Common use of Execution of the Project Clause in Contracts

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the Project, and, to this end, without any limitation or restriction upon any of its other obligations under the Loan Agreement, shall cause each of the Water Companies to perform, in accordance with the provisions of their respective Project Agreements, all the respective obligations of the Water Companies therein set forth, shall take or cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon the provisions of paragraph (a) of this Section and except as the Borrower and the Bank shall otherwise agree, the Borrower shall cause the Water Companies to: (i) carry out their obligations in accordance with the provisions of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the Project. (a) Except as the Bank shall otherwise agree, procurement of the goods, works, and consultants’ services, required for the Project and to be financed out of the proceeds of the Loan shall be governed by the provisions of Schedule 1 to the Project Agreements, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water Company, under financial terms and conditions identical to those governing the Loan. (b) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements in such manner as to protect the interests of the Borrower and the Bank and to accomplish the purposes of the Loan, and, except as the Bank shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either Subsidiary Loan Agreement or any provision thereof. Section 3.06. For the purposes of Section 9.07 of the General Conditions and without limitation thereto, the Borrower shall: (a) prepare, on the basis of guidelines acceptable to the Bank, and furnish to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the Bank, a plan for the continued achievement of the objectives of the Project; and, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.07. The Bank and the Borrower hereby agree that the obligations set forth in Sections 9.04, 9.05, 9.06, 9.07, 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by each of the Water Companies pursuant to Section 2.03 of the respective Project Agreement.

Execution of the Project. (a) Section 3.01. The Borrower declares its commitment to the objectives of the Project, and, to this end, without any limitation or restriction upon any of its other obligations under the Loan Agreement, shall cause each of shall: (a) carry out the Water Companies to performProject through RHM, in accordance with the provisions assistance of their respective Project AgreementsBEA, all the respective obligations of the Water Companies therein set forthwith due diligence and efficiency and in conformity with appropriate administrative, shall financial and environmental practices; (b) take or cause to be taken all action, including the provision of funds, facilities, services and other resources, action necessary or appropriate to enable each of the Water Companies BEA to perform such obligationsthe obligations in accordance with the Agency Agreement referred to in the provisions of this Agreement, and shall not take or permit to be taken any action which would prevent or interfere with such performance; and (c) cause to be provided, promptly as needed, the funds, facilities, services and other resources required for the Project. (b) Section 3.02. Without limitation upon the provisions of paragraph (a) Section 3.01 of this Section Agreement, and except as the Borrower and the Bank shall otherwise agree, the Borrower shall cause the Water Companies toshall: (ia) carry out their obligations in accordance with the provisions of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; Project Operational Manual and the Resettlement Policy FrameworkImplementation Program set forth in Schedule 5 to this Agreement; and (b) through MOF and RHM, and except enter into an agency agreement with BEA (the Agency Agreement), on such terms as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, in the opinion of be acceptable to the Bank, such amendment or waiver may materially which shall include terms specifying the responsibilities of BEA in respect of procurement, financial management and adversely affect the implementation disbursement aspects of the ProjectProject implementation. (a) Section 3.03. Except as the Borrower and the Bank shall otherwise agree, procurement of the goods, works, and technical services, consultants’ services, services and training required for the Project and to be financed out of the proceeds of the Loan shall be governed by the provisions of Schedule 1 4 to the Project Agreementsthis Agreement, as such said provisions may be further elaborated in the Procurement Plan. (b) . The Borrower shallBorrower, or in accordance with the established procedure, shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference guidelines acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water Company, under financial terms and conditions identical to those governing the Loan. (b) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements in such manner as to protect the interests of the Borrower and the Bank and to accomplish the purposes of the Loan, and, except as the Bank shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either Subsidiary Loan Agreement or any provision thereof. Section 3.063.04. For the purposes of Section 9.07 of the General Conditions and without limitation thereto, the Borrower shall: (a) prepare, on the basis of guidelines acceptable to the Bank, and furnish to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the Bank, a plan for designed to ensure the continued achievement of the objectives of the Projectproject’s objectives; and, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.07. The Bank and the Borrower hereby agree that the obligations set forth in Sections 9.04, 9.05, 9.06, 9.07, 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by each of the Water Companies pursuant to Section 2.03 of the respective Project Agreement.

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the ProjectProject as set forth in Schedule 2 to this Agreement, and, to this end, without any limitation or restriction upon any of its other obligations under shall carry out the Loan AgreementProject through PO-RALG, the Participating LGAs, and the DLAs, with due diligence and efficiency and in conformity with appropriate administrative, financial, environmental, social and technical practices, and shall cause each of provide, promptly as needed, the Water Companies to perform, in accordance with the provisions of their respective Project Agreements, all the respective obligations of the Water Companies therein set forth, shall take or cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of resources required for the Water Companies to perform such obligationsProject, and shall not take or permit to be taken any action which would prevent or interfere with such performancethe carrying out of the Project. (b) Without limitation upon the provisions of paragraph (a) of this Section and except as the Borrower and the Bank Association shall otherwise agree, the Borrower shall cause the Water Companies to: (i) carry out their obligations in accordance with the provisions of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, Implementation Program set forth in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the ProjectSchedule 4 to this Agreement. (a) Except as the Bank Association shall otherwise agree, procurement of the goods, works, works and consultants’ services, services required for the Project and to be financed out of the proceeds of the Loan Credit shall be governed by the provisions of Schedule 1 3 to the Project Agreementsthis Agreement, as such the said provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference guidelines acceptable to the BankAssociation, and furnish such update to the Bank Association not later than twelve (12) months after the date of the preceding Procurement Plan, for the BankAssociation’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water Company, under financial terms and conditions identical to those governing the Loan. (b) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements in such manner as to protect the interests of the Borrower and the Bank and to accomplish the purposes of the Loan, and, except as the Bank shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either Subsidiary Loan Agreement or any provision thereof. Section 3.063.03. For the purposes of Section 9.07 9.06 of the General Conditions and without limitation thereto, the Borrower shall: (a) prepare, on the basis of guidelines acceptable to the BankAssociation, and furnish to the Bank Association not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the BankAssociation, a plan for the continued achievement of the objectives future operation of the Project; and, (b) afford the Bank Association a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.073.04. The Bank and Borrower shall for purposes of making the Borrower hereby agree that counterpart contribution to the obligations set forth in Sections 9.04, 9.05, 9.06, 9.07, 9.08 and 9.09 financing of the General Conditions Project: (relating a) open, or cause to insurancebe opened, use and thereafter maintain, until the completion of goods the Project, Project Account A and servicesB in Tanzania Shillings in a commercial bank acceptable to the Association on terms and conditions satisfactory to the Association; (b) deposit, plans or cause to be deposited, into the Project Account A an initial contribution of the Tanzania Shilling equivalent of three hundred fifty thousand Dollars ($350,000) and schedulesinto Project Account B an initial contribution of the Tanzania Shilling equivalent of one hundred thousand Dollars ($100,000) by the Effective Date, records as provided in Section 6.01 (a) of this Agreement; (c) deposit, or cause to be deposited not later than April 1, 2005, a further contribution into Project Account A of the Tanzania Shilling equivalent of three hundred fifty thousand Dollars ($350,000) and reportsinto Project Account B the Tanzania Shilling equivalent of one hundred thousand Dollars ($100,000); (d) thereafter, maintenance during each subsequent Fiscal Year of Project implementation, deposit, or cause to be deposited, into the Project Accounts by July 1, October 1, January 1 and land acquisitionApril 1, respectivelysuch amounts as shall have been agreed upon with the Association; and (e) ensure that amounts deposited into the Project Accounts shall be carried out by each used exclusively to make payments to meet expenditures made or to be made in respect of the Water Companies pursuant reasonable cost of goods, works and services for the Project in addition to Section 2.03 those financed from the proceeds of the respective Project AgreementCredit.

