SECTION - I INSTRUCTIONS TO BIDDERS I-1 A - General 1. Scope of Bid 1.1 The Employer, as defined in Bidding Data, hereinafter “the Employer,” wishes to receive bids for the Design, Construction, Commissioning and Remedying Defects of Works specified in the Bidding Data, and as described in the Employer’s Requirements (Section VI), hereinafter referred as “the Works” 1.2 The Successful bidder will be expected to complete the Works within the Time for completion specified in the Bidding Data. If the Contractor fails to complete the Works during that period the Contractor shall pay delay damages to the Employer as specified in Bidding Data. The Defects Notification Period for remedying Defects is given in Bidding Data. 2. Source of Funds 2.1 Works will be financed by the source given in Bidding Data. 3. Eligible Bidders 3.1 All bidders shall confirm in Section VII (Form of Bid), Section IX (schedules), a statement that the Bidder (including all members of a joint venture and sub-contractors) is not associated directly or indirectly in the preparation of the bidding document. 3.2 Foreign bidders can submit bids as specified in Bidding Data 4. Qualification of the Bidders 4.1 All bidders shall include the following information and documents with their Bid in Section IX: (a) Certified copies of original documents defining the constitution or legal status, place of registration, and principle place of business; written power of attorney of the signatory to the Bid to commit the Bidder; (b) All bidders shall include the following information and documents as a minimum with their bids in Section IX: i. Reports on the financial standing of the Bidder, such as profit and loss statements and auditors’ reports for the past three years; ii. Evidence of adequacy of working capital for this Contract (access to line(s) of credit and availability of other financial resources); iii. Total monetary value of construction work performed for each of the last ten years; iv. Experience in works of a similar nature (design works and construction works) and size for each of the last ten years, and details of work under way or contractually committed; I-2 v. Major items of construction equipment proposed to carry out the Contract; vi. Qualification and experience of key Design Team, and Site Management and Technical Personnel proposed for the Contract; vii. Information regarding any litigation, current or during the last five years, in which the Bidder or any partners of a joint venture are involved, the parties concerned, and disputed amount; viii. Proposals for subcontracting components of the Works amounting to more than 10 percent of the contract amount; and ix. Proposals for work methods, staffing and schedules, in sufficient detail to demonstrate the adequacy of the Bidder’s proposal to Employer’s requirements and the completion time described in the bidding documents. 4.2 All bidders shall include the following information and documents with their Bid in Section IX: (a) The Bid shall include all the information listed in Sub-Clause 4.1 above for each joint venture partner; (b) The Bid and, in case of successful bid, the Contract Agreement shall be signed so as to be legally binding on all partners; (c) All partners shall be jointly and severally liable for the execution of the contract in accordance with the Contract terms; (d) One of the partners shall be nominated as being a partner in charge, authorized to incur liabilities, and receive instructions for and on behalf of any and all partners of the joint venture; (e) The execution of the entire Contract, including payment, shall be done exclusively with the partner in charge; and (f) A copy of agreement entered into by the joint venture partners shall be submitted with the Bid. 4.3 To qualify for the award of the Contract, bidders shall meet the following minimum qualifying criteria: (a) Average annual volume of construction work performed in last five years shall be at least the amount specified in Bidding Data; (b) Experience as a contractor in the construction of at least two contracts of a nature and complexity equivalent to the Works over the last 10 years in international airports (one contact should be fully completed and for the last contract; works cited should be at least 75 percent completed); (c) Proposals for the timely acquisition (own, lease, hire, etc) of the essential equipment if any specified in Bidding Data; I-3 (d) A Project Manager with five years’ experience in works of an equivalent nature and volume, including no less than three years as Manager; (e) Each of the proposed design team member should have minimum qualifications and experience if given in the Employer’s Requirements; (f) Each of the proposed design team members should have carried out designs within the last 5 years, of at least two works of a nature and complexity equivalent to the task for which they are proposed for. (g) Liquid assets and/or credit facilities net of other contractual commitments and inclusive of any advance payments which may be paid under the contract, of not less than the amount specified in Bidding Data; and (h) A consistent history of litigation or arbitration awards against the Bidder or any partner of a joint venture may result in disqualification. 