys City Municipality by its decision No. 1-61-1 of 15 February 2007 “Concerning approval of the detailed plan for the Panevėžys Industrial (Logistics) Centre in Pažalvaičiai (at J.Janonio St.)”.

Selection Commission /

means a commission on the selection of investors in the PanevėžysIndustrial Park formed by order of the Director of the Panevėžys Municipal Administration and charged with the responsibility for organising the distribution of application forms and for examining and evaluating the applications.

Granting Authority / means the PanevėžysCityMunicipality, address Laisvės a. 20, LT-35200 Panevėžys, Republic of Lithuania
Commencement Date /

means the moment stated in the Land Lease Agreement, Investment Agreement and/or other agreement between the Granting Authority and the Investor from which the Investor’s activities in the leased land plot are deemed to be started.

Business Plan /

means a document prepared by the Investor which provides a financial and economic justification of the Investor’s activities related to the adaptation of the leased land plot for the planned economic activity and the carrying out of such activity during at least 5 years in the future.

Land Plot /

means one of the land plots of the Industrial Park the list of which is presented in Annex 1.

2.PREPARATION AND SUBMISSION OF APPLICATIONS

2.1.The Investor shall prepare and submit the Application. The Application Form is provided in Annex 2 to this Procedure. The Application shall be accompanied by documents evidencing the Investor’s qualifications as specified in Section 5 of this Procedure. The Application shall also be accompanies by a declaration of good faith confirming that the information and documents presented by the Investor are true.

2.2.The Application signed by the Investor or its authorised representative shall be submitted in the Lithuanian language. If documents are issued in a language other than the Lithuanian language, they must be accompanied by translations signed by the translator.

2.3.The original Application shall be numbered and filed in such a way that, without damaging the filing, it would be impossible to add new pages or remove or replace pages, and shall be attested, on the reverse side of the last page, by signature of the head or authorised person of the Investor (or a member of a group of Investors appointed by common consent), with the documents proving the right of signature provided, and by corporate seal (if any) in such a way that the signature and seal would be damaged in case of damage to the filing.

2.4.The Application shall be submitted to the Granting Authority to the address: Panevėžio miesto savivaldybė, Laisvės a. 20, LT-35200Panevėžys.

2.5.The Investor shall include in the Application the documents proving compliance with the selection criteria specified in Sub-Clause 5.1. The Investor may also include additional documents in the Application to prove the compliance.

2.6.The Investor’s application shall include a letter of commitment to conclude the Investment Agreement and the Land Lease Agreement by management body/bodies in case if concluding these Agreements is offered to the Investor.

2.7.Where a group of Investors submits a joint Application on the basis of a joint venture agreement, all the parties to the joint venture agreement must jointly meet the minimal requirements set out in Sub-Clause 5.1.

2.8.A group of Investors submitting a joint Application on the basis a joint venture agreement shall submit the original agreement or a notarially certified copy thereof.

2.9.The Application shall state the term of validity thereof. The term of validity of the Application shall be at least 90 (ninety) calendar days from the end of the term for the submission of the Applications. In case of suspension of the procedure the term shall be extended for the period of suspension. If no term of validity is stated in the Application, it shall be deemed that the term of validity of the Application is the same as stated in this Procedure.

2.10.The Investor shall provide in the Application a detailed description of the planned activity covering the technical, financial and investment aspects.

3.APPLICATIONS EVALUATION PROCEDURE

3.1.The submitted applications shall be examined, analysed and evaluated at the meetings of the commission on the selection of investors in the PanevėžysIndustrial Park. The schedule of meetings of the Commission at which enveloped with Applications are opened shall be approved by order of the Director of the Municipal Administration. The examination and evaluation of the Applications shall be confidential, without the presence of the Investors having submitted the Applications or representatives thereof. The Commission shall evaluate whether:

3.1.1.the Investor has provided accurate and complete information on its qualifications;

3.1.2.documents evidencing qualifications of the Investor are true and not false;

3.1.3.the Investor meets the minimum qualifications requirements;

3.1.4.the Application meets the requirements set out in this Procedure.

3.1.5.Should any questions concerning the Application arise, the Investor shall provide explanations without changing the Applications. The explanations shall be sent by email: by fax: + 370 45 501 239

3.1.6. Experts (consultants) may be hired for the evaluation of the Applications by decision of the Commission subject to approval of the Granting Authority.

4.REASONS FOR REJECTION OF APPLICATIONS

4.1.The Application submitted by the Investor shall be deemed to be incompliant with this Procedure and the Commission shall reject the Application in the following cases:

4.1.1.the Application has been submitted by a person or a group of persons not meeting the qualifications requirements set for the Investors in this Procedure. It shall be deemed that the Investor (or a member of agroup) does not meet the qualifications requirements if at least one qualifications requirements is not met or at least one document evidencing compliance has not been submitted;

4.1.2.the Investor has provided inaccurate or incomplete information in its Application and has failed to rectify the situation at the Granting Institution’s request within the specified time limit;

4.1.3. it has come to light that the information provided by the Investor (or a member of a group) is untrue or the documents provided are false.

