State Centre for Defence Military Sites and Procurement

APPROVED during the Procurement committee’s meeting of

26th February 2015Meeting Notes No.: VAMOIC 2015/021-01

REGULATIONS OF OPEN PROCEDURE„Supply of Autonomous Underwater Vehicle”

(Identification No.: VAMOIC 2015/021)

Riga, 2015

1

IGENERAL INFORMATION

1. Type of procurement procedure and applicable method:1.1. The Open procedure is organized complying with the requirements of the Law on

Public Procurement of the Republic of Latvia and other regulations governing public procurements.

1.2. Identification number of the procurement procedure: VAMOIC 2015/021.1.3. Title of the procurement procedure: Supply of Autonomous Underwater

Vehicle.1.4. Source of financing for procurement procedure: – state budget (100%).

2. Contracting authority: 1st Regional Logistics Centre, Logistics Command, National Armed Forces, located at Roņu iela 2, Liepāja, LV-3407.

3. Organizer of procedure: State Centre for Defence Military Sites and Procurement (hereinafter – Centre), located at Ernestīnes iela 34, Rīga, LV-1046. Centre’s working hours: working days from 8:30 until 17:00.

4. Contact person: Managerial information on the Procedure is available from: Senior Desk Officer of Goods and Services Contract and Procurement Division of Legal and Procurement Provision Department – first lieutenant Elīna Brūniņa, e-mail: elina.brunina@vamoic.gov.lv, phone: (+371) 67300288, fax: +371 7300207.

5. Tender security: not required.

6. Advance payment: planned at the rate of 20% of the price of the goods (1 system).

7. Tenderer: supplier who has submitted an offer.

8. Subject of the procurement and amount:8.1. The subject of procurement is supply of autonomous underwater vehicle (AUV)

(hereinafter – Goods), installation, testing and personnel training in accordance with the technical specification (Annex 2).

8.2. CPV code: 35730000-08.3. Amount: 1 (one) AUV system; training of 6 (six) specialists.8.4. Tenderer may submit only one version of the bid, for the full amount of the subject

of the procurement.

9. Offer selection criteria: offer complying with the requirements of the procedure regulations and the technical specification with the lowest price (in Euros, VAT not included).

10. Place of delivery of Goods: in accordance with INCOTERMS 2010 DAP, Roņu iela 2 (2 Ronu Street), Liepāja, LV-3407.

11. Term of Contract execution: until complete execution of contractual obligations.

12. Offer submission place, date and time:12.1. The deadline for offer submission is: 11:00am on 23 April 2015, address:

Centre, located at Ernestīnes iela 34, Rīga, LV-1046. 12.2. Documents shall be submitted in person or sent by mail in a closed and sealed

envelope to Secretariat of Centre, Ernestīnes iela 34, Rīga, LV-1046, Latvia. If the Tenderer sends the offer by post, it is the Tenderer’s responsibility to ensure a timely receipt of the offer.

12.3. Offers received after the deadline for submission of offers are not opened and are sent back to the submitter unopened.

13. Regulations of the procurement procedure, requests and responses for additional information

2

13.1. The Regulations are publicly available on Ministry of Defence web-site http://www.mod.gov.lv/lv/Papildriki/Iepirkumi/ section „Uzaicinājumi”.

13.2. Procurement committee and the interested supplier exchange information in writing. Any information provided verbally is not binding within the procedure.

13.3. Questions regarding the Regulations shall be in writing and shall be submitted by post services to Ernestīnes iela 34, Rīga, LV-1046, by fax: +371 67300207 or e-mail: elina.brunina@vamoic.gov.lv.

13.4. If the interested supplier has timely requested additional information, Procurement committee shall provide it within 5 (five) days, but no later than 6 (six) days before the deadline of submission of the offer. The day of the receipt of the questions shall be the day when a mailed letter is registered at the Secretariat of the Centre, but for e-mailed or faxed letters – the date of the receipt shown on the respective technical media. For e-mails and faxes received outside the working hours of the Centre, the date of the receipt shall be the following working day.

13.5. Procurement committee provides information to the interested supplier that has submitted a request for additional information/asked questions using mail, fax or e-mail depending on the method the request was submitted and simultaneously (same day/within one day) published the information on Ministry of Defence web-site http://www.mod.gov.lv/lv/Papildriki/Iepirkumi/ section „Uzaicinājumi” with the Regulations. If the interested supplier’s requested information has been published on the Ministry of Defence web-site it is considered that the interested supplier has received the additional information. The Contracting authority is not responsible if the interested supplier has failed to acquaint itself with the information that is readily available on the Ministry of Defence web-site.

13.6. With downloading the Regulations the interested supplier undertakes to follow all future changes in the Regulations, as well as Procurement committee’s answers to the questions submitted by interested suppliers that will be published on Ministry of Defence’s web-site http://www.mod.gov.lv/lv/Papildriki/Iepirkumi/ Section „Uzaicinājumi” with the respective Regulations.

IIREQUIREMENTS FOR PREPARATION AND SUBMISSION OF THE

OFFER

14. Tenderer shall prepare and submit the offer in accordance with the following requirements:14.1. All documents shall be in Latvian or English; 14.2. Offer documents and its copies shall be submitted in one package ensuring

against an unauthorized access without damaging the package;14.3. Pages shall be numbered;14.4. All documents of the offer must be thread-bound with a strong thread or string.

The place of bounding shall be prepared in compliance with the requirements of the Regulations of the Cabinet of the Ministers No.916 (dated 28 September 2010) “Regulations on Preparation and Formatting of the Documents”. The offer must be prepared in a way that would not allow any substitution of pages without damaging the fastening;

14.5. Documents of the offer must be clearly legible, without corrections and erasures;14.6. Table of contents shall be placed at the beginning of the offer. If the offer is

submitted in several volumes, each volume must have a separate table of contents and the table of contents of the first volume must contain the number of volumes and number of pages in each volume;

14.7. Documents shall be arranged in the following order: 3

14.7.1. Procedure application – Financial offer (Annex 1);14.7.2. Statement from the Register of Enterprises;14.7.3. Technical offer (Annex 3).

14.8. If the offer or parts of if contain trade secrets, the offer pages containing such information shall be marked with “Trade Secret”, except the cases outlined in the Law on Public Procurement;

14.9. The Tenderer shall submit offer in one original and two copies. The title page of the original must be marked with a note “ORIGINAL” and title pages of the copies must be marked with a note “COPY”;

14.10. Supplements, amendments to the offer or withdrawals of the offer may be submitted in written format until the deadline for submission of the offers either personally or sent by mail to the Centre’s Secretariat, address: Ernestīnes iela 34, Rīga, with a corresponding note “SUPPLEMENT”, „AMENDMENT” or “WITHDRAWAL”.

15. Withdrawal is irrevocable and it excludes Tenderer’s withdrawn offer from further participation in the Procedure.

16. Offer shall be submitted in a sealed packaging. The place of the sealing shall be marked with the Tenderer’s stamp and signature.

17. The package shall be marked with: Procurement committee of the

State Centre for Defence Objects and Military SitesErnestīnes iela 34, Rīga

LV-1046Name of the TendererAddress and phone of the Tenderer

Offer for Open Procedure„Supply of autonomous underwater sensor system”

(Identification No.: VAMOIC 2015/021)

Not to be opened before 11:00am on 23 April 2015

18. In case of any discrepancy in the materials of the Original and Copies of the offer, the Original shall prevail.

19. Opening of the offers19.1. The opening of the Offers commence after the deadline for submission of the

offers. The offer opening meeting is organized in accordance with the Law on Public Procurement.