4.4 The construction volume for each of the partners of a joint venture shall be added together to determine the Bidder’s compliance with the minimum qualifying criteria of Sub-Clause 4.3(a), (b) and (g); however, for a joint venture to qualify, each of its partners must meet at least 25 percent of minimum criteria 4.3(a), (b) and (g); and the partner in charge at least 40 percent of those minimum criteria. Failure to comply with this requirement will result in rejection of the joint venture’s Bid. Subcontractor’s experience and resources will not be taken into account in determining the Bidder’s compliance with the qualifying criteria. 5. One Bid per Bidder 5.1 Each Bidder shall submit only one Bid either by himself, or as a partner in a joint venture. A Bidder who submits or participate more than one Bid will be disqualified. 6. Cost of Bidding 6.1 The Bidder shall bear all costs associated with the preparation and submission of its Bid, and the Employer will in no case be responsible or liable for those costs, regardless of the conduct or outcome of the bidding process. 7. Site Visit 7.1 The Bidders are advised to visit and examine the Site of Works and its surroundings and obtain for himself on its own responsibility all information that may be necessary for preparing the Bid and entering into a Contract for Design and Construction of the Works. The costs of visiting the Site shall be at the Bidder’s own expense. 7.2 The Employer may conduct a Site visit concurrently with the pre-bid meeting referred to in Clause 17. I-4 B – Bidding Documents 8. Content of Bidding Document 8.1 The Bidding documents are those stated below, and should be read in conjunction with any addenda issued in accordance with Clause 10: Volume I Disclaimer Section I – Instructions to Bidders Section III - Conditions of Contract Section V - Standard Forms [Contract] Volume II Section VI - Employer’s Requirements Volume III Invitation for Bids Section II – Bidding Data Section IV – Contract Data (Deleted) Section VII - Form of Bid Section VIII - Schedule of Prices Section IX - Schedules Section X - Standard Forms [Bid] 9. Clarification of Bidding Document 9.1 A prospective Bidder requiring any clarification of the bidding documents may notify the Employer in writing or by facsimile at the Employer’s address indicated in Bidding Data. The Employer will respond to any request for clarification, which he receives earlier than 14 days prior to the deadline for submission of Bids. Copies of the Employer’s response will be forwarded to all purchasers of the bidding documents, including a description of the inquiry but without identifying its source. 10. Amendment of Bidding Document 10.1 At any time prior to the deadline for submission of bids, the Employer may amend the bidding documents by issuing addenda. 10.2 Any addendum thus issued shall be part of the bidding documents pursuant to Sub-Clause 8.1, and shall be communicated in writing or by facsimile to all purchasers of the bidding documents. prospective Bidder shall promptly acknowledge receipt of each addendum to the Employer. I-5 10.3 To give prospective Bidders reasonable time in which to take an addendum into account in preparing their Bids, the Employer shall extend as necessary the deadline for submission of Bids, in accordance with Clause 20. C – Preparation of Bids 11. Language of Bid 11.1 The Bid, and all correspondence and documents related to the Bid exchanged by the Bidder and the Employer shall be written in English language. Supporting documents and printed literature furnished by the bidder may be in another language provided they are accompanied by an accurate translation of the relevant passages in English language, in which case, for purposes of interpretation of the Bid, the English translation shall prevail. 12. Documents Comprising the Bid 12.1 The Bid submitted by the Bidder shall comprise all the documents described under Clause 19 and any other information requested in the Employer’s Requirements. 13. Bid Prices 13.1 Unless stated otherwise in the bidding documents, the contract shall be for the whole works as described in Sub-Clause 1.1, based on the lump sum price submitted by the Bidder. 13.2 Depending on the Bidder’s proposal, the Bidder shall fill all relevant items in the price schedules required for the works. Bidders may add any new activities items which are not included in the price schedules, but are needed to complete the works in accordance with bidder’s proposal and carry them to the Bid Price. Similarly Bidders may delete items which are included in price schedule but are not required in accordance with the bidder’s proposal. 