5.MINIMAL REQUIREMENTS FOR INVESTORS

5.1.The Granting Authority has set the following minimal requirements for the Investors having regard to the importance of the PanevėžysIndustrial Park, the Investment Agreement and the Land Lease Agreement as well as the commitments to be assumed by the Investors:

Item No / Minimal requirements / Importance of requirements (where applicable) / Documents evidencing compliance with requirements
1. / The Investor (except natural persons) has been established, registered and operating according to the laws ofrelevant state and is entitled to conduct the activities described in the Business Plan. / Copy of a certificate of the Investor’s registration in the Company Register according to the requirements of the country of registration, attested by corporate seal and signature of the head of the company; copy of the Articles of Association of the Investor.
2. / The Investor has not gone bankrupt, is not under liquidation, is not insolvent, is not under restructuring, has not come to an arrangement with its creditors, has not suspended or restricted its operations, no out-of-court bankruptcy proceedings have been instituted against it, no forced liquidation procedure or arrangement with creditors is being sought, and nothing of the above-said is threatening to it under the laws of the country of its registration. / Original certificate of the Investor’s legal status issued by the manager of the Company Register of the country of the Investor’s registration (the certificate shall be issued for the period not later than 30 calendar days prior to the deadline for the submission of the Applications).
3. / Planned amount of investments per ha of the Leased Land Plot / At least the minimum investment (LTL 2 million per ha) / Business Plan, Application
4. / Planned period from the effective date of the Investment Agreement and the Land Lease Agreement till the Commencement Date / Maximum 3 years / Business Plan, Application
5. / Number of new long-term jobs (to be maintained at least 3 years) to be created per ha of the Leased Land Plot. The jobs shall be created within 12 months from the start of activities in the Leased Land Plot. / At least 5 / Business Plan, Application
6. / The Investor has own funds or can raise borrowed funds necessary for securing the investments and the implementation of the investment project. / Specific amount not smaller than the product of LTL 2 m. and the area of the Land Plot. / Investor’s Application, Business Plan

If the Investor seeks to conclude the Land Lease Agreement for more than one Land Plot, the planned period from the effective date of the Investment Agreement and the Land Lease Agreement till the Commencement Date (requirement No. 4) for each Land Plot shall be not longer than the set period of 3 years.

5.2. The Applications of the Investors meeting the minimum requirements shall be subjected to evaluation.

6.EVALUATION OF APPLICATIONS

6.1.The Commission shall evaluate the Applications according to the evaluation criteria laid down in Sub-Clause 6.2 of the Procedure. The ranking of Investors for each Land Plot shall be established in the order of decreasing score obtained by each Investor.

6.2.The Applications submitted by the Investors shall be evaluated and compared according to the following criteria:

Item No / Evaluation criterion / Description / Score
1. / Amount of investments per ha of the Leased Land Plot prior to start of activities / The investments shall be earmarked for the covering of capital costs in the leased land plot and/or for acquiring property in the leased land plot under financial lease agreements. / 50
2. / Number of new long-term jobs (to be maintained at least 3 years) to be created per ha of the Leased Land Plot. / The number of jobs to be created per ha of the Leased Land Plot shall be evaluated. The number of new long-term jobs shall be calculated by deducting from the total jobs to be created in the Land Plot those jobs which would be made redundant if the company moves (or partially moves) to the Industrial Park from another locality. / 50
Total: / 100

Methodology for the evaluation of Criteria 1and 2:

The best Application (submitted for the land plot) shall be assigned the highest according to the criteria. Other Applications shall be evaluated on proportion basis with respect to the best Application (e.g., ifthe biggest amount of offered investment is LTL 6 million, the investor of this offer shall be assigned 50 scores, the investor offering LTL 4 million shall be assigned LTL 4 mln./LTL 6 mln x 50 scores = 33,3 scores). Score 0 means no offer according to a criterion. In case if only one Application is subjected to evaluation, the value of the best Application for Criterion 1 will be equal to the amount of the minimal investment required; for Criterion 2 – 5 new jobs. In the evaluation of the Application, the maximum score is limited to that specified in Sub-Clause 6.2.

6.3.The Investor shall justify compliance with the minimal qualifications criteria as required by Sub-Clauses 5.1 and 6.1 in its Business Plan and in the declaration filled according to Annex 3 to the Procedure.

7. EXECUTION AND VALIDITY OF THE INVESTMENT AGREEMENT AND THE LAND LEASE AGREEMENT

7.1.The Panevėžys City Council shall adopt a decision on conclusion of the Investment Agreement and the Land Lease Agreement with the Investor whose Application has been evaluated as the best Application.