19.2. Due to the access control system, the interested suppliers shall notify of their participation in the offer opening meeting in a timely manner by contacting the point of contact provided in the Regulations.

IIITENDERER’S QUALIFICATION REQUIREMENTS, REQUIRED DOCUMENTS,

VERIFICATION AND EXCLUSION

20. Qualification requirements:20.1. Tenderer shall be registered as required by the law and in accordance with the

procedures prescribed by law; 20.2. Tenderer is authorized by the manufacturer to perform maintenance and

modernization of the autonomous underwater vehicle.

4

21. Procedure application and qualification documents21.1. To confirm its participation in the Procedure, the Tenderer shall submit the

Application (using Annex No.1 form).21.2. The original of the Application must be signed by Tenderer’s representative with

the rights of representation or its authorized person. If the Tenderer is a Supplier association and the rights of representation have not been specified in the association’s agreement, the original of the procedure application must be signed by a representative of each person included in the Supplier association that has the rights of representation.

21.3. In order for the Procurement committee to verify the rights of representation of the Tenderer, the Tenderer shall submit a valid statement (an original or a copy attested in accordance with the Regulations of the Cabinet of Ministers No. 916 (dated 28 September 2015) “Regulations on Preparation and Formatting of the Documents”; hereinafter – attested copy) from the Register of Enterprises of the Republic of Latvia indicating the Tenderer’s representatives with the rights of representation and the scope of the representation (information weather the person/s is/are authorize to represent the Tenderer individually or together with other person/s).

If the application is signed by a person other than the person indicated in the statement from the Register of Enterprises, the Tenderer shall submit an authorization (an original or an attested copy) from the person with the rights of representation to another person to sign the application.

21.4. Qualification documents:

21.4.1. A document issued to the Tenderer by the manufacturer of the offered Goods authorizing the Tenderer to perform maintenance and modernization of the autonomous underwater vehicle.

21.5. If the Tenderer is a Supplier association, the Tenderer shall submit: 21.5.1. Document specified in Clause 21.3. for each member of the Supplier

association;21.5.2. Partnership agreement (an original or an attested copy), signed by the

representative with the rights of representation or respectively authorized person of the members of the Supplier association. The agreement shall specify the main member that will represent the Supplier association and will sign the offer documents on behalf of all members of the Supplier association. The agreement shall specify the persons incorporated in the Supplier association as well as the extent of liability of each person (the amount of work to be performed);

21.5.3. An acknowledgment that in case the group of persons (Supplier association) shall be awarded the contract, the Supplier association at the request of the Contracting authority, before the conclusion of the contract, will register a general partnership in accordance with the laws and regulations of the Republic of Latvia with specific responsibilities of each member. The Contracting authority shall notify of this requirement together with the decision on the results of the Procedure.

21.6. If the Tenderer is a partnership, the Tenderer shall submit:21.6.1. Document specified in Clause 21.3. for each member of the partnership;21.6.2. Partnership agreement (an original or an attested copy). The agreement shall

specify the main member that will represent the partnership and will sign the offer documents on behalf of the partnership. The agreement shall specify the persons incorporated in the partnership as well as the extent of liability of each person (the amount of work to be performed).

5

21.7. Foreign Tenderers:21.7.1. Foreign Tenderers shall comply with the requirements of the Clause 20.1.

and shall submit documents that verify the compliance thereof. The document shall be issued by the respective foreign institution, organization or person who in accordance with the laws and regulations of the Tenderer’s country of registration is authorized to issue such documents. If rules and regulations of the Tenderer’s country of registration do not require issue of documents of registration as prescribed by Clause 20.1., the Tenderer shall submit an acknowledgment or explanation thereof.

21.7.2. Foreign Tenderer may submit document other than that specified in Clause 21.3., but it shall contain information on the authorized persons with the rights of representation and the scope of the representation.

22. If the offer is not signed by the person with the rights of representation, the Procurement committee shall make a decision to refuse to review the offer.

23. Assessment of the Tenderer’s qualification23.1. Procurement Committee assesses the Tenderer’s qualification.23.2. Tenderer is eliminated from further participation in the Procedure if the

Procurement Committee establishes the fact that:23.2.1. The Tenderer has failed to provide qualification documents according to

Clause 21 and/or the content of qualification documents does not comply with requirements of Clause 21;

23.2.2. Tenderer has failed to submit the required information, has failed to submit the additional information requested by the Procurement committee within the deadline set by the Procurement committee, or has provided untruthful information regarding its qualification;

23.2.3. Tenderer does not conform to the requirements of Clause 20.

IV TECHNICAL OFFER

24. Required documents:24.1. Detailed description of the offered Goods (using Annex 3 form) in accordance

with the requirements of the Technical specification and its appendices.24.2. Acknowledgment that the Tenderer will perform personnel training in

accordance with the requirements of the Technical specification (the acknowledgment included in the Annex 3).

24.3. Personnel training program – for maintenance and user level operation of the control system.

25. Technical offer shall include information on: 25.1. Manufacturer and model of the offered Goods;25.2. Deadline for delivery, installation and testing of the Goods, and personnel

training, which shall be within 24 months after the Contract has come into force;25.3. Deadline for replacement of Goods of improper quality or elimination of any

discrepancies during the period of warranty which shall be no more than 12 months after the day a statement of detected deficiencies has been prepared.

25.4. Period of warranty, which is not less than 2 (two) years from the day the Goods have been commissioned and/or the day a statement of replacement of the Goods of improper quality has been signed.

26. Assessment of the conformity of the Technical offer.

6

26.1. Procurement committee shall perform the assessment of the conformity of the Technical offer.

26.2. The Tenderer shall be eliminated from further participation in the Procedure and its offer is not evaluated, if the Procurement Committee establishes the fact that:26.2.1. Tenderer has not submitted the Technical offer documents or the

documents or the content of the documents do not comply with the requirements of the Clause 24 and 25;

26.2.2. Technical offer does not comply with the Technical specification;26.2.3. The offer has not been submitted for the full amount of the subject of

the procurement and/or two or more offer variants have been submitted.

V FINANCIAL OFFER

27. Tenderer shall indicate the following information in the Financial offer:27.1. Offer price in EUR. The offer price shall be determined and indicated with the

accuracy of two (2) digits after the decimal point;27.2. Offered price shall include all costs associated with delivery, installation and

testing of the Goods, and personnel training, including costs of employee salaries, etc., as well as all state and municipality imposed taxes and duties. All prices shall be provided according to the Annex 1.

28. Evaluation of the Financial offer28.1. After the assessment of the conformity of the offers the Procurement Committee

evaluates the financial offers of the Tenderers that passed the assessment of the conformity of the Technical offer.

28.2. The Procurement Committee examines the offers for arithmetical errors. During the evaluation of the Financial offer the Procurement committee acts according to the Section 56 part three of the Law on Public Procurement.

28.3. The Procurement committee assesses whether an offer of unjustifiably low cost has not been submitted and acts according to the Section 48 of the Law on Public Procurement.

28.4. If the Procurement committee establishes the fact that an offer of unjustifiably low cost has been submitted, the offer is rejected.