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the ProjectProject as set forth in Schedule 2 to this Agreement, and, to this end: (i) shall carry out Part A of the Project through MOPT with due diligence and efficiency and in conformity with appropriate administrative, engineering, financial and telecommunications practices, and shall provide, promptly as needed, the funds, facilities, services and other resources required for Part A of the Project; and (ii) without any limitation or restriction upon any of its other obligations under the Loan this Development Credit Agreement, shall cause each of the Water Companies BTRC to perform, perform in accordance with the provisions of their respective the Project Agreements, Agreement all the respective obligations of the Water Companies BTRC therein set forth, shall take or and cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies BTRC to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon the provisions of paragraph (a) of this Section and except as the Borrower and the Bank Association shall otherwise agree, the Borrower shall cause the Water Companies to: (i) carry out their obligations in accordance with the provisions Part A of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, Implementation Program set forth in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the ProjectSchedule 4 to this Agreement. (ac) Except as the Bank The Borrower shall otherwise agree, procurement of the goods, works, and consultants’ services, required for the Project and make available to be financed out of BTRC the proceeds of the Loan shall be governed by the provisions of Schedule 1 Credit allocated from time to time to the Project AgreementsCategories (1)(b), as such provisions may be further elaborated in the Procurement Plan. (b2)(b) The Borrower shalland (3)(b), or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company under a subsidiary loan agreement Subsidiary Grant Agreement to be entered into between the Borrower and the Guilan Water Company, BTRC under financial terms and conditions identical satisfactory to those governing the LoanAssociation. (bd) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements Grant Agreement in such manner as to protect the interests of the Borrower and the Bank Association and to accomplish the purposes of the LoanCredit, and, except as the Bank Association shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either the Subsidiary Loan Grant Agreement or any provision thereof. Section 3.063.02. Except as the Association shall otherwise agree, procurement of the goods and consultants’ services required for the Project and to be financed out of the proceeds of the Credit shall be governed by the provisions of Schedule 3 to this Agreement. Section 3.03. For the purposes of Section 9.07 9.06 of the General Conditions and without limitation thereto, the Borrower shall: (a) prepare, on the basis of guidelines acceptable to the BankAssociation, and furnish to the Bank Association not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the BankAssociation, a plan for the continued achievement future operation of the objectives Part A of the Project; and, (b) afford the Bank Association a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.073.04. The Bank Borrower and the Borrower Association hereby agree that the obligations set forth in Sections 9.03, 9.04, 9.05, 9.06, 9.07, 9.07 and 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) in respect of Part B of the Project shall be carried out by each of the Water Companies BTRC pursuant to the provisions of Section 2.03 of the respective Project Agreement. Section 3.05. The Borrower shall, by no later than January 1, 2004, appoint a Project Accountant in MOPT, with terms of reference satisfactory to the Association.

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the ProjectProject as set forth in Schedule 2 to this Agreement, and, to this end, without any limitation or restriction upon any of its other obligations under the Loan Development Credit Agreement, shall cause each of the Water Companies MUB to perform, perform in accordance with the provisions of their respective the Project Agreements, Agreement all the respective obligations of the Water Companies MUB therein set forth, shall take or and cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies MUB to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon the provisions of paragraph (a) of this Section and except as the Borrower and the Bank shall otherwise agree, the Borrower shall cause the Water Companies to: (i) carry out their obligations in accordance with the provisions of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the Project. (a) Except as the Bank shall otherwise agree, procurement of the goods, works, and consultants’ services, required for the Project and to be financed out of the proceeds of the Loan shall be governed by the provisions of Schedule 1 to the Project Agreements, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan Credit to the Guilan Water Company MUB under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water CompanyMUB (the MUB Subsidiary Loan Agreement), under financial terms and conditions identical to those governing which shall have been approved by the Loan.Association, which shall include: (bi) The the obligation of the MUB to establish and maintain a special and separate account in a commercial bank, acceptable to the Association, on terms and conditions satisfactory to the Association, including appropriate protection against set-off, seizure or attachment: (A) to be funded with the difference in amounts between: the principal paid by USAG to the MUB pursuant to the USAG Subsidiary Loan Agreement; and the principal paid by the MUB to the Borrower pursuant to the MUB Subsidiary Loan Agreement; and (B) use the proceeds therein deposited exclusively for the financing of investments to improve services to the urban poor in the ger areas; (ii) the principal amount so made available to, and repayable by, the MUB shall relend be the equivalent in terms of Dollars (determined as of the date or respective dates of withdrawal from the Credit Account, or payment out of the Special Account, as the case may be) of the value of the currency or currencies so withdrawn or paid out on account of the cost of items required for the Project to be financed out of the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to Credit, and shall be entered into between recovered by the Borrower from the MUB in semi-annual installments in Dollars over forty years, including a grace period of ten years; (iii) interest shall be charged on the principal amount of the MUB Subsidiary Loan withdrawn and outstanding from time to time at a rate equal to one percent (1%) per annum; and (iv) the Mazandaran Water CompanyBorrower shall charge a commitment charge on such principal amount, under financial terms and conditions identical not withdrawn from time to those governing time at the Loanrate set forth in Section 2.04(a) of the Development Credit Agreement. (ac) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the MUB Subsidiary Loan Agreements Agreement in such manner as to protect the interests of the Borrower and the Bank Association and to accomplish the purposes of the LoanCredit, and, except as the Bank Association shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either the MUB Subsidiary Loan Agreement or any provision thereof. Section 3.063.02. For Except as the purposes of Section 9.07 Association shall otherwise agree, procurement of the General Conditions goods, works and without limitation thereto, consultants’ services required for the Borrower shall: (a) prepare, on Project and to be financed out of the basis proceeds of guidelines acceptable the Credit shall be carried out by the MUB in accordance with the provisions of Schedule 1 to the Bank, and furnish to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Project Agreement. Section 3.03. The Borrower and the Bank, a plan for the continued achievement of the objectives of the Project; and, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.07. The Bank and the Borrower Association hereby agree that the obligations set forth in Sections 9.03, 9.04, 9.05, 9.06, 9.07, 9.07 and 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by each of the Water Companies MUB pursuant to Section 2.03 of the respective Project Agreement.

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the ProjectProject as set forth in Schedule 2 to this Agreement, and, to this end, without any limitation or restriction upon any of its other obligations under the Loan Development Credit Agreement, shall cause each of the Water Companies Nepal Rastra Bank to perform, perform in accordance with the provisions of their respective the Project Agreements, Agreement all the respective obligations of the Water Companies Nepal Rastra Bank therein set forth, shall take or and cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies Nepal Rastra Bank to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon The Borrower shall make available on a grant basis to Nepal Rastra Bank the provisions proceeds of paragraph (a) of this Section and except as the Borrower Credit and the Bank shall otherwise agreePooled Funds, the Borrower shall cause the Water Companies to: (i) carry out their obligations allocated from time to time, in accordance with the provisions of this NRB Subsidiary Grant Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the Project. (a) Except as the Bank shall otherwise agree, procurement of the goods, works, and consultants’ services, required for the Project and to be financed out of the proceeds of the Loan shall be governed by the provisions of Schedule 1 to the Project Agreements, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water Company, Nepal Rastra Bank under financial terms and conditions identical to those governing which shall have been approved by the LoanAssociation. (bc) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon In accordance with the provisions of Section 3.03(a) abovethe NRB Subsidiary Grant Agreement, the Borrower shall make available, through the Borrower’s contributionin a timely manner, to Nepal Rastra Bank sufficient funds, in necessary and appropriate amounts, to ensure effective implementation of the Guilan Water Company: (i) the Project. Such funds shall include proceeds of the Loan; Credit, the Pooled Funds, and (ii) such amounts as may be needed to finance the any additional funds from Borrower’s contribution to expenditures under Parts B and D of own resources required for carrying out the Project. (bd) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the NRB Subsidiary Loan Agreements Grant Agreement in such manner as to protect the interests of the Borrower and the Bank Association and to accomplish the purposes of the LoanCredit, and, except as the Bank Association shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either the NRB Subsidiary Loan Grant Agreement or any provision thereof. Section 3.063.02. Except as the Association shall otherwise agree, procurement of the goods and consultants’ services required for the Project and to be financed out of the proceeds of the Credit and the Pooled Funds, shall be governed by the provisions of Schedule 1 to the Project Agreement. Section 3.03. For the purposes of Section 9.07 9.06 of the General Conditions and without limitation thereto, the Borrower shall: (a) prepare, on the basis of guidelines acceptable to the BankAssociation, and furnish to the Bank Association not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the BankAssociation, a plan for designed to ensure the continued achievement of the objectives of the Project’s objectives; and, (b) afford the Bank Association a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.073.04. The Bank Borrower and the Borrower Association hereby agree that the obligations set forth in Sections 9.03, 9.04, 9.05, 9.06, 9.07, 9.07 and 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be be, or caused to be, carried out out, by each of the Water Companies Nepal Rastra Bank pursuant to the provisions of Section 2.03 of the respective Project Agreement.