13.3 All duties, taxes, and other levies payable by the contractor under the Contract, or for any other clause, as of the 28 days prior to the deadline for submission of Bids, shall be included in the Bid Price. 13.4 Unless otherwise provided in the Bidding data, the lump sum price quoted by the bidder shall not be subjected to adjustment during the performance of the Contract. 14. Currencies of Bid and Payment 14.1 The prices shall be quoted by the Bidder in Sri Lanka Rupees or United State Dollars (US$) or in both currencies as appropriate I-6 15. Bid Validity 15.1 Bids shall remain valid for the period stipulated in the Bidding Data. 15.2 In exceptional circumstances, prior to expiry of the original bid validity period, the Employer may request from the bidders to extend the period of bid validity for a specified additional period. The request and the responses thereto shall be made in writing or by facsimile. A bidder may refuse the request without forfeiting its Bid security. A Bidder agreeing to the request will not be required to modify its Bid, but will be required to extend the validity of its Bid Security for the period of extension, and in compliance with Clause 16 in all respects. 16. Bid Security 16.1 The Bidder shall furnish, as part of its Bid, a Bid security in the amount stipulated in the Bidding Data. 16.2 The Bid security shall, at the Bidder’s option, be in the form of a certified cheque, letter of credit or a guarantee from a reputed bank or insurance bond from a company located in Sri Lanka or from an acceptable bonding organization in Sri Lanka. The format of the Bid security should be in accordance with the specimen form of bid security included in the bidding document or another form acceptable to the Employer. Bid security shall be valid for the period given in the Bidding data. 16.3 Any Bid not accompanied by an acceptable Bid security shall be rejected by the employer as non-responsive. The bid security of a joint venture shall be issued so as to commit fully all partners to the proposed joint venture. 16.4 The Bid securities of unsuccessful bidders will be returned as promptly as possible, but not later than 28 days after the expiration of the period of Bid validity. 16.5 The Bid security of the successful bidder will be returned when the bidder has signed the agreement and furnished the required Performance Security. 16.6 The Bid Security may be forfeited: (a) If the Bidder withdraws its bid, except as provided in SubClause 22.2; (b) If the bidder does not accept the correction of its Bid price, pursuant to Sub-Clause 28.1; or (c) In the case of a successful Bidder, if he fails within the specified time limit to: i. Sign the agreement; or ii. Furnish the required Performance Security I-7 17. Pre-Bid Meeting 17.1 Bidder’s designated representative(s) is invited to attend a pre-Bid meeting, which, if convened, will take place at the venue and time specified in the Bidding Data. 17.2 The purpose of the meeting will be to clarify issues and to answer questions on any matter that may be raised at that stage. 17.3 The Bidders are requested, as far as possible, to submit any questions in writing or by facsimile, to reach the Employer not later than one week before the meeting. It may not be practicable at the meeting to answer questions received late. All questions raised at the pre-bid meeting or under Clause 9.0 will be responded to in writing by the Employer. 18. Format and Signing of Bid 18.1 The Bidder shall prepare one original of the documents comprising the Bid as described in Clause 19 of the instructions to bidders. In addition, the Bidder shall submit a copy of the bid, as described in Clause 19. In the event of discrepancy between them, the original shall prevail. The bid shall be sealed in accordance with Clause 19. 18.2 The original and the copy of the bid shall be signed by a person or persons duly authorized to sign on behalf of the Bidder. All pages of the bid where entries or amendments have been made shall be initiated by the person or persons signing the bid. 18.3 The Bid shall contain no alterations, omissions, or additions, unless such corrections are initiated by the person or persons signing the Bid. D – Submission of Bids 19. Sealing and Marking of Bids 19.1 The Bidder shall seal the original and copy of the Bid in separate envelopes, duly marking the envelops as “ORIGINAL” and “COPY.” The envelopes shall then be sealed in an outer envelope. The “ORIGINAL” cover shall include the originals and the “COPY” shall include copies of the documents listed under sub clause 19.5. 