The project is accepted and approved by the Cabinet on July 10 2008. Regulations No 534 of the Government of the Republic of Latvia and the European Investment Fund, the Treaty on European Union structural funds implementation table of contents 1.
Definitions and interpretation 2.
The subject of the contract and task 3.
JEREMIE Investment Fund 4.
JEREMIE actions 5.
The Foundation's Supervisory Board 6.
JEREMIE Fund financing 7.
Investment fund strategy and planning document 8.
Operational objectives and business plan 9.
The action 10.
Cost 11.
Ineligible expenditure 12.
The additional commitment of the parties 13.
Liability 14.
Monitoring, reporting, audit 18.
Date of entry into force; 16. termination
Applicable law; dispute resolution procedure 17.
Final provisions Annex A Annex B Annex C Annex D Annex E Annex F Annex G Annex H Annex I This financing agreement ("agreement") is concluded on 16 July 2008, between: the Government of the Republic of Latvia represented by the Ministry of the economy (EM) as the action programme "entrepreneurship and innovation" in the event the responsible authority, freedom Street, LV-1519 55, Riga Latvia (the Latvian Government ") and the European Investment Fund 43, Avenue J.F. Kennedy, L-2968 Luxembourg Luxembourg ("ETF") on the following: (A) the preamble. European Parliament and Council Regulation (EC) No 1080/2006 is a newly formulated the principles and strategies governing the European Regional Development Fund (the ERDF "").
(B) The European Parliament and Council Regulation (EC) No 1083/2006 is approved for general rules on, among other things, the ERDF, Cohesion Fund ("CF") and the European Social Fund (ESF), funding and put.
(C) as one of the instruments of the Fund (Council Regulation (EC) No 1083/2006 provides sense) within the paid use of financial resources, the Commission of the European Communities ("the Commission") and the EIF have together developed the initiative "joint European resources for micro to medium enterprises from" ("JEREMIE"), the purpose of which is to finance the expenditure relating to the operations, which include investment companies (mainly small and medium-sized enterprises) for the management of financing instruments such as venture capital funds the guarantee fund and the loan fund, in support of and in accordance with which all Jeremie and payable liabilities the financial means are available and consumed in Council Regulation (EC) No 1083/2006 and in article 44 of Commission Regulation (EC) no 1828/2006.
D. the 2007 November 20 the Commission has adopted a decision on the managing authorities (defined below) submitted to the national strategic reference framework 2007-2013, including the implementation of it-in particular, the action programme "entrepreneurship and innovation" ("program").
E. 2007. on 24 November, the Commission, by decision c (2007) has approved the operational programme 4466. The provisions of the programme of action are properly taken into account, the Parties shall draw up the agreement.
F. 2008. on 8 April, the Cabinet of Ministers of the Republic of Latvia, assuming protokollēmum (Protocol No 22, § 34) "on the European Union structural funds implementation" ("the Protocol"), is decided on the Investment Fund Council Regulation (EC) No 1083/2006 the meaning choose the ETF.
(G). The parties have agreed that the JEREMIE investment funds (as defined below) will be organized as a "separate financial unit" within the EIF under this agreement as permitted in Commission Regulation (EC) no 1828/2006 From paragraph 3 of article 43.
H. the Government of Latvia has agreed to cover using for this purpose that the amounts of money under this agreement is transferred, the JEREMIE Investment Fund costs (defined below), including the direct costs of the ETF, as provided for in Council Regulation (EC) No 1083/2006 and in article 44 (b) of Commission Regulation (EC) no 1828/2006, article 43, paragraph 3 of the payments concerned in this Contract.
I. the parties confirms that JEREMIE is a new initiative launched by the Commission in the Republic of Latvia at least until earlier resignation date (defined below) jointly introduced the Government of Latvia and the EIF. Consequently, given that the use of the EU structural funds and the implementation of the JEREMIE for the new institutional infrastructure is still in its early stages, the parties declare their readiness to examine the consequences of this agreement, including compliance with any applicable Community law and, if necessary, to modify it.
J. of Commission Regulation (EC) no 1828/2006, 43 (5) for the purposes of article Republic of Latvia concluded this agreement as the Ministry of the economy of the operational programme "entrepreneurship and innovation" in the event the responsible authorities and the Latvian Government to duly authorized representatives of the parties.
K. the Cabinet of Ministers of the Republic of Latvia with 2008 July 10, protokollēmum (Protocol No. 48, § 1) "draft rules" for the Government of the Republic of Latvia and the European investment fund the Treaty on the European Union structural funds ' implementation ' is authorized by the Minister of Economics of the Republic of Latvia of Kaspars Gerhards to conclude this agreement the Government of the Republic of Latvia.
 
In the light of the foregoing, the parties agree as follows: 1. definitions and interpretation 1.1 in this agreement the following terms and expressions shall have the following meanings, unless the context doesn't follow a different meaning: "the earliest date" means 30 June 2011;
"Responsible authority" means the Ministry of economy as national institutions, the Government of Latvia is designated as operational programmes specific measure of a responsible authority, or other authority designated by the Government of Latvia in this capacity;
"Business plan" means a business plan pertaining to any particular financial engineering instruments and has been drawn up in accordance with paragraph 8;
"Working day" means the day on which the Office is open for the EIF and the Luxembourg bank in Riga, Luxembourg and Brussels are open for normal services;
"Statement of work" means the ETF prepare a document that is based on the business plan, which under point 8 shall submit financial intermediaries;
"Operation" means a project or project group, within the meaning of Regulation No 1083 that are chosen in accordance with points 4 and 5 which introduces one or more financial intermediaries;
"Contract" means a contract concluded with the financial intermediary in respect of the activity;
"Program" means the action programme "entrepreneurship and innovation" activity no 2.2.1.1. "investment fund investment guarantees, subprime loans, venture capital funds and other financial instruments", part of which are administered in accordance with the provisions of this agreement through the JEREMIE Investment Fund;
"The ETF'S standard cost rate" means the rate from time to time review the EIF and reflect actual costs incurred, the ETF is carrying out a task and established on the basis of the full cost approach EIF'S direct and indirect staff costs;
"The ETF'S direct costs" means the year current cost part that means the ETF report from time to time, which are available in the JEREMIE Investment Fund to cover the costs, which are incurred in connection with the EIF JEREMIE Investment Fund Administration, as provided for in paragraph 10.1, and cost. The ETF'S direct cost calculation method, based on the standard cost rates of the EIF are determined in the annex to the costs;
"EU structural funds" shall mean the European regional development fund, as defined in Regulation No 1083, and other funds for which the parties may agree to from time to time in accordance with the applicable EU legislation;
"EU structural funds Regulation" means Regulation No 1080, Regulation No 1083 and the implementing regulation, as well as any other EU legislation, which is applicable in the EU structural funds;
"Financial engineering instrument" means any and all 44 of Regulation No 1083. the instruments referred to in article;
"Financial intermediary" means financial engineering instruments (any of them, except the ETF), country (or other public person) structure or trader, who is responsible for the implementation of the action and who is chosen in accordance with point 9.1;
"The Supervisory Board of the Fund" or "FUP" means the Government of Latvia appointed collegiate institution, in accordance with paragraph 5 fulfils certain obligations in relation to JEREMIE Investment Fund;
"FUP members" means the Supervisory Board of the Fund, the permanent members, which are appointed by the Government of Latvia in accordance with paragraph 5;
"FUP observers" means the ETF, the Latvian Government or authorities appointed a natural person (or any other natural persons participating in or attending the Foundation Supervisory Council meetings only in an individual case), which are entitled to attend the meeting of the Supervisory Board of the Fund and of the other right provided for in paragraph 5;
"Annual budget" means, in respect of each calendar year, with JEREMIE Investment Fund activity related costs forecast for the calendar year concerned, drawn up by the EIF and approved by the Supervisory Board of the Fund in accordance with section 10.4 of this agreement;
"Investment strategy and planning document" means a document which sets the JEREMIE Investment Fund's investment strategy and action planning in the context of JEREMIE actions attached in Annex A to the agreement;

"Investment business" means in accordance with 7.3 points and ETF authority approved documents that detail the steps that the EIF under the investment strategies and planning document provides for the period up to 30 June 2011;
"Income from operations" means any sum of money that, in connection with the operation of the relevant operational for the duration of the contract and then cancel after or has derived from these activities and that the financial intermediary concerned including the JEREMIE Bank account in accordance with paragraph 9.4;
"Annual progress report" means the report for each calendar year, in accordance with the annex (C) prepare the EIF and approved by the Supervisory Board of the Fund;
"Cost" means the annual costs of the ETF report features that are available from time to time in the JEREMIE Investment Fund, as provided for in paragraph 10.1 and in Cost and are considered "eligible expenditure", to the extent permitted by Regulation No 1083 article 78 and as is established by the responsible authority in Annex F in the attached list. Cost comprises the direct costs of the ETF and the associated costs;
"Cost" means the annex to documents relating to the calculation and payment of the costs of the procedures agreed between the parties, and which is added to annex I; "implementing regulation" means Regulation (EC) no 1828/2006;
"JEREMIE" means the initiative "joint European resources for micro-to-medium from companies", launched by the Commission and the EIF the European investment bank, as a member of the group, to promote greater access to finance for micro, small and medium-sized enterprise development in the European Union;
"Assets and liabilities of the JEREMIE" means all the existing at that time JEREMIE Fund rights, entitlements and obligations that apply to all of its investments in financial engineering instruments, as well as all the JEREMIE Investment Fund's rights, entitlements and obligations that apply to all contracts concluded in order to ensure that activities, such as, for example, the right to any amount of money that is paid from time to time helps Bank account and any amount of money invested in accordance with management guidelines, the remainder;
"It helps the Bank account (s)" means, individually separate interest-bearing bank accounts relating to the implementation of the Tasks and is open according to 3.3;
"The JEREMIE Investment Fund" means the Regulation No 1083 and described in the implementing regulation, the investment fund, which will be established in accordance with paragraph 3 and which tasks will hold the the ETF;
"JEREMIE financial instruments ' means the total amount of money that determines from time to time, adding to the report the following amounts: (i) the total amount of money received in the Bank account of JEREMIE in accordance with 6.1 and 6.3, if applicable; plus (ii) the interest that accrued on JEREMIE Bank account balance, total; plus (iii) any activity of the period of validity of the contract and any actions or the expiry of the contract is canceled-revenue from transactions that are credited to the Bank account of the JEREMIE; a report from the (minus) (iv) specific action or the expiry of the contract is canceled-an amount equal to the greater of the following amounts-zero (x) or the difference between the activity in question and the invested capital actually paid and (y) the total revenue from transactions that are paid out to JEREMIE Bank account in connection with a particular transaction.
"JEREMIE account" means the ETF'S off-balance-sheet accounts in connection with the implementation of the tasks that will be open in accordance with point 3.2;
"JEREMIE additional bank account" means a separate distinction between interest-bearing bank account (except JEREMIE Bank account) that is intended for use in conjunction with any ineligible expenditure and is open according to 3.3;
"JEREMIE measures" means measures carried out by the EIF, by implementing the JEREMIE Investment Fund, as provided for in paragraph 4.1;
"Commission" means the Commission of the European communities;
"Management guidelines" means the guidelines that governed the unused balance of the JEREMIE Financial management adopted by the Supervisory Board of the Fund by the EIF proposal and in accordance with the principles set out in Annex H;
"Parties" means the Government of Latvia and the EIF;
"Co-investment" means each of the up to investment by EIF is authorised to conclude with the aim to maximize the JEREMIE Investment Fund use efficiency;
"Co-investment agreement" means the agreement relating to the implementation of the programme, Co-investments and which the EIF is authorised to conclude with the recognised third parties;
"Agreement" means this agreement and its annexes and the amendments that have been made;
"Small and medium-sized enterprises" or "SME" means small and medium-sized enterprises as defined in Commission recommendation 2003/361/EC;
"Ineligible expenses" means expenses, excluding any costs relating to the execution of a task, but which, in accordance with the list established by the responsible authority, attached to the annex F are considered non-eligible expenditure under the EU structural funds regulations and related rights of the Republic of Latvia;
"Referral links" implies the right of donation rules, under which the ETF is 2.3 obligation specified conditions and in accordance with point 2.3 of the terms and conditions for transfer by JEREMIE, together with all assets and liabilities of the acquiring institution;
"Justified the cancellation" means this contract cancellation, which is based on the fact that one of the parties has made a breach of contract or several offences, the offence (s) found (s) cannot be resolved within a reasonable time and/or alleged infringement (irregularities found) after the other Parties reasonable discretion, taken in good faith, makes this the continued fulfilment of the contract impossible or particularly onerous to the other Parties;
"Transition management principles" means the activities carried out by the EIF in connection with possible JEREMIE Investment Fund Administration the conferral of tasks to a third party by 15.2 points in the evaluation of the contract, the principle that the parties have agreed in Annex G, the attached document.
"Acquiring institution" means the person whom the Latvian Government at its discretion and decide on its own responsibility, appoint in accordance with Regulation No 1083 44. Article this article for the implementation of the activities envisaged and which will take place in the EIF JEREMIE Investment Fund in the performance of tasks in Latvia;
"Annex" means an annex to this agreement;
"Progress report" means any of the reports, including an annual progress report by the EIF shall be drawn up in accordance with Annex C, and submitted to the Supervisory Board of the Fund;
"Point" means the point of this agreement;
"Rules" means the rules governing the Supervisory Board of the Fund, the internal agenda and which may be adopted in accordance with the 5.12 points;
"Regulation No 1080" means a regulation of the European Parliament and of the Council (EC) No 1080/2006;
"Regulation No 1083" means Council Regulation (EC) No 1083/2006;
"Costs" means the annual Cost of the part as associated costs are defined in the annex, whose cost is deducted from the funds, the EIF which is occasionally available in the JEREMIE Investment Fund, as provided for in paragraph 10.1, and cost;
"Original cost" means the amount of money that are payable in relation to the costs that are incurred by the EIF under this agreement during the period from the conclusion of the contract until the first payment provided for in paragraph 6.1, and the Latvian Government is bound to pay the ETF 10.2. in the case provided for in point;
The "right" means a right to use the JEREMIE financial instruments pursuant to the tasks provided for in this agreement, granted to the EIF, in accordance with paragraph 2;
"Order" means the special burden imposed on rights, as more fully described in the donation made in this agreement, and which have the conditions right for the gift, as defined under point 2.2;
"Monitoring Committee" means the Committee established by the Government of Latvia is under the operational programme from Regulation No 1083 63. representatives referred to in article by putting it on that the obligations laid down in article and giving it the right provided for in that article.
"Managing authority" means the Ministry of Finance of the Republic of Latvia as a national institution, in accordance with the law of the Republic of Latvia has been appointed to the management of the programme of action;
"National strategic reference framework" means the preamble, paragraph (D) of the Republic of Latvia in the EU structural and cohesion funds programming the master document.
1.2 pursuant to paragraphs 1.1 and, if not apparent from the context: (a) Regulation and the implementing regulation 1083 defines terms and expressions used in this agreement in the same sense, unless otherwise provided in the contract;
(b) with a large cap, the terms and expressions that are defined in the preamble, is used in the same sense throughout the contract, unless otherwise provided in the contract;
(c) words that: (i) used in the singular include the plural and vice versa;
(ii) applied in the same family, also includes the other gender;
(iii) without a specific indication of refers to the person, also include commercial companies and corporations, and vice versa;
(d) a reference to any primary or secondary legislation is to be considered as a reference also to any amendment thereto;
(e) in the interpretation of this agreement the headings are not taken into account; and

(f) the annexes form an integral part of the contract and they have the power.
2. Subject of the contract and the task of concluding this agreement 2.1 the parties, to: (a) create a JEREMIE Investment Fund in accordance with Regulation No 1083 44 (b) article and determine that the Latvian Government is taking the ETF 2.2. Rights provided for donations;
(b) agree on the rules governing the implementation of the JEREMIE investment funds and action, as provided for in Regulation No 1083 and the implementing regulation;
(c) specify the information required in accordance with article 43 of the implementing regulation 5 and 6 and article 44 paragraph 1 and paragraph 2; and (d) determine the amount and terms of payment payment of the costs of the ETF receives, according to the decision of the Protocol and as provided for in Regulation No 1083 44 (b) of the implementing regulation and in article 43, paragraph 4 of the article.
2.2 to create and fund the JEREMIE Investment Fund, the Government of Latvia, in accordance with this agreement, the terms and conditions laid down by this law that burdened the EIF assigned with the task of uzlikum, and with the EIF in accordance with the terms and conditions of this agreement from the Government of Latvia adopted the law with the task of uzlikum. In view of the above, the parties agree and acknowledge that the rights provided for in the grant Agreement is carried out, provided that the grant is subject to the uzlikum of the task, which provides that (i) the right is assigned to a specific objective, the ETF will work as JEREMIE Investment Fund to implement JEREMIE in the authority in Latvia in accordance with Regulation No 1083 article 44 and this agreement, and (ii) the EIF must be used in accordance with the law this agreement and as provided in this agreement.
2.3 in addition to the above task uzlikum, the Latvian Government is taking this Right provided for in paragraph 2 of the allocation for the ETF provided that the grant is subject to the duty, which is called the Transfer of future commitments and which is as follows, if the expiry of this agreement, or cancel, regardless of the expiration or cancellation reason or basis, the Latvian Government not later than 90 days prior to expiry of the contract cancellation or the date of its entry into force is announced that it has chosen the acquiring institution, the EIF's obligation, not unreasonably, immediately put the specified rights to the acquiring institution together with all assets and liabilities of the JEREMIE, which exists in a given moment, as heritage of the case of the Republic of Latvia of rights in rem within the meaning of the Regulations Act. For the avoidance of doubt, the parties acknowledge that the ETF's performance of the obligations, the transfer does not in any way: (i) will not be obliged to assess the acquiring institution choice legal conditions and context, its suitability, and any other aspects of the choice of the acquiring institution and the acquiring institution and the choice of its conditions will be responsible solely for the Government of Latvia;
(ii) will not be required to assume any kind of responsibility in relation to JEREMIE asset and liability transfers to the acquiring institution in accordance with paragraph 15.9.
3. the JEREMIE funds 3.1 the parties agree that the JEREMIE Investment Fund will be organized as a "separate block of finance" in the framework of the ETF, as it allows the implementing regulation for article 43, paragraph 3.
3.2 to create a separate block of Finance within the EIF in accordance with the implementing regulation, article 43, paragraph 3 of the EIF will set up an account with the name of the JEREMIE "JEREMIE Latvian project-the investment fund account" which will be provided for all questions relating to the JEREMIE financial resources administration under this agreement. For the avoidance of doubt, for the purposes of this agreement the JEREMIE account is not a bank account and it will not be able to set off any amount of money, which refers to the JEREMIE funds. EIF posted all transactions relating to financial instruments, Jeremie JEREMIE account. For interest calculation purposes all transactions will be fixed value date.
3.3 to be able to perform the task, including measures in the JEREMIE JEREMIE Investment Fund will be paid from the State budget of the Republic of Latvia under the operational programme financial means provided for, including-national contributions, and, if applicable, other contributions, which are provided for in this agreement and are payable in accordance with paragraph 11. To get that amount of money and performance needs of this agreement, the Government of Latvia, the EIF will open the necessary Bank accounts and Jeremie JEREMIE additional bank account in the name of a suitable credit institution operating in the European Union and which, in accordance with the applicable law will be selected by the EIF.
3.4 JEREMIE JEREMIE account, Bank account, and Jeremie additional bank account at all times and in any aspect is to be used, to be there and they can act only separate from other ETF funds, and may be used solely for the performance of JEREMIE Actions in accordance with this agreement.
3.5 the ETF paraksttiesīg duly authorised persons will be entitled to make subsequent payments from JEREMIE Bank account: (i) payments that are required in connection with the transactions;
(ii) the direct costs of the ETF charges due to the EIF for ETF'S Tasks performed, including measures of JEREMIE execution, as provided for in paragraph 10 and cost;
(iii) the related expense payments under the cost;
(iv) JEREMIE Bank account balance-in accordance with the management guidelines;
(v) any other payment that is related to the implementation of the task and what is directly in writing jointly approved by the Latvian Government and the EIF.
3.6 the ETF paraksttiesīg duly authorised persons are entitled to take from JEREMIE extra payments to the bank account, if it is common in writing in accordance with paragraph 11 of the Latvian Government and approved by the EIF.
4. Jeremie actions 4.1 for the performance of a task carried out by the EIF JEREMIE measures which will include the following: 4.1.1 investment strategy and planning document in the strategy and business plan of the investment;
4.1.2 investment fund strategy and planning document review in accordance with paragraph 7, business plan development and review in accordance with paragraph 7.3 and the corresponding proposals to the Supervisory Board of the Fund;
4.1.3 the preparation of statement of work, in accordance with paragraph 8 and appropriate financial intermediary selection (inviting expressions of interest and/or other appropriate means, in accordance with applicable law and, in any case, according to the equal treatment, non-discrimination and transparency principles) that activities will be allocated for payments from JEREMIE JEREMIE Investment Fund for the implementation of the strategy, as defined in the investment fund strategy and planning document, and on the basis of the business plan of the investment;
4.1.4 negotiating on the terms of the transaction, the transaction agreement conclusion and implementation of contracts, in accordance with the operational rules of the legal documentation;
4.1.5 the JEREMIE investment activities of the Fund for investments in portfolio management, including any action that is deemed necessary by the EIF under the appropriate and market practices according to the rules of the Treaty in cases where the relevant financial intermediaries fulfil operational contracts, provided that in the event the ETF will be considered correct not to take any action in connection with any financial intermediary accepts līgumpārkāpum, resulting in the loss of that amount may exceed 100 000 euros such a decision requires an affirmative opinion of the Supervisory Board of the Fund;
4.1.6 reasonable assistance in accordance with the annexes A, B, C and D, summarizing specific information necessary for the Latvian Government could meet the applicable EU law on State aid, except for activities relating to EU law on State aid enforcement of the general monitoring and inspection and for which will be responsible solely for the Latvian Government. The Latvian Government will indicate in writing to the EIF, which type of information requires the previous sentence for that purpose;
4.1.7 reporting to the Government of Latvia to the Supervisory Board of the Fund under paragraph 14 and Annex C for sales transactions;
4.1.8 Co-investment opportunity identification, negotiation of commercial rules in Co-investments and Co-investment in the conclusion of agreements in accordance with the investment strategy of the Fund and the programming documents and the basis of the business plan of the investment; and 4.1.9 unused JEREMIE financial balance in the Administration, including the transfer of all or part of these tasks to third parties on outsourcing or subcontracting basis, in accordance with management guidelines; 4.1.10 and transition management principles intended-all transactions that are associated with the potential of JEREMIE Investment Fund Administration the conferral of tasks to a third party by 15.2 points in the evaluation of the agreement.
4.2 the EIF is responsible for its internal administration, related to JEREMIE actions. The ETF is to appoint a project manager who will act as the main contact between the ETF and the Latvian Government and the Fund's Supervisory Board in connection with this agreement.
4.3 the EIF will set up offices in Latvia, who will start as soon as the JEREMIE Investment Fund has been made 6.1 (i) in the first instalment provided for in paragraph 1, and which will ensure the appropriate personnel as may be necessary, in the light of the JEREMIE and scope of activities arising out of investment strategies and investment planning document and business plan.

4.4 performance of EIF JEREMIE measures will be entitled to perform specific tasks related to Jeremie and enforcement Activities under the ETF based insight you need expert advice, hire lawyers and external advisors, such as the tax and legal advisers. Get the receipt of services, the EIF should ensure that (i) the amount of the service and the content is related to the matters covered by this agreement, (ii) the fee payable for such services is determined according to competitive market rates, and (iii) external consultancy services provided is sufficiently documented.
5. The Supervisory Council of the Fund 5.1 task includes, amongst others, the EIF to fulfil the obligations laid down in paragraph 4, the JEREMIE measure pursuant to the provisions of this paragraph 5 on the Supervisory Board of the Fund. The parties declare that the decision of the Supervisory Board of the Fund will always be made to the Supervisory Board of the Fund according to the assessment of the competent authorities and the opinion of the managing authority and the EIF in connection with any of the objectives of the EU structural funds regulations will be entitled safe without taking any additional verification, that the Supervisory Board of the Fund decisions fully reflect the responsible authorities and managing authorities. For the avoidance of doubt, no decision of the Supervisory Board of the Fund shall not be considered by the managing authority or authorities to delegate duty to the Supervisory Board of the Fund and the managing authority and the responsible authority shall retain all of their responsibilities relating to the duties and responsibilities stemming from the EU structural funds regulations and related rights of the Republic of Latvia.
5.2 the Latvian Government will set up a Fund to the Supervisory Board, composed of the five permanent members, which are appointed by the responsible authority from responsible authorities and managing authorities or employees of small and medium-sized enterprises (SMEs) financing sector respectable experts. The responsible authority shall also appoint the Chairman of the Supervisory Board of the Fund, and the Vice-President of the permanent members.
The ETF will be entitled to nominate up to two officials will participate in the Fund to the Supervisory Board meetings as Observer, with FUP condition that (to avoid any confusion) FUP observers are not considered members of the FUP. The Supervisory Board of the Fund shall have the right from time to time invite as FUP observers on an ad hoc basis, of another person if the Fund Supervisory Board considers the participation of such persons in the meeting of the Supervisory Board of the Fund on the need, in view of the Fund's Supervisory Board agenda.
5.3 each and every Member of the FUP FUP observer, except those that you invite observers FUP to a particular Fund's Supervisory Board meeting on an ad hoc basis, are appointed to two-year terms and may be again appointed to the next term. If for any reason a FUP Members free space, the responsible authority shall immediately appoint a new Member to the FUP FUP members remaining in the former term of Office (for the avoidance of doubt and, subject to paragraph 5 of the General rules, the Supervisory Council of the Fund will be entitled to perform his obligations under this agreement, even if the existing vacancy is not filled in). For the avoidance of doubt, the principles set out in point 5.2 regarding the composition of the Supervisory Board of the Fund shall also apply to any Members of the vacancy filling FUP this 5.3 circumstances provided for in paragraph 1.
5.4 first FUP members appointed by the responsible authority within one month from the date of entry into force of the Treaty.
5.5 FUP members are not entitled to the pay and/or any reimbursement for expenses incurred by them in the performance of their duties the JEREMIE Investment Fund.
5.6 the Fund's Supervisory Board is responsible for the tasks entrusted to it under this agreement, and in particular, its remit is as follows: 5.6.1 expression of Views about the EIF trust fund strategy and planning documents and/or investment business plan revisions and adjustments to the project, provided that before any such project approval of the Fund's Supervisory Board must ensure that it has received all approvals It is the duty of izprasī to receive from all relevant institutions of the Government of Latvia;
5.6.2 the JEREMIE Investment Fund implementation progress and strategy review, approval of the progress report and the ETF carried out the task, including measures implementing the JEREMIE, during the period covered by the approved annual progress report, due under this agreement;
5.6.3 internal agenda, by the terms of the Fund's Supervisory Board considers it necessary, for example, the rules provided for in paragraph 5.12., acceptance; and in the annual budget submitted by the EIF 5.6.4 project approval or of a statement of objections on it, as provided for in section 10.4;
5.6.5 expression of opinions on the team, what the ETF is created with this contract related activities, including project managers, which EIF appointed in accordance with point 4.2;
5.6.6 expression of views on the activities of the ETF carried out using the transition management principles, and of their status;
5.6.7 any request relating to eligible costs and is expressed in accordance with paragraph 11.2., approval;
5.6.8. the funds management approval of the guidelines, on the basis of a proposal by the EIF, in accordance with the principles set out in Annex H;
5.6.9. expression of opinion about the activities of the ETF 4.1.5. in the cases provided for in paragraph 1.
5.7 in addition to decision making and the expression of opinions in accordance with point 5.6 of the Supervisory Board of the Fund on the basis of the information provided by the EIF shall perform the following obligations: 5.7.1 regularly monitor the overall activities of the ETF compliance with objective measures, JEREMIE, Jeremie investment operations of the Fund and the impact on the Latvian economy and the implementation of the activities under the JEREMIE Programme of Action objectives, investment strategies and planning of the foundation document and business plan of the investment;
5.7.2 if necessary, the EIF and the Latvian Government recommendations on the General principles for the wording (i.e. those that do not apply to any individual action), relating to the implementation of the measures, the JEREMIE JEREMIE Investment Fund further development and/or future activities that focus on JEREMIE JEREMIE Investment Fund and the impact of measures on the Latvian economy optimization.
In connection with the above, the Supervisory Council of the Fund will be entitled to request from the ETF and ETF will provide the Fund to the supervisory board all the information requested and justified all the available documents related to JEREMIE investment operations of the Fund.
5.8 the Fund Supervisory Board meeting shall be held at least once each quarter. The Chairman shall convene the Supervisory Board of the Fund is sitting on its own initiative or if requested in writing of any two members of the FUP, the responsible authority or the EIF. The Supervisory Board of the Fund, decisions are taken by the majority of the members of the FUP, provided that a decision has to be at least three members of the FUP.
5.9.5.6.5, 5.6.6, 5.6.1. and points for matters 5.6.9. Fund Supervisory Board has the right to express either a positive or negative opinion about the EIF documents submitted projects, and it is not entitled to specify the amendments and changes to the submitted projects. The ETF will take into account the views expressed by the Supervisory Board of the Fund, and, in particular, it does not implement its part of the draft decisions, on which the Fund Supervisory Board has expressed a negative opinion.
5.6.2, 5.6.4, 5.6.7 5.6.8. points, and in those cases the Supervisory Board of the Fund shall be entitled to either approve or reject the proposals of the ETF and it does not have the right to amend these proposals unless the EIF is not agreed in writing to such amendments.
5.10 the EIF will provide the Supervisory Board of the Fund secretariat and will perform all additional administrative ancillary activities that focus on the Fund's Supervisory Board can carry out its tasks. The following is based on the relevant communication and the transmission of documents to members and Observers of the FUP FUP.
5.11 the Fund Supervisory Board has the right to make decisions and express opinions in matters provided for in paragraph 5, without calling a Council meeting in accordance with the procedure laid down in paragraph 5.8, and the decision to adopt a written vote or an unlawful occupier procedures (i.e., procedures, which provides that a decision has been taken, if it is not objected to) in order, in accordance with the provisions of this procedure, as provided for under paragraph 5.12 of the fund adopted the rules of procedure of the Supervisory Board.
5.12 the Fund Supervisory Board has the right, in consultation with the EIF, to adopt the rules of procedure of its activity, corresponding to the terms of this agreement and for which the content is subject to the following provisions: (i) the Supervisory Board of the Fund, when convened by its Chairman or his/her absence or absence (job vacancies)-Vice Chairman;
(ii) invitations to fund meetings of the Supervisory Board is disclosed to the FUP members (and observers be sent copies of the FUP) by fax or e-mail and to be received not later than ten working days before the scheduled date of the hearing or, in case of emergency, no later than two working days before the scheduled date of the hearing;
(iii) shall be identified in the invitation as a minimum sitting date, time, place and agenda;