VI VERIFICATION OF INFORMATION BEFORE MAKING THE DECISION ON

CONTRACT AWARD

29. According to Section 39, Paragraph one, Clause five, six and seven of the Law on Public Procurement, the Procurement committee shall verify the information regarding the Tenderer who would be granted the contract award in order to assess if the Tenderer is not to be excluded from the participation in the procurement procedure.

30. Regulations on exclusion of the Tenderer:30.1. Tenderer is excluded from further participation in the procurement procedure if

within the last 3 (three) years since the day the offers have been submitted the Tenderer or the person who is a member of the board or the council of the Tenderer, or a procurator, or a person who is authorized to represent the Tenderer in actions related to a subsidiary, has by such a judgement of a court or a punishment prescription of a prosecutor that has entered into effect and is non-disputable and not subject to appeal been found guilty of committing any of the following criminal offences:

7

30.1.1. Taking of bribes, bribery, bribe embezzlement, mediation for bribery, acceptance of unauthorized benefit or commercial bribery;

30.1.2. Fraud, embezzlement or money laundering;30.1.3. Evasion of taxes and equivalent payments;30.1.4. Terrorism, financing of terrorism, invitation to terrorism, threats of

terrorism or recruitment and training of a person for execution of an act of terrorism.

30.2. Tenderer is excluded from further participation in the procurement procedure if within the last 3 (three) years since the day the offers have been submitted the Tenderer has by such a decision of a competent authority or a judgment of a court which has entered into effect and has become non-disputable and not subject to appeal been found guilty of employment of one or more citizens or nationals of the countries that are not members of the European Union if they reside in the territory of the European Union country illegally.

30.3. Tenderer is excluded from further participation in the procurement procedure if within the last 12 (twelve) month since the day the offers have been submitted the Tenderer has by such a decision of a competent authority or a judgment of a court which has entered into effect and has become non-disputable and not subject to appeal been found guilty of employment of an individual without written labour contract by failing to provide informative declarations on the employees who assume employment by the deadline set forth in the tax rules and regulations.

30.4. Tenderer is excluded from further participation in the procurement procedure if within the last 12 (twelve) month since the day the offers have been submitted the Tenderer has by such a decision of a competent authority or a judgment of a court which has entered into effect and has become non-disputable and not subject to appeal been found guilty of fraudulent competition in a form of vertical agreement with a purpose to impair customer’s freedom to define the resale price or horizontal cartel agreements, except when the respective institution at the moment of identification of the breach of competition rights has released the Tenderer from the penalty or has decreased the penalty for cooperation within the framework of the leniency program.

30.5. Tenderer is excluded from further participation in the procurement procedure if insolvency proceedings have been declared for the Tenderer, the economic activity of the Tenderer has been suspended or discontinued, legal proceedings have been initiated regarding the bankruptcy of the Tenderer or it is determined that the Tenderer will be liquidated.

30.6. Tenderer is excluded from further participation in the procurement procedure if the Tenderer has tax debts in Latvia and a country where it is registered or permanently residing, including debts of mandatory State social insurance contributions in total exceeding 150 Euros in each country.

30.7. Exclusion regulations mentioned in Clauses 30.1-30.6 are applicable to all members of a partnership, if the Tenderer is a partnership, as well as all members of a Supplier association, if the Tenderer is a Supplier association.

31. Procurement committee obtains the required information:31.1. On breaches and criminal offences mentioned in Clauses 30.1.-30.4.  from the

Information centre of the Ministry of Interior (Penalty register);31.2. On facts mentioned in Clause 30.5. from the Register of Enterprises;31.3. On facts mentioned in Clause 30.6. from the State Revenue Service and the

Latvian municipalities.

32. In case it is concluded that the Tenderer (to include any member of a Supplier association or partnership) to be granted the rights of contract award has tax liabilities,

8

to include debts of mandatory State social insurance contributions in total exceeding 150 Euros, the Procurement committee shall request that within 10 (ten) working days a statement (attested by the respective person or its representative) is submitted from Electronic declaration system of the State Revenue Service or a statement issue by a municipality verifying that since the day of the receipt of the request from the Procurement committee the person has no tax liabilities including debts of mandatory State social insurance contributions in total exceeding 150 Euros.

33. Requirements towards foreign Tenderers33.1. In case a foreign Tenderer is to be granted the contract award, the Procurement

committee requests documents issued from respective competent institutions that would verify the Tenderer’s compliance with the requirements of the Clauses 30.1.-30.6. Deadline for submission of such documents shall be no less than 10 (ten) working days after the request has been issued or sent out. If the respective Tenderer fails to provide the requested documents, the Tenderer shall be excluded from further participation in the procurement procedure.

33.2. If documents verifying the compliance of the Tenderer with the requirements of the Clauses 30.1.-30.6. are not issued in the country of registration or permanent residency, such documents can be substituted by an oath or, if giving an oath is not prescribed by the laws and regulations of the respective country, substituted by an acknowledgment made by the Tenderer itself (or a member of the Supplier association, or sub-contractors, or members of partnership or person who’s qualification the Tenderer is relying on to justify its qualification) to a competent institution of the executive or judicial authority, sworn notary or a competent subject-matter organization in the country of registration (permanent residency).

34. Decision on the contract award and the conclusion of the contract34.1. The Procurement Committee awards the contract to the Tenderer who has

submitted an offer complying with the terms and conditions of the Regulations of the Procedure at the lowest price (not including VAT).

34.2. The Procurement Committee informs Tenderers in writing about the results of the Procedure within 3 (three) working days after the day the decision is made.

34.3. Procurement Contract between the Contracting authority and the winner of the Procedure is concluded according to the Law on Public Procurement not earlier than the next day after the waiting period. Procurement Contract is prepared by the organizer of the Procedure on the basis of the decision of the Procurement committee about contract award, the Draft Contract annexed to the Regulations of the Procedure and the offer of the winner of the Procedure.

34.4. The winner of the Open Procedure shall sign the contract within five (5) working days starting from the day when the invitation to sign the contract has been sent by Contracting authority. If the winner of the Procedure fails to sign the contract within the deadline, it shall be noted as a rejection to conclude the procurement contract and the Procurement committee shall act in accordance with the Law on Public Procurement.

34.5. Upon request of the Procedure organiser the Supplier association who is chosen to conclude the contract with must register a partnership in Register of Enterprises of the Republic of Latvia in accordance with Clause 21.5.2. of the Procedure Regulations and in compliance with the scope of responsibility indicated in the Offer within 10 (ten) working days from the date when the decision on contract award has been published online at Procurement supervision bureau web-page. The Contract with Supplier association is concluded after the Merchant’s registration certificate (a copy) has been submitted to the Contracting authority. If partnership is not registered within ten (10) working days from the

9

date when the decision on contract award has been published online on Procurement supervision bureau’s web-page, it is considered as Tenderer’s (Supplier association’s) rejection to sign the procurement agreement.

VIIRIGHTS AND OBLIGATIONS OF THE PROCUREMENT COMMITTEE

35. The Procurement Committee acts according to the Law on Public Procurement, Procedure Regulations and the order No.93 issued by Centre on 19 February 2015.

36. Rights of the Procurement committee:36.1. To request (in writing) to clarify submitted information and to provide detailed

explanations. Such requests may only be issued for the purpose of clarification of information needed to compare and evaluate the offers, and do not grant any rights to the Tenderer to request to change its offer;

36.2. To verify the reliability of any information submitted by Tenderer;36.3. If the Procurement committee has doubts about the truthfulness of the

information included in the Tenderer’s offer or authenticity of the document copies, the Procurement committee is authorized to request the Tenderer to verify truthfulness of the information and/or to present an original document or issue an attested copy of a document.

36.4. To involve external experts with consultative rights in the work of Committee;36.5. During the meeting of the offer opening, in the presence of the representatives of

the Tenderers, to bound together the original of the Tenderer’s offer if it has not been bound together. In such case the Procurement Committee shall not be responsible for the content of these documents;

36.6. To request from the Tenderer information on the Price formation mechanism for the offered Goods and/or Services;

36.7. To reject an Offer if it has not been submitted in accordance with the requirements of the Regulations and/or its content does not comply with the requirements of the Regulations and/or the Tenderer has submitted untruthful information for the assessment of its offer or has failed to submit the required information, including has failed to submit the additional information requested by the Procurement committee within the deadline set by the Procurement committee;

36.8. To reject Tenderer’s offer if the Tenderer changes or supplements the information included in the offer during any stage of the evaluation process;

36.9. To perform other activities in accordance with the Law on Public Procurement, other rules and regulations and these Procedure Regulations.

37. Obligations of the Procurement Committee:37.1. To review the offers of the Tenderers submitted within the set offer submission

deadline;37.2. To make the decision on the results of the Procedure;37.3. To perform other activities in accordance with the Law on Public Procurement,

other rules and regulations and these Procedure Regulations.

VIIIRIGHTS AND OBLIGATIONS OF THE SUPPLIER / TENDERER

38. Rights of the Supplier/Tenderer:38.1. To request from the Procurement committee additional information about

Procedure Regulations by submitting a written request in a timely manner;38.2. To request an acknowledgment of the receipt of the offer when submitting the

offer;

10

38.3. To perform other activities in accordance with the Law on Public Procurement, other rules and regulations and these Procedure Regulations.

38.4. Obligations of the Supplier/Tenderer:38.4.1. At the Procurement committee’s request within the deadline set by the

Procurement committee respond and give explanations in writing to the questions and request asked regarding the offer,

38.4.2. Provide truthful information in the offer;38.4.3. At the Procurement committee’s request within the deadline set by the

Procurement committee, provide in writing the information on the Price formation mechanism of the Goods and/or Services;

38.4.4. By submitting the offer each Tenderer undertakes to comply with all terms and conditions of the Procedure Regulations as the basis of the execution of the procurement;

38.4.5. To perform other activities in accordance with the Law on Public Procurement, other rules and regulations and these Procedure Regulations.

IXOTHER PROVISIONS

39. Other obligations related to the procurement procedure, if not prescribed by these Regulations, shall be determined in accordance with the valid laws and regulations of the Republic of Latvia.

40. The Open Procedure Regulations have been prepared and approved in Latvian language on 28 (twenty eight) pages with unofficial translation into English, consisting of the text of the Regulations on 10 (ten) pages and 4 (four) annexes that are an integral part of these Regulations:

1. Annex No.1 – Application – Financial offer (form) on 2 (two) pages;2. Annex No.2 – Technical specification on 6 (six) pages;3. Annex No.3 – Technical offer (form) on 2 (two) pages;4. Annex No.4 – Draft Contract on 8 (eight) pages.

Head of Procurement committee S.Kondratoviča

11

Annex 1 to Regulations of theProcedure with Identification No.  VAMOIC 2015/021

A P P L I C A T I O N - F i n a n c i a l o f f e r

Note! Tenderer shall fill out the empty fields

Procurement: Supply of autonomous underwater vehicleIdentification No. VAMOIC 2015/021

To: State Centre for Defence Military Object and ProcurementErnestīnes ielā 34,Rīga, LV-1046,Latvija

Honourable Committee,

1. In accordance with the Regulations of the Procedure, we, the undersigned, confirm that we agree to the terms and conditions of the Procedure. We offer to perform the delivery, installation and testing of the Goods and perform personnel training in accordance with the requirements of the Regulations for the total amount of:

Subject of Procurement Quantity Offer Price, EUR (excl.VAT)

Autonomous underwater vehicle (AUV) system 1 system

Personnel Training 6 persons

Total:

If the Tenderer plans to deliver the AUV system as multiple deliveries of separate components during the 24 month period, the Tenderer shall fill out the approximate planned schedule of the system component delivery in terms of funding:

Planned delivery in terms of funding

Year 2015: advance payment

Year 2016:

Year 2017:

2. If the Tenderer is a Supplier association: 2.1. Persons that form the Supplier association (name, registration No., legal

address):

12

2.2. Extent of the liability of each person:

3. We agree with the terms and conditions of the draft Contract annexed to the Regulations of the Procedure.

4. We certify that all the documents attached comprise our offer.5. Information on the Tenderer or person that represents the Supplier association in the

Procedure:

Name of the Tenderer: _____________________________________________Registered:_________________________________________________________With No.: ____________________________________________________________Legal address:____________________________________________________

Office address: ______________________________________________________Contact person: ____________________________________________________

(name, surname, positions)Telephone: __________________________________________________________Fax: ____________________________________________________________E-mail address: _____________________________________________________Taxpayer Registration No.: ____________________________________Bank: ____________________________________________________________Code: _____________________________________________________________Account: ____________________________________________________________Telephone: __________________________________________________________

Hereby I assume full liability for the document package submitted for the Procedure, the information included therein, the layout, and compliance with the requirements of the Procedure Regulations. The provided information and data is true.

The document package of the offer consists of _________ (_____________) pages.

Signature: Name, surname: Position:

The Application-financial offer has been drafted and signed (Date, month, year)

place for stamp

13

Annex 2 to Regulations of theProcedure with Identification No.  VAMOIC 2015/021

TECHNICAL SPECIFICATION

Purchase of Autonomous Underwater Vehicle (AUV)

Use of AUV

To supplement Mine warfare data center with gained by AUV data. To ensure safety from explosives on sea lines of communications, which are under Latvian government responsibility. To take part in national and international naval mine warfare operations. To provide with harbours underwater situation monitoring and guarding.

AUV structure

AUV system consists of:

Underwater vehicle – 2 pcs

Portable surface display and control unit – 2 pcs

Surface equipment, auxiliary equipment and tools – 2 sets

Mission planning and execution software installed on display and control unit

Post mission data analysis software installed on display and control unit

Dimensions

Underwater vehicle:

Overall length: not more than 200 cm

Body diameter: not more than 30 cm

Portable surface display and control unit:

Dimensions not more than: 50 cm x 50 cm x 50 cm

Weight in airUnderwater vehicle: not more than 70 kg

Portable surface display and control unit: not more than 12 kg

Composition

Portable surface display and control unit: polymer

WatertightCrashworthy

Underwater vehicle: Metal alloy or polymer material

WatertightCrashworthy

Special requirements

Must be capable to operate in autonomous mode from IMANTA, SKRUNDA class vessels, from RHIBs and jetties. Operational range not less than 2000m. Possibilities of operational control during mission (start and end of mission, mission abort, position of underwater vehicle, transit to mission area).Underwater vehicle launch and recovery shall be done without special launch and recovery equipment.AUV must be capable to detect, classify and visualize (video or photo recording) underwater object without operator control.

14

During mission underwater vehicle should be able to avoid underwater obstacles independently, without operator commandSDNE of underwater vehicle should be not more than 5 mAUV should be equipped with specific sensors in accordance with attachmentUnderwater vehicle must be capable to follow sea bottom on designated altitude in water volumeOperational depth from 3 to 100mOperable till sea state 4Operable in currents till 1,5 knots;Coverage should be not less than 0.1 square nautical mile per hourVoltage:115/220 V 50 - 60 Hz external or internal supply for mission preparations and post mission analysis ,24 V VDC internal supply during mission timeUnderwater vehicle consist of at least three hermetical rechangable modules. Electronic module, battery module, propulsion module.

Other special requirements

Underwater vehicle should be qualified to meet NATO STANAG 1364 requirements.

System provider should be authorized to do AUV maintenance and modernization.

System must be portable.

System final instalation, system users training and system testing should be done by delivering company in Liepaja, Roņu street 2.

Quality and warranty requirements

System should be fully calibrated and ready for use before delivery

2 years warranty from delivery time.

Annex to the Technicalspecification

15

1. GENERAL REQUIREMENTS

1.1. LIST OF ABBREVIATIONS AND ACCRONYMS : ASCII – American Standard Code for Information Interchange DGPS – Differential Global Positioning SystemMCM – Mine CountermeasureMILCO – Mine Like ContactMILEC – Mine Like EchoMWDC – Mine Warfare Data CenterINS – Inertial Navigation SystemUSBL – Ultra Short Baseline LBL – Long Baseline SSS – Side Scan Sonar CTD – Conductivity Temperature Depth VSW – Very Shallow Water from 3 till 10 mMBES – Multi Beam Echosounder

1.2. Functional and operational requirements AUV system shall be capable:

- To provide naval platform (ship or RHIB) with MCM capability;- Autonomously conduct water volume and bottom search with side scan sonar in

accordance with developed plan;- To provide limited aquatorium (harbours, rivers) underwater search and underwater

data procurement;- To provide underwater objects identification;- To conduct Very Shallow Water search;- To provide with underwater data acquisition and delivery to MWDC;- To conduct underwater CTD, sound velocity profile measurements ;- To represent (visualize) side scan sonar mission results;- To visualize video camera records on completion of mission;- To visualize AUV recorded path on completion of mission;- To provide with simple command transfer from underwater vehicle to control

station;- To provide with simple command transfer from control station to underwater

vehicle;- To provide with all gained data processing, preservation and analysis possibility;- To conduct automatic and manual MILCO detection, clasification and visualization;- To provide AUV position visualization on control station display, when AUV is at

least 2000m radius from control station; - To avoid underwater obstacles independently;- To search/scan water volume in depth range from 3 to 100m;- To be operable in water temperature range from -2 to +40 C degrees and air

temperature range from -10 to +45; - System storage temperature range from -15 to +50 C degrees;- To be operable till sea state 4;- To provide possibility for deployment of AUV from IMANTA, SKRUNDA class

ships and RHIBs;- To store mission data from at least 18 hours of mission;- Endurance at least 4 hours with speed 3 knots, without battery.- To provide mission data in HTML and ASCII text format.

1.3. General requirements:1.3.1 Underwater vehicle must be equipped with:

16

1. Search and classifications sensors:Side scan sonar:

- Must be capable to work with dual frequency;- First frequency from 400 kHz to 700 kHz, second frequency from 900 kHz to 1600

kHz;- Along track and cross track resolution not less than 3 cm.

Video camera:- Colour or black and white with resolution at least 750x580 pixels with automatic

focusing; - Provide with recorded video saving in AVI or MPEG format, photo pictures saving

in JPG or BMP format.2. Navigation, propulsion and steering system with following elements:

Depth determination sensor or MBES;Obstacle avoiding sonar:

- Frequency range 850 – 950 kHz;- Minimum range 50m.

Doppler Velocity Log - Frequency range 400-600 kHz

Inertial Navigation System:- System position error should not exceed 0.3% of made distance;

DGPS system:- System position error should not exceed 2.5m.

At least one propeller, vertical and horizontal rudder;Underwater movement stabilisation system;USBL system component (beacon);

3. Supporting sensors and systems: - Sound velocity profile measurements device;- CTD sensor;- Two light elements(for camera and underwater vehicle position determining);- Data storage system.4. Communication systems:- Provides data and command exchange between underwater vehicle and control

station through WIFI net with at least IEEE 802.11g standard or equivalent;- Provide data and command exchange between underwater vehicle and control

station through UHF radio communications;- Provide data and command exchange between underwater vehicle and control

station through acoustic channel in 30-40 nkHz frequency range;- Provide data exchange between underwater vehicle and control station through

Ethernet/Fiber optic link (1Gb/s) after mission.5. Emergency system:

In emergency situation:- provide with information about underwater vehicle position;- provide with underwater vehicle surfacing;- provide with warning message dispatch to control station; - provide with pinger signals in 37.5 kHz frequency, and speed rate 1 ping per

second. 6. Energy source (battery):- To be rechangable by two men power;- Able provide continuous underwater vehicle mission with all sensors not less than 4

hours.7. Control module

During mission guide, control and make decisions in accordance with operator’s programmed algorithm.

17

1.3.2. Command and control station with computer system:- Provide with operation planning interface; - Provide with gained data analysis and storage;- Provide with mission data visualization;- Is able to work without external energy source at least 4 hours;- To be portable by one man power;- Shall be equipped with mission planning and execution software;- Provide communications between control station and underwater vehicle;- Shall be equipped with:

Keyboard with Latin alphabet and digits 0-9;Display cursor control;Communication antennas.

- Supply 24 V VDC;- USBL transducer to be included in set.

1.3.3. Command and control station software:1.3.3.1. Mission planning/post mission analysis module.

Shall provide following parameters input:- Operation area positions; - Operation plan.

Shall be fitted with graphical editor; Shall work with S-57 or S-63 cartography standards or equivalent.

1.3.3.2. Testing kit.Provide with following information:- test results;- sensor status; - energy source capacity;- status of planned operation inputs.

1.3.3.3. Operation monitoring module. Is visualizing: - progress of operation;- actual mission status;- Energy source capacity. Provide with:- Mission abort (when necessary);- Transit to new operation area;- End of mission.

1.3.4. Peripheral tools requirements:- Provide with possibility of underwater vehicle safe transportation, storage and

maintenance;- Provide with system testing possibility;- Provide with energy source recharging capability.

2. PERSONNEL TRAINING PROGRAMME 2.1. 6 persons should be trained for system maintenance on user level;2.2. 6 persons should be trained for work with control system on user level.3. AUV TECHNICAL DOCUMENTATION In technical documentation following information to be included:- System calibration results; - System installation documentation;- System maintenance documentation;- User documentation. Technical documentation has to be prepared in English or Latvian.

Annex 3 to Regulations of theProcedure with Identification No.  VAMOIC 2015/021

18

TECHNICAL OFFER

Purchase of Autonomous Underwater Vehicle (AUV)

Use of AUV

AUV structure

AUV system consists of:

Dimensions

Underwater vehicle:

Portable surface display and control unit:

Weight in air

Composition

Special requirements

Other special requirements

Quality and

19

warranty requirements

Detailed description of all the parameters and conditions in accordance with technical specifications requirements as laid down in the Annex to the Technical specification:

1. Manufacturer and model of the offered Goods __________________________________.

2. Deadline for delivery and installation of the Goods and training of the personnel: ___(_______________) months from the day the Contract has come into force.

3. Deadline for replacement of Goods of improper quality or elimination of any deficiencies during the period of warranty: ____ (____________________) months after the day a statement of detected deficiencies has been prepared.

4. Warranty term for Goods: ___ (_______) ___________ from the day the Goods have been commissioned and/or the day a statement of replacement of the Goods of improper quality has been signed.

5. We certify that we will perform the personnel training in accordance with the requirements of the Technical specification.

6. Training program for the personnel training is attached to the offer on page ____________.

Hereby I assume full liability for the document package submitted as part of the Technical offer, the information included thereof, the layout, and its compliance with the requirements of the Regulation. The provided information and data is true.

Signature: _________________________________

Name, surname: _________________________________

Position: __________________________________

Technical offer prepared and signed on ____________(date)

20

Annex 4 to Regulations of theProcedure with Identification No.  VAMOIC 2015/021

(Draft)CONTRACT

For supply of autonomous underwater vehicle(identification No.: VAMOIC 2015/021)

_______ ___ _______ 2015

_________________, acting under authorities derived from __________________(hereinafter - „Contracting authority”), represented by ____________________ acting under authorities derived from________ as one Party,

and__________________, registered at the Register of the Enterprises of the Republic of Latvia on __________ (date) with common Registration number: _________________________ (hereinafter - „Supplier”) represented by ____________________, as the Other party,

together referred to as “Parties” and separately as “Party”,on the basis of the results of the Open Procedure „Supply of autonomous underwater vehicle”, identification No.: VAMOIC 2015/021 recorded in the meeting minutes of _______2015, No.: VAMOIC 2015/021-__, conclude the following contract (hereinafter - the „Contract”):

1. 1. SUBJECT OF THE CONTRACT

1.1. Contracting authority orders and Supplier delivers autonomous underwater vehicle (hereinafter – System) – 1 (one) set, performs installation and testing of the System, as well as trains 6 specialists on maintenance and user level operation of the control system, in accordance with the Technical specification (Annex No.1 to Contract).

1.2. The description, price and delivery terms of the System have been determined in accordance with the Supplier’s offer submitted for the Open Procedure (hereinafter – the Offer) and on the basis of the Procurement Committee’s decision of _________, 2015, meeting minutes No. VAMOIC 2015/021-____.

1.3. Place of delivery of the System: Roņu iela 2, Liepāja, LV-3401, Latvija, in accordance with international commercial terms: INCOTERMS 2010 DAP.

2. TOTAL CONTRACT AMOUNT2.1. Price of the System (1 set), including installation and testing, excluding Value Added

Tax (hereinafter – VAT) is _______ EUR (__________).2.2. Price of personnel training (for 6 (six) persons) excluding VAT is _______ EUR

(____).2.3. Contract amount without VAT is ____EUR (______).2.4. Total Contract amount including VAT is _____ EUR (_________________).2.5. Total Contract amount includes the value of the System, packaging and delivery,

installation, testing and personnel training, transportation costs, as well as all state and municipality imposed taxes, duties and any other costs associated with the System and its delivery.

21

2.6. The amount indicated in Clause 2.4. as the total Contract amount including VAT may change if changes in VAT rate are introduced, as well as a result of rounding the VAT amount.

2.7. If the Supplier is not resident of Latvia, the VAT is paid by the Contracting authority in accordance with the valid procedures and amount prescribed by the regulations of the Republic of Latvia.

2.8. Depending on the status of the state budget appropriation Contracting authority is authorized to amend the Contract’s Terms of Payment by informing the Supplier in writing.

2.9. During the execution of the Contract the Supplier is forbidden to increase the Contract amount set in Clause 2.3. and Contract’s Annex No. ___ “Supplier’s Financial offer”.

3. RESPONSIBILITIES OF THE PARTIES3.1. Supplier:

3.1.1. Delivers, installs and tests the System, and trains Contracting authority’s personnel (6 specialists) at a location specified by the Contracting authority in accordance with the terms of the Contract and Technical specification;

3.1.2. Trains Contracting authority’s personnel in accordance with the requirements of the Annex No.1 of the Contract and the training program submitted as part of the Open Procedure;

3.1.3. Introduces the Contracting authority with truthful and thorough information regarding the System, its quality, safety, as well as usage and storage instructions;

3.1.4. Within 5 (five) working days after the Contracting authority’s request submits a list for approval by the Contracting authority of employees who will perform the delivery, installation and testing of the System, as well as personnel training;

3.1.5. At the Contracting authority’s request the Supplier shall substitute certain employees;

3.1.6. Is not entitled to transfer the rights and obligations imposed by this Contract to third parties;

3.1.7. Provides warranty for the System and fulfils warranty liabilities, as well as performs technical and other requirements as prescribed by the Technical specification.

3.2. Contracting authority:3.2.1. Accepts the delivery of the System provided the System and its quality

complies with the requirements of the Contract, and it has been delivered according to the terms and conditions of the Contract and Technical specification;

3.2.2. Is entitled to invite independent specialists and experts when accepting the System;

3.2.3. Pays for the accepted System in accordance with the terms of payment of the Contract;

3.2.4. Provides access to Contracting authority’s premises for Supplier’s employees (based on the pre-approved list) and ensures the opportunity to deliver the System by mutually agreeing on time and delivery procedures.

4. TERMS OF DELIVERY AND TRANSFER OF GOODS 4.1. Supplier delivers the System to the location specified in Clause 1.3. in accordance

with INCOTERMS 2010, DAP; performs the installation and testing of the System, and the training of the personnel within ____(_____) months after the Contract has come into force.

22

4.2. Partial delivery of the components of the System is possible by preparing and mutually signing an acceptance and transfer statement for delivery of each component of the System. The final acceptance and transfer statement is signed after the System is delivered in full amount, it is installed, tested and personnel training has been performed.

4.3. No later than 5 (five) working days before the delivery of the System, the Supplier shall coordinate (in writing (by e-mail) and by phone) the specific time of the delivery, installation and testing of the System with the Contracting authority’s official responsible for the Procedure specified in Clause 11.7.

4.4. In the accompanying documents of the System the Supplier shall indicate the name, quantity, price, manufacturer and year of production of the System.

4.5. Usage instructions and any other information related to the usage and storage of the System shall be attached to the System in Latvian and English languages.

4.6. The Supplier bears full responsibility for accidental loss or damages of the System until both Parties have signed the acceptance and transfer statement.

4.7. Before signing the acceptance and transfer statement the Contracting authority is entitled to examine the System or a component of the System. Contracting authority is entitled to refuse to accept the System and sign the acceptance and transfer statement if the System or its component does not comply with the terms and conditions of the Contract, Technical specification (Annex No.1), the Supplier has failed to comply with any of the requirements of the Clause 3.1. In such a case the Contracting authority shall submit a written claim to the Supplier within 3 (three) working days, and the Supplier, at its own expense, is required to remedy the claims (including to deliver new System complying with the requirements of the Contract and its annexes) and to fulfil sanctions imposed by Clause 7.1. for exceeding the deadline of the delivery, if the deadline has been exceeded.

4.8. After the acceptance of the System (Clause 4.9.) any issues regarding the quality of the System shall be resolved according to warranty terms and conditions.