19.2 The inner and outer envelope shall: i. ii. Be addressed to the Employer at the address provided in the Bidding Data; Bear the name and identification number of the Contract and Bid document as defined in the Bidding Data; and I-8 iii. Provide a warning not to open before the time and date for bid opening, as specified in the Bidding Data 19.3 In addition to the identification required in Sub-Clause 19.2, the inner envelopes shall indicate the name and address of the bidder to enable the bid to be returned unopened in case it is declared “late” pursuant to clause 21. 19.4 If the outer envelope is not sealed and marked as above, the Employer will assume no responsibility for the misplacement or premature opening of the bid. If the outer envelope discloses bidder’s identity, the Employer will not guarantee the anonymity of the Bid submission, but this shall not constitute grounds for rejection of the Bid. 19.5 The Companies are required to submit the following documents and information (As per the format given in Section IX- Schedules) along with the bids. This information will be critical for the evaluation of the offer submitted. Lack of submission of all the requested information will make the bid liable for disqualification and finally for rejection of the offer. All documentation and correspondence with respect to the bid shall be in English language. 19.5.1 Proof of the experience of the contractor, in carrying out Similar Projects successfully completed in a single contract, within the last ten (10) years in international airports. The information submitted shall include the client’s names, contract name, year of completion, scope of the construction works handled, contract value, contact names and telephone numbers of client, and any other relevant information. 19.5.2 The construction programme (inclusive of General Execution plan , Plants & Equipment, work schedule and project cash flow plan) 19.5.3 The offers submitted shall include detail CV’s of all the professional and technical staff proposed for this project, covering their qualifications and experience in the relevant fields including employees of subcontractors if any, who are involved in the project execution and in decisions making having a bearing on the project execution. (Minimum 5 years experience in the relevant field with full professional qualification). 19.5.4 Power of attorney authorizing to sign the bid. 19.5.5 Form of Bid, duly filled and signed. I-9 19.5.6 Schedule of prices, duly filled and signed( including soft copy ) 19.5.7 Duly filled Compliance / Deviation Sheet 19.5.8 Duly filled Technical Schedules including Technical Literature, catalogues, brochures of all offered items, published by the manufacturer. 19.5.9 Bid Security in the format submitted, for the specified amount. 19.5.10 Arbitration / Litigation history for the past 10 years (a brief narrative of the significant legal proceedings by or against the bidder along with the reference numbers and the outcome if concluded) 19.5.11 Certified copies of the Memorandum and Articles of Association of the Company or the partnership agreement as the case may be of the Bidder. 19.5.12 Granting authority for the signing of the Bid documents and for the contract agreement if the bid is accepted by CPC, in case of a Company, the board resolution of the company or a documented decision of the partners in a partnership as the case may be. 19.5.13 The audited profit and loss accounts and the balance sheet for the five (05) financial years immediately preceding the date of Bid and names of three (3) banks or other financial establishments from whom reference could be obtained. 20. Deadline for Submission for Bids 20.1 Bids must be received by the Employer at the address specified in Invitation for Bid no later than the time and date stipulated in the bidding data. 20.2 The Employer may, in exceptional circumstances and at its discretion, extend the deadline for submission of bids by issuing an addendum in accordance with Clause 10, in which case all rights and obligations of the Employer and the Bidders previously subjected to the original deadline will thereafter be subjected to the deadline as extended. I-10 21. Late Bids 21.1 Any bid received by the Employer after the deadline for submission of bids prescribed in Clause 20 will be returned unopened to the bidder. 22. Modification, Substitution and Withdrawal of Bids 22.1 The bidder may modify, substitute, or withdraw its bid after Bid submission, provided that written notice of the modification or withdrawal is received by the Employer prior tote deadline for submission of Bids. 22.2 The bidder’s modification or withdrawal notice shall be prepared, sealed, marked, and delivered in accordance with the provisions of Clause 18 & 19, with the outer and inner envelopes additionally marked “Modification” or “Withdrawal,” as appropriate. 