(iv) the Chairman or in his absence or presence (job vacancies), the Vice-President is entitled to start discussing any issues on the agenda, to drive the debate, and to confirm the results of the vote. Meeting agenda can be updated with new points that were not notified, calling a meeting only if all the existing members of the FUP post agrees.
(v) all decisions of the Supervisory Board of the Fund are located in the minutes of the hearing, which shall be prepared by the project (or in his absence or presence (job vacancies), Vice-Chairman), or designated person of the President.
5.13 all notices addressed to the Supervisory Board of the Fund, will be considered received if they are sent to the responsible authorities the address listed in paragraph 17.1, or to such other address or in such other manner, for which the Fund Supervisory Board has announced the ETF.
5.14 FUP members must meet certain standards and the integrity they have a duty to refrain from performing actions that could cause a conflict of interest situation.
6. Jeremie Fund financing 6.1 to enable the ETF to use the law, the Government of Latvia during the period from the date of this agreement until 2010 December 31, and will reallocate the EIF JEREMIE Bank account in the amount of money a total of 183 185 892 euro in the following order: (i) the first payment of € 91 500 000 will be paid immediately and as soon as it is technically possible then When in accordance with paragraph 7.3 is approved investment business plan;
(ii) the second payment of eur 91 685 892 will be paid on the day on which the parties agree, having regard to the last approved annual report, the Trust Fund for the strategy and programming documents, business plans and financial resources of the JEREMIE, which to date has actually invested.
6.2 in relation to this agreement, (ii) paragraph 6.1 of the payments provided for in the Government of Latvia will provide up to 6.1 (ii) above, the amount of money that the JEREMIE funds are available in sufficient quantity, the financial resources required to provide optimized investment strategy of the Fund and the implementation of the programming document and enable the EIF JEREMIE investment funds to run the tasks. In particular, the Government of Latvia will take all necessary actions to ensure the effective cost of the EU structural funds regulations and other regulations of the European Union, which are applicable at that time Jeremie and/or the JEREMIE Investment Fund.
6.3. If the Commission confirms, that the expenditure of the EU structural funds Regulation is applicable, and have made the whole question needed further priekšdarbīb, the parties undertake to consider, in addition to the investment fund of the JEREMIE Programme activity "infrastructure and services" means the 23 million eur, which will be used to finance SMEs multi-family residential insulation improvement in Latvia.
7. Investment Fund strategy and planning documents 7.1 for the performance of a task carried out by the EIF JEREMIE actions under the Fund's strategy and planning document, as provided for in Annex A in accordance with the EU rules and Regulations of the structural funds on the basis of the operational programme.
7.2 If the ETF or the Latvian Government considers this necessary investment fund strategy and planning documents may be reviewed to take account of: 7.2.1 JEREMIE investment operations of the Fund and the impact on the economy of Latvia to review previous periods;
7.2.2 change the legal framework against which JEREMIE (including, but not limited to, EU structural funds Regulation);
7.2.3 the changes in the operational programme relating to activities that are supported by the JEREMIE Investment Fund; and 7.2.4 of the Fund Supervisory Board made recommendations.
If the investment fund strategy and planning document review is deemed necessary, the EIF shall submit to the Supervisory Board of the Fund, the adjusted investment fund strategy and planning document in the project. Corrected investment fund strategy and planning document will be approved in accordance with paragraph 5.6.1., taking into account the opinion of the Supervisory Board of the Fund.
7.3 as soon as it is technically possible, but not later than 30 days after the signing of this agreement, the EIF will prepare and submit to the responsible authority of the business plan of the investment project, which will indicate in detail the activity according to the ETF investment strategy and planning document, plan to take three years. The responsible authority within 30 days after receipt of the investment business plan to approve or make objections.
8. the operational objectives and business plans 8.1 for each specific activity the EIF shall prepare a statement of work, on the basis of which to develop business plans, in accordance with paragraph 5.2 shall be submitted to the financial intermediaries.
8.2 each statement of work: (i) be formulated in accordance with the provisions of the EU structural funds Regulation and on the basis of the operational programme;
(ii) reflect and respect the selection criteria, which in each case is approved by the Monitoring Committee; and (iii) will fund a strategy and planning document and business plan of the investment principles laid down.
8.3 for each action, the relevant financial intermediary shall submit a business plan which the ETF ETF assesses, acting as JEREMIE Investment Fund.
8.4 each financial intermediary must develop a business plan in accordance with the specific work task. In any case, every business plan must include the following information: (a) the company's target market and its financing criteria, terms and conditions;
(b) the financing of the operational budget management tool;
(c) the financial engineering instruments;
(d) līdzfinansējoš partners or shareholders (participants);
(e) financial engineering instruments;
(f) the rules on the management of professionalism, competence and independence;
(g) EU structural funds investment justification and intended use;
(h) financial management policy instruments for investment companies;
(i) financial engineering instruments, the provisions of the winding up, including the provisions on the features of the financial engineering instruments recovered from the investment, and that the remaining funds after all guarantee obligations, and applicable to the operational programme's contribution, reuse.
9. operation 9.1 financial intermediary selection made by the EIF under the Oversight Committee approved selection criteria, the investment fund strategy and planning documents and applicable law, and on the basis of the business plan of the investment.
9.2 operating contracts and amendments thereto that are closed to JEREMIE on behalf of a unit trust must meet the Oversight Committee approved selection criteria. If the Supervisory Committee amended the approved selection criteria, the amended criteria are applicable starting from the day when the Government of Latvia on specific amendments are notified the EIF.
9.3 all treaties, without taking into account any other provisions in this agreement, the following provisions must be laid down to: 9.3.1 the financial intermediary's obligation to implement the actions set out in the contract transactions;
9.3.2 the financial intermediary's obligation to provide regular reports to the EIF under the standardized form and quantity;
9.3.3 financial intermediary's obligation to ensure access to documents relating to measures for JEREMIE any national or European institution which, in accordance with applicable laws, duly authorised to perform the audit and/or control activities;
9.3.4 the financial intermediary's obligation to perform the appropriate marketing and publicity campaigns that are focused on specific areas, and the purpose of which is to make known to the JEREMIE initiative the SME in the territory of the EU structural funds regulations relevant provisions;
9.3.5 the order in which the financial intermediary shall submit annual reports on the Activities of the ETF and the audit procedures to be followed by financial intermediaries;
9.3.6 the ETF the right to recover any losses incurred in the operation of the agreement breach of obligations of financial intermediaries, in accordance with appropriate and in accordance with market practice according to the provisions of the Treaty. The EIF is not entitled to agree on arbitration clauses into the contracts of activity, except with the consent of the Supervisory Board of the Fund;
9.3.7 financial intermediary the rights to cover the market practices appropriate management costs in accordance with article 43 of the implementing Regulation (4);
9.3.8 the Latvian Government substitutions and/or nomination rights, to ensure that the operating agreement may be transferred to the acquiring institution, as provided for in paragraph 15.8;
9.3.9 that investment in the contracts concluded with the financial intermediary companies on corporate financing of activities, the financial intermediary must provide that: (i) the company is obliged to keep the documents relating to investment and other financial payments made to them by the financial intermediaries, at least until 2021 December 31, except in accordance with the relevant agreements, the specific Activity of financial intermediaries is determined to keep the relevant documents to yourself;

(ii) financial intermediary is entitled to recover any damages incurred if the company violates the specific contribution provided for in the Treaty;
(iii) financial intermediary conscientious, either through negotiation or through the appropriate requirements, the road will take your performance to the claim;
(iv) the Latvian Government, the Commission and the EIF'S representatives have the right to enter the premises and access to their documents in order to verify and ensure the funding of the activities carried out and the company's business legitimacy and compliance with all rules and requirements;
(v) the funds partly obtained from the EU's structural funds;
(vi) the company is obliged not to engage in any activities and not to accept any decision that does not comply with the provisions of the European Community, in particular the rules on competition;
(VII) the company is bound by EU structural funds regulations and legislation of the Republic of Latvia for the publicity and visual identity requirements, and compliance with the reporting procedures.
9.4 all the proceeds from the transactions are without undue delay, to be paid into the Bank account of the JEREMIE, be available for JEREMIE Investment Fund and is accepted in accordance with this agreement, the investment fund strategy and planning documents and taking into account the contribution of the business plan.
10. costs 10.1 the Latvian Government considers that the tasks carried out by the EIF, including JEREMIE actions, execution is linked to the emergence of the EIF, which Cost the EIF shall be entitled to recover, as provided for in the implementing regulation, article 43, paragraph 4. EIF'S right to receive payment for the direct costs of the ETF is right that the ETF has been granted in accordance with this contract and the Civil Code of the Republic of Latvia, shall form an integral part.
Under this contract, all of paragraph 10.2 costs, deducting them from JEREMIE Bank account of the available financial means in the form and within the time limit, as the parties have agreed on the cost. After the end of each calendar year the EIF shall submit to the Supervisory Board of the Fund report that specifies the details of the costs incurred during the previous calendar year; report form, as well as its submission deadline to the Supervisory Board of the Fund, and the consequences will be fixed in the annex of the cost. The parties confirm and agree that attachment is a document in which they are expected to agree on a detailed cost calculation procedure and the procedure for payment of the costs related to the issues, and that therefore, in the event of any conflict between the terms of this agreement, relating to the cost of the order and payment order with the cost-related issues, and the cost of the annex rules governing these issues, relevant cost provisions of the annex shall prevail over force.
10.2 in the event despite the fact that the competent authority has approved the investment business plan 6.1 (i) above, however, the payment of funds not done until 31 December 2008: (i) the parties initiated without undue delay in mutual consultation to agree on appropriate measures to be taken to implement the Agreement and perform the obligations of the parties concerned. These consultations will be completed until 31 January 2009;
(ii) the ETF will be entitled to request, and the Latvian Government will be obliged to pay the ETF'S initial costs incurred after the conclusion of the contract. For the avoidance of doubt, the initial costs referred to above do not include the interest that the use of the specific amounts of money would be to use accrued, if the payment was made in accordance with this agreement and the cost.
The Latvian Government will cover the initial costs at the ETF demand following the end of the consultation period referred to above, except if the Latvian Government meanwhile is already ieskaitījus in JEREMIE financial instruments in accordance with the Bank's account 6.1 – in this case, the EIF will forfeit applicable costs from JEREMIE Bank account of the available financial resources.
10.3 the parties agree that the total direct costs of the ETF and the associated costs will be paid during the term of this agreement will not exceed the maximum amount laid down in the implementing regulation for article 43, paragraph 4.
10.4 the EIF shall submit to the Supervisory Board of the Fund, the annual budget for the following calendar year, no later than 15 November of the preceding year (inclusive), except for the annual draft budget for 2008 submitted by the ETF fund the first Fund to the supervisory board the Supervisory Board meeting. The Supervisory Council of the Fund within thirty days of receipt of the draft of the annual budget of the daily express their approval or opposition to it. With regard to the adoption of the annual budget, the following rules shall apply: (i) if the ETF has received the approval of the Supervisory Board of the Fund, the annual budget will be considered as approved on the date on which the ETF has received approval from the Supervisory Board of the Fund;
(ii) where the ETF has not received the approval of the Supervisory Board nor the opposition, nor the annual budget will be deemed to be approved at the end of the 30th day after the Supervisory Board of the Fund received the annual budget;
(iii) where the ETF has received any objection from the Fund, the EIF Supervisory Board within fifteen days from the date of receipt of the objection in good faith will take account of the objections by taking any actions that it considers suitable for the purpose, including discussing the objections with the Fund's Supervisory Board and/or the responsible authority and submit to the Supervisory Board of the Fund budget adjusted to the amendment at its own discretion. This next version of this budget section 10.4 objectives will be considered a new draft of the annual budget.
11. Non-eligible expenditure 11.1 this contract during the ETF will be entitled from time to time due to Non payment related expenses from JEREMIE additional Bank account at the time the available financial means, if such expenses are approved by the Supervisory Board of the Fund.
11.2 any time when the ETF provides that it will occur without any related expenses, the EIF must be submitted to the Supervisory Board of the Foundation of their financing request, specifying the amount and time of payment of ineligible expenditure, causes a brief description and the reason why the expenditure concerned is deemed ineligible. The Supervisory Council of the Fund within thirty days from the date of receipt of the request, either request will be accepted or refused, on condition that, if the request is approved, the approval decision must provide for the appropriate amount of money lodged JEREMIE additional bank account approved within the time limit specified in the request.
12. additional commitments of parties 12.1. The Government hereby undertakes that: 12.1.1 it will provide all information and assistance reasonably requested by the EIF, and what is needed to ensure the ability to meet the EIF JEREMIE actions in accordance with the terms of this agreement;
12.1.2 informed the ETF about prospective changes to laws and other regulations, which, after the Latvian Government based insights can lead to adverse effects on the availability of financial resources to the Trust Fund or the JEREMIE JEREMIE Investment Fund to perform tasks in accordance with this agreement prior to such amendments or changes are made;
12.1.3, without undue delay, make the assessments necessary to ensure compliance with EU State aid rules, and submit to the Commission communications on activities in relation to which such notification is required under EU rules on State aid;
12.1.4 regardless of the EIF under this Treaty in certain tasks, fulfil all obligations of the EU structural funds regulations and other applicable laws of the European Community.
12.2 with the EIF undertakes that: Government of Latvia provide 12.2.1 appropriate assistance which it may require from time to time with regard to state aid, as provided for in paragraph 4.1.6.;
12.2.2 will create its own internal administration in such a way as to ensure the effective implementation of the JEREMIE Actions and task;
12.2.3 Office opened in Latvia, as provided for in point 4.3.
13. liability 8.1 unless the policy is already in place, the EIF will establish appropriate internal policies that seek to ensure that JEREMIE action being taken in accordance with this agreement.
13.2 liability of the Government of Latvia to the EIF under this agreement are limited to the ETF'S bad or gross negligence. To prevent confusion, the EIF will not be responsible for (i) the JEREMIE Investment Fund's financial activities and financial results;
(ii) any loss arising from financial intermediaries operating agreements allow for the violation of duties, except if the above is the ETF'S evil intent or gross negligence, the direct consequences.
13.3. Neither of the parties is not liable for indirect, consequential or other similar damages.

13.4. In addition, the ETF'S liability in connection with this agreement are excluded to the extent that the ETF carried out activities that, in the absence of this paragraph, the ETF'S liability under this contract, is based on official information that is received from the competent authorities, including, but not limited to, any information contained in the national strategic reference framework or in the operational programme, with which the ETF accepts no obligation to the accuracy of that information completeness, compliance and independent examination. This concept in paragraph 13.4 "official information" means information that is provided by the EIF responsible authority officials issued a written document (except for electronic documents).
13.5 provide the Latvian Government and protect the ETF from (a) any reasonable and documented costs and expenses, and (b) any liability which the ETF has incurred such requirements by third party is bringing against the ETF due to the fact that the ETF to fulfil or have fulfilled the JEREMIE Actions. The obligations: (i) is valid only if the ETF costs, expenses and losses incurred by the EIF is not evil intent or from an act or omission that occurred behind the ETF large attention, and if the ETF is carried out with due diligence defence against certain claims; and (ii) the sum will not exceed 500 000 euros for each of the claims.
13.6 the Latvian Government liability under or in connection with this agreement and all cases regardless of the cause or circumstances of liability was limited by its obligation to cover the costs to pay initial costs and do other (if any) directly provided for in the contract.
14. monitoring, reporting, audit 14.1 the parties will execute their respective monitoring, reporting and auditing obligations provided for in annexes B, C, and D. 15. Date of entry into force; termination 15.1 this Agreement shall enter into force on the date it is signed by the Government of Latvia and the ETF, and this is the time for conclusion of it date to the final report on the programme of activities for the day of issue, following the term of the contract-the parties consider it necessary to give the ETF to execute tasks, including-subject to the provisions of Regulation No 1083. During the period of six months before the expiry of that period, the parties will meet to agree on the option to extend this contract for a further period of time, the duration of which the parties agree.
15.2 the parties agree and acknowledge that the 30 June 2011 the Government of Latvia will be entitled: (i) to review the activities of the JEREMIE Investment Fund's progress and strategy;
(ii) provided that it is made (i) in paragraph 15.2 actions and depending on the result of the decision taken, to cancel the contract in accordance with paragraph 15.5; and (iii) in the light of the EU Structural Fund regulations, including, but not limited to, Regulation No 1083.44 points, to conclude a new financing agreement with a third party, which will hold the JEREMIE Investment Fund, or to designate the acquiring institution in accordance with point 2.3.
15.3 during the term of this agreement, each of the parties is entitled to cancel the contract at any time (the abolition of the Treaty entry into force immediately) if it shall notify the other Parties that are causing undue cancellation situation.
15.4 especially and not in any way trying to narrow down the reasons that can cause the termination of universality, Based on: (a) the Government of Latvia is entitled to declare cancellation of the ETF Based not or does not meet the objective, and more specifically, if: (i) does not comply with the investment fund EIF strategy and the strategy set out in the programming document, or (ii) does not comply with any of the EIF in the essential contractual obligations, and if the Government of Latvia (in both cases mentioned above) has sent a warning to the EIF by pointing to the infringement and are not distracted by the EIF violation within 60 days from the receipt of the warning; and (b) the EIF is empowered to proclaim the abolition of Reasoned, if (i) the Government of Latvia has provided contributions to the JEREMIE Investment Fund in accordance with this agreement to give the possibility of exercising rights of the ETF, or (ii) the Government of Latvia more than 60 (sixty) days after the due date has not paid the ETF ETF payment due under this agreement and for which the amount exceeds eur 100.000, or (iii) the Government of Latvia has not complied with any relevant contractual obligations If such failure create an obstacle to the exercise of rights and the EIF to fulfil tasks in accordance with this agreement, or (iv) in the light of paragraph 10.2 of the parties envisaged in the consultation obligation, the transfer of financial resources in accordance with 6.1 (i) point has not happened up to 31 December 2008, and if (in all the cases mentioned above,) ETF has sent a warning to the Government of Latvia, pointing to violations, and the Government of Latvia has not prevented breaches within 60 days from the receipt of the notice.
In the event of the cancellation of all reasonable expenses in connection with the cancellation of the Contract shall be borne by the parties that this fault has occurred on the contract cancellation.
9.6 without limiting the right of the parties to declare the abolition of any Reasonable time in the circumstances where there is no reasonable basis for cancellation, this contract can be cancelled only if the cancellation of the contract shall not take effect earlier than the date and if the parties have informed the other Parties on the abolition of the agreement at least six months in advance. However, the EIF is empowered to derogate from the Treaty well before the earlier of the date when the Republic of Latvia, the Republic of Latvia or to any duly authorised, public authorities shall make such amendments or corrections in the laws and other regulations, which the ETF based perspective may have a significant negative impact on the JEREMIE Investment Fund activities and operation, and, consequently, also on the ETF'S ability to perform a task and follow their particular objectives as a result of which the contract is concluded.
15.6 in the event of the cancellation of this contract ETF'S are exempt from the obligation to perform the JEREMIE measures, beginning with the date of entry into force of the repeal. All payments relating to the costs of the ETF is entitled to until the date of entry into force of the repeal, the date for payment of the contract cancellation occurs. The part of the costs relating to the costs that the ETF has been received at the time of cancellation of the contract to the date of entry into force of the withdrawal Agreement until December 31 (calculation based on the number of complete months remaining), the EIF's obligation to pay within fifteen days from the cancellation date of entry into force.
15.7 this Agreement shall terminate If or is cancelled, except Reasonable, then: (i) if the contract is terminated due to the expiry of the period, all expenses incurred by the JEREMIE Investment Fund and EIF in connection with expiry of the contract, including expenditure relating to rights and Jeremie assets and liabilities, including the transaction agreement and/or Co-investment agreement, transfer to the acquiring institution or to the Latvian Government, depending on the circumstances shall be borne by the Government of Latvia or the acquiring institution;
(ii) if the contract is cancelled before the deadline, including under paragraph 15.2, all expenses incurred by the JEREMIE Investment Fund and EIF in connection with the cancellation of the contract, including expenditure relating to rights and Jeremie assets and liabilities, including the transaction agreement and/or Co-investment agreement, transfer to the acquiring institution or to the Latvian Government, depending on the circumstances, amount to eur 50 000 shall be borne by the EIF as a JEREMIE Investment Fund but the other-the Latvian Government.
15.8 all in all treaties and agreements must provide for the Co-investment by the Latvian Government substitutions and/or nomination rights, which provides that this termination or cancellation, the contract can be transferred to the acquiring institution or other newly appointed person. Thus, this termination or cancellation in the event of: (i) all transactions agreements and Co-investment agreements will remain in force between financial intermediaries and of the persons acquiring institution or newly appointed – JEREMIE Investment Fund; and (ii) all existing operating agreements and Co-investment agreements commitments and obligations will remain in force and will be fully applicable to the acquiring institution or newly appointed person-JEREMIE Investment Fund.
15.9 no basket and narrowing down 15.6. as provided for in article, termination or cancellation, the right is returned back to the Government of Latvia, and Jeremie Bank account credited the JEREMIE financial instruments JEREMIE additional balance and the Bank account of the balance of the funds transferred, as well as any other JEREMIE assets and liabilities will be transferred to the Government of Latvia and will be credited to the bank account, the Government of Latvia has announced the ETF. All the expenses that arise in connection with the EIF JEREMIE assets and liabilities that will be settled in accordance with paragraph 9.8.
If the Latvian Government has announced the identity of the acquiring institution of the ETF, as provided for in paragraph 2.3, the EIF's obligation to execute the transfer. In this case, the EIF will cover expenses that arise in connection with it helps the transfer of assets and liabilities, to 15.7. (ii) the amount laid down in paragraph 1, after deducting from the JEREMIE financial products that it has to pass the acquiring institution, but the expenses which exceed the amount borne by the acquiring institution

15.10 despite the other provisions of this paragraph 15, in case if there are any unexpected emergency or incident, which the parties could not affect (except labour disputes, strikes, financial difficulties and other similar conditions), including, but not limited to, Jeremie cancellation or suspension in accordance with the legal acts of the European Union or in another manner that poses a barrier to any of the parties to fulfil the obligations laid down in the Treaty, and which is not related to the Work of the mistake or negligence and not insurmountable , or an inescapable, inevitable despite efforts having efforts (each such case will be referred to as "the circumstance of force majeure"), the parties to which it affects, must immediately notify the other Parties, by written notice ("notice of force majeure"), which contains the force majeure circumstances in nature, probable duration and foreseeable effects. Receive a notice of force majeure, the Parties shall immediately start negotiations and do everything possible to minimize losses caused by the force majeure occurs. None of the parties is not responsible for the obligations of their contract, if the parties do not have to meet the circumstances of force majeure. If the parties, acting in good faith, make sure and believe that JEREMIE implementation of measures and the respect task force majeure circumstances is not possible or is extremely significant difficulty, the contract is cancelled and the applicable paragraph 15.6 of the second and third sentence.
16. Applicable law; the procedures for the settlement of disputes 16.1 this contract is and it is iztulkojam in accordance with the laws of the Republic of Latvia.
16.2 the parties put all their efforts to adjust to any dispute, controversy or claim arising out of or in connection with this agreement, including its validity, invalidity, breach or withdrawal of the voluntary way. The dispute, controversy and claims that are not regulated under the preceding sentence in reasonable time, will be transferred to conciliation (mediation) in accordance with the Swiss Chamber of commercial mediation rules of Switzerland, in the version in force on the date on which in accordance with the Swiss rules of commercial mediation the mediation application is submitted. The conciliation process venue will be Geneva, Switzerland, but conciliation discussions can be held in another place, for which the parties mutually agree. The conciliation process will be held in English. If the dispute, controversy or claim is not fully tuned in the conciliation procedure 2 (two) months, it will be passed the resolution to arbitration in accordance with the Swiss Chamber of the Swiss international arbitration rules in the version in force on the date on which in accordance with the Swiss rules of international arbitration of the arbitration application is submitted. The number of arbitrators will be 3 (three), the venue of the arbitration proceedings will be in Geneva, Switzerland, the arbitration will be held in English.
17. Final provisions 17.1 All notifications and correspondence, which one gives the other Parties is to be in writing and shall be delivered by registered letter or by fax (with a confirmation of transmission, the subject of approval shall clearly indicate the JER-003) to the following addresses: Government of Latvia: the Ministry of economy to: Secretary of State in 55 Street, Riga LV-1519 fax: + 371 67280882 Latvia: European Investment Fund EIF to: JEREMIE Investment Fund project manager 43 Avenue J.F. Kennedy, L-2968 LUXEMBOURG Fax: + 352 426688 280 from Luxembourg with a copy of the EIF project manager who acts as contact person in Latvia.
Each of the parties will be notified in writing immediately to the other Parties of any change of its address. Notice of such changes to the receiving Parties may send notices to the last address communicated to it.
All notifications and correspondence addressed to the managing authority is to be given in writing and sent by registered letter or by fax (with a confirmation of transmission, the topic clearly indicating the JER-003) to the following address: Ministry of finance, the leading authority on sand Street, nr. 1, Riga LV 1919, Latvia fax: + 37167095503 17.2 this contract represents the entire agreement of the parties on this subject matter, and supersedes any prior agreements.
17.3 this agreement is amended shall be made in writing and shall enter into force when it is signed by both parties. Amendments to the annexes are to be made in writing and shall enter into force when it is signed by the responsible authority, on the one hand, and, on the other hand, the EIF.
17.4 if any provision of this agreement is or are held to be invalid or unenforceable, it will not in any way affect the rest of this contract validity and applicability. Unenforceable or inapplicable provision shall be deemed automatically to have been replaced by other existing and applicable regulations, which more accurately reflects the intentions of the Parties when they agreed to the unenforceable or inapplicable provision.
17.5 the parties in good faith and conclude negotiations, agree to such amendments to this agreement, which may be necessary or desirable in connection with any changes in EU structural funds regulations or laws of the Republic of Latvia and in other legislation.
17.6 This agreement is concluded in two copies in the English language and in duplicate in the Latvian language, each of which is considered to be the original of that document. Any conflict between the texts of the Treaty in English and Latvian language, decisive is the text in English.
Riga, Latvia, July 16, 2008 in the Republic of Latvia, Minister of Economic Affairs on behalf of the European Investment Fund on behalf of the Executive Director of the _____ ____ ____ _____/Kaspars Gerhard/____ ____ ____ ____/Richard Pelly/Annex A policy strategy of investment funds in the Context of JEREMIE is 1 the European Commission (DG Regio) and the European investment bank group joint initiative designed to give Member States the possibility to use part of their structural funds in 2007-2013 budget period, the Trust Fund be used repeatedly. Investment Fund aims to improve the availability of funding for small and medium-sized enterprises (SMEs) with specially designed for this purpose financial products portfolio. This Fund can manage the European Investment Fund (EIF), the public procurement procedure chosen institution or national financial institution.
Since the beginning of 2007, the Latvian Government has been working closely with the EIF in order to explore the positive benefits that contribute to the implementation of the concept of the Fund. An essential part of this process was a "market failure analysis report", which the ETF was completed in July 2007 and in which it made a number of recommendations to the Ministry of the economy. Carefully consider these and other aspects of the report, the Government in April 2008 decided to introduce the concept through the JEREMIE Investment Fund, initially managed by the EIF.
The main open "market failures" are: • the existing guarantee schemes do not have enough funds and their distribution on the market is limited, compared to the potential market; existing schemes do not possess the efficiency created by guarantee schemes that are based on a portfolio basis, and that, as such, is much more attractive for banks to encourage bank with greater dedication;
• entrepreneurs indicates lack of funding as a major obstacle to the start of the business;
• the bank should be encouraged to operate in the SME segment and take more risks, as well as to shift the bank's focus from the evaluation of the creditworthiness of the security assessment on the viability of the business plan;
• not enough private capital investments in startup (seed) and start-up segments. Entrepreneurs starting a business for the first time, there are several applications that offer small grant funding, but they largely lack the equity component of a product that offers adequate funding to support critical economic operators in the first years of operation;
• the enlargement contribution is missing from existing small businesses that need capital production capacity, working capital and capital market or further development;
• lack of business angels (that) activity level.
(A) in the annex to this Treaty provides mutual fund strategy and planning by the ETF proposes to implement the Government of Latvia and with its support to help to address these gaps. This investment fund strategy and planning document is prepared, using ETF'S knowledge and expertise it has developed, driving a similar tasks in other Member States, and with the Latvian guarantee agency and the Ministry of the economy. In addition, in developing this strategy, a number of meetings have been held with the operators (financial intermediaries) Latvian SMES in different sectors of the financial sector, which has been given to investment in the proposed clarification of the instruments. These discussions need to continue the implementation of the activities also during the implementation process, given that the financial intermediaries play an important role in the introduction of financial engineering instruments.
2. Investment Fund

The EIF has developed this trust fund strategy and planning documents approved by the Latvian Government, through market data analysis, discussions with market participants and led the negotiations with the Ministry of economy and Finance Ministry. The parties acknowledge that this contribution to the Fund's strategy and planning document should be treated as a summary and a more detailed introduction to the housing plan, which will now be referred to as ' investment business plan ', where the parties have negotiated a project separately from this document and the EIF will be submitted by the responsible authority for approval in accordance with paragraph 7.3.
It is intended that the programme as a whole will be assigned to 206 million, shifting them to individual financial engineering instruments, mainly for the following areas: • export insurance to 30 million euro;
• Portfolio guarantees – up to 80 million;
• Efficiency – the total amount of housing up to 23 million euro (requires Commission approval and must be carried out according to the amended Treaty);
• Risk capital-the total amount of eur 50.5 million;
• Technology transfer-22.5 million euro.
This investment fund in the portfolio of instruments created the additional benefit is that it provides multiple deployment of funds, thus allowing the Latvian Government to maximise the long-term impact of structural funds on the market. The financial resources invested in through these mechanisms in favour of SMEs, and ensuring the return of investment funds, will be available again-by encouraging undertakings in accordance with the decision of the Government of Latvia. To illustrate this important aspect of the investment business plan in detail explain how each tool will work and how the portfolio as a whole will be combined so that, over time, earn financial returns.
This document also is intended to explain how to use the financial resources allocated, based on certain assumptions, it is the most visible and shown in the following table.
Instrument contracts liabilities total breakdown by year of the export insurance 1 2 3 1 30.00 0.00 15.00 15.00 portfolio guarantees 6 12.00 20.00 30.00 30.00 housing efficiency 3 10.00 13.00 0.00 23.00 financing technology transfer 4 11.25 11.25 22.50 0.00 Risk capital 25.25 25.25 50.50 5 0.00 total: 19 206.00 81.50 81.50 94.50 30.00 total uses 176.00 206.00 anyone of the five such instruments is designed for different types of SMEs and the different ways of trying to address the market failure. Taken together, the instruments acts as a ' portfolio ', which provides the impact on the market and reward investment funds in different ways.
2.1 the proposed financial engineering instruments explanations below briefly describes how each particular instrument will work, but the explanation may change, given that it will continue negotiations with the selected financial intermediaries on implementation aspects. At this stage, this information should be considered, which is for informational purposes only.
Export insurance scheme to promote greater SME export business of the parties provides that the export insurance event will be designed to be similar to guarantees. The guarantees approach is selected, or you can export insurance scheme to project cash flow; It enables you to make certain assumptions about possible future results, as well as serving as the basis for negotiations to be able to decide on the most effective structure, which would be used for export insurance schemes. The scheme is intended to cover 50% of a much larger portfolios. Considering that the scheme was in fact constitute the portfolio of insurance contracts more export credits, of which only a part will create the payment obligations to the credit provider, it is acceptable that the guarantee agreement is closed on the amounts and a specific amount of the guarantees, which is several times greater than the assigned capital.
Portfolio guarantee for banks to expand lending to SMEs Is intended that the scheme will cover 50% of a much larger portfolios; the scheme will cover 50% of the losses incurred for each outstanding loan in the portfolio. However, there is a certain limit (maximum limits) for the total amount of payments that you receive one financial intermediary. Given that actually constitute the guarantee scheme portfolio more loans, of which only a certain percentage will cause payment obligations to the loan provider, it is acceptable that the guarantee agreement is closed on the amounts and a specific amount of the guarantees, which is several times greater than the assigned capital.
Energy efficiency in housing loans with the banks financing the planned housing efficiency operation provides for co-financing contract is concluded on the basis of which the JEREMIE Investment Fund costs in advance all of the 23 million euro in full financial intermediaries that double that amount of money and loans. The repayment schedule is set for 6 years and provides for the payment of interest to the amount of 8%, which is partly being made, including those against financial intermediaries management fee payments to the maximum allowed 4.0%. Outstanding loans reduces the amount that financial intermediaries must pay JEREMIE Invested Fund.
Venture capital mechanism with selected venture capital management companies or networks are for two different risk capital schemes: venture capital and business angels in co-financing. Both schemes the same cost and repayment schedule. The risk inherent in venture capital transactions, are high; investors funds cannot be achieved, providing the maximum amount of losses, but the potential uplift potential is high. Therefore, with regard to risk capital schemes of return planning prudent approach is used, which provides a return that is less than the SMEs invested financial resources: the case of venture capital, it is assumed that you will lose 25% of the utilized for this purpose, financial resources, and in the case of business angels, it is assumed that you will lose 50% of the utilized for this purpose funds. The value of the portfolio of each Fund at the end of the operating cycle is not taken into account.
Early stage/technology transfer financing with the selected management companies are two schemes which focus on the launch and the launch before-financing. Both payment and repayment schedule, the sum of growth provide a slower progression than venture capital and business angels. Given the significant risks inherent in these activities, you assume that the SMEs invested in a certain part of the financial resources will not be refunded back to the Fund: this part is 75% in the case of launch and up to 100% before-launch event. The value of the portfolio of each Fund at the end of the operating cycle is not taken into account.
2.2 General objectives the JEREMIE investment funds in the overall concept of the basic element is the clarity of the objectives that have been developed by the Ministry of the economy, and which can be summarized as follows: • the financial resources Granted complete use;
• Economic benefit maximization;
• Cost effectiveness (the statutory maximum amount);
• Maximize private co-financing (subject to stated objectives);
• Investment fund management successful transfers after 3 years.
This last point is significant additional aspects, which provides collaborative approach the Latvian guarantee agency that currently provides the responsible authority as a potential acquiring institution, capacity-building, so that on that date it can take over from the EIF JEREMIE Investment Fund management duties in full.
2.3 implementation schedule important aspect of this initiative is the rapid completion of all the preparatory tasks to ensure that the final beneficiaries (SMEs) started to take advantage of the instruments, without undue delay. The ETF is well aware this aspect, especially in the light of the specific circumstances of the market, and will seek to implement all aspects after the best possible, given the necessary resources and management support.
Specifying that-assuming that the date is 16 July 2008, and assuming that the responsible authority approves investment in good business plan, and therefore this Contract provided for in paragraph 6.1 of the first payment, pay the ETF will undertake to perform the following steps as below: • establishment of the ETF'S local office in Riga – august 1, 2008;
• With the necessary resources to ensure the implementation of the EIF team creation – 2008; on 16 august;
• Investment business plan completion and its submission to the authority responsible for approval-august 16, 2008;
• Marketing and information flow to financial intermediaries at the appropriate level-2008 16 September;
• "The invitation of expression of interest" document with the completion of the selection procedure and subsequent publication-2008 of 30 September.
After the completion of the transaction and after the response is received, it can be started by the financial intermediary selection process. Taking the view that rather than the desired target date than on the legal time-limits, first financial intermediary selection is designed to be completed in November 2008.

After the completion of the selection will first deal with the selected financial intermediaries outlining. The target date for this activity is impossible to determine, since agreement on contract terms and conditions can be actively retard, but the ETF will seek agreement on a final agreement with the intermediary provisions as soon as possible, so that the SMEs begin to benefit without undue delay.
3. The economic and financial results of the forecasting 3.1 the economic effect of the financial engineering instruments the economic benefits include the development of SMEs, which are otherwise not receive funding, private sector financial resources izbalansēšan and long term objective to ensure the sustainability of the Fund for repeat-in the same sector. Instruments can take higher risks than market players would normally take, acting on a commercial basis.
The measures are intended to create incentives for growth and create a driving force for further development of sustainability – especially those in disadvantaged circumstances created by the now global economic climate. They will seek to address the existing market failures – National Strategic Framework 2007-2013 and in accordance with the priorities set by the company.
Tools have been developed to implement the Lisbon strategy for a dynamic and competitive knowledge-based economy, capable of sustainable economic growth with more and better jobs, and greater social cohesion. In particular: 1. measures are designed to help develop and disseminate new technologies that contribute to the knowledge-based economy. Has promoted synergy between the market, the environment and scientific research institutes, and it can be extended by establishing long-term cooperation. This will lead to technology transfer to other sectors.
2. with regard to the economic operators, the promotion of an entrepreneurial culture should be strict in their growth, SMEs benefiting from instruments that are specifically designed to enhance their vitality.
3. From the aspect of financial market measures introducing new approaches to the financing of SMES, to promote innovation in SMEs and the availability of products in this sector. Communication should be encouraged between existing financial institutions and businesses and thus stimulated the growth in production and employment, which is also supported by the JEREMIE Investment Fund (JLF). The creation of confidence of economic operators should be elevated in private has financial participation.
4. In addition, several of the measures are intended to stimulate or create new market level of preparedness in respect of intermediaries who can provide specific services for financing Latvian SMEs sector. This is especially true for activities generating investment in equity in the sector in the early stages of the operation.
3.2 financial performance forecasting, investment business plan the ETF will explain their understanding of the portfolio of instruments that will be introduced in Latvia, and based on his own inner knowing and using your own internal pool of forecasting model on the possible financial results. Such a forecast is the high degree of uncertainty and fears of this kind cannot be considered any type of specific prediction or guarantee of return. However, using all due diligence, a model that is discussed in the form of the project indicates that if the implementation will take place as planned, ending capital balance to be around 195 million euro (it is essential to add that these calculations are very indicative nature ' '. This calculation does not provide a performance guarantee). This same document provides detailed portfolio performance sensitivity analysis applying several risk scenarios, and provides for the possible worst-case outcome.
The Government of Latvia understands and approves this calculation does not take into account predictability and, by these predictions. Although ETF always apply all possible efforts, the EIF can not provide any guarantees on the Investment Fund's actual results.
4. Implementation aspects 4.1 financial intermediary selection overall, the initiative aims to promote access to finance for SMEs, the introduction of financial engineering instruments, what is being done with the selected financial intermediaries (FS). These financial intermediaries may be banks, venture capital management companies or different types of SME financing specialists.
The EIF will use his experience clear and transparent best financial intermediaries in the management of the selection process for each instrument. This selection process will comply with European Community directives in the area of public procurement and Latvian laws. Following this, JEREMIE Investment Fund, implementing investment plans the introduction of financial engineering instruments, close agreement with financial intermediaries with proven competence and reliability. Activities and contributions for SMEs will be based on the business plan submitted by the FSS, the likelihood and certainty. Cost effectiveness will always be a priority.
4.2 investment fund management, the transfer of the Government of Latvia with the EIF appointed on Contract as such the JEREMIE Investment Fund enforcers for the first three years of operation. Diversion of funds to SMEs can be a process that lasts over those three years, and the total life of the investment fund will certainly exceed this time limit.
At the request of the Government of Latvia an important operational objective of the EIF is to help Latvian guarantee agency as the authority of the Government of Latvia is currently anticipated as a potential acquiring institution, to achieve the standard required for a successful transfer of the action in due time. The adoption of a decision on transfer and commissioning time is the Latvian Government accountability, and it will be held based on the points in the agreement.
The role of the EIF is a defined transition management principles, which are annexed to this agreement in Annex g. collecting there, this role includes responsibility for the best chance to help selected based on national authority to achieve the required standard. In this regard will be made an independent analysis to determine the capabilities and skills needed for the investment fund management. The EIF will provide practical and specialized training in three sent workers and will provide selected members of the Latvian administration training for various investment funds, on the basis of the ETF'S expertise in the areas of management, the need for such actions. This process is fully regulated transition management principles.
4.3 monitoring, reporting and management of the ETF will take a regular reporting and monitoring activities in accordance with the harmonized standards of reporting data collection. At least once every three months to meet with the EIF appointed the Supervisory Board of the Fund, which will act the Ministry of the economy and Finance Ministry. In addition, the annual report will be drawn up, the aim of which is to meet the Commission's requirements for reporting, as provided for in the annexes to the agreement (B) and (C). for more information on how the EIF will manage this process is specified investment business plan in Chapter 7.
5. summary in General, SME target audience consists of end beneficiaries a wide portfolio: measures will be launched in all Latvian level and young entrepreneurs will be supported to enable them to pursue their business ideas, existing start-ups will be supported to ensure market presence, and the more advanced traders will be encouraged to develop and expand. Purpose is to introduce new approaches in the Latvian economic policies that contribute to the dynamics of the economy, updated, which in turn transformēs to superior growth, renewed and improved employment prospects and healthy and growing SME sector.
JEREMIE fund concept in Latvia for the implementation of this and related documents for the mechanisms can be an essential and important role in creating SME financing sector maturity in Latvia.
Annex B monitoring of implementation in accordance with the applicable rules 1. definition of Monitoring is the process of financial and non-financial information for routine compilation, to monitor the activities of the JEREMIE investment funds, compare it with the objectives, budget and work plan, and compliance with legal and contractual requirements under the EU structural funds regulations and the contracts concluded between the ETF and the responsible authority on the content of the information.
2. the purpose of the monitoring process for the programme of responsible authorities, particularly the managing authority (PA) and the Ministry of Economics (EM) will make sure that: • the introduction of the activity i) meets the applicable requirements, particularly EU structural funds regulations, and (ii)) (where applicable) contain measures which are necessary for the compilation of the relevant information in accordance with the State aid rules regulating;
• implemented activity objectives;
• compliance with the requirements of the legal basis.
3. As a general principle the surveillance process will give the necessary assurance, regular inspection and assessment of the implementation, using the appropriate tools to detect anomalies and inconsistencies or risk so that you can take corrective action, if necessary.
4. Main actors

Implementation of the JEREMIE is supposed to be based on the decisions and measures by which the principle significance of sequential are involved specified people: the Commission, the Government of Latvia, responsible authority and/or managing authority, ETF, JEREMIE Investment Fund, financial intermediaries and SMEs (mainly).
5. General guidelines • monitoring in the context of JEREMIE Investment Fund's investment strategy and planning documents, and on the basis of the business plan of the investment in the Fund's Supervisory Board.
• Monitoring the implementation of activities will be carried out by the EIF.
• Monitoring of activities will include internal and/or external actions by different stakeholders, while respecting the principle of the importance of ensuring that the implementation of each phase is controlled by a higher stage in the person.
• Ensure that the activities of the ETF contracts will contain the necessary provisions, which allow the ETF to get information from financial intermediaries required to facilitate appropriate monitoring activities, including that to obtain the relevant information from the companies that receive support under Jeremie. The ETF will ensure that actions are defined in the EIF in the contracts the right to carry out monitoring visits to financial intermediaries and companies that receive support from JEREMIE Investment Fund.
6. monitoring instruments that implement the JEREMIE Investment Fund provides that the monitoring tools, which is to be introduced, JEREMIE funds include, depending on the circumstances, documented testing, reporting, control, inspection, audit reports.
Three months from the date of conclusion of the contract the competent authority and the EIF should agree on procedures, the monitoring process and the flow of information, applicable to the JEREMIE Investment Fund surveillance system for identifying non-compliance reporting, payment requests, supporting documentation and payment information flow requirements, EU structural funds regulations and related laws in Latvia provided publicity and visual identity requirements of the State aid notification requirements and other issues.
Annex C report JEREMIE reporting system is an essential part of the monitoring system helps, and it is designed to ensure the appropriate management of the initiative and facilitate to the extent possible, the report of the Latvian Government, which is determined by the Commission.
The ETF will respect such deductions in order: (i) the ETF will prepare for each calendar year (first time-until 31 March 2009), annual progress report, including JEREMIE actions carried out during the previous calendar year, detailed analysis, investment fund strategy and planning documents, and contribution to the implementation of the business plan analysis and detailed information about the progress of the activity, each financial intermediary activities, Jeremie Financial management and costs.
(ii) annual progress report will contain the necessary information relating to the activities and the JEREMIE Investment Fund to enable the Government of Latvia to meet reporting obligations to the Commission in accordance with the implementing regulation.
(iii) annual progress report will be drawn up in the English language and at the request of the Supervisory Board of the Fund's short summary is drawn also Latvian language.
(iv) the ETF will submit annual progress reports to the Fund to the Supervisory Board for approval until 31 of each calendar year to March.
(v) the ETF will prepare quarterly progress report in English, including investment fund strategy and planning documents, and contribution to the implementation of the business plan analysis, as well as detailed information about the progress of the Operation. The following quarterly progress report in English to the EIF will submit for approval to the Supervisory Board of the Fund within 30 days after the quarter in question.
(vi) ensure that the activities of the ETF agreements contain the necessary provisions, which allow the ETF to get information from financial intermediaries required to facilitate appropriate monitoring activities, including that to obtain the relevant information from the companies that receive support under Jeremie.
(VII) within three months from the date of conclusion of the contract the competent authority and the EIF must agree on reporting procedures that will be applied to the JEREMIE Investment Fund surveillance system.
Annex D AUDIT 1. General principles of the responsible authority and the managing authority will be entitled to send the audit authorities of the duly authorised representatives to carry out any audits that it considers necessary in respect of EIF JEREMIE financial products and to support the company. This provision will be included in the agreements. Six months after the conclusion of this agreement, the responsible authority and the EIF will agree on audit procedures in detail.
2. The ETF will respect such auditing requirements: • the JEREMIE Investment Fund will conclude appropriate agreements with financial intermediaries, which provides that the Commission, ETF, their authorised representatives, the European Court of Auditors and all the other institutions of the community or community bodies which are entitled to check the use of the JEREMIE financial means, have access to information they need to fulfill their duties.
• In connection with the above activities will be included in the treaties of relevant provisions and the relevant provisions are also to be included in any future agreement, which is closed in connection with the provision of support to businesses in JEREMIE.
• Ensure that the activities of the ETF agreement provides for the right to carry out monitoring of ETF checks to financial intermediaries and companies that receive support from JEREMIE Investment Fund.
3. The time limit for any person involved in the operation must be stored until 2021 December 31, relevant documentation for verification purposes.
However, notwithstanding the foregoing, evidence of the existence of the expenditure for payment of the invoice with your payment receipt form and the payment for goods and services in the form of evidence is required only insofar as they are necessary for an audit, which examined the financial assistance from the structural funds spending, according to which the share capital, loans or guarantees payment, which prompted the use of SMEs was depends on the specific expenditure on specific goods and services.
The above provisions in no way affect the provisions that the Latvian Government must be followed to ensure compliance with State aid rules.
Annex E withdrawal policy for payment transactions under the programme FROM JEREMIE JEREMIE Investment Fund and investment fund rules for the Elimination of the JEREMIE funds withdrawal policies of financial engineering instruments (such as venture capital funds, guarantee funds or loan funds, etc.) will be systematically included in the financial engineering instruments work orders, which proposed the ETF, and will be discussed by the Supervisory Board of the Fund, to which it is to be confirmed.
At least 6 months before 30 June 2011 the parties will meet to discuss and agree on the possibility of extending the term of the contract for a further period for which the parties agree, or to eliminate.
In the light of the financial engineering instruments for various features and financial engineering instruments for the development of early stage concept, at this stage it is not possible to determine the specific and detailed guidelines on the withdrawal policy. However, given that the JEREMIE funds withdrawal strategy in more detail later will determine the responsible authority and if it will be accepted by the managing authority, the responsible authority and other persons, depending on the circumstances, be involved, the possible withdrawal scenario could be: (i) create a JEREMIE Investment Fund EIF or other institution;
(ii) put the financial resources available to another body which deals with SMEs.
This list is not considered exhaustive, but only for a possible solution.
Annex F the applying and the list of eligible expenditure not in accordance with Council Regulation (EC) No 1083/2006, article 78, defined by the managing authority are Eligible expenses all costs relating to the implementation of the JEREMIE under the financing agreement, including costs connected to the contract and the investment fund strategy and planning document, namely: • standard costs of the ETF;
• EIF transport costs and charges relating to the JEREMIE Investment Fund employees sent journeys;
• The ETF'S local office costs;
• cost consultants, including legal advisers (for the avoidance of doubt, they do not include the costs) in connection with the transactions;
• costs occasioned by the JEREMIE Investment Fund external audit;
• costs incurred in connection with the Latvian language in the translation of documents for the implementation of the financing agreement;
• procurement, competition and interests expression procedure required to perform a task, the cost;
• costs occasioned by the responsible authority or other responsible authorities approved the assignment of employees to work in the EIF under a separate agreement to be concluded between the ETF and the responsible authority and, if necessary, with the other institutions;

• costs incurred in connection with a financing agreement expiry or cancellation and any of JEREMIE financial instruments, the operating contract and/or Co-investment agreement and Jeremie transfer of assets and liabilities to the Government of Latvia or another person appointed to manage the financial resources of JEREMIE actions in accordance with the framework financing agreement was 15.7. (ii) and paragraph 9.9, up to the maximum rate laid down in those paragraphs;
• costs incurred in connection with the financing of the bank account opening, maintenance and management;
• costs related to the proceedings that resulted in relation to the transaction;
• costs related to JEREMIE, marketing, promotion and advertising in Latvia;
• other costs that are necessary for the execution of Tasks by the responsible authority from time to time determine to apply;
• ETF costs the Latvian civil procedure law within the meaning of article 33, excluding (i) the costs incurred in the proceedings between the parties, and (ii) any sum of money that the EIF or the JEREMIE investment funds must be paid to third parties on the basis of a court decision or judgment.
• A capacity audit was carried out in accordance with Annex G of this agreement, the cost.
Ineligible expenses include: • land and real estate acquisition;
• The purchase of Vehicles;
• Loan and other debt interest;
• Recoverable value added tax and other taxes;
• Costs incurred in the proceedings between the parties;
• Any amount of money that the EIF or the JEREMIE investment funds must be paid to third parties on the basis of a court decision or judgment;
• Any amounts that the EIF must be paid in accordance with paragraph 13 of the agreement;
• Penalties and fines;
• Expenses that are not related to JEREMIE introduction in Latvia in accordance with the contract and the cost.
Annex G transition management principles is provided for in this annex, the transitional process, the most significant aspect of management between the ETF and the Authority appointed by the Government of Latvia as a potential acquiring institution in Latvia. This is reflected in the detailed negotiations with the Ministry of economy of the ETF and the Latvian guarantee agency.
1. Introduction 1.1 the legal basis for the introduction and description this annex defines actions that will make the ETF during the three years before the possible contract 15.2. entry into force of paragraph. Organization by the Ministry of Economics chosen as potential acquiring institution, is a Latvian guarantee agency. JEREMIE Fund transition or in any case before the expiry of the three-year period from the date of conclusion of the contract will be considered in the activities listed in Annex G.
The contract is awarded on the basis of the ETF'S Council Regulation No 1083/2006 44. (b) (i) article. Choice of acquiring institution regulated by the Regulation 44. (b) (ii), which provides for the award of contracts for financial institutions without the application, if it is in accordance with the national regulations that are relevant to the Treaty establishing the European Community.
Agreement between the EIF and the responsible authority aims to provide the opportunity to drive the EIF Trust Fund and help the Latvian guarantee agency to achieve the standards required for the transition of the operation within the time specified. The extent to which support is provided to the Latvian guarantee agency, the ETF'S tasks will be: • the Latvian guarantee agency's competence, the technical capacity and the existing support function analysis, taking account of the requirements in relation to JEREMIE investment management of the Fund in accordance with point 2 of this annex;
• Up to three Latvian guarantee agency staff for special training, the purpose of which is the collective agreement between the EIF, the responsible authorities and Latvian guarantee agency, which will run parallel to the local and the Luxembourg team, through the EIF JEREMIE Investment Fund EIF'S responsibility within the framework of the tasks in accordance with this annex, point 3 and 4;
• Administration of Latvia selected special training of the members of the various investment fund in the performance of tasks (of different initiatives in the field of financial engineering, investment fund management and supervision, as well as reporting to the authorities on the activities and results), in accordance with this annex 4.2. 
1.2. Legal basis and the responsibility for the decision, if it is adopted, the JEREMIE Investment Fund transition Latvian guarantee agency or any other of the acquiring institution is fully responsible, responsible authority under applicable law, t.sk. Article of Regulation No 1083 44 and in accordance with the criteria for the transition. Nothing that is given in Annex G, not to be treated as the EIF's obligation or responsibility for any such appointment and/or the ETF'S role in relation to the selected screening of the acquiring institution.
The EIF, with all my efforts, only one will be responsible for training employees on activities related to JEREMIE Investment Fund management and its activities, as well as help prepare the Latvian guarantee agency may transfer the functions provided for in this annex. In no circumstances shall the EIF is not responsible for any action that is not explicitly provided for in this annex, or of Latvian guarantee agency's alleged willingness to take over the investment operations of the Fund.
The parties declare that the decision of the responsible authority to any other organisation, not Latvian guarantee agency, the choice will make this attachment (G) void and free from any of the EIF in the obligations. The parties agree that, if the responsible authority will accept such a decision and notifies the EIF, the parties negotiate in good faith for the future agreement on the training of selected institutions.
2. Capacity audit and recommendations 2.1. Ex ante analysis the ETF will provide the name of the institution responsible for the professional skilled independent consultant (auditor), Latvian guarantee agency will analyze strengths and weaknesses, to successfully manage the investment fund and to carry out all the tasks it sais wound. The EIF will work with selected consultants for preparing and compiling the final report on the Latvian guarantee agency's ability to take over the investment fund, which recommended actions to be taken ("capacity audit").
An independent consultant will be chosen on JEREMIE Investment Fund, if the responsible authority will issue a final confirmation that all such costs, in accordance with Regulation No 1083 78 articles are considered "eligible management costs".
The responsible authority will provide the ETF with all necessary and relevant information in connection with the independent counsel of choice, especially with regard to public procurement procedures.
Given the range of possible tasks and the necessary restructuring and personnel/infrastructure requirements, which can lead to a capacity audit results and which may require a substantial decision of the Latvian Government, EIF intends to complete this task during the first year from the date of signature of the contract. The goal is to include the relevant results of the training programme (see point 4 of this annex) sent to the employee and task.
At the discretion of the ETF'S evaluation and audit capacity will include the following: • a task that should take on JEREMIE operation, count and analysis; tasks include initiating and designing the instrument, the instrument for the assessment of the risk profile, outcome development, compliance with State aid and EU structural funds requirements, marketing publicity of financial intermediaries, cost management and recovery, monitoring and reporting;
• skills required for the performance of the tasks of the evaluation;
• control and management requirements for the Trust Fund to support the activities and the resulting identification;
• technical analysis of the support mechanism, to ensure a clear management and control, including accountability;
• the possible organization comparisons with certain requirements;
• plan needed to create the proposed organization requires, URt.sk., staff, skill requirements and equipment, t.sk. IT computer equipment and software, in due time, proceedings (part of the following skills/activities may need to attract contract work);
• project plan development, establishing clear guidelines for the tasks. The plan must include a proposed management structure for the control of the project;
• The calculation of operating costs, including capital and running costs. 
2.2. the Ex post analysis in full compliance with public procurement procedures, provided that the same consultants who are selected for an audit, the capacity of the subsequent analysis of Latvian guarantee agency's preparedness shortly before the three year period, considering the exact dates during the third year. Provides that the amount of analysis, judgement and discretion by the EIF, will be the same as the selected capacity audit.
3. the work of Dispatch

Three Latvian guarantee agency members, who are selected jointly by the ETF, responsible authority and Latvian guarantee agency will be sent to work full time for three years, the EIF or the expiry of the contract-to shorter period ("send"). During transmission, Sent employees will remain in force, agreements with the Latvian guarantee agency; pay them pay Latvian guarantee agency and they will act in accordance with the labour law, social security and tax laws. The EIF does not take any payments sent to employees, other than those referred to in this annex.
The Latvian guarantee agency and the EIF will sign in the dispatch sent employees; Send employees in all respects (t.sk. health and social security) will continue to receive remuneration from the authority that they have sent, and JEREMIE Investment Fund will cover only the travel and subsistence expenses relating to travel, provided that the competent authority has approved them as related costs, in accordance with article of Regulation No 1083 78. Send employees will respect the ETF staff code of conduct and, in particular, the internal rules governing conflicts of interest and disclosure of sensitive information obtained in the performance of job responsibilities.
Send employees will be part of the EIF JEREMIE Section Jeremie and accountable Manager, everyday working with ETF'S head of the Office of Latvia.
Send the employee's tasks will include all of the EIF as the JEREMIE Investment Fund activities in Latvia, starting with the launch of activities to monitoring and reporting progress. The staff send personal qualities will be important, given the requirement for specific knowledge, but shipping will aim to enable all employees to take the active and positive role in the operation, as well as develop expertise in three years.
The working time of dispatch Send officers staying at the premises of the ETF in Latvia, but they will have to go regularly travelling to Luxembourg commercial and training purposes.
4. Training program 4.1 training provide training specific to the EIF the three sent to employees. The training will be held responsible and will carry the ETF ETF specialist, external service providers, regional manager and/or head of the Office of Latvia by the EIF.
Any external training costs cover the JEREMIE Investment Fund, assuming that the competent authority has approved the expenditure in question as referring to Regulation No 1083 78 within the article and they are subject to the normal annual budget calculated. In case the amount granted is not sufficient, we will ask for additional budget. Provides that all three training Sent will include the full set of skills, and together will consist of 50-day training course for three years.
If capacity is determined during the audit of the other training requirements, they will be considered and the EIF will provide them, if possible, payment. 
4.2 in addition to training in addition, EIF will provide special training for selected members of the Administration, by training them for different JEREMIE Investment Fund's mission, if requested by the competent authority. However, it should be noted that the ETF will only provide the procedure and to the EU regulation of the ETF-based good practice training.
Following additional training, if made, will include the additional cost to be calculated and must be accepted before training, and once approved, they are collected directly from the relevant Latvian authorities.
Annex H-guidelines for the management of the Government of Latvia 1. principle and confirms that the Rights of the EIF, which EIF assigned under this agreement include the right to manage the JEREMIE financial instruments from time to time deposit in JEREMIE Bank account, except for the amount of money that is paid to the needs of Operations or other purposes in accordance with the Treaty, and report the amount that the ETF is considered necessary to keep the JEREMIE Bank account liquidity risk ("cash"). Cash management will be carried out in accordance with the following management guidelines.
2. to implement the cash management of the funds, the EIF within six months from the signing of this agreement, under the JEREMIE Investment Fund's best interests, will choose either to the European investment bank or the Treasury of the Republic of Latvia. The EIF Treasury management and management of the bank in the nature of the contract must be approved prior to their introduction to the Supervisory Board of the Fund.
3. it is expected that Treasury funds will be deposited into the cash management bank in term of the euro or euro currencies-denominated deposit slips replacement in accordance with the applicable agreement between the EIF and the cash management bank. Treasury funds will be deposited into the deposit slips and managed so as to ensure sufficient liquidity to fund the Trust Fund's core investment activities, while trying to achieve the appropriate level of risk and return.
4. As an alternative to paragraph 3, if the ETF believes that alternative can be implemented in the management of measures through possible alternative products available in cash management, bank of Latvia in the best interests of the Government, it will have the right (but does not create any legal obligation) to make appropriate proposals to the Supervisory Board of the Fund. If the Fund's Supervisory Board accept the affirmative decision, which features will be deployed accordingly.
5. The EIF shall submit quarterly reports to the Supervisory Board of the Fund for Treasury management that the ETF has taken, in accordance with management guidelines.
Annex I annex 1 costs. This annex (the annex of the cost ') definitely cost calculation and payment terms under the contract in accordance with its paragraph 10, related to JEREMIE investment activities of the Fund in accordance with the Treaty.
2. Terms and expressions defined in the Treaty, this cost in the annex have the same meaning, unless they have been defined differently here or if not apparent from the context or meaning.
3. In addition to the above mentioned in point 2, the following defined terms and expressions are used in that role below, unless the context otherwise not apparent meaning: a) the annual costs means the costs incurred in connection with the operation of the JEREMIE Investment Fund in question during the calendar year, and which every year are based on the relevant statement of award of costs;
b) associated costs means the costs referred to in point 5;
c) statement of the meaning of the cover document drawn up on the basis of annex 2 of this annex the attached model, the EIF shall submit to the Supervisory Board of the Fund in paragraph 11 in the order listed, showing the annual expenditure of the funds and information for their calculation;
d) direct costs means the ETF ETF standard costs, Transport costs and the ETF ETF'S local office cost totals;
(e) the direct costs of the ETF) prepayment means the amount of money a year, which the ETF receives for each calendar year quarterly instalments in accordance with paragraph 9, to cover the direct costs of the ETF planned for the same calendar year. Each calendar year, the ETF'S direct costs applicable to the prepayment amount is specified in the annual budget;
f) ETF'S direct cost balance payment for each calendar year shall mean the annual balance of payments, determined by comparing direct costs of the ETF with ETF prepayment costs during that calendar year, and paid in accordance with the procedure laid down in paragraph 11;
g) ETF'S direct cost bank account means the sub-account that EIB opens a Bank account the JEREMIE and from which is made for the payment of all direct costs of the ETF in the order set out in the annex to this cost;
EIF Jeremie) employee means any ETF staff employees who are posted from time to time the execution of the task, including JEREMIE Actions;
I) ETF'S local office costs means the costs and expenses incurred in connection with the execution of the ETF and apply to the EIF'S establishment and functioning of the Bureau in Riga, and which is calculated in point 4.3 in order;
j) ETF'S standard costs means the costs and expenses incurred in connection with the execution of the ETF and ETF is calculated based on the standard cost rates specified in paragraph 4.1;
k) ETF'S Transport costs means the costs and expenses incurred in connection with the execution of the ETF and apply to the EIF JEREMIE trips of employees in accordance with the travel policy, which from time to time shall apply to the European Investment Bank Group, and the order referred to in paragraph 4.2;
l) expenditure bank account means the sub-account that EIB opens a Bank account the JEREMIE and from which is made for the payment of all related expenditure in the order set out in the annex to this cost.
4. Eligible direct costs of the ETF 4.1. rights to receive ETF standard costs

The parties agree to and agree that the ETF ETF'S are entitled to standard costs that each calendar year is indicated in the relevant notice of cost recovery and calculated for each calendar year on the basis of the standard cost rates EIF applicable calendar year. The ETF'S standard costs calculated by multiplying the actual amount of time that any employee of the EIF JEREMIE has dedicated task, with a ETF'S standard cost rate. ETF fully responsible for its employees the best posting for its head office in Luxembourg, as well as the local office in Riga. The parties agree that the ETF'S from time to time review the standard cost rate and is entitled to amend it, and that the rate currently in force will be updated at the end of each calendar year on the basis of the Auditors the audited accounts for the year in question; that is, although the rate of updating is not possible to determine in advance, the EIF provides standard costs rates EIF annual increase. The current ETF'S standard cost rate calculation applied in 2008, is attached in annex 1 to this annex, provided that the final cost of the ETF'S standard rate, which will apply this year, will be determined on the basis of the Auditors audited annual accounts 2008 as soon as they become available.
The parties agree to and agree that the ETF'S standard for determining payment amounts will be applied only to the ETF'S standard cost rate and its calculation principle. 
4.2. rights to receive ETF Transport costs the parties accept and agree that the ETF ETF'S are entitled to transportation costs, that amount for each calendar year is indicated in the relevant notice of cost recovery and which corresponds to the actual cost of the ETF ETF staff travel related to the task. 
4.3. rights to receive the ETF'S local office costs the parties accept and agree that the ETF ETF'S are entitled to local office costs, which amount for each calendar year is indicated in the relevant notice of cost recovery and which corresponds to the actual cost of the ETF ETF on the establishment and functioning of the Office in Riga 5. Expenditure associated costs are: (i) the cost of consultants, including legal advisers (for the avoidance of doubt they do not include the costs) in connection with the transactions;
(ii) public procurement, competition and interests expression procedure required to perform a task, the cost;
(iii) costs incurred in connection with the responsible authorities or the competent authorities of the other approved institutions for the work assignments of the EIF under a separate agreement to be concluded between the ETF and the responsible authority and, if necessary, with the other institutions;
(iv) the costs incurred in connection with any translation of documents, which must be in accordance with the Treaty, the Latvian language;
(v) costs incurred in connection with the expiry or cancellation of the contract and any of JEREMIE financial instruments, the operating contract and/or Co-investment agreement and Jeremie transfer of assets and liabilities to the Government of Latvia or another person appointed to manage the financial resources of JEREMIE actions in accordance with the contract within 15.7. (ii) and paragraph 9.9, up to the maximum rate laid down in those paragraphs;
(vi) costs incurred in connection with the bank account opening, maintenance and management;
(VII) costs incurred in connection with the JEREMIE Investment Fund external audit;
(VIII) the costs related to JEREMIE, marketing, promotion and advertising in Latvia;
(ix) costs the Latvian civil procedure law within the meaning of article 33 relating to proceedings arising in relation to the transaction, excluding (i) the costs incurred in the proceedings between the parties, and (ii) any sum of money that the EIF or the JEREMIE investment funds must be paid to third parties on the basis of a court decision or judgment;
(x) capacity in audit costs, carried out in accordance with Annex G of the Treaty;
(xi) other costs necessary for the task, which from time to time, the responsible authority and by mutual agreement between the EIF will be recognized as the related costs.
6. Limit the parties confirm that the ETF'S direct costs and Related expenditure amounts will not exceed the limit specified in the agreement and in article 10.3 of regulation for the implementation of article 43 in the fourth paragraph. If the direct costs of the ETF and the total expenditure will exceed this limit, apply the provisions of point 14.
7. Early termination of the contract is cancelled before the deadline, including in cases where the cancellation of the contract before the expiry of the Treaty takes place in article 15.2 of this revision and direct expenditure and related ETF expenditure amounts at this point exceed the limit laid down in paragraph 6, the Latvian Government is obliged to pay the amount of money that the ETF is equal to such excess. Such payment will be credited toward the payment to be made in accordance with paragraph 12.
8. The ETF'S direct costs and expenses the bank account bank account direct costs of the ETF ETF opens bank account and the bank account of expenditure as JEREMIE Bank sub-account.
The amount of money lodged in the direct costs of the ETF'S bank account and the bank account of expenditure may be spent only for the payments set out in paragraphs 9 and 10. 
8.1 the ETF'S direct cost bank account funds the direct costs of the ETF'S motion the bank account is held in the following order.
(a) a sum of money corresponding to the calendar year in question provided for the direct costs of the ETF and is set in the annual budget, the EIF JEREMIE is deducted from your Bank account and transfer it to the EIF the direct costs of the bank account on the first working day of the calendar year or-in 2008-next business day after the contract section 10.4 in accordance with the procedure laid down in the approved annual budget.
(b) If in any calendar year actual direct costs exceeding the ETF ETF'S direct cost of prepayment, as defined in paragraph 9 (b) in subparagraph (i), the EIF JEREMIE is deducted from a Bank account in the amount of money corresponding to such excess, and transfer it to the direct costs of the ETF'S bank account on the day when the procedure laid down in paragraph 11 are approved or taken notice of the award of costs.
(c) if the end of the calendar year, the ETF'S direct costs is left in a bank account in any amount of money, then the annual fee to be taken in accordance with point 8.1 above, (a), referred to in part is reduced by this amount. 
8.2 the bank account of expenditure expenditure bank account is updated from time to time from JEREMIE Bank account to cover any related expenses incurred by a JEREMIE Investment Fund. EIF financial instruments JEREMIE deduction from your Bank account and transfer funds to a bank account in such manner and at such time as is necessary to timely expenditure.
9. The ETF ETF pay the direct costs direct costs for any given calendar year are paid to the EIF as a prepayment for the direct costs of the ETF and ETF'S direct cost balance payment procedure laid down in this paragraph 9.
(a) the direct costs of the ETF prepayments prepayments are the direct costs paid to the agenda set out in the table below: table-cost prepaid payment arrangements for the payment of the first quarter (Q1) not later than January 1 of the direct costs of the ETF'S bank account are charged the direct costs of the ETF prepaid fourth and this amount is transferred to the EIF of the second quarter (Q2) not later than 1 may of the ETF'S direct cost bank account are charged the direct costs of the ETF prepaid fourth and this amount is transferred to the EIF'S third quarter duty (Q3) not later than 1 July of the direct costs of the ETF'S bank account are charged the direct costs of the ETF prepaid fourth and this amount is transferred to the EIF'S fourth quarter (Q4) of payment no later than October 1 of the direct costs of the ETF'S bank account are charged the direct costs of the ETF prepaid fourth and this amount is transferred to the EIF each payment referred to in the table above be up to date, indicated in the table. If this day is not a working day, payment is to be made the next business day.
If the contract is signed in the middle of a calendar quarter, the first EIF direct cost prepaid quarterly payment is to be made in proportion to the number of days from the date of signing of the contract until the end of the quarter (basis: one quarter corresponds to 90 days).
(b) the direct cost of the EIF'S balance payment At each end of the calendar year calculated the ETF ETF Direct costs actually incurred by the calendar year, and calculate the direct costs of the ETF balance payment: EIF direct cost balance payment the actual direct costs of the ETF-ETF'S direct cost of prepayment annual calculation is made in the relevant statement of award of costs according to the provisions of paragraph 11.
The ETF'S direct cost balance payment for the calendar year to be the year's may 1, but, if that day is not a working day, it is to be carried out the next working day. At the same time, depending on the circumstances: (i) if the actual direct costs exceeding the ETF ETF'S direct cost of prepayment, the EIF is empowered to withhold from the ETF'S direct cost bank account the amount of money specified in the statement of costs as direct costs of the ETF balance payment, and remit this amount of money, or ETF

(ii) the direct costs of the ETF if the prepayment exceeds the actual direct costs of the ETF, ETF ETF is the direct cost balance netting against the direct costs of the ETF prepaid quarterly payment, due on this date. If the direct costs of the ETF prepaid quarterly payment amount is not sufficient for the pre-defined including, the ETF at the same date, the difference is transferred to the EIF'S direct costs to the bank account.
The parties agree that, in both cases set out above (i) and (ii) above, in connection with the ETF'S direct cost balance payment of any of the parties are not obliged to pay the other Parties for any interest on the payment.
10. Expenditure relating to the payment of costs is to be paid in a timely manner, on the basis of invoices that are received from time to time, by direct transfer from a bank account of expenditure. Each calendar year related expenses paid amount is specified in the relevant notice of cost recovery.
11. notification of cost recovery after the end of each calendar year, as soon as it becomes possible, but in any case no later than the next calendar year 31 March ETF Fund shall be submitted to the Supervisory Board statement on cost recovery, which shape the specimen attached to this annex in annex 2, pointing at the annual costs incurred in the calendar year concerned, and calculation.
Within thirty days of the receipt of the notification of the award of costs, the Fund Supervisory Board has the right to approve the statement of costs or to make comments or objections about its contents, provided that any objections must be adequately justified. As regards the notification of the approval of costs is applicable to the following provisions: (i) if the ETF receives the approval of the Supervisory Board of the Fund, the statement of costs is considered to be approved on the date on which the ETF receives the approval of the Supervisory Board of the Fund;
(ii) if the ETF does not receive from the Fund, not the Supervisory Board approval or opposition, a notice of the award of costs to be considered as approved at the end of the 30th day after the date on which the Fund Supervisory Board received a notice of the award of costs;
(iii) If the Fund EIF receives any objections, the Supervisory Board within fifteen days after the receipt of these ETF's complaint is in good faith should be taken into account in making any measures which the ETF considered objective, including those objections to be discussed by the Supervisory Board of the Fund, and should be submitted to the Supervisory Board of the Fund, the second statement on cost recovery, which has been amended according to the ETF'S sole discretion. The second statement of costs considered as accepted within five working days of receiving it.
Statement of costs becomes final and shall enter into force on the date on which it was approved or accepted in the order listed above, and this date all notice of cost recovery charges specified automatically becomes such that pay.
12. Final payments after termination or cancellation has no effect on any payments to be made in accordance with paragraphs 9 and 10, after termination or cancellation, including the cancellation of the contract before the deadline, the EIF will calculate the total direct costs of the ETF and the total expenses that had to be paid and which have been paid throughout the period of validity of the contract.
If the calculated amount exceeds the limit, the management costs of the implementing regulation specified in article 43 in the fourth paragraph, the Government of Latvia is entitled to request for the ETF, as soon as possible and not delay, taking into account the relevant circumstances, make it as the final payment of the balance of the cost of a sum of money corresponding to such excess, if one does not agree with the Government of Latvia to the following reimbursement from other available sources.
 
13. The following annex is attached in annex 3 of the budget, which is defined in the cost forecast for the first three-year period. The parties confirm that this forecast is not binding force and as easy to forecast, which is based on information available at the time of the conclusion of this agreement is subject to change, and the parties and third parties should not rely on it as the relevant cost estimates for the period.
The cost of the annex 1 of the annex to ETF'S standard cost rate calculation for the year 2008, in accordance with the Treaty, in particular the EIF appointed employees (which in this cost as defined in annex "EIF JEREMIE employees") take the action provided for in the Treaty in connection with the formation of the JEREMIE Investment Fund in Latvia and its activities. The EIF provides that the first three years of operation the necessary staff resources include 3.5 individuals, as indicated below.
In addition to these, the resources allocated to the EIF appointed from time to time the required tasks of various employees who experience satisfying about 100 professional experience from the ETF'S main office in Luxembourg. This additional contribution is included in the EIF'S standard cost rate calculation applied for each year, and therefore it will not result in additional costs to the Government of Latvia. These additional resource will provide support to EIF JEREMIE seconded staff in all actions relating to the JEREMIE Investment Fund, including the investment-related activities as product structure, the discussions with financial intermediaries, careful checks, any business development and the legal framework for the activities relating to the processing of the transaction-reporting on investments and their monitoring, accounting, and systems management.
To ensure that all provisions of the contract, the successful implementation of the relationship with the Latvian Government officer constantly monitor combinations which work in the seconded employees and the ETF ETF experts.
The table below shows the 2008 ETF applied standard cost rate calculation. This estimate was made, subject to the producer, which is currently available in about 2007 and which have not yet been audited by the Auditors, provided that the actual cost of the ETF'S standard rate, which will apply for the year 2008, will be based on the auditor audited the annual accounts 2008 as they become available.
Employee category EIF JEREMIE estimated number of employees (first 3 years) rate EUR/administrative staff at cilvēkmēnes 0.5 18.900 specialists cost 33.000 annex 3 Annex 2 statement of costs (sample)--------------------------------------------------------------------------------------------------------– – – – – – – – recipient: [•] Sender: European Investment Fund in Luxembourg, JER-003 date in accordance with the funding agreement ("agreement"), concluded on 16 July 2008 between the Republic of Latvia and the European Investment Fund (EIF "") and for the cost of the letter (the "cost" of the annex) 13 The EIF shall provide Notice to you, as to costs (as it is defined in the annex of the cost).
Terms and expressions defined in the Treaty and in the Costs in this document have the same meaning, unless they are otherwise defined or if it is not apparent from the context or meaning.
Welcome to you one month to submit us your approval the following costs about 200 [•]. year: investment fund costs according to the annual budget or adjustments according to the actual situation of the difference between the direct cost ETF ETF standard cost rate month/EIF JEREMIE staff travel expenses local office costs of ETF expenditure cost of consultants in relation with the competition costs associated with business travel costs in connection with translation costs related to the termination costs related to accounts in banks in relation with the independent audit costs related to litigation costs in connection with the marketing and advertising costs in accordance with paragraph 11 of the annex to the costs (b) section [•]. on May 1, or, if that day is not a working day, the working day EUR [•] [positive amounts will be withheld from the ETF case: direct cost account and will be paid in a bank ETF] [negative amounts will be necessary: to prepay for the direct costs of the ETF, payable quarterly at the same date].
The cost of this annex annex 3 Annex 3 Annex cost contains the costs which the ETF is planned for the first three JEREMIE Investment Fund for years. This estimate is only as non-binding guidelines and may be amended in consultation with the Supervisory Committee of the Fund.
The calculation is not suitable for the cost factor that is 12.5% of the EIF not-standard cost rates.







The estimated cost of the first phase of the BUDGET year 1 year 2 gsd Abt 3. % amount allowed 183,000,000 183,000,000 183,000,000 ETF Prof. resources in Latvia 2 2 2 ETF Admin. 0.5 0.5 0.5 Latvia resources ETF Prof. resources from Luxembourg Latvia 1 1 1 3 3 3 Designated resources COST ETF ETF unit full cost rate for Prof. staff EUR/month 3 1,235,520 1,284,941 the full cost of the ETF 1,188,000 rate for the Admin. personnel/month 0.5 EUR 118.800 123.552 128.494 common staff costs 1,306,800 1,359,072 1,413,435 year mission costs EUR/per person on a mission/36 Latvia office costs 54.000 58.860 64.157 EUR/month 12 subtotal 1,420,800 1,483,332 1,548,878 60.000 65.400 71.286 0.78 0.81% margin% 0.81%%








Associated costs for advice/day € 60 EUR/63.000 68.670 74.850 legal advice about the transaction in year 7175.000 190.750 207.918 invitation for expression of interest costs EUR/invitation 6 job posting costs 45.000 49.050 53.465 EUR/staff/year 3120.000 130.800 142.572 legal translation costs EUR/page 250 of 12.500 13.625 14.851 Termination/transition costs 0 €/termination of Auditor costs 25.000 25.000 100.000 EUR/year 1 30.000 32.700 35.643 capacity audit case 155.000 105.000 €/reserve Investment Council meetings EUR/year 4.000 4.360 4.752 marketing costs 4 EUR/3 45.000 49.050 53.465 unexpected campaign costs 12.5% 12.5% total cost 92.313 86.033 122.245 2,137,613 2,133,370 2,513,639 Av per year. % annual interest% 1.37% 1.17 1.17% 1.24% Prof. staff rate the EIF 2008 (figures based on the agreement with the EC in 2007) 33.000 34.320 35.693 ETF Admin. the staff rate of 2008.


promotion year 19.800 20.592 21.416 (EIF) 4.00% For the year of the change in inflation in Latvia 9% average inflation rate expected in Riga, Latvia, July 16, 2008 in the Republic of Latvia, Minister of Economic Affairs on behalf of the European Investment Fund on behalf of the Executive Director of the _____ _____ _____ _____ _____ _____ _____/Kaspars Gerhards/_____ _____ _____ _____ _____ _____ _____/Richard Pelly/Funding Agreement between the Government of Latvia and the European Investment Fund Funding Agreement between the Government of the Republic of Latvia, represented by the Ministry of Economics and the European Investment Fund on 16 July 2008 table of contents 1.
Definition and Interpretation 2.
Object of the agreement and Task 3.
JEREMIE Holding Fund 4.
JEREMIE Actions 5.
Project Steering Committee 6.
Funding of the JEREMIE Holding Fund 7.
Investment Strategy and Planning 8.
Terms of reference and Business Plan 9.
Operations 10.
Costa 11.
Non-eligible Expense of 12.
Ancillary undertaking of the parties 13.
Liability 14.
Monitoring, Reporting, Auditing, 15.
Effective Date; 16. Termination
Each Time The Law; Dispute Resolution 17.
Appendix A Appendix B of the final Provision Appendix C Appendix D Appendix E Appendix F Appendix G Appendix H Appendix I this funding agreement (the "agreement") is entered into on July 16, 2008, by and between: the Government of the Republic of Latvia, as represented by the Ministry of Economics ("MOE") in its capacity as Authority Responsible for the measure of Operational Programme ' Entrepreneurship and Innovation ' 55 Street Committee EN 1519 Riga Latvia ("Government of Latvia") and the European Investment Fund 43, Avenue J.F. Kennedy, L-2968 Luxembourg LUXEMBOURG ("ETF") as follows: preamble (A) By Regulation (EC) Of.. 1080/2006 of the European Parliament and of the Council the principles and strategies each the European Regional Development Fund (ERDF) have been restated.
(B) By Council Regulation (EC). From. 1083/2006 general provision regarding, inter alia, of the scope, funding and use of the ERDF, the Cohesion "of the Fund (" CF ") and the European Social Fund (ESF) have been adopted.
(C) As one of the instruments for the application of funds disbursed under the Fund (as defined in Council Regulation (EC) No. 1083/2006), the initiative "joint European resources for micro to medium enterprises (" JEREMIE ") has been jointly developed by the Commission of the European Communities (" the Commission ") and the ETF, for the purpose of financing expenditure in respect of operations comprising financial engineering contributions to support tool , such as venture capital funds, guarantee funds and loan funds, enterprises, primarily small and medium-sized ones, whereby all funds to be disbursed and applied in the course of JEREMIE shall be made available and used in accordanc with article 44 of Council Regulation (EC) No. 1083/2006 and the Commission Regulation (EC) No. 1828/2006 (D) On 20 November 2007. the Commission adopted the decision relating to the National Strategic Reference Framework for the period 2007-2013 submitted by the Managing Authority (as defined below), including its implementation, inter alia, through the Operational Programme "Entrepreneurship and Innovation" ("Operational Program").
24 November 2007 e.on, the Commission approved the Operational Programme by Decision c (2007)-4466. The provision of the Operational Programme have been duly taken into account by the parties in drafting this agreement.
(F) On 8 April 2008., the Cabinet of Minister of the Republic of Latvia by the Protocol Decision (minutes From 22, § 34) "On Implementation of Holding Funds of the European Union Structural Fund" ("Protocol Decision") decided to select the ETF fund the Council as holding pursuan Regulation (EC) No. 1083/2006. The parties have concluded that the JEREMIE Holding Fund (as defined below) would be organised as a separate block of finance "within the EIF in accordanc with this agreement, as permitted under article 43, para. 3 of the Commission Regulation (EC) no 1828/2006 From H. The Government of Latvia has also agreed to cover, through the non is transferred to the JEREMIE Holding Fund under this agreement, the costs (as defined below), (a) the portions of which shall be the direct costs of the ETF, as contemplated in article 44 (b) of Council Regulation (EC) No. 1083/2006 and article 43, para. 4 of Commission Regulation (EC) No. 1828/2006, such payment to be made in accordanc with this agreement.
(I). The parties that the acknowledg JE REM is a novel initiative launched by the Commission and jointly developed in the Republic of Latvia by the Government of Latvia and the EIF, at least up to the Earlies to Ordinary Termination date (as defined below). Accordingly, taking into account the early state of the new institutional infrastructure for the use of EU Structural funds and implementation of JEREMIE, the parties declare their readiness to consider the effect of this agreement, including its compliance with any applicable Community rules and regulations, and to amend it on a need basis.
(J). For the purpose of article 43 (5) of the Commission Regulation (EC) No. 1828/2006 this agreement is entered into by the Republic of Latvia by the Ministry of Economics acting in its capacity as Authority Responsible for the measure of the Operational Programme and duly authorized representatives of the Government of Latvia.
K. the execution of this agreement by Mr. Kaspars Gerhards, Minister. of Economics of the Republic of Latvia in the name and on behalf of the Government of Latvia has been authorised by Protocol Decision of Minister of the Republic of Latvia (minutes of the 48, § 1) "project of Regulation" Funding Agreement between the Government of the Republic of Latvia and the European Investment Fund "of 10 July 2008.
 
NOW THEREFORE it is agreed as follows: 1. Definition and Interpretation 1.1 In this agreement the following defined terms and expressions shall bear the following meaning, unless the context requires otherwise: "agreement" means this agreement and the amended from axis of time Appendic to time;
"Annual budget" means, for each calendar year, the forecast of the costs connected to the operations of the Fund, the JEREMIE Holding for such calendar year, to be prepared by the EIF and approved by the project Steering Committee in accordanc with article 10.4 below;
"Annual progress report" means the progress report for each calendar year to be prepared by the ETF in accordanc with Appendix C, and to be approved by the project Steering Committee;
"Appendix" means an appendix to this agreement;
"Article" means an article of this agree men;
"The Associated Expense" means (a) of the annual amount of Costa, defined as such in the Appendix, in which EIF Costa shall withdraw from the non available from time to time in the JEREMIE Holding Fund, as provided under article 10.1 below and in the Costa of the Appendix;
"Business Day" means a day during which the EIF Luxembourg Office is open, and banks open for general business in Luxembourg and Riga, Brussels;
"Business Plan" means each business plan, relating to any single Financial Engineering instrument, which shall be prepared in accordanc with article 8;
"Co-investment" means each co-investment transactions which shall be entitled to enter the ETF into, with the aim of maximising the effect of the application of the JEREMIE Holding Fund;
"Co-investment agreement" means each agreement relating to the implementation of the programme of Co-investment which shall be entitled to enter the ETF into with recognised third parties;
"Commission" means the Commission of the European communities;
"Costa" means the annual costs which the EIF shall withdraw from the non available from time to time in the JEREMIE Holding Fund, as provided under article 10.1 below and in the Appendix, and which costs shall be deemed as "eligible expenditure" to the exten to permitted by article 78 of the Regulation. 1083 and sharp by the Responsible Authority determined in the list attached as Appendix F here. The costs shall be composed of the direct costs of the ETF and the Associated Expense.
"Costs" means the Appendix document concerning the calculation and payment Costa, sharp agreed by the parties and attached under Appendix I of the heret; "Ordinary Termination" the Earlies Data means 30 June 2011;

"The ETF'S direct costs" means (a) of the annual amount of the costs which the EIF shall withdraw from the non available from time to time in the JEREMIE Holding Fund, the costs incurred reimburs by the EIF in connection with the running of the JEREMIE Holding Fund, as provided under article 10.1 below and in the Costa of the Appendix. The method of calculation of the EIF'S direct costs, which shall be based on the Standard cost rates, the EIF shall be defined in the Costa of the Appendix;
"The ETF'S Standard cost rate" means the rate, as updated from time to time by the EIF, which reflect the actual cost incurred by the ETF in the performance of the Task by applying a full-cost approach covering the EIF's direct and indirect cost per operational staff;
"EU Structural Funds ' means the European Regional Development Fund, as defined under Reg. 1083, and other funds which the parties may agree from time to time in accordanc with applicable EU legislation;
"EU Structural Funds regulations" means the Reg. 1080, Reg. 1083 and the Implementing Regulations, as well as any other EU legislation from time to time applicable to the EU Structural Funds;
"Financial Engineering instrument" means any or all of the instruments referred to in article 44 of Regulation. 1083;
"Financial Intermediary" means a Financial Engineering instrument (for the avoidance of doubt, other than the ETF), body or company, public or private, whethers responsible for implementing operations, to be selected in accordanc with article 9.1;
"Implementing Regulation" means Commission Regulation (EC) No. 1828/2006;
"Initial costs" means any amount due for the costs, incurred by the EIF in accordanc with this agreement in the period from the execution of this agreement and before initial payment under article 6.1, which the Government of Latvia shall pay the ETF in the case provided under article 10.2 below;
"Internal rules" means the rules each of the internal proceedings of the project Steering Committee, which may be adopted in accordanc with article 5.12;
"The investment Business Plan" means the document providing details of the activities which they carry out the EIF plans in line with the Investment Strategy and Planning up to 30 June 2011, to be drafted by the EIF and approved by the Responsible Authority in accordanc with article 7.3 below;
"Investment Strategy and Planning" means the document concerning the investment strategy and the planning of the activities of the JEREMIE Holding Fund in relations to the JEREMIE Action, which is attached to this agreement as Appendix A;
"JEREMIE" means the initiative "joint European resources for micro to medium enterprises" launched by the Commission and the EIF, as members of the European Investment Bank Group, in order to promote increased access to finance for the development of micro, small and medium-sized enterprises in the European Union;
"JEREMIE account" means the ETF'S off-balance sheet account, relating to the implementation of the Task, to be opened in accordanc with article 3.2;
"JEREMIE Action" means the tasks to be carried out by the EIF in the framework of the implementation of the JEREMIE Holding Fund as provided in article 4.1;
"JEREMIE Additional Bank account" means the interest bearing segregated bank account, other than the Bank account, it helps to be used in connection with any Non-eligible Expense, to be opened in accordanc with article 3.3;
"JEREMIE assets and Liabilit" means all the rights, claims and liabilit to of the JEREMIE Holding Fund connected to all investments of the same in the Financial Engineering Instrument existing from time to time, as well as all the rights, claims and liabilit to of the JEREMIE Holding Fund connected to any agreements entered into in order to ensur the activity of the same , such as the rights to the balance of any money deposited from time to time in the Bank account of JEREMIE and any money invested in accordanc with the Treasury guidelines;
"It helps the Bank account (s)" means any interest bearing segregated bank account, relating to the implementation of the Task, to be opened in accordanc with article 3.3;
"The JEREMIE funds" means, from time to time, in the aggregate amount of: (i) the aggregate of non received in the Bank account the JEREMIE in accordanc with article 6.1 and article 6.3, if applicable; plus (ii) the aggregate interest accrued from time to time in the Bank account the JEREMIE; plus (iii) for the period of duration of any Operational agreement and at the termination of any Operational agreement any Proceed of operations received from time to time in the Bank account the JEREMIE; Les (iv) at the termination of the relevant Operational agreement, the higher of zero and the difference between (x) the capital contributed and actually paid into the relevant Operations, and (y) the aggregate of the Proceed of the operations paid into the Bank account under the JEREMIE the relevant Operations;
"JEREMIE Holding Fund" means the holding fund prescribed in the Regulation. 1083 and the Implementing Regulation, to be established in accordanc with article 3, where it will be performed by the tasks by the EIF;
"Managing Authority" means the minis try of Finance of the Republic of Latvia, as the national authority designated under Latvian law to manage the Operational Programme;
"Monitoring Committee" means the Committee, having the composition, tasks and powers set out in articles 63 et seq. of Reg. 1083, established by the Government of Latvia in connection with the Operational Programme;
The "National Strategic Reference Framework" means the reference document of the Government of Latvia for preparing the programming of the Structural funds of EU and Cohesion ", as set out in paragraph (D) of the preamble;
"Non-eligible Expense" means any expense, other than Costa, connected to the compliance with the Task which, according to the list determined by the Responsible Authority and the attached Appendix F, with the axis of the heret is deemed to be non-eligible expenditure is under the EU Structural Funds regulations and related Latvian law;
"Operation" means a project or group of projects is defined as per Reg. 1083, selected in accordanc with article 4 and 5, and implemented by one or more Financial Intermediar;
"Operational agreement" means an agreement entered into with a Financial Intermediary regarding UN Operations;
"Operational Programme" means the activity n. 2.2.1.1. holding fund for the investment in high-risk guarantee, loans, and venture capital funds and other financial instruments within the operational programme ' Entrepreneurship and innovation ', a part of which is administered through the JEREMIE Holding Fund, in accordanc with the provision of this agreement;
"Parties" means the Government of Latvia and the EIF;
"Proceed of operations" means any amount which, in the framework of an Operation, for the period of duration of the relevant Operational agreement and at the termination thereof, is generated from such Operations and is paid to the Bank account by JEREMIE the relevant Financial Intermediary in accordanc with article 9.4;
"Progress report" means each of the reports, including the Annual progress report, to be prepared by the ETF in accordanc with Appendix C, and to be submitted to the project Steering Committee;
"Project Steering Committee" or "PSC" means the Committee appointed by the Government of Latvia and entrusted with the responsibilities regarding the JEREMIE Holding Fund in accordanc with article 5;
"The PSC members" means the ordinary members of the project Steering Committee, to be appointed by the Government of Latvia in accordanc with article 5;
"The PSC Observer" means the individual appointed by the ETF, by the Government of Latvia or by the Responsible Authority (or any other individual is present or participating in the meetings of the project Steering Committee on an ad hoc basis) having the right to attend the meetings of the project Steering Committee, as well as the other rights provided in article 5;
"Reg. 1080 "means Regulation (EC) No. 1080/2006 of the European Parliament and of the Council;
"Reg. 1083 "means Council Regulation (EC) No. 1083/2006;
"Responsible Authority" means the MoE, as the national authority designated by the Government of Latvia as the responsible authority for the Operational Programme, measure or of any entity which may be substituting subsequently appointed by the Government of Latvia in such capacity;
"Right" means the right to use the JEREMIE funds, donated it to the EIF in accordanc with article 2 below, subject to the Task provided hereunder;
"Small and medium-sized enterprises" or "SM" means small and medium-sized enterprises as defined in the Commission's Recommendations 2003/361/EC;
"Successors Entity" means the entity which may be appointed by the Government of Latvia under article 44 of the Regulation. 1083, in its full discretion and under its sole responsibility, their implementations that the operations contemplated in that article and to succeed the ETF in the performance of the tasks of the JEREMIE Holding Fund in Latvia;
"Task" means the special burden attached to the donation of the right, as described in more detail in this agreement, subject to which the donation of the right is performed, as provided in article 2.2 below;
"Termination for cause" means the termination of this agreement due to a breach or breach of a series of the same by a Party, which are not capable of being remedied within a reasonable period of time and/or which, pursuan to the reasoned opinion of the other Party acting in good faith, render the continuation of this agreement impracticabl or extremely onero by such other Party;
"The Term (s) of reference" or "ToR (s)" means the document to be prepared by the ETF, which shall be the basis for any Business Plan submitted by the Financial Intermediar in accordanc with article 8;

"The Transfer Obligation" means the condition of the donation of the right according to which the ETF has an obligation, in the circumstanc and on the terms and conditions set out under article 2.3 below, to transfer the right together with any assets and Liabilit Jeremie to Successors to the Entity;
"Transition management principles" means the principles each the activities to be carried out by the EIF in connection to the possible award of the role of the entity running the JEREMIE holding fund, after the review provided under article 15.2 below, to a third party, as agreed by the parties in the document attached as Appendix G of the heret. "Treasury guidelines" means the guidelines each set of the treasury management of the balance of the JEREMIE funds not drawn down , to be adopted by the project Steering Committee upon proposal by the EIF, and in accordanc with the outline provided in Appendix h. 1.2 subject to article 1.1 and save where the context otherwise requires: (a) the capitalised terms and expressions defined in Reg. 1083 and the Implementing Regulations have the same meaning when used herein, unless otherwise defined herein is;
(b) the capitalised terms and expressions defined in the preamble have the same meaning throughout this agreement, unless otherwise defined herein is;
(c) words denoting: (i) the singular number only shall include the plural number and vice versa also;
(ii) one gender only shall include the other gender;
(iii) persons only shall include companies and corporations and vice versa;
(d) any provision of any primary legislation shall be deemed by counterparties or also to refer to any modification thereof;
(e) headings shall be ignored in construing this agreement; and (f) the form of an integral part Appendic of this agreement and shall have effect accordingly.
2. the object of the agreement and the parties with Task 2.1 in entering into this agreement for the purpose of: (a) establishing the JEREMIE Holding Fund under article 44 (b) of the Regulation. 1083, and providing for the donation by the Government of Latvia of the right prescribed in article 2.2 the EIF;
(b) defining the rules for the implementation and operation of each of the Fund as prescribed in the JEREMIE Holding Reg. 1083 and the Implementing Regulations;
(c) setting out the information required under article 43, para. 5 and 6 and article 44, para. 1 and 2 of the Implementing Regulation; and (d) determining the amount and the terms of the recovery of costs by the ETF, in compliance with the Protocol and Decision as contemplated in article 44 (b) of the Regulation. 1083 and article 43, para. 4 of the Implementing Regulation.
2.2 In order to establish and fund the JEREMIE Holding Fund, the Government of Latvia hereby donates their ETF, on the terms and conditions set out in this agreement, the right subject to the Task and the EIF hereby, on the terms and conditions of this agreement, accept from the Government of Latvia the Right to be burdened with the Task. Therefore, the parties agree that the Andean acknowledg donation contemplated hereby is subject to the Task that the right (i) is being donated for the special purpose that the EIF acts as the JEREMIE Holding Fund it implementations that the JEREMIE initiative in Latvia, in accordanc with article 44 of Regulation. 1083 and this agreement, and (ii) shall be exercised by the EIF in accordanc with, and subject to, the provision of this agreement.
2.3 In addition to the burden of the Task, the donation of the right by the Government of Latvia to the EIF under this article 2 is subject to the obligation, referred to as the Transfer Obligation, as follows. Upon termination of this agreement, for whatever reason this may occure, should the Government of Latvia, from later communicate than 90 days before the effective termination date, that it has selected Entities, Successors to the EIF shall (a) without delay transfer of their Successors unreasonabl such Entity the right, together with any assets and Liabilit Jeremie to existing at the relevant time, as a unity of rights and assets ("sense") in the meaning of the Latvian property law. It is understood for the avoidance of doubt that the ETF, in carrying out its Obligation, under the IR from the Transfer of circumstanc: (i) assess the legal framework of the selection of the Entity, the Successors of the latter, suitability or any other aspect of the selection of the Entity, which shall be the Successors carried out by the Government of Latvia under its sole responsibility;
(ii) be required to assume any liability of any nature in connection with the transfer of any assets and Liabilit Jeremie to the Entity under article Successors 15.9. Jeremie Holding Fund 3 3.1 the parties agree that the JEREMIE Holding Fund shall be established as a separate block of finance "within the EIF, as permitted under article 43, para. 3 of the Implementing Regulation.
3.2 In order to establish a separate block of Finance within itself, in accordanc with article 43, para. 3 of the Implementing Regulation, shall establish the EIF JEREMIE account, denominated "project JEREMIE HOLDING FUND Latvia-account", it all matters relating the administrat the JEREMIE funds in accordanc with this agreement. For the avoidance of doubt, the account shall not be JEREMIE a bank account, and shall not be capable of receiving any mon in respect of the JEREMIE funds. The EIF shall record all transactions in respect of the JEREMIE JEREMIE funds in the account. All transactions shall bear the value data for the computation of interest.
3.3 In order to be enabled to perform the Task, which includes the JEREMIE Actions, the JEREMIE Holding Fund shall receive contributions from the State budget of the Republic of Latvia in accordanc with the funds allocated to the Operational Programme, including the national contributions and, if applicable, other contributions contemplated in this agreement and payable in accordanc with article 11 below. In order to receive such non and for the purpose of this agreement, for the benefit of the Government of Latvia, the EIF shall not open any cessary JEREMIE Bank accounts, and the account, Jeremie Additional Banks in its name with a credit institution suitabl operating within the European Union to be selected by the EIF in compliance with applicable law.
3.4 the account the JEREMIE JEREMIE Bank account and the Bank account JEREMIE Additional shall at all times and in all respect be used, or otherwise disposed of, committed separately from other resources, the EIF and shall be used exclusively for the performance of the JEREMIE Actions in accordanc with this agreement.
3.5 the following payments from the Bank account shall be the JEREMIE validly made by a duly authorised signator by ETF'S: (i) payments required in connection with the operations;
(ii) payments of the ETF'S direct costs due to sharp reimbursemen ETF for the performance by the ETF of the Task, which includes the JEREMIE Actions, as provided under article 10 and under the Costa of the Appendix;
(ii) payments of the Associated Expense, in accordanc with the Costa of the Appendix;
(iv) the investment of any balance of the Bank account the JEREMIE in accordanc with the Treasury guidelines;
(v) any other payment connected to the implementation of the Tasks in writing expressly authorised by the Government of Latvia and the EIF jointly.
3.6 Any payment from the Bank account, Jeremie Additional which is expressly authorised by the EIF and the Government of Latvia jointly in accordanc with article 11 below, shall be validly made by a duly authorised signator by EIF.
4. Jeremie Actions 4.1 To comply with the Task, the EIF shall perform the JEREMIE Actions, which shall include the following: 4.1.1 the pursuit of the strategy set out in the Investment Strategy and Planning and of the investment Business Plan;
4.1.2 the Revision of the Investment Strategy and Planning in accordanc with article 7, draft and revision of the investment Business Plan in accordanc with article 7.3, and submission of the relevant proposals to the project Steering Committee;
4.1.3 Preparation of the terms of reference in accordanc with article 8, Selection of appropriate Financial Intermediar (by call for expression of interest and/or other relevant tools in accordanc with applicable law, and in any case in accordanc with the principles of equal treatment, non-discrimination and transparency) which shall receive contributions from the JEREMIE Holding Fund, in the framework of operations , for the purpose of implementation of the JEREMIE strategies as defined in the Investment Strategy and Planning and along the lines of the investment Business Plan;
4.1.4 negotiation of terms of operations, execution and implementation of the Operational agreements in accordanc with the terms of the legal documentation thereof;
4.1.5 portfolio management of the contributions from the Fund to the JEREMIE Holding operations, including any actions it is appropriate, deemas in accordanc with suitabl and market-standard services, in case of breach of the relevant Operational agreements by the relevant Financial Intermediar, provided that, should the EIF shall be appropriate not to take de any action in case of a breach by a Financial Intermediary generating a loss which is likely it exceeds 100 EUR 100.000 This decision shall be subject to (a) a favourabl opinion from the project Steering Committee;
4.1.6 reasonable assistance in collecting relevant information in order to allow cessary not the Government of Latvia to comply with applicable EU rules on State aid, with the exclusion of overall monitoring and review of compliance with EU rules on State aid, which shall be the Government of Latvia's sole responsibility, in accordanc with Appendic-(A), (B), (C) and (D). The Government of Latvia indicates to the EIF shall in writing the type of information required by it for the purpose of the preceding line.
4.1.7 Reporting to the Government of Latvia, through the project Steering Committee, on the progress of the various operations in accordanc with article 14 and Appendix C;

4.1.8 Identification of opportunities for Co-investments, negotiation of commercial terms of Co-investments and execution of the Co-investment agreements, in accordanc with the Investment Strategy and Planning and along the lines of the investment Business Plan;
4.1.9 the Treasury management of the balance of the JEREMIE funds not drawn down, also by outsourcing and/or subcontracting to third parties all or part of the relevant activities, in accordanc with the Treasury guidelines; and 4.1.10 All activities connected to the possible award of the role of the entity running the JEREMIE holding fund, after the review provided under article 15.2 below, to a third party, in the manner provided under the Transition management principles.
4.2 the EIF shall be responsible for its internal administration in relations to the performance of the JEREMIE Actions. The EIF shall designat a project manager, who shall act as the central point of contact for the Government of Latvia and for the project Steering Committee in connection with this agreement.
4.3 the EIF shall establish an Office in the Corporation, which shall be operational upon occurrence of the initial disbursemen to the JEREMIE Holding Fund in accordanc with article 6.1 (i) and which shall be adequately staffed, as may be required by the scope of the JEREMIE Actions in accordanc with the Investment Strategy and Planning and in line with the investment Business Plan.
4.4 In performing the Action shall be the EIF JEREMIE, entitled to retain services of attorney and external consultants, such as tax and legal adviser, for specific tasks in connection with the JEREMIE Actions requiring, at the reasonable opinion of the EIF, expert advice. When procuring such services, the EIF shall ensur that (i) the scope of such services is connected to the scope of this agreement, (ii) the fees payable for such services are established on competitive market terms, and (iii) the services rendered by the external consultants with a reasonably evidenced.
5. Project Steering Committee 5.1 the of its compliance with the Task, the ETF's performance of the JEREMIE Actions, as prescribed in article 4, shall be subject to the provision relating to the project by the Steering Committee, as prescribed in this article 5. The parties that any resolution acknowledg taken by the project Steering Committee shall always be taken by the latter after appropriate assessment of the position of the Responsible Authority and of the Managing Authority, and that, for all of the ETF'S purpose of the EU Structural Funds regulations, shall be entitled to assume safely, without further enquiry, that any decision and resolution taken by the project Steering Committee fully reflec the position of the Responsible Authority and of the Managing Authority. For the avoidance of doubt, of resolution of the project Steering Committee shall be deemed as delegation to the project Steering Committee of the Managing Authority's or the responsible Authority's responsibilities, and the respectiv the Managing Authority and the Responsible Authority shall remain competent for its duties and responsibilities in accordanc with the EU Structural Funds Regulations and related Latvian law.
5.2 the Government shall establish a corporation of Project Steering Committee, which shall be ordinary consis of five members appointed by the Responsible Authority, among its personnel, that of the Managing Authority, or among the reputabl experts in the field of SMEs financing. The Responsible Authority shall also be appoin, among the ordinary members, the Chairman and the Vice-Chairman of the project Steering Committee.
The EIF shall be entitled to up to two designat of it to officials who will be participating in the sessions of the project Steering Committee as Observer, the PSC provided that, for the avoidance of doubt, the Observer will not be the PSC the PSC members. The project Steering Committee shall have the right to it from time to time designat, on an ad hoc basis, other individual as Observer, the PSC in case it deemas that the participation of such individual is appropriate considering the agenda of the project Steering Committee.
5.3 the term of Office of each Member of the PSC, the PSC and the Observer, others than those appointed on an ad hoc basis, shall be two years and the re-appointment for additional terms shall be permitted. If the position of an PSC Members for any reason whatsoever vacat, the Responsible Authority shall without delay of a new unreasonabl appoin PSC Members for the remainder of the term of Office of the Members of the PSC substituted (for the avoidance of doubt, and subject to the remaining provision of this article, the project Steering Committee shall be able to carry out its tasks under this agreement without such substitution having taken place). For the avoidance of doubt, the principles set out in article 5.2 in respect of the composition of the project Steering Committee shall also apply to the replacement of any Member of the PSC in the contemplated in this by circumstanc article 5.3 5.4 the first PSC members shall be appointed by the Responsible Authority within one month from the date of the effective date of this agreement.
5.5 the PSC members shall not be entitled to compensation and/or any of the expense incurred reimbursemen for in performing their duties by the JEREMIE Holding Fund.
5.6 the project Steering Committee shall be responsible for the tasks entrusted to it under this agreement, and namely for the following matters: 5.6.1 Expression of opinion on draft, submitted by the EIF, relating to any amendments or revisions of the Investment Strategy and Planning and/or of the investment Business Plan, provided that, before approving any such draft, the project Steering Committee shall obtain any required approval of the Procura from any appropriate authority within the Government of Latvia;
5.6.2 Review of the progress made and the strategy of the JEREMIE Holding Fund, the approval of the progress reports, and discharge of the ETF for performing the Tasks, including the JEREMIE Actions, during the reference period of each approved Annual progress report in accordanc with this agreement;
5.6.3 Adoption of the rules of internal organisation which the project Steering Committee is appropriate, deemas such as those provided under article 5.12;
5.6.4 Approval of the draft Annual budget submitted by the ETF, or expression of objection theret, as per article 10.4 below;
5.6.5 Expression of opinion on the team allocated by the ETF to the activities connected to this agreement, including the project manager appointed by the ETF under article 4.2 above;
5.6.6 Expression of opinion on the activities carried out by the EIF in the frame of the Transition management principles, and on the progress of made thereunder;
5.6.7 Approval of any requests relating to Non-eligible Expense per axis of article 11.2 below;
5.6.8 Approval of the Treasury guidelines, upon proposal from the ETF, in accordanc with the outline provided in Appendix H;
5.6.9 Expression of opinion on the activities carried out by the EIF in the cases provided under article 4.1.5 above.
5.7 In addition to taking decision and expressing opinion in accordanc with article 5.6, the project Steering Committee shall, on the basis of the information provided by the EIF, carry out the following tasks: Regular monitoring of ETF's 5.7.1 overall compliance with the Task, and the performance of the JEREMIE Actions, of the performance and impact on the Latvian economy of the JEREMIE Holding Fund and of the performance of the operations , in accordanc with the objective of JEREMIE, the Operational Programme and the Investment Strategy and Planning, and the investment Business Plan;
5.7.2 If not cessary, issuance of recommendations of statements of principles of a general nature (i.e. any other, not relating to ... single operations) the ETF and to the Government of Latvia regarding the performance of the JEREMIE Action, the further development of the activities of the JEREMIE Holding Fund and/or further activities directed at optimising the impact on the Latvian economy of the JEREMIE Holding Fund and of the JEREMIE Actions.
For the purpose of the above, the project Steering Committee shall have a right to request it, and the ETF ETF shall provide accordingly, any reasonable information and any available document concerning the activity of the JEREMIE Holding Fund.
5.8 the project Steering Committee shall hold meetings at least quarterly. The Chairman shall conven the meetings of the project Steering Committee upon its own initiative or upon the written request of any two members of the PSC, the Responsible Authority or the EIF. Decision by the project Steering Committee shall be adopted by simple majority of the members of the PSC who is present, with a minimum presence of the three members of the PSC being required.
5.9 In the case provided under article 5.6.1, 5.6.5, 5.6.6 and 5.6.9 above, the project Steering Committee shall be entitled to express either positive or negative-opinion on the draft submitted by the EIF and shall not have the power it indicates the amendments or changes to such draft. The EIF shall take into account the opinion is expressed by the project Steering Committee, and in particular shall not execute those parts of the draft decision on which the project Steering Committee has given a negative opinion of.
In the cases provided under articles 5.6.2, 5.6.4, 5.6.7 and 5.6.8, the project Steering Committee shall be entitled to approve or to rejec ETF's proposal, and shall not have the power to amend such proposals in the EIF has consented in writing unless it any such amendment.
5.10 the ETF will take care of the Secretariat to the project Steering Committee, and will carry out all the ancillary administrative activities aimed at enabling the project Steering Committee to carry out its task. This will include namely sending the relevant communications and documents to be discussed the PSC members and Observer of the PSC.