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the Project, and, to this end, without any limitation or restriction upon any of its other obligations under shall carry out the Loan AgreementProject through the SAGW with due diligence and efficiency and in conformity with appropriate administrative, financial, cadastral and real estate registration, and environmental practices, and shall cause each of provide, promptly as needed, the Water Companies to perform, in accordance with the provisions of their respective Project Agreements, all the respective obligations of the Water Companies therein set forth, shall take or cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of resources required for the Water Companies to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performanceProject. (b) Without limitation upon the provisions of paragraph (a) of this Section and except as the Borrower and the Bank shall otherwise agree, the Borrower Borrower, through the SAGW, shall cause the Water Companies to: (i) carry out their obligations in accordance with the provisions of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, Implementation Program set forth in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the ProjectSchedule 5 to this Agreement. (a) Except as the Bank shall otherwise agree, procurement of the goods, works, works and consultants’ services, services required for the Project and to be financed out of the proceeds of the Loan shall be governed by the provisions of Schedule 1 4 to the Project Agreementsthis Agreement, as such said provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference guidelines acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) 12 months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water Company, under financial terms and conditions identical to those governing the Loan. (b) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements in such manner as to protect the interests of the Borrower and the Bank and to accomplish the purposes of the Loan, and, except as the Bank shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either Subsidiary Loan Agreement or any provision thereof. Section 3.063.03. For the purposes of Section 9.07 of the General Conditions and without limitation thereto, the Borrower shall: (a) prepare, on the basis of guidelines acceptable to the Bank, and furnish to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the Bank, a plan for designed to ensure the continued achievement of the objectives of the Project’s objectives; and, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.073.04. The Bank Where buildings or dwellings have been constructed or occupied otherwise than in accordance with applicable laws or regulations of the Borrower, the Borrower shall only record the buildings or dwellings in the REC, and shall not register any ownership rights over the relevant land, unless and until such buildings or dwellings have been regularized in accordance with such applicable laws or regulations, in which case ownership rights over the buildings or dwellings, and the relevant land, shall be registered by the Borrower hereby agree that in the obligations set forth in Sections 9.04, 9.05, 9.06, 9.07, 9.08 and 9.09 REC upon application of the General Conditions (relating to insurance, use of goods occupier and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by each fulfillment of the Water Companies pursuant to Section 2.03 of the respective Project Agreementconditions prescribed by such laws or regulations.

Execution of the Project. (a) The Borrower Recipient declares its commitment to the objectives of the ProjectProject as set forth in Schedule 2 to this Agreement, and, to this end, without any limitation or restriction upon any of its other obligations under the Loan this Agreement, shall cause each of the Water Companies FSRDC to perform, perform in accordance with the provisions of their respective the Project Agreements, Agreement all the respective obligations of the Water Companies FSRDC therein set forth, shall take or and cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies FSRDC to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon The Recipient shall make the provisions proceeds of paragraph the Grant available to FSRDC under a subsidiary grant agreement to be entered into between the Recipient and FSRDC, under terms and conditions which shall have been approved by the Association. (ac) The Recipient shall exercise its rights under the Subsidiary Grant Agreement in such manner as to protect the interests of this Section the Recipient and the Association and to accomplish the purposes of the Grant, and, except as the Borrower and the Bank Association shall otherwise agree, the Borrower shall cause the Water Companies to: (i) carry out their obligations in accordance with the provisions of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower Recipient shall not amend assign, amend, abrogate or waive the Subsidiary Grant Agreement or any provision thereof if, in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the Projectthereof. (a) Except as the Bank Association shall otherwise agree, procurement of the goods, works, works and consultants’ services, services required for the Project and to be financed out of the proceeds of the Loan Grant shall be governed by the provisions of Schedule 1 to the Project AgreementsAgreement, as such said provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or Recipient shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference guidelines acceptable to the BankAssociation, and furnish such update to the Bank Association not later than twelve (12) 12 months after the date of the preceding Procurement Plan, for the BankAssociation’s approval. (a) Section 3.03. The Borrower shall relend the proceeds of the Loan to the Guilan Water Company under a subsidiary loan agreement to be entered into between the Borrower Recipient and the Guilan Water Company, under financial terms and conditions identical to those governing the Loan. (b) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements in such manner as to protect the interests of the Borrower and the Bank and to accomplish the purposes of the Loan, and, except as the Bank shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either Subsidiary Loan Agreement or any provision thereof. Section 3.06. For the purposes of Section 9.07 of the General Conditions and without limitation thereto, the Borrower shall: (a) prepare, on the basis of guidelines acceptable to the Bank, and furnish to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the Bank, a plan for the continued achievement of the objectives of the Project; and, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.07. The Bank and the Borrower Association hereby agree that the obligations set forth in Sections 9.03, 9.04, 9.05, 9.06, 9.07, 9.07 and 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by each of the Water Companies FSRDC pursuant to Section 2.03 of the respective Project Agreement. Section 3.04. Within six months from the Date of Effectiveness, the Recipient shall have adopted the ESMF, RPF, and the IPDP satisfactory to the Association. Section 3.05. Within six months from the Date of Effectiveness, the Recipient shall have appointed an accounting firm to assist in the fiduciary management of the Project with qualifications and experience satisfactory to the Association;

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the ProjectProject as set forth in Schedule 2 to this Agreement, and, to this end: (i) shall carry out Parts A, B and D of the Project through MOWTC, MOLG and District Administrations with due diligence and efficiency and in conformity with appropriate administrative and financial practices and shall provide, promptly as needed, the funds, facilities, services and other resources required for such Parts of the Project; and (ii) without any limitation or restriction upon any of its other obligations under the Loan Development Credit Agreement, the Borrower shall cause each of URC to perform all its obligations set forth in the Water Companies to perform, in accordance with the provisions of their respective Project Agreements, all the respective obligations of the Water Companies therein set forthAgreement, shall take or cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies URC to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon the provisions of paragraph (a) of this Section Section, and except as the Borrower and the Bank Association shall otherwise agree, the Borrower shall cause the Water Companies to: (i) carry out their obligations in accordance with the provisions Parts A, B and D of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Implementation Program set forth in Schedule 4 to this Agreement. (c) The Borrower shall not amend or waive any provision thereof if, in for the opinion purposes of the Bank, such amendment or waiver may materially and adversely affect the implementation Part C of the Project. : (ai) Except as the Bank shall otherwise agree, procurement of the goods, works, and consultants’ services, required for the Project and make available to be financed out URC a portion of the proceeds of the Loan shall be governed by the provisions of Schedule 1 Credit as an equity contribution to the Project Agreements, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the BankURC’s capital, and furnish such update to the Bank not later than twelve (12ii) months after the date relend a portion of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan Credit to the Guilan Water Company URC under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water CompanyURC, under financial terms and conditions identical which shall have been approved by the Association which shall include repayment in 15 years, including 5 years of grace, the payment of interest at the rate of 7% per annum, and the exchange risk to those governing the Loanbe borne by URC. (bd) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements Agreement in such manner as to protect the interests of the Borrower and the Bank Association and to accomplish the purposes of the LoanCredit, and, and except as the Bank Association shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either the Subsidiary Loan Agreement or any provision thereof. Section 3.063.02. For Except as the purposes of Section 9.07 Association shall otherwise agree, procurement of the General Conditions goods, works and without limitation theretoconsultants’ services required for Parts A, B and D of the Borrower shall:Project and to be financed out of the proceeds of the Credit shall be governed by the provisions of Schedule 3 to this Agreement. (a) prepare, on the basis of guidelines acceptable to the Bank, and furnish to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Section 3.03. The Borrower and the Bank, a plan for the continued achievement of the objectives of the Project; and, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.07. The Bank and the Borrower Association hereby agree that the obligations set forth in Sections 9.03, 9.04, 9.05, 9.06, 9.07, 9.07 and 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) in respect of Part C of the Project shall be carried out by each of the Water Companies URC pursuant to Section 2.03 of the respective Project Agreement. Section 3.04. The Borrower shall by not later than July 1, 1995 commence to compensate URC for all Borrower-directed, non- remunerative services provided by URC. Section 3.05. The Borrower shall, no later than January 31 in each year of Project implementation, with effect from January 31, 1995, review with the Association the size and composition of TSIREP. (a) In order to ensure a meaningful implementation of the Program the Borrower shall not make, or cause any investments to be made, in the transport sector, which were not included in the TSIREP, which exceed the equivalent of $5 million in any one year without prior consultation with, and the consent of the Association. The Association’s consent shall not be unreasonably withheld. (b) The Borrower shall further ensure that any investment outside TSIREP which exceeds the equivalent of $1 million shall only be carried out if its economic rate of return is not less than twelve percent. (a) The Borrower shall conduct, not later than March 31, 1996, jointly with the Association, a midterm review of the Project. Without limitation upon the generality of the foregoing, the review shall, inter alia, cover the implementation and management aspects of the Project, implementation procedures, progress made by the Project including transfer of responsibility to local staff, revision of the strategy paper for rural feeder roads maintenance and rehabilitation, evaluation of the financing mechanism for main roads maintenance, review of MOWTC’s mandate with respect to road maintenance, environmental measures taken, performance and use of technical assistance personnel, the role of national counterpart staff, the status and results of training, reporting, accounting and audit performance, disbursement procedures and the overall sustainability of the Project. (b) Not later than ninety (90) days prior to the midterm review referred to in (a) above, the Borrower shall furnish to the Association, for its comments, a report in such detail as the Association shall reasonably request, including an evaluation of the progress achieved in implementing the Project. (c) The Borrower shall, promptly thereafter, carry out the recommendations stemming from the aforementioned review.

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the ProjectProject as set forth in Schedule 2 to this Agreement, and, to this end, without any limitation or restriction upon any of its other obligations under the Loan Agreement, shall cause each of the Water Companies CDR to perform, perform in accordance with the provisions of their respective the Project Agreements, Agreement all the respective obligations of the Water Companies CDR therein set forth, shall take or cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies CDR to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon the provisions of paragraph (a) of this Section and except as the Borrower and the Bank shall otherwise agree, the Borrower shall cause the Water Companies to: (i) carry out their obligations in accordance with the provisions of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the Project. (a) Except as the Bank shall otherwise agree, procurement of the goods, works, and consultants’ services, required for the Project and to be financed out of the proceeds of the Loan shall be governed by the provisions of Schedule 1 to the Project Agreements, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend make available as a grant the proceeds of the Loan to the Guilan Water Company CDR under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water CompanyCDR, under financial terms and conditions identical to those governing which shall have been approved by the LoanBank. (bc) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements Agreement in such manner as to protect the interests of the Borrower and the Bank and to accomplish the purposes of the Loan, and, except as the Bank shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either the Subsidiary Loan Agreement or any provision thereof. Section 3.063.02. For Except as the purposes of Section 9.07 Bank shall otherwise agree, procurement of the General Conditions goods, works and without limitation thereto, consultants’ services required for the Borrower shall: (a) prepare, on Project and to be financed out of the basis proceeds of guidelines acceptable the Loan shall be governed by the provisions of Schedule 1 to the Bank, and furnish to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the Bank, a plan for the continued achievement of the objectives of the Project; and, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said planProject Agreement. Section 3.073.03. The Bank and the Borrower hereby agree that the obligations set forth in Sections 9.04, 9.05, 9.06, 9.07, 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by each of the Water Companies CDR pursuant to Section 2.03 of the respective Project Agreement. Section 3.04. The Borrower shall select, from its investment program for the agriculture sector, sub-projects, to be financed out of the proceeds of the Loan, for the rehabilitation, operation and maintenance of the Irrigation Schemes referred to under Part A.1 (b) of the Project on the basis of criteria acceptable to the Bank, including those set forth in Schedule 5 to this Agreement.

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the ProjectProject as set forth in Schedule 2 to this Agreement, and, to this end, without any limitation or restriction upon any of its other obligations under the Loan Agreement, shall cause each of the Water Companies Project Province to perform, perform in accordance with the provisions of their respective the Project Agreements, Agreement all the respective obligations of the Water Companies such Project Province therein set forth, shall take or cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies Project Province to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon the provisions of paragraph (a) of this Section and except as the Borrower and the Bank shall otherwise agree, the The Borrower shall cause make available to each Project Province its Respective Proceeds of the Water Companies toLoan on the following principal terms: (i) carry the principal amount so made available shall be the amount withdrawn from the Loan Account or paid out their obligations in accordance with of the provisions Respective Special Account, on account of this Agreement the cost of goods, works and services required for such Project Province’s Respective Part of the applicable Project Agreementsand to be financed out of the proceeds of the Loan; (ii) each Project Province shall repay the principal amount so made available to it over a period of twenty (20) years, inclusive of a grace period of five (5) years; and (iiiii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall charge each Project Province: (A) interest on the principal amount so made available and withdrawn and remaining unpaid from time to time at a rate equal to the rate of interest applicable from time to time to the Loan pursuant to Section 2.05 of this Agreement, and (B) a commitment charge on the principal amount so made available and not amend or waive any provision thereof if, in the opinion withdrawn from time to time at a rate equal to three-fourths of the Bank, such amendment or waiver may materially and adversely affect the implementation one percent (3/4 of the Project1%) per annum. (a) Section 3.02. Except as the Bank shall otherwise agree, procurement of the goods, works, works and consultants’ services, services required for the Project and to be financed out of the proceeds of the Loan shall be governed by the provisions of Schedule 1 to the Project Agreements, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water Company, under financial terms and conditions identical to those governing the Loan. (b) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the ProjectAgreement. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements in such manner as to protect the interests of the Borrower and the Bank and to accomplish the purposes of the Loan, and, except as the Bank shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either Subsidiary Loan Agreement or any provision thereof. Section 3.06. For the purposes of Section 9.07 of the General Conditions and without limitation thereto, the Borrower shall: (a) prepare, on the basis of guidelines acceptable to the Bank, and furnish to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the Bank, a plan for the continued achievement of the objectives of the Project; and, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.073.03. The Bank and the Borrower hereby agree that the obligations set forth in Sections 9.04, 9.05, 9.06, 9.07, 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by each of the Water Companies Project Province pursuant to Section 2.03 of the respective Project Agreement.

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the ProjectProject as set forth in Schedule 2 to this Agreement, and, and to this end, without any limitation or restriction upon any of its other obligations under the Loan Agreement, shall cause each of the Water Companies CHESF to perform, in accordance with the provisions of their respective the Project AgreementsAgreement, all the respective obligations of the Water Companies CHESF therein set forth, shall take or cause to be taken in a timely manner all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies CHESF to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon The Borrower shall relend the provisions proceeds of paragraph (a) the Loan to CHESF, under a subsidiary loan agreement satisfactory to the Bank, between the Borrower and CHESF, which shall include, inter alia, the financial terms and conditions set forth, in respect of the Loan, in Sections 2.04 through 2.07 of this Section Agreement, but including a service fee to be paid by CHESF to the Borrower at a rate of 0.5% per annum on the principal amount of the Subsidiary Loan withdrawn and except outstanding from time to time; (c) The Borrower shall exercise its rights under the Subsidiary Loan Agreement in such manner as to protect the interests of the Borrower and the Bank shall otherwise agreeand to accomplish the purposes of the Lean, the Borrower shall cause the Water Companies to: (i) carry out their obligations in accordance with the provisions of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend assign, amend, abrogate or waive the Subsidiary Loan Agreement or any provision thereof if, in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the Projectthereof. (a) Section 3.02. Except as the Bank shall otherwise agree, procurement of the goods, works, works and consultants’ services, services required for the Project and to be financed out of the proceeds of the Loan shall be governed by the provisions of Schedule 1 I to the Project Agreements, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water Company, under financial terms and conditions identical to those governing the Loan. (b) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the ProjectAgreement. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements in such manner as to protect the interests of the Borrower and the Bank and to accomplish the purposes of the Loan, and, except as the Bank shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either Subsidiary Loan Agreement or any provision thereof. Section 3.06. For the purposes of Section 9.07 of the General Conditions and without limitation thereto, the Borrower shall: (a) prepare, on the basis of guidelines acceptable to the Bank, and furnish to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the Bank, a plan for the continued achievement of the objectives of the Project; and, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.073.03. The Bank and the Borrower hereby agree that the obligations set forth in Sections 9.04, 9.05, 9.06, 9.07, 9.08 9.O8 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by each of the Water Companies CHESF pursuant to Section 2.03 of the respective Project Agreement.

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the ProjectProgram and Project as set forth in Schedule 2 to this Agreement, and, to this end: (i) shall carry out Part A of the Project through MHUD, cause MbCC to carry out Part B.1 of the Project, MzCC to carry out Part B.2 of the Project and the Swaziland Electricity Board to carry out Part B.3 of the Project, all with due diligence and efficiency and in conformity with appropriate administrative, financial, engineering and urban development practices and shall provide, promptly as needed, the funds, facilities, services and other resources required for such Parts of the Project; and (ii) without any limitation or restriction upon any of its other obligations under the Loan Agreement, the Borrower shall cause each of the Water Companies SWSC and SNHB to perform, perform in accordance with the provisions of their respective the SWSC Project AgreementsAgreement and the SNHB Project Agreement, respectively, all the respective obligations of the Water Companies SWSC and SNHB therein set forth, shall take or cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies SWSC and SNHB to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon the provisions of paragraph (a) of this Section Section, and except as the Borrower and the Bank shall otherwise agree, the Borrower shall cause the Water Companies to: (i) carry out their obligations in accordance with the provisions and cause to be carried out Parts A, B.1, B.2 and B.3 of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, Implementation Program set forth in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the ProjectSchedule 5 to this Agreement. (ac) Except as the Bank The Borrower shall otherwise agree, procurement of the goods, works, and consultants’ services, required for the Project and to be financed out relend: (i) $2,200,000 equivalent of the proceeds of the Loan shall be governed by the provisions for Part B.1 of Schedule 1 to the Project Agreements, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water Company, under financial terms and conditions identical to those governing the Loan. (b) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements in such manner as to protect the interests of the Borrower and the Bank and to accomplish the purposes of the Loan, and, except as the Bank shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either Subsidiary Loan Agreement or any provision thereof. Section 3.06. For the purposes of Section 9.07 of the General Conditions and without limitation thereto, the Borrower shall: (a) prepare, on the basis of guidelines acceptable to the Bank, and furnish to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the Bank, a plan for the continued achievement of the objectives of the Project; andMbCC, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.07. The Bank and the Borrower hereby agree that the obligations set forth in Sections 9.04, 9.05, 9.06, 9.07, 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by each of the Water Companies pursuant to Section 2.03 of the respective Project Agreement.

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the ProjectProject as set forth in Schedule 2 to this Agreement, and, to this end, without any limitation or restriction upon any of its other obligations under the Loan this Agreement, shall cause each of the Water Companies NaCSA to perform, perform in accordance with the provisions of their respective the Project AgreementsAgreement, all the respective obligations of the Water Companies Project Agreement therein set forth, shall take or and cause to be taken all action, including the provision of funds (which shall include counterpart funds), facilities, services and other resources, necessary or appropriate to enable each of the Water Companies NaCSA to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon To enable NaCSA to meet its obligations under Schedule 2, Section I (2), of the provisions of paragraph (a) of this Section and except as the Borrower and the Bank shall otherwise agreeProject Agreement, the Borrower shall cause take all measures on its part to ensure that NaCSA shall at all times be under the Water Companies to: (i) carry out their obligations in accordance with the provisions management of this Agreement a qualified Commissioner and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy FrameworkDeputy Commissioner, whose qualifications, skills mix, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, in the opinion terms of reference are consistent with Section 14 of the BankNational Commission for Social Action Act, such amendment or waiver may materially 2001 (Act. No. 13 of 2001), and adversely affect under the implementation governance and general supervision of the Projecta qualified Board of Directors. (ac) Except as the Bank The Borrower shall otherwise agree, procurement of the goods, works, and consultants’ services, required for the Project and to be financed out of make the proceeds of the Loan shall be governed by the provisions of Schedule 1 Credit available to the Project Agreements, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company NaCSA under a subsidiary loan agreement Subsidiary Financing Agreement to be entered into between the Borrower and the Guilan Water CompanyNaCSA, under financial terms and conditions identical to those governing which shall have been approved by the LoanAssociation. (bd) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements Financing Agreement in such manner as to protect the interests of the Borrower and the Bank Association and to accomplish the purposes of the LoanCredit, and, except as the Bank Association shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either the Subsidiary Loan Financing Agreement or any provision thereof. Section 3.063.02. For Except as the purposes of Section 9.07 Association shall otherwise agree, procurement of the General Conditions goods, works and without consultants’ services required for the Project and to be financed out of the proceeds of the Credit shall be governed by the provisions of Schedule 1 to the Project Agreement. Section 3.03. Without limitation theretoto its obligations under Section 3.01 of this Agreement, the Borrower shall, for the purposes of making available its counterpart contribution to the financing of the Project: (a) prepareopen and maintain, on the basis of guidelines acceptable to the Bank, and furnish to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the Bank, a plan for the continued achievement of the objectives duration of the Project; and,, an advance account (hereinafter referred to as the Project Account) in Leones in a commercial bank on terms and conditions satisfactory to the Association; (b) afford deposit into the Bank Project Account an initial advance equivalent to $360,000, and thereafter replenish the Project Account on a reasonable opportunity to exchange views with quarterly basis, or whenever the Borrower on said planbalance of the Project Account is less than $50,000 equivalent, whichever occurs first; and (c) ensure that funds deposited into the Project Account shall be used only for the purposes of defraying the cost of expenditures incurred in the execution of the Project which are not financed out of the proceeds of the Credit. Section 3.073.04. The Bank Borrower and the Borrower Association hereby agree that the obligations set forth in Sections 9.03, 9.04, 9.05, 9.06, 9.07, 9.07 and 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) in respect of the Project shall be carried out by each of the Water Companies NaCSA pursuant to Section 2.03 of the respective Project Agreement.

Execution of the Project. (a) The Borrower Recipient declares its commitment to the objectives of the Project, Project as set forth in Schedule 2 to this Agreement and, to this end, without any limitation or restriction upon any of its other obligations under the Loan Agreementshall carry out Parts B.1, shall cause each B.2 and B.3 of the Water Companies to performProject, through SIF/MEPER, DOE/DOI/CODEVAR and PMSD, respectively, with due diligence and efficiency, in accordance conformity with appropriate administrative, financial and technical practices, and with due regard to ecological and environmental factors, and shall provide, promptly as needed, the provisions of their respective Project Agreements, all the respective obligations of the Water Companies therein set forth, shall take or cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of resources required for the Water Companies to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performanceProject. (b) Without limitation upon the provisions of paragraph (a) of this Section Section, and except as the Borrower Recipient and the Bank Trustee shall otherwise agree, the Borrower Recipient shall cause the Water Companies to: (i) carry out their obligations in accordance with the provisions Part B of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; Implementation Program set forth in Schedule 4 to this Agreement, the Land Acquisition Plan; SIF Memorandum of Understanding, the Procurement Plan; DOI/CODEVAR Memorandum of Understanding and the Resettlement Policy FrameworkPMSD Memorandum of Understanding. (a) The Recipient shall conclude the SIF Memorandum of Understanding, acceptable to the Trustee, with SIF for the execution and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, in the opinion management of the Bank, such amendment or waiver may materially and adversely affect the implementation Part B.1 of the Project. (ab) The Recipient shall exercise its rights under the SIF Memorandum of Understanding in such manner as to protect the interests of the Recipient and the Trustee, and to accomplish the purposes of the GET Grant and, except as the Trustee shall otherwise agree, the Recipient shall not assign, amend, abrogate or waive the SIF Memorandum of Understanding, or any provision thereof. Section 3.03. Except as the Bank Trustee shall otherwise agree, procurement of the goods, works, works and consultants’ services, services required for Part B of the Project and to be financed out of the proceeds of the Loan GET Grant shall be governed by the provisions of Schedule 1 3 to the Project Agreements, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water Company, under financial terms and conditions identical to those governing the Loan. (b) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Projectthis Agreement. Section 3.053.04. The Borrower shall exercise its rights under the Subsidiary Loan Agreements in such manner as to protect the interests of the Borrower and the Bank and to accomplish the purposes of the Loan, and, except as the Bank shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either Subsidiary Loan Agreement or any provision thereof. Section 3.06. For the purposes of Section 9.07 of the General Conditions and without limitation thereto, the Borrower shallcause: (a) prepare▇▇▇▇▇, on DOI and CODEVAR to prepare and agree upon a Memorandum of Understanding, giving details of the basis implementation arrangements for the implementation of guidelines acceptable to the Bankturtle trade compensation study, and furnish to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed compensation and retraining program for this purpose between the Borrower and the Bankturtle shell artisans, a plan for the continued achievement of the objectives under Part B.2 of the Project; and,; (b) afford the Bank ▇▇▇▇▇ and PMSD to prepare and agree upon a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.07. The Bank and the Borrower hereby agree that the obligations set forth in Sections 9.04Memorandum of Understanding, 9.05, 9.06, 9.07, 9.08 and 9.09 giving details of the General Conditions (relating to insurance, use implementation arrangements for the implementation of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by each Part B.3 of the Water Companies pursuant to Section 2.03 of the respective Project AgreementProject.

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the Project, Project as set forth in Schedule 2 to this Agreement and, to this end, without any limitation or restriction upon any of its other obligations under the Loan Development Credit Agreement, shall cause each of the Water Companies FID to perform, perform in accordance with the provisions of their respective the Project Agreements, Agreement all the respective obligations of the Water Companies FID therein set forth, shall take or and cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies FID to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon the provisions of its obligations under paragraph (a) of this Section and except as the Borrower and the Bank shall otherwise agreeabove, the Borrower shall cause the Water Companies to: (i) carry out their obligations in accordance with the provisions of this Agreement undertakes to approve and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, an annual five percent increase in the opinion budgetary allocations of its Communes for the Bank, such amendment or waiver may materially and adversely affect the implementation entire duration of the Project. (a) Except as the Bank shall otherwise agree, procurement of the goods, works, and consultants’ services, required for the Project and to be financed out of the proceeds of the Loan shall be governed by the provisions of Schedule 1 to the Project Agreements, as such provisions may be further elaborated beginning in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approvalFiscal Year 2001. (a) The Borrower shall relend make the entire proceeds of the Loan Credit available, on a non-reimbursable grant basis, to the Guilan Water Company under FID pursuant to a subsidiary loan agreement convention to be entered into between the Borrower and FID (hereinafter referred to as the Guilan Water CompanyConvention), under financial terms and conditions identical which shall have been approved by the Association and which shall include the terms and conditions set forth in Schedule 4 to those governing the Loanthis Agreement. (b) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements Convention in such a manner so as to protect the interests of the Borrower and the Bank Association, and to accomplish the purposes of the LoanCredit and the objectives of FID, and, except as the Bank Association shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either Subsidiary Loan Agreement the Convention, or any provision thereof. Section 3.063.03. For the purposes of Section 9.07 9.06 of the General Conditions and without limitation thereto, the Borrower shall: (a) prepare, on the basis of guidelines acceptable to the BankAssociation, and furnish to the Bank Association not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the BankAssociation, a plan for designed to ensure the continued achievement of the objectives of the Project; and, (b) afford the Bank Association a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.073.04. Except as the Association shall otherwise agree, procurement of the goods, works and consultants’ services required for the Project, and to be financed out of the proceeds of the Credit, shall be governed by the provisions of Schedule 1 to the Project Agreement. Section 3.05. The Bank Borrower and the Borrower Association hereby agree that the obligations set forth in Sections 9.03, 9.04, 9.05, 9.06, 9.07, 9.07 and 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by each FID in respect of the Water Companies Project pursuant to Section 2.03 2.05 of the respective Project Agreement. Section 3.06. Without limitation upon its obligations under Section 3.01 of this Agreement, the Borrower shall: (a) maintain, in a commercial bank and on terms and conditions satisfactory to the Association, an advance account in the currency of the Borrower (hereinafter referred to as the Project Account), to be operated and maintained by FID, into which it shall deposit from time to time its local counterpart contribution to the cost of the Project; (b) deposit into the Project Account an initial advance equivalent to $250500,000, and thereafter replenish the Project Account on a quarterly basis, or whenever the balance thereof equals not more than one third of the amount of the initial deposit, whichever occurs first; and (c) ensure that funds deposited into the Project Account shall be used only for the purposes of defraying the cost of expenditures incurred in the execution of the Project which are not financed out of the proceeds of the Credit.

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the Project, Project and, to this endend shall carry out the Project through MED, without any limitation or restriction upon any with the participation of its other obligations under FONCODES in respect of Infrastructure Subprojects pursuant to the Loan FONCODES Agreement, all with due diligence and efficiency and in conformity with appropriate managerial, administrative, financial, education, social and environmental practices, and shall cause each of provide, promptly as needed, the Water Companies to perform, in accordance with the provisions of their respective Project Agreements, all the respective obligations of the Water Companies therein set forth, shall take or cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of resources required for the Water Companies to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performanceProject. (b) Without limitation upon or restriction to the provisions of paragraph (a) of this Section and except as the Borrower and the Bank shall otherwise agreeabove, the Borrower shall cause the Water Companies to: (i) carry out their obligations in accordance with the provisions of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with with: (i) the Environmental Management PlanIndigenous Peoples Strategy; the Land Acquisition Plan; and (ii) the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the ProjectImprovement Action Plans. (a) Section 3.02. Except as the Bank shall otherwise agree, procurement of the goods, works, works and consultants’ services, services required for the Project and to be financed out of the proceeds of the Loan shall be governed by the provisions of Schedule 1 4 to the Project Agreements, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approvalthis Agreement. (a) The Borrower shall relend At all times during the proceeds execution of the Loan Project, the Borrower (through MED) shall maintain: (i) a Project steering committee with membership structure and responsibilities satisfactory to the Guilan Water Company under Bank, including the following responsibilities: (A) to review Project implementation reports and audits; and (B) to approve the Operational Manual, each Annual Operations Plan, and any modification thereof; and (ii) a subsidiary loan agreement to be entered into between Project coordinating unit responsible for overall Project coordination, supervision, monitoring and evaluation, including: (A) preparing each Annual Operations Plan; (B) issuing Project implementation guidelines; (C) maintaining the Borrower Project impact monitoring system; (D) procuring goods and consultants’ services for the Guilan Water Company, under financial terms Project; and conditions identical to those governing the Loan(E) preparing FMRs and processing withdrawal applications. (b) The Borrower shall relend ensure that PCU is staffed, at all times during the execution of the Project, by core professional staff in numbers and with experience and qualifications acceptable to the Bank, operating under terms of reference satisfactory to the Bank, and selected in accordance with competitive and transparent procedures satisfactory to the Bank, all as prescribed in the Operational Manual. Section 3.04. With regard to Part B.3 of the Project, the Borrower (through MED) shall enter into an agreement with FONCODES, under terms and conditions satisfactory to the Bank, for the purposes of ensuring the participation of FONCODES in the implementation of such Part of the Project, said agreement to provide, inter alia: (a) the transfer to FONCODES of the proceeds of the Loan allocated to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. Category (a1) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed table in Part A.1 of Schedule 1 to finance the Borrower’s contribution to expenditures under Parts B and D of the Project.this Agreement; (b) Without limitation upon the provisions obligation of Section 3.03(b) above, FONCODES to carry out Infrastructure Subprojects in accordance with: the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the LoanOperational Manual; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements in such manner as to protect the interests of the Borrower and the Bank and to accomplish the purposes of the Loan, and, except as the Bank shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either Subsidiary Loan Agreement or any provision thereof. Section 3.06. For the purposes of Section 9.07 of the General Conditions and without limitation thereto, the Borrower shall: (a) prepare, on the basis of guidelines acceptable to the Bank, and furnish to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the Bank, a plan for the continued achievement of the objectives of the Project; and, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.07. The Bank and the Borrower hereby agree that the obligations set forth in Sections 9.04, 9.05, 9.06, 9.07, 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by each of the Water Companies pursuant to Section 2.03 of the respective Project Agreement.

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the ProjectProject as set forth in Schedule 2 to this Agreement, and, to this end, without any limitation or restriction upon any of its other obligations under the Loan Agreement, shall cause each the Local Entities to carry out Parts A and B of the Water Companies Project and shall carry out Part C of the Project through MOH, all with due diligence and efficiency and in conformity with appropriate economic, financial, administrative, technical and public health practices, and shall provide, or cause to be provided, promptly as needed, the funds, facilities, services and other resources required for the purpose. (b) Without limitation upon the provisions of paragraph (a) of this Section and except as the Borrower and the Association shall otherwise agree, the Borrower shall carry out Part C of the Project in accordance with the Implementation Program set forth in Schedule 4 to this Agreement. (a) The Borrower shall make available to each Local Entity its Respective Proceeds, under arrangements to be made between the Borrower and said Local Entity, in accordance with the provisions set forth in Schedule 6 to this Agreement. (b) The Borrower shall: (i) cause each Local Entity to perform, in accordance with the provisions of their respective the Project AgreementsImplementation Arrangements to which it is a party, all of the respective obligations of the Water Companies said Local Entity therein set forth, shall ; (ii) take or cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies said Local Entity to perform such obligations, and shall ; (iii) not take or permit to be taken any action which would prevent or interfere with such performance.; and (biv) Without limitation upon exercise its rights under each of the provisions Project Implementation Arrangements in such manner as to protect the interests of paragraph (a) of this Section and except as the Borrower and the Bank Association and to accomplish the purposes of the Credit, and, except as the Association shall otherwise agree, the Borrower shall cause the Water Companies to: (i) carry out their obligations in accordance with the provisions of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Frameworknot amend, and except as the Bank shall otherwise agree, the Borrower shall not amend abrogate or waive any provision thereof if, in the opinion of the Bank, such amendment Project Implementation Arrangements or waiver may materially and adversely affect the implementation of the Projectany provision thereof. (a) Section 3.03. Except as the Bank Association shall otherwise agree, procurement of the goods, works, goods and consultants’ services, services required for the Project and to be financed out of the proceeds of the Loan Credit shall be governed by the provisions of Schedule 1 3 to the Project Agreements, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water Company, under financial terms and conditions identical to those governing the Loan. (b) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Projectthis Agreement. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements in such manner as to protect the interests of the Borrower and the Bank and to accomplish the purposes of the Loan, and, except as the Bank shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either Subsidiary Loan Agreement or any provision thereof. Section 3.063.04. For the purposes purpose of Section 9.07 of the General Conditions Conditions, and without limitation thereto, the Borrower shall: (a) prepare, on the basis of guidelines acceptable to the BankAssociation, and furnish to the Bank Association not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the BankAssociation, a plan (including the long-term strategies prepared by the Local Entities pursuant to Part F.2 of Schedule 6 to this Agreement) for the continued achievement of the objectives future operation of the Project; and, (b) afford the Bank Association a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.07. The Bank and the Borrower hereby agree that the obligations set forth in Sections 9.04, 9.05, 9.06, 9.07, 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by each of the Water Companies pursuant to Section 2.03 of the respective Project Agreement.