22.3 No Bid may be modified by the Bidder after the deadline for submission of Bids. 22.4 Withdrawal of a Bid during the interval between the deadline for submission of Bids and expiration of the period of Bid validity may result in the forfeiture of the Bid security pursuant to Sub-Clause 16. E – Bid Opening and Evaluation 23. Bid Opening 23.1 The Employer will open the bids, including withdrawals and modifications made pursuant to Clause 24, in the presence of bidders’ authorized representatives who choose to attend, at the time, date, and location stipulated in the Bidding data. 23.2 Envelopes marked “WITHDRAWAL” shall be opened first, and the name of the bidder shall be read out. Bids for which an acceptable notice of withdrawal has been submitted pursuant to Clause 24 shall not be opened. Subsequently, all envelopes marked “MODIFICATION” shall be opened and the submissions therein read out in appropriate detail. 23.3 The Envelopes marked as “Original” will be opened. If no envelope is marked as “Original” the Employer may open one of the envelopes. If the required documents are available in that envelope, Employer may mark it as “Original” and the unopened envelope as the “Copy”. If so the envelope marked as copy will remain unopened. If any of the required document is missing in I-11 the envelope opened first, the Employer may open the other envelope to search such missing information and transfer such documents to one envelope and mark it as “ORIGINAL” and resealed the other envelope and mark as “COPY”. 23.4 The bidders’ names, the bid prices, including any alternative bid price or deviation, any discounts, Bid modifications and withdrawals, the presence(or absence) and amount of bid security, and any such other details as the Employer may consider appropriate, will be announced by the Employer at the opening. No Bid shall be rejected at Bid opening except for late Bids pursuant to Clause 23. 23.5 The Employer shall prepare minutes of the Bid opening, including the information disclosed to those present in accordance with SubClause 23. 23.6 Bids not opened and read out at Bid opening shall not be considered further for evaluation, irrespective of circumstances. 24. Process to be Confidential 24.1 Information relating to the examination, clarification, evaluation, and comparison of Bids, and recommendation for the award of a contract shall not be disclosed to Bidders or any other persons not officially concerned with such process until the award to the successful Bidder has been announced. Any effort by a bidder to influence the Employer’s processing of bids or award decisions may result in the rejection of the Bidder’s Bid. 25. Clarification of Bids 25.1 To assist in the examination, evaluation, and comparison of Bids, the Employer may, at its discretion, ask any Bidder for clarification of its Bid, including breakdowns of prices. The request for clarification and response shall be in writing or by facsimile, but no change in the price or substance of the Bid shall be sought, offered, or permitted. 26. Examination of Bids and Determination of responsiveness 26.1 Prior to the detailed evaluation of bids, the Employer will determine whether each bid (a) meets the eligibility criteria; (b) has been properly signed; (c) is accompanied by the required securities; (d) is substantially responsive to the requirements of the bidding documents; and (e) provides any clarifications and/or substantiation that the employer may require to determine responsiveness pursuant to Sub-Clause 26.2. I-12 26.2 A substantially responsive Bid is one that conforms to all terms, conditions, and specifications of the bidding document without material deviation or reservation. A material deviation or reservation is one (a) which affects in any substantial way the scope, quality, or performance of the works; (b) which limits in any substantial way, inconsistent with the bidding document, the Employer’s rights or the Bidders obligations under the Contract; or (c) whose rectification would affect unfairly the competitive position of other bidders presenting substantially responsive Bids. 26.3 If a Bid is not substantially responsive, it will be rejected by the Employer, and may not subsequently be made responsive by correction or withdrawal of the nonconforming deviation or reservation. 27. Evaluation and Comparison of Bids 27.1 The Employer will evaluate and compare only the Bids determine to be substantially responsive in accordance with Clause 26. 27.2 The Employer will evaluate the bid proposals on the basis of their responsiveness to the Employer’s Requirements, applying the evaluation criteria, and point system specified in Sub-Clause 27.3 and 27.4. The Employer will also use the appropriate information submitted in the Bid proposal in allocating points. 