8.FINAL PROVISIONS

8.1.The investments shall be financed from the Investor’s own or borrowed funds. The Granting Authority shall not provide to the Investor any security of its obligations (no guarantee, collateral or any other security) and shall not pay any compensation to the Investor in any form (neither investments in property, nor payments to the Investor, nor otherwise) for the fulfilment of the Investor’s obligations under the Investment Agreement and/or Land Lease Agreement during the term thereof.

8.2During the term of the Investment Agreement and the Land Lease Agreement, the Investor shall furnish the Granting Authority with any information as stipulated in this Procedure, the Investment Agreement and the Land Lease Agreement or any other information reasonably requested by the Granting Authority pertaining to the carrying out of the said Agreements; the Investor shall also obtain prior consent of the Granting Authority to the terms and conditions of any agreements (if any) provided for in the Investment Agreement and/or Land Lease Agreement or to any other actions related to the carrying out of the said Agreements.

8.3. The Investor may assign its rights and responsibilities under the Investment Agreement and Land Lease Agreement to any entity founded by the Investor, which is wholly (100%) owned by the Investor during the term of lease and the core activity of which would be investments and operations in the Leased Land Plot. The Investor shall guarantee to the Granting Authority, in the form acceptable to the latter, that in case if such entity fails to fulfil its obligations to the Investor as stipulated in the Procedure, the Investment Agreement and the Land Lease Agreement, the Investor shall immediately fulfil such obligations itself, at the Granting Authority’s request.

  1. ANNEXES TO THE TENDERING PROCEDURE

Annex 1 to the Procedure

Land plot ID / Land plot area, ha / Additional information (control)
1. / J.Janonio g.62, unique No. 4400-1286-7091 / 2,7642 / Owned by PanevėžysCityMunicipality
2. / J.Janonio g.62 A, unique No. 4400-1286-6772 / 0,4356 / Owned by PanevėžysCityMunicipality
3. / J.Janonio g. 62 B, unique No. 4400-1286-6534 / 0,2583 / Owned by PanevėžysCityMunicipality
4. / J.Janonio g.62 C, unique No. 4400-1142-5168 / 0,4962 / Public land owned by the State and transferred to PanevėžysCityMunicipality under a loan-for-use agreement
5. / J.Janonio g. 64, unique No. 4400-1286-5302 / 5,0071 / Owned by PanevėžysCityMunicipality
6. / J.Janonio g. 64 A, unique No. 4400-1286-6150 / 12,1943 / Owned by PanevėžysCityMunicipality
7. / J.Janonio g. 64 B, unique No. 4400-1286-5975 / 6,9759 / Owned by PanevėžysCityMunicipality
8. / J.Janonio g. 64 C, unique No. 4400-1286-5631 / 0,4140 / Owned by PanevėžysCityMunicipality
9. / J.Janonio g. 66, unique No. 4400-1142-5248 / 6,4991 / Public land owned by the State and transferred to PanevėžysCityMunicipality under a loan-for-use agreement

Annex 2 to the Procedure

APPLICATION

BY THE INVESTOR

INVESTING IN THE PANEVĖŽYSINDUSTRIAL PARK

______

(Date)

______

(Place)

Name of Investor (company)
Business ID
Registered office address
Address for correspondence
Name of responsible person
Tel. No.
Fax No.
E-mail address
Name of authorised person
Tel. No. of authorised person
Fax No. of authorised person
Email of authorised person

[NOTE: where the APPLICATION is submitted by a group of legal persons (consortium), information on each member shall be provided]

WE WISH TO LEASE THE FOLLOWING LAND PLOT

Preferred sequence / Land plot ID
1

LIST OF DOCUMENTS TO BE SUBMITTED

Item No / Description of document
1. / Copy of a certificate of the Investor’s registration in the Company Register according to the requirements of the country of registration, attested by corporate seal and signature of the head of the company; copy of the Articles of Association of the Investor
2. / Copy of the Articles of Association of the Investor attested by corporate seal and signature of the head of the company
3. / Original certificate of the Investor’s legal status issued by the manager of the Company Register of the country of the Investor’s registration (the Investor has not gone bankrupt, is not under liquidation, is not insolvent, is not under restructuring, has not come to an arrangement with its creditors, has not suspended or restricted its operations, no out-of-court bankruptcy proceedings have been instituted against it, no forced liquidation procedure or arrangement with creditors is being sought, and nothing of the above-said is threatening); the certificate shall be issued for the period not later than 30 calendar days prior to the deadline for the submission of the Applications.
4. / Detailed description of the planned operations (Business Plan) stating the technical, financial and investment aspects, in particular:
4.1. / amount of investments earmarked for the covering of capital costs in the leased land plot and/or for acquiring property in the leased land plot under financial lease agreements
4.2. / Planned period from the effective date of the Investment Agreement and the Land Lease Agreement till the Commencement Date
4.3. / Number of new long-term jobs (to be maintained at least 3 years) to be created per ha of the Leased Land Plot.
4.4. / Sources of funding of the project:
-own funds;
-borrowed funds.

Information on the Investor’s compliance with the selection criteria: