Lease terms and conditions for state-owned tea plantations

• Within the scope of the Program*, the state-owned tea plantation* shall be granted on lease without an auction with the consent of the Government of Georgia.
• State-owned tea plantations may be granted on lease under the following conditions:

            - the lease term – 25 years;

            - the annual cost of the lease – 50 GEL per ha;

            - the cost of the lease may be reviewed in the fifteenth year after signing a lease                                     agreement and then every 5 years;

            - the right of lease may be conceded to any third person/encumbered or granted on                               sublease under prior consent of the lessor and the Agency, provided that the new lessee                   fulfills the former lessee’s obligations to the lessor and the Agency;

            - the area of state-owned tea plantation to be received on lease by an agricultural                                   cooperative shall not be more than the area of tea plantation owned by the agricultural                       cooperative.

• To receive state-owned tea plantations on lease within the scope of the Program, a business entity* shall submit to LEPL "National Agency of State Property" the relevant application, the Conditional Agreement on Co-financing concluded with the Agency, and the unconditional and irrevocable bank guarantee issued by a commercial bank for 10% co-financing to be provided by the Agency to the business entity according to the terms of the Program.
• The bank guarantee to be submitted to LEPL "National Agency of State Property" shall be valid for no less than 68 months after the Program beneficiary* files its application and shall cover the following requirements:

            - During the first 4 months after its effective date, the bank guarantee shall ensure that a                       lease agreement is concluded if the Government of Georgia issues the relevant legal                           act.

            - If the Government of Georgia issues the relevant legal act, the bank guarantee shall                           ensure that the Program beneficiary fulfills the obligations under the Program (and pays                     the penalty imposed under the lease agreement for the default on obligation(s)).

• Unless the Government of Georgia issues the relevant legal act within 1 month after a business entity files its application, the submitted bank guarantee shall be returned to the business entity.
• If the Government of Georgia adopts a legal act, the lease agreement shall be concluded within 3 months after the Government of Georgia adopts the act.
• If the Government of Georgia issues the relevant legal act and a business entity fails to conclude the lease agreement within 3 months after the Government of Georgia issues the relevant legal act, the amount of the bank guarantee submitted by the business entity shall be fully transferred to the State Budget. 
• When submitting documents by the potential Program beneficiary for the same real estate, preference shall be given to the business entity who has earlier submitted the above documents to LEPL "National Agency of State Property".
• After the lease agreement is concluded within the term determined by the relevant legal act of the Government of Georgia, the relations related to the bank guarantee shall be regulated by the lease agreement and the legislation of Georgia.
• If the lessor terminates the lease agreement due to the default on obligations assumed by the lessee under the lease agreement, the funds paid and the costs incurred by the lessee shall not be refunded.