27.3 During the technical evaluation, the Employer will determine whether the Bidders are qualified and whether technical aspects are substantially responsive to the requirements set forth in the bidding document. In order to reach such a determination, the Employer will examine the information supplied by the Bidders, and other requirements in the bidding document, taking into account the following factors (but not limited to). a) Qualification i. The determination will take into account the Bidder’s financial and production capabilities and past performance; it will be based upon an examination of the documentary evidence of the Bidder’s qualification submitted by the Bidder, as well as such other information as the Employer deems necessary and appropriate; ii. The Employer will examine whether the bidder is satisfying the minimum criteria given under Sub-Clause 4.3. iii. An affirmative determination under 27.3 (a) ii above will be a prerequisite for the Employer to continue with the technical evaluation; a negative determination will result in rejection of the Bid. I-13 b) Technical The determination will take into account the Bidder’s proposal with special attention given to the following and will assign a score based on the point system and the criteria given in SubClause 27.4. i. Overall completeness and compliance with the Employer’s Requirements; and deviations /shortcomings from the Employer’s Requirements ii. Site Management and Technical personnel iii. The Design team iv. Work plan and methodology v. Compliance with the time schedule 27.4 The following point system will be used for evaluation of the technical responsiveness of bid proposals. Criteria (i) Specific Construction experience of the bidder in similar nature works in last ten years (ii) Specific experience of key site Management and technical personnel proposed for the Works (iii) Experience of the key Members of the Design Team Maximum Points Minimum Required 30 15 25 17 10 07 (iv) Overall compliance with the requirements of the bidding document 10 05 (v) Work Plan and Time schedules 15 08 (vi) Any other improvements to the Employer’s Requirements, suggested by the Bidder 10 - Total 100 65 The following Sub-Criteria will be used in assigning points to (i), (iv), (v) and (vi) above I-14 (a) (b) (c) Satisfactory - 50% Good - 75% Very Good - 100% For allocating points for (ii) & (iii) above, each key member of Site Management & Technical Team and Design Team will be assigned a weighing in accordance with their roles for the assignment. Subjected to the weightings assigned each key staff member will be evaluated using the following Sub-Criteria. (a) (b) (c) General qualifications Total experience Experience related to the task - 25% - 25% - 50% 27.5 Each bid proposal will be evaluated for technical responsiveness by assigning technical score as above. A bid shall be rejected at this stage if it does not respond to important aspects of the Employer’s Requirements or if it fails to achieve an overall minimum of 65 points together with the minimum given against each criteria. 27.6 After the technical evaluation, financial evaluation will be done. 27.7 In financial evaluation, the Employer will determine for each bid the Evaluated Bid Price by adjusting the Bid Price as follows: (a) Excluding Provisional Sums and the provision, if any, but including Day Work, where priced competitively; (b) Correct the arithmetic errors in-pursuant to Clause 28. (c) Making appropriate adjustments on sound technical and/or financial grounds for any other quantifiable acceptable variations, deviations or alternative offers. (d) Applying any discounts offered by the bidder. 27.8 The Employer reserves the right to accept or reject any variation, deviation, or alternative offer. Variation, deviation, alternative offers and other factors that are in excess of the requirements of the bidding document shall not be taken into account in Bid Evaluation. 27.9 If the Bid, which results in the lowest evaluated Bid Price, is seriously unbalanced or front loaded in relation to the Employer’s estimate of the items of work to be performed under the Contract, the Employer may require the Bidder to produce detailed price analyses for any or all items Price Schedule, to demonstrate the internal consistency of those prices with the construction methods and schedule proposed. After evaluation of the analyses, taking into consideration the schedule of estimated Contract Payments, I-15 the Employer may require that the amount of the Performance set forth in Clause 32 be increased at the expense of the Bidder to a level sufficient to protect the Employer against financial loss in the event of default of the successful bidder under the Contract. 28. Correction of Errors 28.1 Bids determined to be substantially responsive will be checked by the Employer for any arithmetic errors. Errors will be corrected by the Employer as follows (a) Where the there is a discrepancy between the amount in figures and in words, the amount in words will govern; and (b) Where there is a discrepancy between the unit rate and the line item total resulting from multiplying the unit rate by the quantity, the unit rate as quoted will govern, unless there is an obviously gross misplacement of the decimal point in the unit rate, in which case the line item total as quoted will govern, and the unit rate will be corrected. (c) Unless this sub-clause is modified in bidding data and if the bid price decreases by the above procedure, the amount stated in the form of bid shall be adjusted with the concurrence of the bidder and shall be considered as binding upon the bidder. If the bidder does not accept the corrected amount of bid, his bid will be rejected, and the bid security may be forfeited in accordance with this sub clause 16.6(b). (d) Unless this sub-clause is deleted in Bidding Data and if the total Bid price increases due to corrections made on above procedure, the bid price shall not be adjusted to increased price and the corrections should be readjusted within the Bid price in consultation with the Bidder. F. Award of Contract 29. Award 29.1 Subject to Clause 30, the Employer will award the Contract to the bidder whose bid has been determined to be substantially responsive to the bidding document in accordance with the Clause 26.1, has achieved minimum points given under Sub-Clause 27.5 for Design and Technical proposal, and who has offered the lowest Evaluated bid price, provided that such Bidder has been determined to be (a) eligible in accordance with the provisions of Clause 3; and (b) qualified in accordance with the Provisions of Clause 4.3 30. Employer’s Right to Accept any Bid and to Reject any or all Bids I-16 30.1 The Employer reserves the right to accept or reject any Bid, and to annul the Bidding process and reject all Bids, at any time prior to award of contract, without thereby incurring any liability to the affected bidder or Bidders or any obligation to inform the affected bidder or Bidders of the grounds for the Employer’s action. 31. Notification of Award 31.1 Prior to expiration of the period of Bid validity prescribed by the Employer, the Employer will notify the successful bidder by registered letter that its bid has been accepted. This letter (hereinafter and in the Conditions of Contract called the “Letter of Acceptance”) shall specify the sum which the Employer will pay the Contractor in consideration of the design, execution and completion of the Works and the remedying of any defects therein by the contractor as prescribed by the contract. 31.2 The letter of acceptance will constitute the formation of the contract. 31.3 The agreement will incorporate the Memorandum of Understanding if any, between the Employer and the successful bidder, and shall be signed by the Employer and the Successful bidder. 31.4 After issuing the letter of acceptance, the Employer will send the Bidder the Agreement in the form provided in the bidding documents, incorporating all agreements between the parties. 31.5 Upon the furnishing by the successful bidder of the Performance Security, the Employer will promptly notify the other bidders that their bids have been unsuccessful. 31.6 The Employer shall notify the successful bidder the date, time and venue for entering into executing the contract agreement. 32. Performance Security 32.1 Within 14 days of receipt of the Letter of Acceptance, the successful bidder shall furnish to the employer a Performance Security in the amount specified in the bidding data in the form given in the Standard Forms [Contract] given under section V. 32.2 The performance security shall be issued by a recognized commercial Bank in Sri Lanka or a foreign bank with the guarantee confirmed by a recognized commercial bank operating in Sri Lanka, and approved by the Central Bank of Sri Lanka and payable to the CPC on demand in a sum specified in Bidding data. I-17 33. Advance Payment and Security 33.1 The Employer will provide an Advance Payment as stipulated in the Conditions of Contract, subject to a maximum amount of 20% of the Initial Contract price, within 21 days of the Contractor submitting an acceptable guarantee and upon submission of Performance Security. 34. Payments to the Contractor 34.1 35. Adjudicator The Contractor shall be entitled to receive payments in installments on the basis of his achieving milestones described in the schedule of payments in Section VIII. The payments made to the Contractor will be subjected to a deduction for retention, calculated by applying the percentage of retention stated in Bidding Data, until the amount so retained reaches the limit of retention stated in Bidding Data. 35.1 The Employer proposes the person named in the Bidding Data to be appointed as Adjudicator under the contract. If the Bidder disagrees with this proposal, the bidder should so state in the Bid. Then the Adjudicator shall be appointed by the Appointing authority designated in the Bidding Data at the request of the either party. In any event the Adjudicator shall be a person not associated with the project directly or indirectly and who could demonstrate impartiality and independence in his functions. I-18