5.11 the project Steering Committee shall be entitled to take the decision and express the opinion under article 5, others than by a meeting in accordanc with article 5.8, also by written procedure, or by a no-objection procedure (taci procedure), as such procedures will be determined through internal rules of the project Steering Committee in accordanc with article 5.12 5.12 the project Steering Committee shall be entitled to its own their adop internal rules , after consultation with the EIF, which shall comply with the provision of this agreement, provided that: (i) the project Steering Committee shall be convened by the Chairman or, in his absence or vacancy here,/by the Vice-Chairman;
(ii) the call of any meeting of the project Steering Committee shall be communicated to the members of the PSC, and copied to the PSC, by fax or e-mail the Observer, to be received from later than ten business days before the scheduled date for the meeting, or, in case of urgency, no later than two business days before the scheduled date for the meeting;
(iii) the communication of call shall include at least the date, time, venue and agenda of the meeting;
(iv) the Chairman, or in his/her absence or vacancy of the Vice-Chairman, shall be entitled to open the discussion on each point of the agenda, it regulat the debate, and to certify the vote. New points, not included in the communication of call, may be added to the agenda only if all members of the PSC in the Office so agree;
(v) any decision of the project Steering Committee shall be accounted for in minutes, drafted by the Chairman (or in his/her absence, or vacancy, by the Vice-Chairman) or by a person appointed by the same from time to time.
5.13 Any communications to the project Steering Committee shall be validly effected if made it the address of the Responsible Authority in accordanc with article 17.1, or to such other address or in such other manner as the project Steering Committee may communicate it to the EIF.
5.14 PSC members shall respect the defined standard of integrity and shall abstain from action that could induce a conflict of interest in the discharge of their duties.
6. Funding of the JEREMIE Holding Fund 6.1 To enable the ETF to exercise a right, the Government of Latvia shall transfer it to the EIF and pay into the Bank account the JEREMIE a total amount of € 183,185,892 between the execution of this agreement and 31 December 2010, as follows: (i) a first tranche of EUR 91,500,000 shall be paid without delay and as soon as the unreasonabl technically possible following approval of the investment Business Plan in accordanc with article 7.3;
(ii) a second tranche of EUR 91,685,892 shall be paid on the date to be decided by the parties, taking into account the last approved Annual progress report, the Investment Strategy and Planning, the investment Business Plan and the level of the JEREMIE funds actually invested in operations up to the relevant data.
6.2 In relations to the disbursemen the contemplated under article 6.1 (ii) above, and within the limit of the contemplated therein, the Government of Latvia shall Procura that an adequat amount of funds is made available to the JEREMIE Holding Fund in order to ensur the optimised implementation of the Investment Strategy and Planning and to enable the ETF to perform the tasks of the JEREMIE Holding Fund. The Government of Latvia shall in particular take all action required in order to effectively make the disbursement to the EU by pursuan Structural Funds regulations and any other regulations of the European Union being relevant for Jeremie and/or the JEREMIE Holding Fund at any given time.
6.3. Subject to the approval by the Commission of the eligibility of the relevant expenditure is under the EU Structural Funds regulations, and subject to all other action having been taken by cessary not the Commission, the parties will consider a contribution to the JEREMIE Holding Fund from the operational program "Infrastructure and services" of an additional amount of EUR 23,000,000 to be used for the financing of SMEs active in the field of improvement of heat insulation of multi-apartment residential building in Latvia.
7. Investment Strategy and Planning 7.1 It comply with the Task, the EIF shall perform the JEREMIE Actions in accordanc with the Investment Strategy and Planning, as it is set out in Appendix A, in accordanc with the terms of the EU Structural Funds regulations and on the basis of the Operational Programme.
7.2 Should the ETF or the Government of Latvia shall not cessary, de it the Investment Strategy and Planning may be revised taking into account: 7.2.1 the performance and the impact on the Latvian economy of the JEREMIE Holding Fund until such time;
7.2.2 any change of the underlying legal regulations for JEREMIE (including but not limited to the EU Structural Funds regulations);
7.2.3 any change in the Operational Programme related to the operations supported through the JEREMIE Holding Fund; and 7.2.4 any recommendations issued by the project Steering Committee.
Should such revision shall be deemed not cessary, EIF submit a draft of the revised Investment Strategy and Planning to the project Steering Committee and the revised Investment Strategy and Planning shall be approved taking into account the opinion of the project Steering Committee, in accordanc with article 5.6.1.7.3 As soon as technically possible, and no later than 30 days after execution of this agreement , The EIF shall prepare and submit to the Responsible Authority a draft investment Business Plan, which shall provide details of the activities which they carry out the EIF plans in line with the Investment Strategy and Planning over a three year period. The Responsible Authority shall approve it, or make it the same objection, within 30 days from submission.
8. the terms of reference and Business Plan 8.1 In respect of each Operation, the terms of reference shall be prepared by the EIF and shall be the basis for any Business Plan submitted by the Financial Intermediar in accordanc with this article 8.4 8.2 Each Term of reference shall: (i) be formulated in accordanc with the terms of the EU Structural Funds regulations and on the basis of the Operational Programme;
(ii) to comply with, and reflec the selection criteria as approved each time by the Monitoring Committee; and (iii) be consistent with the Investment Strategy and Planning, and with the principles set forth in the investment Business Plan.
8.3 In respect of each Operation, business plans shall be submitted to the EIF by the relevant Financial Intermediary and thereafter by the EIF in its capacity assessed as JEREMIE Holding Fund.
8.4 Each Financial Intermediary shall be required to draft its Business Plan in accordanc with the relevant terms of reference. In any case, any Business Plan shall include the elements set out below: (a) the targeted market of enterprises and the criteria, terms and conditions for financing them;
(b) the operational budget of the Financial Engineering instrument;
(c) the ownership of the Financial Engineering instrument;
(d) the co-financing partners or shareholder;
(e) the by-laws of the Financial Engineering instrument;
(f) the provision on professionalism, competence and independence of the management;
(g) the justification for, and intended use of, the contributions from the EU Structural Funds;
(h) the policy of the Financial Engineering instrument concerning exit from investments in enterprises;
(i) the winding-up provision of the Financial Engineering instrument, including the reutilisation of resources returned to the Financial Engineering instrument from investments or left over after all of the guarantee have been honoured, attributabl to the contribution from the Operational Programme.
9. Operation 9.1 the selection of Financials to be implemented by the EIF shall Intermediar in accordanc with the selection criteria approved by the Monitoring Committee, the Investment Strategy and Planning and with applicable law, and in line with the investment Business Plan.
9.2 Execution and amendments of Operational agreements on behalf of the JEREMIE Holding Fund shall comply with the selection criteria as approved by the Monitoring Committee. In the case of amendments of such criteria by the Monitoring Committee, the amended criteria shall apply effective from the date of communication of such amendments by the Government of Latvia to the EIF.
9.3 Any Operational agreement shall, notwithstanding any other terms set out in this agreement include the following conditions: 9.3.1 the obligation of the Financial Intermediary to pursu the objective set out in of the Operational agreement;
9.3.2 the regular reporting by the Financial Intermediary to the ETF in a standardised form and scope;
9.3.3 the obligation of the Financial Intermediary to allow access to documents related to the Action for any national or the JEREMIE European entity duly empowered by the applicable law to carry out the audit and/or control activities;
9.3.4 the obligation of the Financial Intermediary to carry out marketing and publicity campaigns adequat, focussed in the relevant territory as appropriate, aimed at making the JEREMIE initiative known to the SM in the relevant territory, in line with the relevant provision of the EU Structural Funds regulations;
9.3.5 the procedure for submission of the annual accounts for the Operation by the EIF and the Financial Intermediary auditing procedures to be complied with by the Financial Intermediary;
9.3.6 the right to recover any loss of EIF's due to a breach by a Financial Intermediary of its obligation under the relevant Operational agreement, in accordanc with suitabl and market-standard services. The EIF shall not provide for any arbitration services in such Operational agreements, unless with the consent of the project Steering Committee;
9.3.7 the right of the Financial Intermediary to payment of market-standard management Costa, in accordanc with article 43. 4 of the Implementing Regulation;

9.3.8 a substitution and/or nomination right of the Government of Latvia in order to ensur the transfer of the Operational agreement to any Entity, as provided under the Successors of article 10.1 below;
9.3.9 in the investment agreements between the Financial Intermediary and the enterprises for the financing of the enterprises from the Operations, the Financial Intermediary shall provide that: (i) such enterprises shall keep records of the investment or other financial contributions made by the Financial Intermediary at least until 31 December 2021, unless, under the relevant Operational agreement, the relevant Financial Intermediary will have accepted it to keep such records with it;
(ii) the Financial Intermediary shall be entitled to recover any loss due to a breach of by the enterprises of their obligations under the relevant investment agreement;
(iii) the Financial Intermediary shall diligently, whethers by negotiation or legal action, enforce its claims against such enterprises;
(iv) the representatives of the Government of the United Kingdom, the Commission and the EIF may access the premises and documents of such enterprises for the purpose of ensuring the legality and regularity of the financing from the Operations and of the enterprises ' business;
(v) the relevant financing comes from EU Structural Funds in for;
(vi) such enterprises shall engage in no action or decision contrary to Community rules, particularly rules concerning competition;
(VII) such enterprises shall comply with the publicity, Visual identity and reporting of irregularit to requirements provided for by the EU Structural Funds regulations and Latvian law.
9.4 Any Proceed of operations shall be paid to the Bank account the JEREMIE with out any of the delay, and shall be unreasonabl made available to the JEREMIE Holding Fund, and shall be re-invested in accordanc with this agreement and the Investment Strategy and Planning, and along the lines of the investment Business Plan.
10. Costa 10.1 the Government of Latvia for that ETF acknowledg's compliance with the Task, which includes the JEREMIE Actions, will entail the occurrence of the Costa, which the EIF shall be entitled to recover, as contemplated by article 43, para. 4 of the Implementing Regulation. EIF's right to receive payment of the direct costs of the ETF is integral part of the right donated to the EIF according to this agreement and to the Latvian pursuan Civil Law.
Subject to article 10.2 below, all costs shall be withdrawn from the funds available in the Bank account the JEREMIE in the manner set forth by the timing and the parties in the Costa of the Appendix. After the end of any calendar year, the EIF shall submit it to the project Steering Committee, (a) a statement providing information on the costs incurred in the previous calendar year; the format of such statement, as well as the timing, manner and the consequences of it for submission to the project Steering Committee, provided for the set in the Costa of the Appendix. The parties agree that acknowledg and the Costa of the Appendix is the document where they intended to provide in detail for the calculation and payment of the modalit of the Costa, and that therefore, in the case of any conflicts between any terms of the Funding Agreement relating with calculation and payment of the modalit of the Costa and those of the Costa of the Appendix, the terms of the Appendix shall be Costa prevails.
10.2 In the event that, notwithstanding the approval of the investment Business Plan by the Responsible Authority, of the pay men of funds under article 6.1 (i) above is made before 31 December 2008: (i) the Parties shall without any delay enter into consultation of the undu to determin appropriate steps for implementing this agreement and performance of obligations of their respectiv. Such consultation shall be concluded by 31 January 2009;
(ii) the EIF shall be entitled to claim, and the Government of Latvia shall be obliged to pay the Initial costs incurred any ETF, after the execution of this agreement, for the avoidance of doubt, with the exclusion of any interest to which such amount would have borne had the payment been made by respectiv in accordanc with this agreement and the Costa of the Appendix.
The Government of Latvia shall pay the Initial costs on demand by the ETF following the end of the consultation period, unless in the meantim fund have been paid into the Bank account by JEREMIE the Government of Latvia in accordanc with article 6.1, in which case the EIF shall be the applicable deduc Costa from the funds available in the Bank account the JEREMIE.
10.3 the parties agree that the aggregate of the ETF'S direct costs and the Associated Expense-paid out during the term of this Agreement shall not exceeds 100 the maximum amount provided for under article 43. 4 of the Implementing Regulation.
10.4 the EIF shall communicate it to the project Steering Committee the draft Annual budget for any calendar year from later than 15 November of the previous calendar year, provided that the draft Annual budget for the year 2008 shall be communicated by the ETF to the project Steering Committee on the first meeting of the latter. The project Steering Committee shall notify, within thirty days from receipt, approval of, or its objection to, the relevant draft Annual budget. The following shall apply: (i) should the EIF receive the approval from the project Steering Committee, the Annual budget shall be considered as approved on the date the ETF received the approval from the project Steering Committee;
(ii) should not receive the EIF ither approval nor objection from the project Steering Committee, the Annual budget shall be considered as approved at the end of the thirtieth day after receipt of the draft Annual budget by the project Steering Committee;
(iii) should receive any objection from the EIF to the project Steering Committee, the EIF shall, within fifteen days from receipt, take into account such objection in good faith, taking any action it is appropriate to this deemas purpose, including discussing the objection with the project Steering Committee and/or the Responsible Authority, and submit an amended Annual budget to the project Steering Committee in its discretion. Such version shall be deemed as a further new draft Annual budget for the purpose of this article 10.4.11. Non-eligible Expense of 11.1 Non-eligible Expense shall be validly paid for from time to time by the EIF, during this agreement, out of the funds available in the account at Jeremie Additional Bank the relevant time, as long as they are approved by the project Steering Committee.
11.2 At any time any of the Non-ETF forese eligible Expense, it shall communicate it to the project Steering Committee (a) the request for funding, including the relevant amount and time of payment, (a) a brief description of the reason of such Non-eligible expense, and a mention of the grounds which suggest the non-eligibility of the same. The project Steering Committee shall, within thirty days from receipt to approve or rejec the request, provided that, in case of approval, the decision shall provide for the payment of the relevant amount into the Bank account in JEREMIE Additional line with the timeline set forth in the approved request. It is understood that of the approval will be given by the project Steering Committee should the relevant Non-eligible expense be the consequences of wilful or gross misconduc not gligenc by the EIF.
12. Ancillary undertaking of the parties 12.1. The Government of Latvia hereby undertak 12.1.1 the you: it will provide all information and assistance not cessary in accordanc with reasonable requests by the EIF in order to enable it to perform the EIF JEREMIE Actions in accordanc with the terms of this agreement;
12.1.2 it will keep the ETF prior to the amendment or change of any laws or other regulations which in the reasonable opinion of the Government of Latvia may have an adverse effect on the availability of funds for the JEREMIE Holding Fund or on the performance of the tasks in the JEREMIE Holding Fund accordanc with this agreement;
12.1.3 it will carry out without delay by the cessary unreasonabl assessments to ensur is compliance with the EU rules on State aid, and will carry out any notifications towards the Commission for operations in relations to which such notification is required under the EU with the rules on State AIDS;
12.1.4 it will comply with its obligation under the EU Structural Funds regulations and any other applicable Community rules, the irrespectiv of the EIF's assistance on specific tasks as provided under this agreement.
12.2 you hereby undertak the ETF: 12.2.1 it shall provide the Government of Latvia with all reasonable assistance as may be required from time to time with respect to state aid, as provided under article 4.1.6 above;
12.2.2 it shall establish its internal administration in a manner aimed at ensuring an effective performance of the JEREMIE Action and compliance with the Task;
12.2.3 it shall open an Office in Latvia, as provided under article 4.3 above.
13. Liability 13.1 where they are not already in place, the EIF shall implementations that adequat internal policies in order to ensur that the JEREMIE Actions is performed in compliance with this agreement.
13.2 Any liability of the EIF to the Government of Latvia under this Agreement shall be limited to cases of wilful misconduc and gross gligenc not by the EIF. For the avoidance of doubt, the EIF shall not be liabl for: (i) the financial performance of the JEREMIE Holding Fund or for the financial results of any of the operations, (ii) any loss caused as a result of breach by the Financials of their obligation under Intermediar to the Operational agreements, except in case any of the above is a direct consequences of wilful or gross misconduc not gligenc by the EIF.
13.3 No ither of the Parties shall be liabl for any indirect, consequential or other similar damage.

13.4 Any liability of the EIF in connection with this Agreement shall further be excluded to the exten to any action by the EIF, which but for this provision would cause liability of the EIF under this agreement, is based on official information received from the Responsible Authority, including, but not limited to, any information set out in the relevant National Strategic Reference Framework or in the Operational Programme , whereby the ETF shall not assume any obligation to independently verify the accuracy, relevance or completenes of any such information. In this article 13.4, the expression "official information" shall mean any information provided to the ETF in a written document (other than electronic document) issued by an official of the Responsible Authority.
8.4 the Government of Latvia shall indemnify and hold harmless the ETF for (a) any reasonable costs or documented expense and (b) any liability incurred by the EIF as a result of a third party claim against brough a result of ETF ETF performing the JEREMIE Actions. Such obligation to indemnify shall: (i) exist only in the event that the costs, expense or damage the ETF'S have not been caused by wilful or grossly misconduc not gligen action or omission by the ETF and that the ETF has diligently defended such claim;
(ii) be limited to the maximum of EUR 500.000 per each indemnified claim.
13.6 Liability of the Government of Latvia under or in respect of this Agreement shall in all cases and irrespectiv of the cause or the ground of liability be limited to its obligation to cover the costs, to pay the Initial costs and to make the other payments, if any, expressly provided for in this agreement.
14. the Monitoring, Reporting, Auditing 14.1 the Parties shall comply with their monitoring, reporting and auditing respectiv obligation as set out in (B), (C) and (D) of Appendic. 15. Effective date; Termination 15.1 this Agreement shall become effective upon the date of its execution by the Government of Latvia and the ETF and is entered into for the period from the date of its execution until the date of issuance of the final report on the Operational Programme, such period being deemed by the parties does not view it as with a ETF cessary enabling it to carry out the Task , also in compliance with the provision of Reg. 1083. Within 6 months before the end of such period, the Parties shall meet in order to agree upon the opportunity to extend the term of this agreement for a further period to be agreed by the parties.
15.2 the parties agree that, on the acknowledg and 30 June 2011, the Government of Latvia shall have the right: (i) to review the progress and strategy of the JEREMIE Holding Fund;
(ii) subject to the review mentioned under article 15.2 (i) above, to terminate this agreement, in accordanc with the provision of article 15.5 below; and (iii) in compliance with EU Structural Funds regulations including, but not limited to, with article 44 of Regulation. 1083, you enter into a new funding agreement with a third party, which shall perform the JEREMIE Holding Fund tasks, or their appoin Successors Entity under a. Article 2.3 of this agreement.
15.3 During the term of this agreement, either of the parties may at any time terminate this agreement with immediate effect by notifying the other Party thereof that a Termination for cause has occurred.
15.4 In particular, and without prejudice to the generality of the grounds which may give rise to a Termination for cause: (a) the Government of Latvia may declare a Termination for cause in case of failure by it to comply with the Tasks of the EIF and more particularly, in the case of: (i) a failure by the EIF to comply with the strategies defined in the Investment Strategy and Planning , or (ii) a failure to comply with any of the EIF by its material obligations under this agree men, in each case provided that the Government of Latvia has sent a warning notice stating such breach and the ETF ETF has not cured such breach within a period of sixty days from the date of receipt of the notice; and (b) the ETF may declare a Termination for cause in the case of (i) a failure by the Government of Latvia to the Procura disbursement to the Fund in accordanc JEREMIE Holding with this agreement so as to enable the ETF to exercise the right, or (ii) a default by the Government of Latvia in payment of any amount due to the EIF under this agreement in excess of EUR 100.000 for a period of more than sixty days , or (iii) a failure by the Government of Latvia to comply with any of its material obligations under this agreement in case such failure would prevent the ETF from exercising the right and fulfilling the Task in compliance with this agreement, or (iv) subject to the parties ' consultation prescribed in articles 10.2, transfer of funds in accordanc with article 6.1 (i) does not occure before 31 December 2008 in each case, provided that the ETF has sent a warning notice to the Government of Latvia such breach and stating the Government of Latvia has not cured such breach within a period of sixty days from the date of receipt of the notice.
In the event of Termination for cause, any expense in connection with the termination of this Agreement shall be borne by the Party whose fault gave rise to the termination.
15.5 without prejudice to the right of the parties to declare a Termination for cause at any time, this agreement may be terminated in the absence of cause only effective on or after the Termination date the Earlies Ordinary at the earlies, following a six month prior notice by either Party. Even before the Earlies to Ordinary Termination date, the EIF shall be entitled to terminate this agreement, in case the Republic of Latvia, or any public authority duly empowered within the Republic of Latvia, amend or change the law or other regulations which, in the reasonable opinion of the EIF, may have a material adverse impact on the activities, or on the performance of the JEREMIE Holding Fund and consequently on the ETF's ability to perform the Task and comply with the special purpose for which this agreement was concluded.
15.6 In case of termination of this agreement, the EIF shall be released from any obligation to perform the JEREMIE Actions as of the effective date of such termination. All non in respect of which it is entitled by the EIF Costa concerning the period prior to the effective date of the termination shall become due and payable as of such date. The EIF shall refund a portions of the costs òàæó to the amount of the costs for the remaining term of the received this agreement from the effective date of the termination until 31 December of the year of the termination (based on the number of remaining full months) within fifteen days from the effective date of the termination.
15.7 Upon termination of this agreement other than a Termination for cause: (i) in the case of termination due to expiration of the term, all expense incurred by of the EIF JEREMIE Holding Fund and in connection with such termination, including regarding the transfer of the expense of the right and of the assets and Liabilit JEREMIE, including the Operational agreements and/or Co-investment agreements their Successors, the Entity or to the Government of Latvia, as may be applicable, shall be borne by the Government of Latvia or by the Successors as applicable Entity;
(ii) in the case of early termination, including under article 15.2 above, all of the expense incurred by the EIF JEREMIE Holding Fund and in connection with such termination, including regarding the transfer of the expense of the right and of the assets and Liabilit JEREMIE, including the Operational agreements and/or Co-investment agreements, to the Entity or their Successors the Government of Latvia, as may be applicable , shall be borne by the EIF as JEREMIE Holding Fund up to the amount of € 50.000, and by the Government of Latvia or the Entity for any excess Successors.
15.8 All Operational agreements and all Co-investment agreements shall provide for substitution and/or nomination rights of the Government of Latvia in order to ensur the transfer of such agreements to the Entity, or Successors to any newly appointed entity, in the case of termination of this agreement. Accordingly, in the case of termination of this agreement: (i) all agreements and all Operational Co-investment agreements shall remain effective between the relevant Financial Intermediary Entities, and the Successors or the entity newly appointed as JEREMIE holding fund; and (ii) all commitment and obligation provided for in the Operational agreements and the Co-investment agreements in force shall remain valid and fully effective vis-à-vis the Entities, Successors or the entity newly appointed as JEREMIE holding fund.
15.9 without prejudice to article 15.6, upon expiration or termination of this agreement, the right shall return to the Government of Latvia, and the balance of the JEREMIE funds credited to any Bank account and helps the balance of any funds credited to the Bank account the JEREMIE Additional, as well as any other assets and Liabilit JEREMIE, shall be transferred to the Government of Latvia , and as appropriate shall be credited with such bank account which the Government of Latvia shall communicate it to the EIF. All expense incurred by the EIF in connection with the transfer of any assets and Liabilit Jeremie to shall be borne as per article 15.7. Should the Government of Latvia have communicated it to the EIF the identity of the Entity as Successors provided under article 2.3 above, the EIF shall perform the Transfer Obligation. In such case, all expense incurred by the EIF in connection with the transfer of any assets and Liabilit Jeremie to shall be borne by the EIF up to the amount set forth under article 15.7 (ii) above, and shall be withheld from the JEREMIE funds to be transferred to the same, and for any excess by the Successors Entity.

Notwithstanding any other provision of the 15.10 article 15, in the event that an exceptional situation or event unforeseeabl is beyond any of the parties ' control occure (other than labour dispute, strikes or financial, and the difficult kind), including (without limitations) the cancellation or suspension of their an ac JEREMIE pursuan to of the European Union or otherwise, which prevents either of them from fulfilling any of their obligations under this agreement , which was not attributabl or not gligenc this error on their part and the process of insurmountabl in spits of all due diligence (each a "force majeure event"), the Party facing it shall inform the other Party without delay to a written notice pursuan ("notice of force majeure") stating the nature, duration and foreseeabl is probabl effects. Upon receipt of a notice of force majeure, the Parties shall immediately enter into consultation and make every effort to minimis any damage due to the occurrence of the relevant event of force majeure, it being understood that no party shall be held in breach ither of its obligation under this agreement if it is prevented from fulfilling them due to a force majeure event. If the parties, acting in good faith, ascertained that the continuation of the performance of the JEREMIE Actions and the compliance with the Task is impossible or extremely onero to as a result of the occurrence of a force majeure event, this Agreement shall be terminated and the provision of the second and third line of article 15.6 will apply.
16. Each Law; Dispute Resolution 16.1 this Agreement shall be governed by, and construed in accordanc with, the law of the Republic of Latvia.
16.2 the Parties shall use their best endeavour to settle any dispute, controversy or claim arising out of, or in relations to this agreement, including its validity, invalidity, breach or termination in an amicabl of anthropology. Any such dispute, controversy or claim not resolved in accordanc with the previous line is within a reasonable period of time, shall be submitted to mediation in accordanc with the Swiss rules of Commercial Mediation of the Swiss Chambers of Commerce in force on the date when the request for mediation was submitted in accordanc with the Swiss rules of Commercial Mediation. The seat of the mediation shall be Geneva, Switzerland, although the meetings may be held in another place mutually agreed upon by the parties. The mediation proceedings shall be conducted in English. If such a dispute, controversy or claim has not been fully resolved by mediation within 2 (two) days, it shall be settled by arbitration in accordanc with the Swiss rules of International Arbitration of the Swiss Chambers of Commerce in force on the date when the notice of arbitration was submitted in accordanc with the Swiss rules of International Arbitration. The number of arbitrator shall be of 3 (three), the seat of the arbitration shall be in Geneva, Switzerland, the CAs proceedings shall be conducted in English.
17. Final Provision 17.1 Any notice or communication by one Party to the other Party shall be made in writing and shall be delivered by registered mail or telefax (with transmission confirmation clearly stating in the subject, JER-003) to the following address: If the the Government of Latvia: Ministry of Economics Attn: State Secretary 55, Brivibas Street EN 1519 Riga Latvia Fax from + 371 67280882 If the ETF:: European Investment Fund Attn: Project Manager JEREMIE Hol ding Fund 43, Avenue J.F. Kennedy L-2968 Luxembourg Fax: + 352 426688 280 from LUXEMBOURG With copy to the ETF project manager acting as the contact point for and in Latvia.
Either Party shall notify the other Party in writing respectiv without delay of any change of the undu of the above address details. Until receipt of notification of such changes, a Party may serve notice validly to the last address notified to it duly. Any notice or communication to the Managing Authority shall be made in writing and shall be delivered by registered mail or telefax (with transmission confirmation clearly stating in the subject, JER-003) to the following address: Ministry of finance Attn: Managing Authority 1 Smils Street, LV, 1919, Riga, Latvia Fax: + 37167095503 17.2 this agreement constitut the entire agreement of the parties on the subject hereof and replace and any prior agreement of supersed.
17.3 Amendments to this Agreement shall be made in writing and shall become effective upon execution by the parties theret. Amendments to any of the Appendix shall be made in writing of and shall become effective upon execution by the Responsible Authority, on the one side, and the ETF, on the other side.
17.4 If a provision of this Agreement shall be held invalid or become unenforceable, the validity or the enforceability of the remaining and provision of this Agreement shall not be affected. The invalid or unenforceable provision shall be deemed replaced by a valid provision which will represent the enforceabl and the intention of the parties when agreeing on the invalid or unenforceable provision to the exten the possible utmos.
17.5 the Parties shall in good faith and gotiat not execute any amendments to the terms of this agreement, which may become cessary or not in case of an desirabl amendment of the EU Structural Funds regulations or laws or other regulations of the Republic of Latvia.
10.9 this agreement has been executed in two counterpart in the English language and two counterpart in Latvian language, each of which represent an authentic original of this document. In the case of the English version between the discrepanc and the Latvian one, the English version shall prevails.
Riga, Latvia, July 16, 2008. 
For the Government of the Republic of Latvia Minister of Economics For the European Investment Fund Chief Executive _____ ____ ___ _____/Kaspars Gerhard/_____ ____ ____ ____/Richard Pelly/Appendix (A) investment STRATEGY AND PLANNING Background 1 JEREMIE is a joint initiative of the European Commission (DG Regio) and the European Investment Bank Group, designed to give Member States the option of using a portions of their Structural funds allocations in the period 2007-2013 the industry establish a revolving Fund Holdings. The aim of Holding a Fund is to improve access to finance for small and medium-sized enterprises (SMEs) through a tailored portfolio of financial products. This Holding Funds can be managed by the European Investment Fund (EIF), an institution selected by public procurement procedure or a national financial institutions.
Since early 2007, the Government of Latvia has been working closely with the EIF to explore the benefits from implementing the Holding Fund concept. A key part of this process was the completion of a ' market failure analysis report ' completed by the EIF in July 2007 which gave a series of recommendations to the Ministry of Economics to consider. After due deliberation, the Government decided in April 2008 to implementations that the JEREMIE Holding Fund using a concept to be managed initially by the EIF.
The main areas of ' market failure ' assessed include: • the Existing guarantee schemes have insufficient resources and their market penetration is limited compared to their potential market size; the existing schemes do no present the efficiency of a guarantee scheme on a portfolio basis that will be more appealing to banks so that they promote it with more vigour;
• A lack of entrepreneurs indicates financing as the change removes it to start-up a business;
• The Bank should be encouraged to operate in the SME segment and to assume more risk and shift the focus of evaluation of an application from the collateral to the viability of the business plan;
• Insufficient private equity investments in the seed and start-up segments. First-time entrepreneurs have access to a number of the program offering small grants, but largely lack equity products which offer financing adequat is to support them through the critical first years of life;
• The Gap of expansion investment for the smaller companies established their capital increase needings production capacity, working capital and capital for the further development of the product or market;
• Insufficient level of Business Angel activity.
This Appendix A to the Funding Agreement sets out the Investment Strategy and Planning that the EIF intends on behalf of their implementations and with the support of the Government of Latvia to help address these failures. This investment Strategy and Planning has been prepared utilising the expertise and experience of the EIF has developed in managing similar mandate for other Member States and through the support of the Latvian guarantee Agency and the Ministry of economics. Furthermore in developing this strategy, a series of discussion meetings with market participants (financial intermediar) in various areas of the Latvian SME financing sector have contributed to the process of refining the proposed instrument. These discussions will need to continue as implementation activities as the financial progress will play a key role in the intermediar in the implementation of the financial engineering instrument.
2. The Latvian Holdings Fund Through the process of analysis of market data, discussions with market participants and negotiation with the ministries of Economics and finance, the EIF has created this investment Strategy and Planning, which has been approved by the Government of Latvia. The parties acknowledg that this investment Strategy and Planning is to be seen as a summary, and as a framework, of the more detailed implementation plan, referred to as "investment Business Plan", which has been discussed separately by the parties in draft form, and which the EIF shall submit to the Authority Responsible for approval as provided under article 7.3 of this agreement.
It is intended that a total of EUR 206 million be allocated to the program with the following areas of focus for the individual financial engineering instruments:

• Export insurance for € 30 m;
• Portfolio amounting to EUR 80 m guarantee;
• Housing efficiency amounting to EUR m (subject to approval of the Commission and the related amendments to the Financing Agreement);
• Risk Capital for a total of EUR 50.5 m;
• Technology Transfer for EUR 22.5 m.
This portfolio of instruments within the Holding Fund has the added benefit of creating a revolving process which allows the Government of Latvia to the long-term maximis market impact of Structural Funds. Funds invested through these mechanisms in favour of SM, that provide returns to the Holding Fund will become available for reinvestmen in support of companies upon decision of the Government. It illustrat this important aspect, the investment Business Plan will ex plain in detail how each instrument is expected to operate and how the portfolio as a whole combines to create returns over time.
That document also explain the expected utilisation of the assigned funds, based on certain assumption and this is best illustrated in the following table.
The instrument Number of agreements Total commitment Breakdownas per year 1 2 3 export 15.00 15.00 0.00 30.00 1 insurance portfolio Guarantee 6 12.00 20.00 30.00 30.00 Housing 13.00 0.00 10.00 23.00 efficiency funding 3 4 11.25 11.25 22.50 Tehnology Transfer 0.00 25.00 25.25 25.25 50.50 Risk Capital 5 Total 19 206.00 81.50 81.50 94.50 30.00 called cumulative utilisation 176.00 206.00 Each of the five instruments listed above targets different types of SM and in differing ways seeking to address the assessed market failures. Combined together, the instrument will act as a ' portfolio ' delivering market impact and return to the Holding Fund in differing forms.
2.1 the Proposed Financial Engineering Instrument the explanation below give brief details of how each of the different instrument is envisaged to operate is but is subject to change as discussion on implementation aspects continue with the targeted Financial Intermediar. At this stage, these details should be seen as indicativ in nature.
Export insurance scheme to facilitat greater export business by SM the export insurance measure is assumed to follow a similar approach of guarantee. The choice to use the guarantee approach to simulate the cash flow of an export insurance scheme; it enable the forecasting exercise and it also serve as a basis for discussion to decide upon the most efficient structure that the final export insurance scheme should take. The schema is assumed to cover 50% of substantially larger portfolio. Given that the scheme will in fact construct a portfolio of insurance agreements for a number of export credits of which only a percentage will become an obligation vis-à-vis the providers of the credit, it is permitted to enter into the guarantee agreements and reach a certain guarantee volume up to a certain multiple of the assigned capital.
Portfolio Guarantee for banks to expand lending to SMEs the schema is assumed to cover 50% of substantially larger portfolio; the scheme will cover 50% of the loss incurred for each defaulted loan that has been included in the portfolio. There is, however, a limit (cap) to the aggregate amount of the payments to be carried out in favour of the Financial Intermediary. Given that the scheme will in fact construct a portfolio of guarantee for (a) the number of loans of which only a percentage will become an obligation vis-à-vis the provider of the loan, it is permitted to enter into the guarantee agreements and reach a certain guarantee volume up to a certain multiple of the assigned capital.
Housing Energy Efficiency loans via selected the Bank projected housing efficiency finance operations (a) assume co-financing agreement, through which the upfron of the JEREMIE Holding Fund disburs the full amount of EUR 23 m to double their Financial Intermediar which the amount and extend loans. The repaymen schedule over a period of 6 extend years including repayments of an 8% interest partly offset by the maximum permitted Financial Intermediary's management fee of 2.5%. The defaulted loans assumed to reduce the amount payable to the JEREMIE Holding Fund by the Financial Intermediary.
Venture Capital mechanisms via selected VC management companies or networks two different schemes provided for a VC: venture capital (VC) and co-financing business angels (BA). Both assume the same disbursemen and repaymen schedule. The risk inheren risk capital operations is to be in a high; There is no downward protection for the totality of the investors ' funds, only a great upside potential. A prudent approach is, therefore, assumed for the return of the VC schemes that are projecting returns less than the funds invested into SM: for VC, 25% of these funds are considered loss and 50% for BA. The value of the portfolio by the end of each life cycle funds is not taken into considerations.
Early stage/Technology Transfer financing through selected management companies two schemes are focusing on assumed the pre-seed or seed financing. Both the disbursemen and repaymen of the assumed schedule it in a slow manner than evolve for VC and BA. Due to the high risk inheren in such operations, it is assumed that a certain portions of the funds invested in growth may not return to the fund: this is 75% portions for the seeds and 100% of the reach for the pre-seed. The value of the portfolio by the end of each life cycle funds is not taken into considerations.
2.2 the Overall Objective of A key element of the overall concept of the JEREMIE Holding Fund is the clarity of its objective-which have been developed with the Ministry of Economics and can be summarised as follows • Full utilisation of allocated funds;
• Economic benefits Maximised;
• The cost efficiency of the program (within regulatory caps);
• Maximisation of private co-financing (meeting the set targets);
• Successful transition of Holding Fund management after 3 years.
This last point is an additional aspect of the importanc of which a envisag collaborative approach to building the capability of the entity which the Authority currently Responsible for potential Successors, envisag Entity as the Latvian guarantee Agency, so that at a selected data it may be the adop full duties of JEREMIE Holding Fund management from the EIF.
2.3 Implementation Timetabl A key aspect of this initiative is the prompt completion of all implementation tasks to ensur that the ends beneficiar (SM) begin their gain from the instrument without any delay of the undu. The ETF is very conscious of this aspect, especially given prevailing market conditions, and will it implementations that all striv aspects on a best efforts basis by dedicating resources and management support as required.
More specifically, considering that execution date is 16 July 2008, and assuming approval in due time of the investment Business Plan by the Responsible Authority, and therefore the payment of the first tranche provided under article 6.1 (i) of this agreement, the EIF will commit to deliver the following activities as stated below: • establishment of the ETF'S Local Office in Riga – 1 August 2008;
• Formation of the fully resourced the EIF implementation team – 16 August 2008;
• Completion of the investment Business Plan and submission of the same to the Responsible Authority for acceptance – 16 August 2008;
• Appropriate level of marketing and information flow to financial intermediar-16 September 2008;
• Completion and subsequent publication of ' call for expressions of interest ' documents with selection procedures – 30 September 2008. After these implementation activities have been achieved, and appropriate replies received, the process of selection of the intermediar can begin the Financials. As a target rather than a date commitment, the first completion of selection of first Financial is expected to Intermediar in the November period of 2008. Following finalised selection, the set up of the first transactions with the selected Financial will take place at Intermediar. It is not possible to set target dates for this activity as negotiation on the terms conditions can be a protracted & activity but the EIF will seek final gotiat it contracts with to intermediar as early as possible so that SM's begin their benefit without delay of the undu.
3. Economic effects and forecast Financial results 3.1 the Economic effects the economic benefits of the financial engineering instruments include the development of MOU's which would not otherwise receive funding, the position of private sector funds and the longer term aim of sustainability of the fund to reinves in the same sector. The tool can accept a higher degree of risk than market participants would normally be willing to undertak if acting on a private commercial bass.
The measure with a mean to provide incentives for growth and create a momentum for the future sustainability of growth, especially amidst the unfavourabl condition that have been currently formed by the global economic climate. They will seek to address existing market deficienc-within the context and in accordanc with the allocation to the set by the National Strategic Reference Framework 2007-2013 for the support of enterprises.
The instrument works towards the realisation of the Lisbon agenda of creating a dynamic and competitive knowledge-based economy capable of sustainable economic growth with a more and better jobs and greater social cohesion ". In particular: 1. The measure is designed to assist them in the development and dissemination of new technologies promoting the knowledge-based economy. Synerg to between market, academia and research institutions to be promoted and it may extend to the establishment of long lasting. There will be spill-over to other technology industries.
2. For the entrepreneurs, the promotion of entrepreneurial culture should firmly base the future growth of SMEs that benefit from the tool specifically designed to enhance their viability.

3. From the point of view of the financial market, the measure's introduce new approaches to the funding of the SMEs that foster innovations in the assessment of the SME and the availability of the products to this sector. The communication between existing financial institutions and entrepreneurs should be facilitated and therefore stimulation of production and employment growth supported beyond the term of the JEREMIE Holding Fund (JHF). The cultivation of confidence should be increased participation of attrac private funds.
4. Additionally, several of the measure's intended it to stimulat or create a new level of market maturity in terms of the intermediar able provide specific financing services to the Latvian SME sector. This is particularly true in the very early stage activities in the equity investment sector.
3.2 forecast Financial results Within the investment Business Plan, the EIF will explain our understanding of the portfolio of instruments to be implemented in Latvia and using internal expertise and an in-house forecasting model, a portfolio estimated the possible financial results. Such a forecast has a high degree of uncertainty and estimation of this kind cannot be taken as any form of absolute prediction or guarantee of return. However, on a best efforts basis, the model discussed in draft form indicates that the IFA implementation proceed as intended, the ending capital balance could equal approximately EUR 195 million (It is important to note the ' highly indicativ of nature ' of this estimation. Such estimation is do not provide any guarantee of performance). The same document provides a detailed sensitivity analysis of the portfolio performance under various scenarios and risk estimate of potentially worst case results.
The Government of the United States understand and acknowledg the unpredictably of this exercise, and will take it into account when reviewing these estimation. Whilst a best efforts basis will always be made, EIF can't offer any form of guarantee on the actual performance of the Fund's Holdings.
4. Implementation aspects 4.1 Selection of the financials to the Intermediar overall aim of the initiative is to facilitat a SMEs access to finance through the implementation of the financial engineering instrument that are implemented via selected financial intermediar (FIs). These FIs may be banks, venture capital management companies or SMEs financing specialists of various kinds.
The EIF will utilis it experience to manage a clear and transparent selection process of the best financial intermediar to for each instrument area. This selection process will be consistent with EC directives on procurement and laws of the Republic of Latvia. Following this, the JHF will enter into agreements with FIs of proven competence and reliability so as to carry out investment plans implementing financial engineering instruments. The underlying operations, investments in SMEs, will be based on the feasibility and soundnes of the òàæó business plans submitted by the FIs. Cost efficiency will remain a priority always.
4.2 the Transition of the Holding Fund tasks the Government of Latvia, by means of this Funding Agreement, appoint as the EIF JEREMIE Holding Fund (JHF) entity for the initial three years of operation. Channelling the funds to the SM's may well be a process that will extend beyond the three years and the absolute life of the Holding Fund will certainly pass that timeframe.
At the request of the Government of Latvia, a key aim of the EIF is to assist the Latvian guarantee Agency, the entity currently envisaged by the Government of Latvia as potential Successors, to reach the standard Entity required for the successful transition of the operations at the designated time. The decision and timing on the transfer is the responsibility of the Latvian authorities and will be activated by the use of the relevant clause in this Funding Agreement.
The ETF's role has been agreed in the Transition management principles, attached to this Funding Agreement under Appendix g. By way of summary, such role will be on a best efforts basis to assist the selected national organisation to reach the required standard. In this respect, an independent analysis will be carried out to determin the cessary not capability and skills requirements for Holding Fund management. The EIF will provide on-the-job and specialised training of three specific training in seconde and undertak of selected members of the Latvian administration in the various tasks of the Holding Fund based upon the ETF's knowledge of the areas of management required for these type of activities. This process is fully governed by the Transition management principles.
4.3 Monitoring, Reporting and governance Regular reporting and monitoring activities will be managed by the EIF with agreed reporting standards for data collection. At least every three months, the ETF will attend a meeting with the appointed Project Steering Committee, that will act on behalf of the Ministry of Economics and the Ministry of finance. In addition, the annual reports will be produced with the purpose to meet the European Commission's reporting requirements, as set out in Appendix B and C to this Funding Agreement.
Greater detail on this subject will be given in Section 7 of the investment Business Plan, on how the EIF will manage this process.
5. Summary Overall, the targeted SMES will form a diverse portfolio of beneficiar a: the measure will be launched on a pan-Latvian basis and new entrepreneurs will be supported in order to implementations that their business ideas, existing start-ups will be supported to establish their presence in the market and more developed companies should be encouraged to achieve growth and expansion. The aim is to introduce a new arms in the policy approaches of the Latvian economy that will encourag a dynamism in the economy renewed stands out among which will translate into higher growth, and enhanced job prospects and renewed stands out among a healthy and expanding SME sector.
The implementation of the JEREMIE Holding Fund concept in Latvia, through the mechanisms outlined in this and related documents, can play a significant and important role in building the maturity of the financing sector for SMEs in Latvia.
(B) MONITORING OF IMPLEMENTATION Appendix IN ACCORDANC WITH applicable rules 1. Definition Monitoring is the process for the collection and analysis of financial and non-financial information on a regular basis in order to monitor the JEREMIE Holding Fund performance, compare it with its stated objective, budget and work plan and its compliance with legal and contractual requirements, in accordanc with EU Structural Funds regulations and agreements between the EIF and the Responsible Authority on specific information items to be provided.
2. Aim the monitoring process shall provide the authorities responsible for the Operational Programme, particularly the Managing Authority (MA) and the Ministry of Economics (MOE), with a reasonable assurance that: • the implementation of the activity i) compl to with the applicable requirements, particularly with the EU Structural Funds regulations and (ii)) includes where applicable the cessary arrangements to collect relevant information under the State aid rules;
• the objective of the set out for such activity are being pursued;
• the requirements of the legal base are respected.
3. General principles the monitoring process will provide such assurance by regular checking and progress measurement, using appropriate tools, to identify deviations and risks of non-compliance, so that actions can be taken correctiv when not cessary.
4. Change the Actor of the implementation of the JEREMIE is expected to be based on a cascade of decisions and actions where several actors with a sequentially implied: Commission, the Government of Latvia, Responsible Authority and/or Managing Authority, ETF, Jeremie Holding Fund, Financial Intermediar and SM (primarily).
5. the Broad guidelines • the monitoring in the relations with the Investment Strategy and Planning, and along the lines of the investment Business Plan, of the JEREMIE Holding Fund shall be carried out by the project Steering Committee.
• The monitoring of the implementation of the operations shall be carried out by the EIF.
• The monitoring of the operations will include activities carried out externally, internally and/or by different actors, in a "cascade" structure which ensur-that the implementation of each stage is controlled by an actor at a higher stage.
• The EIF shall Procura that Operational agreements shall include the provision of enabling the cessary sam to collect relevant information from the Financial, in order to facilitat Intermediar an adequat monitoring of the operations, including the relevant information to be collected from enterprises receiving support under Jeremie. The EIF shall Procura that the Operational agreements will provide for EIF's right to carry out monitoring the visits to the Financials and the Intermediar the enterprises receiving support from the JEREMIE Holding Fund.
6. Monitoring instruments to be implemented by the JEREMIE Holding Fund It is expected that the monitoring instruments to be implemented by the JEREMIE Holding Fund will include documentary reporting, monitoring, at check in, the audit report, as appropriate.
Within three months from the execution of this agreement, the Responsible Authority and the EIF shall agree on the details of the procedures, the monitoring process and information flow is applied in the framework of the monitoring system of the JEREMIE Holding Fund on irregularity reporting, payment claim, the requirements concerning the flow of the supporting documentation and information, the payment of EU Structural Funds regulations publicity and visual identity requirements under EU Structural Funds regulations and related Latvian law , State AIDS reporting requirements and others.
Appendix C REPORTING

The JEREMIE reporting system is an essential element of the JEREMIE monitoring system and is designed to ensur appropriate management of the initiative and, as far as possible, to contribute to the reporting obligation of the Government of Latvia required by the Commission.
The EIF shall comply with the following procedure: (i) the reporting of the EIF shall prepare for each calendar year (for the first time before 31 March 2009) the Annual progress report, setting out a detailed analysis of the JEREMIE Actions performed during the previous calendar year, an analysis on the progress with the implementation of the Investment Strategy and Planning and of the investment Business Plan , and detailed information on the progress of the operations, the performance of each Financial Intermediary, the treasury management of the JEREMIE funds, and Costa.
(ii) the Annual progress report shall include the information, relating to the operations and to the JEREMIE Holding Fund, in order to allow cessary not the Government of Latvia to comply with reporting obligations towards it by the Commission in accordanc with the Implementing Regulations.
(iii) the Annual progress report shall be in the English language and, upon request of the project Steering Committee, a brief executive summary of the same shall be available in the Latvian language.
(iv) the Annual progress report shall be submitted by the ETF to the project Steering Committee for its approval by March 31 of each calendar year.
(v) the EIF shall prepare quarterly progress reports, in English, including an analysis on the progress with the implementation of the Investment Strategy and Planning and of the investment Business Plan, and detailed information on the progress of the operations. Such quarterly progress reports shall be submitted, in the English language, by the ETF to the project Steering Committee for its approval by 30 days after the end of the relevant quarter.
(vi) the EIF shall Procura that Operational agreements shall include the provision of enabling the cessary sam to collect relevant information from the Financial, in order to facilitat Intermediar an adequat monitoring of the operations, including the relevant information to be collected from enterprises receiving support under Jeremie.
(VII) Within three months from the execution of this agreement, the Responsible Authority and the EIF shall agree on the details of the reporting procedures applied in the framework of the monitoring system of the JEREMIE Holding Fund.
Appendix D 1. General principles of the audit Authority and the responsible Managing Authority shall have the right to send duly authorised representatives of the competent authorities the audit to carry out any audit it consider it not with respect cessary JEREMIE funds in the ETF, and down to the level of the supported enterprise. This provision will also be included in the Operational agreements. Within six months from the execution of this agreement, the Responsible Authority and the EIF shall agree on the details of the audit procedure.
2. the rules shall comply with the following EIF auditing requirements: • appropriate arrangements will be made by the JEREMIE Holding Fund with the Financials to enable the Intermediar Commission, the EIF, their authorised representatives, the European Court of Auditors and all other Community institutions or bodies, with the Mountain Community which entitled it to verify the use of the JEREMIE funds, to have access to information to enable them to discharge their duties.
• In this respect, Operational agreements shall include appropriate provision, and will provide that appropriate provision shall be included in any of the subsequent agreement providing support to enterprises under Jeremie.
• The EIF shall Procura that the Operational agreements will provide for EIF's right to carry out monitoring the visits to the Financials and the Intermediar the enterprises receiving support from the JEREMIE Holding Fund.
3. the Term of Any party involved in an Operations shall be required to maintain relevant documentation for inspection purpose until 31 December 2021. of vertheles, Not evidence of expenditure in the form of receipted invoices and proof of payment for goods and services by the enterprise is only required as part of the audit trail to justify the financial assistance from the Structural Funds where the equity , loan or guarantee offered to an SM is conditional on certain expenditure on particular goods and services.
The above rules are without prejudice of the rules observed by the Government of Latvia to ensur the compliance with the State aid rules.
Appendix E exit POLICY FOR the CONTRIBUTION FROM the Operational Programme out OF the JEREMIE HOLDING FUND and WINDING-UP PROVISION OF the JEREMIE HOLDING FUND the exit policy of the JEREMIE Holding Fund out of the underlying Financial Engineering Instruments (e.g. venture capital funds, guarantee funds or loan funds, etc.) will be systematically included in the ToR of the Financial Engineering Instrument proposed by the EIF and should be discussed with and approved by the project Steering Committee.
At least 6 months before 30 June 2011, the Parties shall meet in order to discuss and agree upon the opportunity to extend the term of this agreement for a further period to be determined or the wind-up operations.
Given the different characteristics of the various proposed Financial Engineering Instruments and considering the very early stage of their conception, it is not possible to establish, at this stage, specific and detailed guidelines in relations to the exit policy. However, provided that the details of the exit strategy of the JEREMIE Holding Fund will be decided at later stage by the Responsible Authority and, if appropriate, by the Managing Authority, and the other entities involved depending on the basis of a potential exit circumstanc scenario could be: (i) It reinstalls a JEREMIE Holding Fund, with the EIF or another institution;
(ii) the transfer funds available to another institutions dealing with SMEs.
This list shall not be regarded as exhaustiv, but only as an example of potential options.
Appendix F list of eligible and non-eligible expenditure is under article 78 of Council Regulation (EC) 1083/2006, as determined by the Managing Authority of all eligible expense shall be the expense are related to JEREMIE implementation according to this agreement, including the costs and Investment Strategy and Planning Appendix attached, and particularly: • theret ETF Standard costs;
• The ETF, and Costa Costa for Travel connected to the travel of the seconde allocated to the JEREMIE Holding Fund;
• The ETF'S Local Office Costs;
• costs connected to consultants, including legal adviser (for the avoidance of doubt, excluding litigation costs) in connection with the operations;
• the costs connected to the external audit of the JEREMIE Holding Fund;
• costs incurred for translation of any documents which, in accordanc with this agreement, have to be provided in the Latvian language;
• the costs connected to the conduct of any tenders or call for expression of interest in connection with the cessary not compliance with the Task;
• costs arising in connection with the secondmen of personnels from the Responsible Authority, or from other entities approved by the latter, to the EIF, in accordanc with a separate agreement to be entered into between the ETF and the Responsible Authority, and others entities to the if applicable;
• costs arising in connection with the termination of the Funding Agreement, and with the transfer of any funds, Jeremie Operational agreements and/or Co-investment agreements and Jeremie assets and Liabilit to the Government of the United States or any entity appointed for the administration of the funds for the activities under the JEREMIE, article 15.7 (ii) and 15.9 of this agreement and up to the amount provided therein;
• costs incurred for the establishment, maintenance and administration of the bank accounts provided for under this agreement;
• Costs connected to litigation arising in relations with operations;
• costs incurred for the publicity, marketing and campaigning of JEREMIE in Latvia;
• others without Costa cessary for the compliance with the Task, to be defined as eligible by the Responsible Authority from time to time.
• EIF litigation costs in the meaning of article 33 of the Latvian Civil Procedure Code, excluding (i) any litigation costs incurred in litigation between the parties to this Funding Agreement, and (ii) any non payable by or by the EIF JEREMIE Holding Fund to any third party to any court pursuan resolution or judgement.
• Costs for the audit Capability provided for under the Appendix G of this agreement.
Non-eligible Expense shall be of the following:-the purchase of land and real estate;
-Purchase of vehicles;
-Interest on debt;
-Recoverabl value added tax and other taxes;
-Litigation costs incurred in litigation between the parties to this agreement;
any non-payable by or by the EIF JEREMIE Holding Fund to any third party to any court pursuan resolution or judgement;
-any amount payable by the EIF under article 13 of this agreement;
-Penalties and fin;
-Expense-that are not connected with JEREMIE implementation in Latvia according to the FAA and cost Appendix.
Appendix G Transition management principles core aspects of the transition process between the EIF management and the entity currently envisaged by the Government of Latvia as potential Successors in Latvia with the enclosed Entity in this Appendix G, which reflect the detailed discussion of the EIF concluded with the Ministry of Economics and Latvia guarantee Agency.
1. Background and Legal basis 1.1 Background and outline