4.9. The System is considered to be delivered when all components of the System are delivered, the installation and testing of the System is completed, the Contracting authority’s personnel have been trained, and the final acceptance and transfer statement has been submitted, accepted, and mutually signed.

5. QUALITATIVE GOODS COMPLYING WITH THE REQUIREMENTS OF THE CONTRACT

Within the framework of this Contract qualitative System complying with the terms of the Contract is a System that complies with the terms and conditions of the Contract, including the Technical specification (Contract Annex No.1), standards of the System’s manufacturer, as well as requirements of the laws and regulations governing the quality of the System.

6. TERMS OF PAYMENT6.1. Contracting authority pays for qualitative System delivered in accordance with the

terms of the Contract and the laws and regulations of the Republic of Latvia by bank transfer to the Supplier’s account.

6.2. Contracting authority pays in the following order:6.2.1.Contracting authority pays an advance payment in the amount of __%

(______percent) of the System price within 20 (twenty) calendar days after the day the Contract has been signed by both parties and Supplier’s invoice has been received by the Contracting authority (acknowledgment of receipt);

6.2.2. If the System is delivered partially by individual System components, the next payment is made when the Supplier’s delivery of the System’s components has covered the amount of the advance payment, which is acknowledged by signed

23

acceptance and transfer statements prepared by the Supplier and approved by the Contracting authority. All future payments for the System are made within 30 (thirty) calendar days after mutually approved and signed acceptance and transfer statements and Supplier’s invoices are received by the Contracting authority (acknowledgment of receipt).

6.3. The date of the payment shall be the day when Contracting authority has conducted the transfer to Supplier’s indicated bank account.

6.4. Each Party covers its own expenses for the bank services related to money transfers.

6.5. If a System of improper quality or not complying with Contract requirements has been delivered, and an appropriate statement according to the terms of the Contract has been prepared, the payment is done after the detected deficiencies of the System have been eliminated.

7. FINANCIAL LIABILITY7.1. If the Supplier fails to deliver the System by the deadline set forth in Clause 4.1.,

including fails to provide the required training and does not comply with the requirements of the Clauses 4.7., 8.3, the Contracting authority has the right to impose contractual penalty. In such a case the Supplier shall pay the Contracting authority a contractual penalty in the amount of 0,1 % (one tenth of one percent) of the price of the undelivered System for each day of delay.

7.2. If the Supplier repeatedly delivers a System or its component that does not comply with the requirements of the Contract, the Contracting authority has the right to impose a contractual penalty. In such a case the Supplier shall pay the Contracting authority a contractual penalty in the amount of 5 % (five percent) of the amount of the System. The payment of the penalty does not relieve the Supplier from the responsibility to deliver the System, except when the Contracting authority applies the rights of the Clause 10.3.4.

7.3. If the Supplier refuses the execution of the Contract, the Contracting authority has the right to impose a contractual penalty. In such a case the Supplier shall pay the Contracting authority a contractual penalty in the amount of 10 % (ten percent) of the total Contract amount. Within the framework of the Clause the refusal to execute the Contract is considered when the Supplier fails to deliver and install the Goods within 20 (twenty) calendar days after the deadline for the delivery of the System set forth by this Contract.

7.4. The total combined amount of the Contractual penalties imposed by Clauses 7.1. and 7.2. shall not exceed 10% (ten percent) of the total Contract amount.

7.5. Contracting authority is entitled to offset payments due for delivered System by the amount of the contractual penalties imposed according to the Clause 7.1.or 7.2 and/or any losses; otherwise Clause 7.6. is applicable.

7.6. If Clause 7.5. is not applicable, the Supplier shall pay the Contracting authority contractual penalty and/or reimburses any losses based on Contracting authority’s invoice within 15 (fifteen) calendar days from the day the invoice has been sent (postal stamp).

7.7. If the Contracting authority fails to do payments of the Contract within the deadlines set forth by the Contract, the Supplier has the right to impose a contractual penalty. In such a case the Contracting authority pays the Supplier a penalty in the amount of 0,1 % (one tenth of one percent) of the unpaid amount for each day of delay, but not more than 10% (ten percent) of the total Contract amount, within 15 (fifteen) calendar days after the day the Supplier has sent the invoice for contractual penalties.

7.8. The payment of contractual penalty does not release the Parties from execution of the Contract, except as prescribed by Clause 7.3.

24

8. WARRANTY LIABILITIES8.1. Supplier undertakes the warranty liabilities for the System for a period of___ (____)

months from the date of the delivery of the Goods in accordance with the Clause 4.9. and mutual signing of the final acceptance and transfer statement. During this period the Supplier ensures that the System will maintain proper quality, safety and full operational capacity.

8.2. If during the term set by Clause 8.1. the Contracting authority concludes that the System does not maintain proper quality, safety and full operational capacity, the Contracting authority shall inform the Supplier by sending a written notice (informing by phone and e-mail) and shall invite the Supplier to prepare a bilateral statement on the detected deficiencies. Supplier’s representative shall arrive within 5 (five) working days after the receipt of notice at the location of the System specified by the Contracting authority. In case Supplier’s representative fails to arrive, Contacting authority has the right to prepare the statement on detected deficiencies without the Supplier’s attendance. The statement on the detected deficiencies shall be sent to the Supplier (by fax).

8.3. Supplier at its own expense shall eliminate the deficiencies and defects identified in accordance with the Clause 8.2. or replace the System with a new, qualitative System complying with the requirements of the Contract within ____ (____) month after the day the statement on the detected deficiencies was prepared. In such a case the Supplier shall exchange the Goods or shall eliminate the deficiencies in accordance with INCOTERMS 2010, DDP Roņu ielu 2, Liepāja, Latvija. If due to valid and objective reasons or due to force majeure circumstances more time is needed to eliminate the deficiencies of the Goods, Parties shall agree on the extension of the term.

8.4. Supplier at its own expense shall perform repair or replacement of the System during the warranty period, but after the warranty period the Supplier shall ensure the opportunity for the repair and replacement of the System.

8.5. The warranty of the System remains in force even if the owner of the System changes.

8.6. Supplier does not have the obligation to replace System of improper quality if it has lost its quality because the Contracting authority has failed to observe user instructions.

9. FORCE MAJEURE9.1. Parties are freed from fulfilment of Contract liabilities in cases of circumstances of

force majeure. Force majeure circumstances include: fire, flood, earthquake, government decisions, orders and other accidents of extreme nature that the Parties could not have foreseen, nor avoided.

9.2. In case of the force majeure circumstances defined in Clause 9.1. of the Contract, the terms set in the Contract are extended for a period that corresponds to the period of the force majeure that delayed the execution of the Contract.

9.3. Parties must inform one another about the beginning and the end of an accident interfering with the execution of the Contract within 5 (five) calendar days. In the event of delayed notification the Party at fault shall not be freed from fulfilment of the obligations.

9.4. If due to circumstances of force majeure the delivery, installation and testing of the System and training of the personnel is delayed for more than 30 (thirty) calendar days, Parties have the right to unilaterally withdraw from the Contract notifying the other Party in writing 5 (five) calendar days in advance. In such a case the Contracting authority shall return the delivered System components (mutually

25

agreeing on reimbursement for the transportation etc.) and the Supplier reimburses the advance payment paid and other payments received from the Contracting authority in accordance with the Clause 6.2.2.

10. RESOLVING OF DISPUTES AND TERMINATION OF CONTRACT10.1. Parties resolve disputes and disagreements that may arise as a result of fulfilment of

the Contract or in regard to the Contract by mutual negotiations. If Parties are unable to come to an agreement, the disagreements shall be resolved in Court of the Republic of Latvia according to the laws and regulations of the Republic of Latvia.

10.2. Parties may terminate the Contract before the end of the term of the Contract by mutual agreement.

10.3. Contracting authority has rights to unilaterally withdraw from the Contract without Supplier’s consent in the following cases:

10.3.1. if the Supplier exceeds the deadline for delivery, installation and testing of the System and personnel training defined in Clause 4.1. for more than 20 (twenty) calendar days;

10.3.2. if the Supplier fails to fulfil warranty obligations;10.3.3. if the contractual penalty imposed to the Supplier exceeds 10% of the total

Contract amount;10.3.4. if the Supplier has repeatedly delivered a System or its component that does

not comply with the terms and conditions of the Contract.10.4. In the cases mentioned in sub-paragraphs of the Clause 10.3. the Contract is

considered to be terminated on the seventh (7th) day after dispatching of Contracting authority’s notification of withdrawal (registered letter).

10.5. When terminating the Contract in the cases mentioned in sub-paragraphs of the Clause 10.3. the Supplier shall reimburse the Contracting authority the advance payment within 30 (thirty) calendar days from the day the Contracting authority dispatches an invoice, shall pay the contractual penalty and reimburse all losses caused to the Contracting authority in accordance with the invoice submitted by the Contracting authority.

10.6. Supplier is entitled to unilaterally withdraw from the Contract if the Contracting authority fails to make payments for more than 30 (thirty) calendar days after the payment deadline set forth by the Contract, providing a written notice to Contracting authority at least 10 (ten) working days in advance.

11. FINAL PROVISIONS11.1. Contract shall come into force at the moment both Parties sign it and remains valid

until completely fulfilment of obligations.11.2. All Contract amendments and additions shall be prepared in writing and shall be

signed by both Parties, and shall come into force at the moment all copies are signed, unless otherwise specified in this Contract.

11.3. All annexes referred to in the Contract, as well as any Contract amendments or additions made after the conclusion of the Contract, if prepared in accordance with the terms of the Clause 11.2., are an integral part of the Contract.

11.4. During the execution of the Contract the Parties shall have the right to mutually agree and amend in writing the payment terms and amounts of the Clause 6.2. of the Contract.

11.5. Within 3 (three) days Parties shall inform each other in writing (registered letter) on changes in legal status, legal or office address, banking data, reorganization or liquidation of it, changes in the contact persons indicated in the Contract, as well as any other relevant information. After the receipt of the information (acknowledgment of receipt) such information becomes integral part of the Contract.

26

11.6. Notifications on withdrawal from the Contract or any other correspondence related to the Contract must be sent in a registered letter to the legal addresses specified in the Contract.

11.7. Contact person for Supplier – _____________, phone number:__________.11.8. Contact person for Contracting authority - __________, phone number:______.11.9. The Contract is prepared in Latvian and English on ____ (______) pages, ____

(_____) pages of which are the text of the Contract and ____ (____) pages of Annex No.1 Technical Specifications, _____ (____)____ (____) pages of Annex No.2 „Tenderer’s Financial offer”, ___ (______) pages of Annex No.3 „Tenderer’s Technical offer”, ____ (_____) pages of Annex No.4 „Acceptance and Transfer Statement”, ____ (_____) pages of Annex No Nr.5 „Final Acceptance and Transfer Statement”, in 2 (two) original copies having equal legal value, one of which resides with Contracting authority, and the other with Supplier..

11.10. In case of any discrepancies between the Latvian language and English translation, the Latvian version shall prevail.

12. LEGAL ADDRESSES, REQUISITES AND SIGNATURES OF THE PARTIESContracting authority Supplier

27

Annex No.:___To Contract No. ____

SAMPLE Acceptance and Transfer Statement

For Contract No.___________ Date:_____on supply of autonomous underwater vehicle

_____, __ ______2015

_________________, acting under authorities derived from __________ (hereinafter - „Contracting authority”), represented by ____________________ acting under authorities derived from________ as one Party,and ________________________ registered at Enterprise register of the Republic of Latvia on __________ (date) with common Registration number: _________________________ (hereinafter - „Contractor”) represented by ____________________, as the Other party, together referred to as “Parties” and separately as “Party”, on the basis of the Contract No.______ concluded on ________2015, have prepared this acceptance and transfer statement acknowledging that the Supplier, based on the Contract, has delivered parts of the autonomous underwater vehicle (hereinafter – System), as separate components of the System, and the Contracting authority has accepted the delivered components of the System:

No.: List of the System components

Quantity Price, EUR (excl. VAT) for each component of the System

1.

2.

3.

VAT 21%:

Total:

1. Parties acknowledge that the components of the System of proper quality in a timely manner and according to the requirements of the Contract and its annexes have been delivered.

2. There are no objections regarding the delivery.3. Parties agree that the Contracting authority will make the payment according to the

terms of the Contract.4. This statement is an integral part of the Contract and has been prepared in Latvian

(with translation into English) on 1 (one) page, and two original copies have been signed, one resides with the Supplier, and the other - with the Contracting authority. Both copies have equal legal value.

ACCEPTED BY: TRANSFERED BY:Contracting authority: Supplier:

1st RLC, LC, LNAF ________

______________________ ____________________/K.Zelčs/ /______/

place of stamp

__________________ ______________ (Official responsible for the Procedure)

__________________ _______________ (End-user’s representative)

28

Annex No.:______To Contract No.: ______

SAMPLE Final Acceptance and Transfer Statement

pie________ Līguma Nr. _____on supply of autonomous underwater vehicle

_____, __ ______2015

_________________, acting under authorities derived from __________ (hereinafter - „Contracting authority”), represented by ____________________ acting under authorities derived from________ as one Party,and ________________________ registered at Enterprise register of the Republic of Latvia on __________ (date) with common Registration number: _________________________ (hereinafter - „Contractor”) represented by ____________________, as the Other party,

together referred to as “Parties” and separately as “Party”, on the basis of the Contract No.______ concluded on ________2015, have prepared this final acceptance and transfer statement acknowledging that the Supplier, based on the Contract, has delivered the System, has performed the installation and testing of the System, and provided personnel training and the Contracting authority has accepted the delivered System and the performed installation, testing and personnel training:

GOODS Price, EUR (excl. VAT)

Autonomous underwater vehicle

Personnel training (6 persons)

VAT 21%:

TOTAL:

5. Parties acknowledge that the System delivery, its installation, testing and personnel training of ___ specialists has been performed in a timely manner and of proper quality, in accordance with the requirements of the Contract and its annexes.

6. There are no objections regarding the rendered services.7. This statement is an integral part of the Contract and has been prepared in Latvian

and English on 1 (one) page, and two original copies have been signed; one resides with the Supplier, and the other - with the Contracting authority. Both copies have equal legal value.

ACCEPTED BY: TRANSFERED BY:Contracting authority: Supplier:

1st RLC, LC, LNAF ________

______________________ ____________________/K.Zelčs/ /______/

place of stamp

__________________ ______________ (Official responsible for the Procedure)

__________________ _______________ (End-user’s representative)

29