This Appendix sets out the actions that will be undertaken by the ETF during the three years prior to the possible activation of the clause 15.2 of the Funding Agreement. The organisation currently envisaged by the Ministry of economics as the potential Successors Entity is the Latvian guarantee Agency. Transfer of the Holding Fund, or the JEREMIE in any case termination of the Funding Agreement, before the end of a 3 years period from the execution of the Funding Agreement will imply the cessation of the activities included in this Appendix G.
The award of the Funding Agreement the ETF is made on the basis of article 44 (b) (i) of the Regulation. 1083. the Selection of the Entity would be governed by the Successors of article 44 (b) (ii) of the same regulation, which envisag the direct award to a financial institution without request for proposal if this is it a national law pursuan compatible with the Treaty establishing the European Community.
The purpose of the Funding Agreement, the EIF and the common Will of the ISU rity, the Auth to enable the ETF to run the JEREMIE Holding Fund, and to assist Latvian guarantee Agency to reach the standard required for the transition of the operations at the designated time. As far as assistance to Latvian guarantee Agency is concerned, the activities of the ETF'S are governed by this Appendix G, and will consis of: • Analysing the expertise, technical capacity and existing support functions within Latvian guarantee Agency in the light of the requirements related to the running of the JEREMIE Holding Fund, in accordanc with Paragraph 2 below;
• Specific training of up to three staff members of the Latvian guarantee Agency designated in a joint agreement between the EIF, the Responsible Authority and Latvian guarantee Agency, who would work the local alongsid and Luxembourg based ETF team carrying out the JEREMIE Holding Fund tasks under the responsibility of the ETF, in accordanc with paragraphs 3 and 4.1 below;
• Specific training of selected members of the Latvian administration in the various tasks of the Holding Fund (implementation of the various initiative in the field of financial engineering, managing and monitoring the holding fund and results and reporting it to the authorities on the activities and outcomes), in accordanc with Paragraph 4.2 below. 
1.2 Legal basis and development the decision, if any, on the transfer of the Funds to the JEREMIE Holding Latvian guarantee Agency, or to any other Entity, the Successors is full responsibility of the Responsible Authority, as is compliance with applicable legislation, including article 44 of Reg. 1083, and with all the criteria for the transfer. Nothing in this Appendix G should be interpreted as implying any role or responsibility of the ETF for such selection, and/or any role of the ETF in making any assessment as to suitability of the selected Entity Successors.
The EIF shall be solely responsible, on a best efforts basis, to train staff on the activities related to the running and operation of the JEREMIE Holding Fund, and to perform the activities set forth hereunder in order to help prepare Latvian guarantee Agency for the possible transfer of function. Under the EIF shall be responsible from circumstanc for carrying out activities not expressly provided in this Appendix G, or for the eventual readiness of Latvian guarantee Agency to take over the holding fund activities.
The parties that an eventual acknowledg decision by the Responsible Authority to select any organisation other than Latvian guarantee Agency would render the agreement led in this Appendix G fully ineffectiv, and would release from any obligation hereunder by the EIF. The parties agree that, should this decision be taken by the Responsible Authority and communicated to the EIF, the Parties shall discuss and not gotiat in good faith a further contract regarding training for the selected entity.
2. Capability audit and recommendations 2.1 the Ex ante analysis the ETF will on behalf of the Procura Responsible Authority a professionally qualified independent consultant (auditor) to analyse the strength and weakness of Latvian guarantee Agency to successfully manage the holding fund and all connected tasks. The ETF will cooperate with the selected consultant in order to draft and produce a final report on the capability of Latvian guarantee Agency to take over the holding fund, containing recommendations of actions to be taken (the "Capability audit").
The selection of the independent consultant shall be made at the cost of the JEREMIE Holding Fund, if the Responsible Authority will issue a definitive confirmation of that all such costs amount to "eligible management costs" in the meaning of article 78 of the Regulation. 1083. The Responsible Authority shall provide any information not appropriate their ETF cessary and as to the procedure applicable to the selection of the independent consultant, with specific regards to public procurement procedures.
Given the amplitude of the task and the possible restructuring and staffing cessary not/infrastructure requirement, which may result as an outcome of the Capability, and the audio may require important decision of the Government of Latvia, the ETF targets to complete this task within the first year after the signature of this Funding Agreement. The aim is to feed the relevant results back into the training programme, as provided under Paragraph 4 below, and the task of the seconde.
Subject to assessment by the EIF and discretion, it is intended that the Capability audit should include: • the Scoping and analysis of the tasks required to successfully the undertak JEREMIE operations; the tasks include initiation and design of instruments, the assessment of the risk profile of the tool, the modelling of the outcomes, compliance with the State aid and EU Structural Funds publicity requirements, marketing to the Intermediar, managing the Financial disbursement and monitoring and reporting and recover;
• Assessment of the skills requirements to carry out the task;
• Identification of control and management requirements to support the Fund's Holdings and the resultan operations;
• Analysis of the technical support mechanisms to ensur sound management and controls including reporting;
• Benchmarking the proposed organisation against these requirements;
• Proposing a plan to build the required capability in the organisation proposed including staffing, skills requirements and facilities including IT hard and software within the expected time frame. (Some of these skills/activities may need to be outsourced);
• Development of a project plan with clear milestones for the achievement of the task. The plan should include the proposed management structure for the project control;
• Estimation of the cost of the operation including the capital and running costs.
2.2 an Ex post analysis subject to full compliance with public procurement procedures, it is envisaged that the same consultants selected for the audit shall perform a Capability further analysis on the State of preparedness of Latvian guarantee Agency close to the end of the 3 year term, the actual dates to be decided in the course of the third year. It is envisaged that the area of the analysis, assessment and subject to discretion, the ETF will be the same as that selected for the audit Capability.
3. the Secondmen three employees of the Latvian guarantee Agency, selected jointly by the ETF, the Responsible Authority and Latvian guarantee Agency, will be seconded on a full-time basis to the EIF for a period of 3 years, or, if earlier, up to termination of this Funding Agreement ("Seconde"). The Seconde will remain on Latvian guarantee Agency contracts for the duration of their secondmen; as such, they will be paid by Latvian guarantee Agency and subject it to the Latvian employment law, social security and taxation. The EIF shall not provide any payments to the Seconde, except to those expressly mentioned herein below.
(A) the contract will be signed secondmen between the Latvian guarantee Agency and the EIF; the Seconde will in all respect (including health and social insurance) continue to be remunerated by the seconding institution and only travel and per diem expense relating to the business of travel will be paid by the JEREMIE Holding Fund, provided the relevant expenditure is approved as eligible under article 78 of the Regulation. 1083 by the Responsible Authority. The Seconde-will be subject to the EIF's Staff code of conduct and, in particular, the rules regarding conflict of interest and disclosure of confidential information obtained or use in the course of their duties included in the secondmen in the contract.
The Seconde will form part of the ETF's JEREMIE Division and will report to the Head of the JEREMIE Division, working on a daily basis with the Heads of the ETF Office in Latvia.
The Seconde ' task will cover the full range of the activity of the EIF as the JEREMIE Holding Fund for Latvia, from the initiation of the operation, through implementation to monitoring and reporting. Although the individual skills of the Seconde will play a part in the emphasis given to the requirement for specialisation, the aim of the secondmen will be to enable all of them play an Seconde active and positive role in the operations and develop their knowledge over the 3 year period.
During the period of the secondmen, Seconde will be based in the ETF's Latvian premise, but will be asked to make regular trips to Luxembourg for business purpose and for training.
4. Training programme 4.1 Basic training the EIF will provide training to the three Seconde. Training will be the responsibility of the EIF, and will be carried out by specialists, the ETF external providers, the Regional Manager and/or the Head of the ETF'S Office in Latvia.

Any external training costs will be covered by the JEREMIE Holding Fund, in the assumption that the relevant expenditure is approved as eligible under article 78 of the Regulation. 1083 by the Responsible Authority, and shall be included in the normal estimated Annual budget. In the case the amount allocated is not sufficient, a special additional budget will be communicated. It is anticipated that the training for all the three Seconde will cover the full range of skills and will be a total of consis of ca. 50 days of training sessions over the three years.
Should additional training requirements be identified during the audit Capability, these will be taken into considerations and provided by the EIF where possible within the estimated cost.  
4.2 Additional training In addition, the EIF shall consider providing specific training to selected members of the Latvian administration in the various tasks of the JEREMIE Holding Fund if so requested by the Responsible Authority. It should be noted, however, that the ETF will only be able to train in the ETF procedures and best practice, based on, inter alia, the applicable EU legislation.
These additional training, if any, could entail additional costs to be estimated and approved before the training, and once approved shall be paid directly by the relevant Latvian authorities.
Appendix H Treasury Guidelines Outline 1. The Government of Latvia and the EIF acknowledg that the right which is donated to the EIF under this Funding Agreement, includes the right to manage all the JEREMIE funds from time to time deposited into the Bank account, the JEREMIE with marbles of such non that have been disbursed for the purpose of any operations or for any other purpose in accordanc with this agreement , and with those of the marbles of which the EIF shall be non de appropriate that they shall remain deposited into the Bank account the JEREMIE in order to deal with liquidity risk ("Treasury funds"). The management of the Treasury funds shall be effected in accordanc with these Treasury guidelines.
2. In order to perform the management of the Treasury funds, the EIF shall select the European Investment Bank or the Treasury of the Republic of Latvia within six months of the signature of this agreement, on the basis of the best interests of the JEREMIE Holding Fund. The EIF's choice of Treasury Bank and nature of the agreement will be approved by the project Steering Committee in advance of implementation.
3. It is intended that the Treasury funds shall be deposited in the euro or in legacy currencies incisive deposits of various to maturit with the Treasury Bank, in accordanc with the relevant agreement between the EIF and the Treasury Bank. The Treasury funds will be deposited and managed a sufficient liquidity to ensur it is available to fund the core investment operations of the Fund of the United Nations Holding a whilst seeking appropriate level of risk and return.
4. As an alternative to 3 above should be that the ETF de alternative arrangements may be used by Treasury based upon possible alternative products made available by the Treasury, the Bank in the best interest of the Government of Latvia, it shall be entitled, without any obligation to make a proposal to the project Steering Committee. In the case of a favourabl opinion by the project Steering Committee, the Treasury funds shall be used accordingly.
5. The EIF shall report to the project Steering Committee on a quarterly basis on the treasury management undertaken by the ETF in accordanc with the Treasury guidelines.
Appendix I to Appendix 1. Costa this appendix ("Appendix in the Costa") sets out the details relating to the calculation and payment of the costs in accordanc with the Funding Agreement, particularly with article 10 thereof, connected to the operations of the Fund in accordanc JEREMIE Holding with the Funding Agreement.
2. Capitalised terms and expressions defined in the Funding Agreement shall have the same meaning when used herein, unless otherwise defined in or the context otherwise requires.
3. In addition to clause 2 above, the following defined terms and expressions shall bear the following meaning, unless the context requires otherwise: (a)) Annual Costa: means the costs incurred for the operation of the JEREMIE Holding Fund in a given calendar year, as evidenced from year to year in the relevant cost payment statement;
(b)): means an Associated Expense the costs mentioned in clause 5 below;
(c) costs payment statement): means the document, substantially in the form attached as Annexe 2 of the heret, to be provided by the EIF to the project Steering Committee as provided under clause 11 below, providing for the relevant Annual Costa and details of calculation;
(d) the direct costs of the ETF): means the aggregate of the ETF'S Standard, the EIF Travel Costa Costa and the ETF'S Local office costs;
(e) the direct costs of the ETF) advance: means the annual amount the ETF will receive for each calendar year, in the quarterly instalment, in accordanc with clause 9 below, they cover the direct costs of the ETF forecasted for the same calendar year. For each calendar year, the amount of the direct costs of the ETF Advance applicable shall be indicated in the Annual budget;
(f) the direct costs of the ETF) balance payment: means, for any calendar year, the alignment of the ETF'S annual direct costs advance with the actual direct costs of the ETF for such calendar year, to be made in accordanc with clause 11 below;
g) direct a Bank ETF Costa account: means the sub-bank account to be opened by the EIF within the Bank account from the JEREMIE, where all direct costs of the ETF with paid as provided in this Appendix to the Costa;
EIF Jeremie) employee: means any ETF'S operational staff members from time to time allocated to the compliance with the Task, which includes the performance of the JEREMIE Actions;
I) Local office costs of the ETF: means the costs and expense incurred by the EIF, to be in connection with the compliance with the Task, relating to the establishment and operation of the ETF Office in Riga, calculated as provided under clause 4.3 below;
j) ETF'S Standard: means the Costa Costa and expense to be incurred by the EIF in connection with the compliance with the Task, calculated on the basis of the Standard cost rate ETF as provided under clause 4.1 below;
k) means the ETF'S Travel costs: the costs and expense incurred by the EIF, to be in connection with the compliance with the Task, relating to travel of EIF JEREMIE employees, in accordanc with the travel policy from time to time applicable within the European Investment Bank group, calculated as provided under clause 4.2 below;
l) Expense account Bank: means the sub-bank account to be opened by the EIF within the Bank account from the JEREMIE, where all the Associated Expense with paid as provided in this Appendix to Costa.
4. Entitlement to the ETF'S direct costs to the EIF Entitlement Standard Costa 4.1 the parties acknowledg and agree that the EIF shall be entitled to the Standard Costa, the EIF quantified for each calendar year in the relevant cost payment which shall be calculated statement, for any given calendar year on the basis of the ETF'S Standard cost rate applicable for such calendar year. The EIF shall be equal to the Standard costs for the actual time spen on the Task by any EIF JEREMIE employee, multiplied by the ETF'S Standard cost rate. It is understood that the ETF will be fully responsible for the most efficient allocation of its operational staff in its head office in Luxembourg as well as locally in Riga.
The parties that the EIF acknowledg Standard cost rate is reviewed from time to time, and may be modified, by the ETF'S, and that the rate currently in force will be updated at the end of each calendar year based on the audited accounts for that year; in particular, although the updates may not be determined in advance, expect the ETF ETF Standard cost rate to be subject to an increase on an annual basis. The current estimate of the ETF'S Standard cost rate applicable for the year 2008 is attached as Annex 1 of the heret, being it understood that the final Standard ETF cost rate applicable for that year it shall result from the audited accounts for 2008, as soon as they will be available.
The parties acknowledg and agree with the exclusive use of the ETF'S Standard cost rate for the purpose of the quantification of the ETF'S Standard, and acknowledg Costa the principles for its calculation.
4.2 Entitlement to the ETF'S Travel costs the parties acknowledg and agree that shall be entitled to the ETF ETF Travel Costa, quantified for each calendar year in the relevant costs payment statement, which shall correspond to the actual costs incurred by the EIF for the travel of personnel in connection with the ETF'S compliance with the Task.
4.3 Entitlement to the ETF'S Local office costs the parties acknowledg and agree that the EIF shall be entitled to the ETF'S Local office costs, quantified for each calendar year in the relevant costs payment statement, which shall correspond to the actual costs incurred by the EIF for the establishment and operation of the ETF'S local office in Riga.
5. The Associated Expense of the Associated Expense shall be: (i) the costs connected to consultants, including legal adviser (for the avoidance of doubt, excluding litigation costs) in connection with the operations;
(ii) the costs connected to the conduct of any tenders or call for expression of interest in connection with the cessary not compliance with the Task;
(iii) the costs arising in connection with the secondmen of personnels from the Responsible Authority, or from other entities approved by the latter, to the EIF, in accordanc with a separate agreement to be entered into between the ETF and the Responsible Authority, and others entities to the if applicable;
(iv) the costs incurred for translation of any documents which, in accordanc with the Funding Agreement, have to be provided in the Latvian language;

(v) costs arising in connection with the termination of the Funding Agreement, and with the transfer of any funds, Jeremie Operational agreements and/or Co-investment agreements and Jeremie assets and Liabilit to the Government of the United States or any entity appointed for the administration of the funds for the activities under the JEREMIE, article 15.7 (ii) and 15.9 of the Funding Agreement and up to the amount provided therein;
(vi) costs incurred for the establishment, maintenance and administration of the bank accounts provided for under the Funding Agreement;
(VII) costs connected to the external audit of the JEREMIE Holding Fund;
(VIII) the costs incurred for the publicity, marketing and campaigning of JEREMIE in Latvia;
(ix) litigation costs in the meaning of article 33 of the Latvian Civil Procedure Code connected to litigation arising in relations with operations, excluding (i) any litigation costs incurred in litigation between the parties to this Funding Agreement, and (ii) any non payable by or by the EIF JEREMIE Holding Fund to any third party to any court pursuan resolution or judgement.
(x) the costs for the Capability provided for under Appendix G audit of the Funding Agreement.
(xi) other costs, not cessary for the compliance with the Task, to be defined as the Associated Expense and mutually agreed by the EIF and the Responsible Authority from time to time.
6. Cap the parties acknowledg that the aggregate of the ETF'S direct costs and Associated Expense is subject to the authority of the cap set out in article 10.3 of the Funding Agreement and in article 43, Paragraph 4, of the Implementing Regulations. Should the aggregate of the ETF'S direct costs and Associated Expense cap 12 of such clause 14 below, shall apply.
7. Early termination In case of early termination of the Funding Agreement, including as a consequences of the review under article 15.2 thereof, should the aggregate of direct costs and Associated ETF Expense for the term of the Funding Agreement 12 the cap provided under clause 7 above, the Government of Latvia shall be liabl to pay an amount equal to the EIF the excess. Such payment will be offset with the payment due under clause 12 below.
8. The ETF'S direct Bank account and expense into Costa's Bank account As a sub-accounts of the EIF JEREMIE Bank account, open the EIF shall direct the Bank account costs and the Expense of the Bank account.
The EIF is deposited in the non direct costs the Bank account and in the Expense of the Bank account shall be exclusively used respectively for the payments provided under the Commission's 9 and 10 below.
8.1 the ETF'S direct costs Bank account the EIF direct Bank account shall be costs funded as follows.
(a) An amount equal to the forecast of the ETF'S direct costs expected for a given calendar year, as provided in the relevant Annual budget, shall be debited by the ETF to the Bank account and the JEREMIE credited to the Bank Account the EIF direct Costa on the first Business Day of such calendar year, or, for 2008, on the first Business Day after the Annual budget for such year is approved in accordanc with article 6.5 of the agreement.
(b) on any given calendar year Should the actual direct costs exceeds 100 ETF the ETF'S direct costs, as provided in advance under clause 9 (b) (i) below, an amount equal to such excess shall be debited by the ETF to the Bank account and the JEREMIE credited to the Bank Account the EIF direct Costa on the day the relevant cost payment statement is approved in accordanc with clause 11 below.
(c) Any amount standing to the credit of the direct costs of the ETF Bank account at the end of any given calendar year shall reduce the annual payment due under clause 8.1 (a) above.
8.2 the Bank account of the Expense the expense into the Bank account shall be funded from time to time from the Bank account, it helps them deal with any Associated Expense to be incurred by the JEREMIE Holding Fund the. The debit of the account and òàæó JEREMIE Bank credit of the Expense of the Bank account shall be operated by the EIF, in such manner and timing appropriate to deal with the timely òàæó the Associated Expense.
9. Payment of direct costs the ETF ETF direct costs for any given calendar year shall be payable to the ETF in the form of an ETF'S direct costs and an Advance direct to the ETF Costa balance payment, as set out in this clause 19 (a) the direct costs of the ETF advance the ETF'S direct costs shall be payable in advance in the manner set out in the table below : table-Costa advance payment structure first quarterly advance (Q1) debit the Bank Account of the ETF'S direct Costs of a quarter of the direct costs of the ETF advance and credit such amount in favour of the EIF, due 1st January Second quarterly advance (Q2) debit the Bank Account of the ETF'S direct Costs of a quarter of the direct costs of the ETF advance and credit such amount in favour of the ETF , due May 1st Third quarterly advance (Q3) direct debit the Bank Account the EIF Costa of a quarter of the direct costs of the ETF advance and credit such amount in favour of the EIF, due 1st July Fourth quarterly advance (Q4) debit the Bank Account of the ETF'S direct Costs of a quarter of the direct costs of the ETF advance and credit such amount in favour of the ETF due 1st October, Each payment mentioned in the table above will be due the day indicated in the table above. Should that day not be a Business Day, the payment shall be due on the first Business Day of successive.
Should the Funding Agreement be signed in the course of a calendar quarter, the first quarterly instalmen of the ETF'S direct costs shall be payable in advance pro rata on the number of days from the date of the execution of the Funding Agreement until the end of the relevant quarter (basis: 1 quarter = 90 days).
(b) the direct costs of the ETF balance payment After the end of any calendar year, the EIF relevant shall calculate the ETF'S direct costs actually incurred during the relevant calendar year and shall calculate the amount of the direct costs of the ETF balance payment as follows: direct costs of the ETF balance Payment the actual direct costs of the ETF-ETF direct Costa will advance the annual calculation shall be made within the relevant costs payment statement as provided in accordanc with clause 11 below.
The payment of the direct costs of the ETF balance payment for any given calendar year shall be due on the 1st of January of the calendar year or relevant, should that day not be a Business Day, on the first Business Day of successive. At that time, as the case may be: (i) should the actual direct costs exceeds 100 ETF the direct costs of the ETF, the EIF shall be entitled advance to debit the Bank Account of the ETF'S direct Costs for the amount of the direct costs of the ETF balance payment prescribed in the Costa of the payment statement and to credit this amount in favour of the ETF, or (ii) the direct Costs of the ETF should advance 12 the actual direct costs of the ETF The EIF shall be obliged, to set-off the amount of the direct costs of the ETF balance payment against the quarterly amount of direct costs of the ETF advance due on that date. Should the amount of the relevant quarterly instalmen of the ETF'S direct costs advance be not sufficient for the purpose of the offset provided for above, the EIF shall pay the difference into the direct Bank Account the EIF Costa on the same date.
The parties agree that, in both cases provided for under (i) and (ii) above, shall be due from the interest in relations to the ETF'S direct costs balance payment from time to time due to either Party.
10. the payment of the Associated Expense of the Associated Expense shall be paid for when due, based on the invoices from time to time received, directly from the Bank account of the Expense. The amount of the Associated Expense during each calendar year of paid shall be quantified in the costs of payment respectiv statement.
11. Costs payment statement As soon as possible after the end of each calendar year, and in any case from later than 31st March of the following calendar year, the EIF shall communicate it to the project Steering Committee the costs payment statement, providing for the Annual costs incurred in the relevant calendar year and the details of the calculation, substantially in the form attached as Annexe 2 of the heret. Within 30 days from receipt of the payment statement of Costa , the project Steering Committee shall have the right to approve, or to make comments and objection on the content of the payment statement, Costa provided that any objection would have to be justified shall adequately. The following shall apply: (i) should the EIF receive the approval from the project Steering Committee, the costs shall be considered payment statement as approved on the date the ETF received the approval from the project Steering Committee;
(ii) should not receive the EIF ither approval nor objection from the project Steering Committee, the costs shall be considered payment statement as approved at the end of the thirtieth day after receipt of the payment statement by Costa the project Steering Committee;
(iii) should receive any objection from the EIF to the project Steering Committee, the EIF shall, within fifteen days from receipt, take into account such objection in good faith, taking any action it is appropriate to this deemas purpose, including discussing the objection with the project Steering Committee, and communicate a second draft of the payment statement, Costa, amended as appropriate, by the EIF deemas the project Steering Committee. The second draft of the costs shall be deemed payment statement to be adopted five business days after receipt.
On the date in which the Costa of the payment statement has been approved, or adopted, as per above, the same shall become final and effective and all the payments provided therein shall become payable automatically.
12. the Final payment upon termination without prejudice to any payment due under the Commission's 9 and 10 above, upon termination of the Funding Agreement, including early termination, the EIF shall calculate the direct costs of the ETF cumulated and the Associated Expense of due and paid during the entire term of the Funding Agreement.

Should such amount exceeds 100 the cap for the management costs for holding funds provided under article 43, Paragraph 4, of the Implementing Regulations, the Government of Latvia shall be entitled to recover from the ETF, as soon as possible and without delay is unreasonabl depending on the final balance of sharp circumstanc payment of the due amount, an equal Costa to such difference, unless the Government of Latvia agree to cover such expense by other sources available.
13. (A) the budget containing the forecast of the level of the costs for the first 3 years period, is attached as Annex 3 of the heret. The parties that such acknowledg forecast has value, and from binding as a mere forecast made on the basis of the information available on the date hereof is subject to change should not be relied upon by the parties or by any other third parties for the calculation of the costs for the period considered.
Annex a Appendix 1 to Costa Estimated the ETF'S Standard cost rate for the year 2008 In accordanc with the Funding Agreement, specifically allocated ETF personnel (defined in this Appendix to Costa as "EIF JEREMIE employees") will carry out the activities contemplated in the Funding Agreement in connection with the establishment and operation of the JEREMIE Holding Fund in Latvia. The EIF will expect to equal 3.5 personnel resources assigned for the first three years, as shown below.
In addition to these assigned resources, the EIF will assign from time to time different personnel to the required task of capitalising on the experience of approximately 100 professional from EIF's Head Office in Luxembourg. The contributions of these additional resources is included in the calculation of the Standard rate applicable to the EIF Costa from year to year, and will therefore entail an additional cost from the Government of the United Kingdom. These additional resources will assist the EIF JEREMIE employees allocated in any activities relevant for the JEREMIE Holding Fund, including investment-related activities such as product structuring, negotiation with financial intermediar, due diligence reviews, and legal structuring of any transactions, and back office activities such as reporting and monitoring of investments, fund accounting and systems maintenance.
The combination of dedicated resources working on the mandate and the additional expertise provided by the EIF will be continually managed by professionals the relationship manager for the Government of Latvia to ensur all aspects of the Funding Agreement with the successfully implemented.
The table below provides an estimate of the ETF'S Standard cost rate applicable for the year 2008. Such estimate is made by taking into account the unaudited figures currently available for 2007, and it is understood that the actual Standard cost rate applicable to the EIF for 2008 shall result from the audited accounts for 2008, as soon as the latter will be available.
Staff Category Expected EIF JEREMIE employees (first 3 years) EUR/my-month administrative Staff 0.5 3 Annexe 2 18.900 Professional Staff of 33.000 to Costa Costa of payment Appendix Form of statement--------------------------------------------------------------------------------------------------------To: [•] From: European Investment Fund Luxembourg, JER-003 date Dear Sir, Madam, Pursuan to the funding agreement between the Republic of Latvia and the European Investment Fund (EIF ") dated July 16, 2008 (the" Funding Agreement ") , and clause 13 of the costs to the Funding Agreement appendix ("Appendix costs"), the EIF provides you with the cost payment statement (as defined in the Appendix of the Costa).
Capitalised terms and expressions defined in the Funding Agreement and in the costs Appendix shall have the same meaning when used herein, unless otherwise defined in or the context otherwise requires.
We programme.kindly request you to provide us with your approval within 1month of the below Costa for the year 200 [•]: Annual budget costs or Actual direct Cost basis to the ETF ETF Variation Standard costs rates month/EIF JEREMIE Staff Travel costs ETF'S Local office costs Associated Expense of costs related to consultants costs related to tenders costs related to secondments Costa related costs related to the translations costs related to termination bank accounts costs related to external audit costs related to litigation
costs related to marketing and other costs In accordanc campaigning with clause 11 (b) of the Appendix, costs on the 1st of May of [•] or, should that day not be a Business Day, on the first Business Day of the successive, the amount of [•] will be [in the case of positive amount debited to the EIF: direct Bank account and credited Costa in favour of ETF] [in the case of negative amount : set-off against the amount of the quarterly ETF direct Costa advance due on the same date].
Annex a Appendix 3 to Costa this Annex 3 to the Costa of the Appendix details the estimated costs expected to be incurred by the EIF in the first three years of operation of the JEREMIE Holding Fund. This estimation is provided only as a non-binding guideline, and is subject to change in consultation with the project Steering Committee.
(A) the contingency factor equal to 12.5% of the non-ETF'S Standard cost rate has been applied.







ESTIMATED costs budget phase one Year 1 Year 2 Year 3 Av. % No size 183,000,000 183,000,000 183,000,000 ETF Prof. resources in Latvia 2 2 2 ETF Admin resources in Latvia 0.5 0.5 0.5 ETF Prof. resources from Luxembourg Seconded resources in Latvia 1 1 1 3 3 3 units of the ETF ETF COSTA Full cost rate Pro Staff 1,235,520 1,284,941 EUR/month 3 1,188,000 ETF Full cost rate Admin Staff a 0.5 Total Annual EUR/month for Staff costs 118.800 123.552 128.494 1,306,800 1,359,072 1,413,435 Travel costs 36 EUR/mission/staff cost 54.000 58.860 64.157 of Latvia Office EUR/month 12 Sub-total 1,420,800 1,483,332 1,548,878 60.000 65.400 71.286 0.78 0.81% margin% 0.81%% ASSOCIATED EXPENSE of Consultancy fees of EUR 60/day EUR 63.000 68.670 74.850 Legal advice/operation p.a.
7175.000 190.750 207.918 cost of Conducting the Call for Expression of interest/call 6 EUR 45.000 49.050 53.465 Secondmen Costa EUR/pp/pa 3120.000 130.800 142.572 cost of Legal Translation/page 250 EUR 12.500 13.625 14.851 cost of Termination/Transition/termination 0 EUR 25.000 25.000 100.000 EUR/year 1 Costa Auditors 30.000 32.700 35.643 Capability audit/case 105.000 155.000 EURO reserve for Inv. Board meetings/year 4 EUR 4.000 4.360 4.752 cost of Marketing campaign at EUR/3 45.000 49.050 53.465 Contingency 12.5% 12.5% per TOTAL ANNUAL costs of Anna 92.313 86.033 122.245 2,137,613 2,133,370 2,513,639 Av. % ANNUAL percentage 1.17 1.17% 1.37% 1.24%% ETF Prof. Staff rate 2008 (approx. figure based on the 2007 agreement with ECU) 33.000 34.320 35.693 ETF Admin. Staff rate 19.800 20.592 21.416 in 2008 Annual increase (rates EIF) 4.00% Anticipated annual change Latvian Inflation Anticipated inflation 9% average rate Riga, Latvia, July 16, 2008.
 
For the Government of the Republic of Latvia Minister of Economics For the European Investment Fund Chief Executive ____ ____ ____ ____ ____ ____ ____ ____ _____/Kaspars Gerhards/_____ _____ _____ _____ _____ _____ _____/Richard Pelly/Cabinet 10 July 2008 No. 534 of the rules "for the Government of the Republic of Latvia and the European investment fund the European Union's structural funds implementation" published in the newspaper "journal", 118.nr 01.08.2008. -"EN".