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the Project, Project as set forth in Schedule 2 to this Agreement and, to this end, without any limitation or restriction upon any of its other obligations under the Loan Development Credit Agreement, shall cause each of the Water Companies SONELEC to perform, perform in accordance with the provisions of their respective the Project Agreements, Agreement all the respective obligations of the Water Companies SONELEC therein set forth, shall take or and cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies SONELEC to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon the provisions of paragraph (a) of this Section and except as the Borrower Association and the Bank Borrower shall otherwise agree, the Borrower shall cause the Water Companies to: (i) carry out their obligations in accordance with the provisions of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, Implementation Program set forth in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the Project. (a) Except as the Bank shall otherwise agree, procurement of the goods, works, and consultants’ services, required for the Project and Schedule 3 to be financed out of the proceeds of the Loan shall be governed by the provisions of Schedule 1 to the Project Agreements, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approvalthis Agreement. (a) The Borrower shall relend relend, excluding any exchange risk, the proceeds of the Loan Credit to the Guilan Water Company SONELEC under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water CompanySONELEC, under financial terms and conditions identical to those governing which shall have been approved by the LoanAssociation, which shall include an annual interest rate of 4 percent on the disbursed and outstanding amount of the loan, and a repayment period of twenty years including a grace period of five years. (b) The Borrower shall relend the proceeds of the Loan see to the Mazandaran Water Company under it that SONELEC will be directed by officers whose competence and experience are compatible with their functions. (c) The Borrower shall enter into a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Companyperformance contract with SONELEC, under financial covering a three-year period, with effect from June 12, 1992, on terms and conditions identical which shall be satisfactory to the Association, including, but not limited to, provisions to the effect that: (i) SONELEC shall be authorized, without further recourse to, or action on the part of the Borrower, to implement, with effect from January 1, 1993, and every six months thereafter, an increase in water and electricity tariffs at the rate of seven and a half percent semi- annually, in order to achieve a rate of return on net revalued fixed assets in operation (including interest and financial charges) of not less than 0 percent in 1992, not less than 1 percent in 1993, not less than 2 percent in 1994 and not less than 3 percent in 1995; provided, however, that such rate of increase shall be further increased, at the request of SONELEC, whenever it is established, upon a review of the basis on which each such tariff increase has been calculated and in accordance with an agreed formula, that the proposed increase is insufficient to enable SONELEC to achieve the required rate of return; (ii) SONELEC shall adjust the number of its staff progressively in such a way as to attain a minimum ratio of active water and electricity meters per agent of: 68 as of December 31, 1992 and 78 as of December 31, 1993, and 89 as of December 31, 1994, and 95 as of the termination date of the Performance Contract; (iii) the Borrower shall, with effect from July 1, 1992: (A) repossess the sewerage network assets operated by SONELEC, and assume the debt service obligations relating thereto; and (B) authorize SONELEC to impose a sewerage surcharge to those governing of its customers who are connected to the Loan.sewerage system, and reimburse SONELEC for the balance of the cost of maintaining and operating the sewerage network on behalf of the Borrower; (aiv) Without limitation upon SONELEC shall receive adequate compensation in respect of all services that it is required to provide, or obligations that it is required to assume, by the provisions Borrower, which are beyond the scope of Section 3.03(aits normal attributions under its Charter; (v) abovethe radio and television license fees will not, with effect from July 1, 1992, be added to the water and electricity bill; (vi) interim billing statements will be introduced on an alternate monthly basis, with effect from January 1, 1994, in order to supplement the bimonthly billing cycle; (vii) SONELEC and, to the extent necessary or appropriate, the Borrower shall take steps in order to achieve or to maintain, as the case may be, an average collection period not exceeding 60 days, in the case of its private customers, and not exceeding 90 days, in the case of customers belonging to the public administration; (viii) SONELEC will maintain a debt-equity ratio of not more than 60 percent; (ix) the Borrower will make availablearrangements to ensure that SONELEC has ready and sufficient access to foreign exchange to be able to meet its financial obligations to its suppliers and other creditors; (x) the Borrower shall: (A) make adequate budgetary allocations in its annual budget to cover all its financial commitments under the Performance Contract, through including but not limited to its liability for water and electricity consumption for the Borrowerforthcoming fiscal year, based on its actual consumption for the preceding fiscal year, as adjusted to take account of projected increases in tariffs and consumption; and (B) transfer the amount so allocated to SONELEC’s contributionaccount in six equal bimonthly installments, beginning during the first bimonthly period of the fiscal year, the difference between the amount so allocated and the amount actually billed being due and payable to SONELEC or, as the case may be, to the Guilan Water Company: Borrower, during the first billing period immediately following the end of the said fiscal year; (ixi) SONELEC shall establish, not later than January 1, 1993, an analytical accounting system that differentiates amongst its water, electricity and sewerage activities; (xii) the proceeds Borrower shall have a study conducted, not less than six months prior to the termination date of the Loan; Performance Contract, in order to determine the appropriate level and (ii) such amounts as may be needed to finance structure of water and electricity tariffs required for the Borrower’s contribution to expenditures under Parts B and D period following termination of the ProjectPerformance Contract; (xiii) the Borrower and SONELEC shall, prior to the termination date of the Performance Contract, conclude a new performance contract, based on similar terms and conditions, to take effect immediately after the existing Performance Contract. (bd) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements Agreement and the Performance Contract in such manner as to protect the interests of the Borrower and the Bank Association and to accomplish the purposes of the LoanCredit, and, and except as the Bank Association shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either the Subsidiary Loan Agreement or the Performance Contract, or any provision thereof. Section 3.063.03. For the purposes of Section 9.07 of the General Conditions and without limitation thereto, the Borrower shall: (a) prepare, on the basis of guidelines acceptable to the Bank, and furnish to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the The Borrower and the Bank, a plan for the continued achievement of the objectives of the Project; and, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.07. The Bank and the Borrower Association hereby agree that the obligations set forth in Sections 9.03, 9.04, 9.05, 9.06, 9.07, 9.07 and 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by each of the Water Companies SONELEC pursuant to Section 2.03 of the respective Project Agreement.

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the ProjectProject as set forth in Schedule 2 to this Agreement, and, to this end, without any limitation or restriction upon any of its other obligations under the Loan Development Credit Agreement, shall cause each of the Water Companies IMLRC to perform, perform in accordance with the provisions of their respective the Project Agreements, Agreement all the respective obligations of the Water Companies IMLRC therein set forth, shall take or and cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies IMLRC to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon the provisions of paragraph (a) of this Section and except as the Borrower and the Bank shall otherwise agree, the The Borrower shall cause the Water Companies to: (i) carry out their obligations in accordance with the provisions of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the Project. (a) Except as the Bank shall otherwise agree, procurement of the goods, works, and consultants’ services, required for the Project and to be financed out of relend through Inner Mongolia the proceeds of the Loan shall be governed by the provisions of Schedule 1 to the Project Agreements, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, Credit and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company IMLRC under a subsidiary loan agreement agreements to be entered into between the Borrower and the Guilan Water CompanyInner Mongolia, and Inner Mongolia and IMLRC, under financial terms and conditions identical to those governing which shall have been approved by the LoanAssociation and the Bank. (bc) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements in such manner as to protect the interests of the Borrower and the Bank Association and to accomplish the purposes of the LoanCredit, and, except as the Bank Association shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either the Subsidiary Loan Agreement Agreements or any provision thereof. Section 3.063.02. For Except as the purposes of Section 9.07 Association shall otherwise agree, procurement of the General Conditions goods and without limitation thereto, services required for the Borrower shall: (a) prepare, on Project and to be financed out of the basis proceeds of guidelines acceptable to the BankCredit, and furnish employment of consultants to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the Bank, a plan for the continued achievement of the objectives of assist in carrying out the Project; and, (b) afford , shall be governed by the Bank a reasonable opportunity provisions of Schedule 3 to exchange views with the Borrower on said planthis Agreement. Section 3.073.03. The Bank Association and the Borrower hereby agree that the obligations set forth in Sections 9.049.03, 9 04, 9.05, 9.069 06, 9.07, 9.07 and 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by each of the Water Companies pursuant to Section 2.03 2 03 of the respective Project AgreementAgreement by IMLRC. Section 3.04. The Borrower shall cause MR to provide adequate investments, in a timely manner, to upgrade and expand the railway lines connecting with the Jitong Line, so as to enable the Jitong Line to handle the added level of freight traffic after its completion.

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the ProjectProject as set forth in Schedule 2 to this Agreement, and, to this end, without any limitation or restriction upon any of its other obligations under the Loan this Agreement, shall cause each of the Water Companies ECEPGC to perform, perform in accordance with the provisions of their respective the Project Agreements, Agreement all the respective obligations of the Water Companies ECEPGC therein set forth, shall take or cause to be taken all actionactions, including the provision of funds, facilities, services and other resources, resources necessary or appropriate to enable each of the Water Companies ECEPGC to perform such obligations, obligations and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon the provisions of paragraph (a) of this Section and except as the Borrower and the Bank shall otherwise agree, the Borrower shall cause the Water Companies to: (i) carry out their obligations in accordance with the provisions of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the Project. (a) Except as the Bank shall otherwise agree, procurement of the goods, works, and consultants’ services, required for the Project and to be financed out of the proceeds of the Loan shall be governed by the provisions of Schedule 1 to the Project Agreements, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company ECEPGC under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water Company, ECEPGC under financial terms and conditions identical to those governing which shall have been agreed by the Loan. (b) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial Bank. Such terms and conditions identical to those governing shall include the Loan.following: (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds principal amount of the LoanSubsidiary Loan shall be repaid by ECEPGC in Dollars to the Borrower over a period not exceeding twenty (20) years, including a grace period not exceeding five (5) years; (ii) the principal amount of the Subsidiary Loan repayable by ECEPGC shall be the equivalent in Dollars (determined as of the date, or respective dates, of repayment) of the value of the currency or currencies withdrawn from the Loan Account; and (iii) the Subsidiary Loan shall be charged: (a) interest on the principal amount thereof withdrawn and outstanding from time to time, at a rate equal to the rate payable by the Borrower from time to time pursuant to Section 2.05 (a) of this Agreement; and (iib) such amounts as may be needed a commitment charge at a rate equal to finance the Borrower’s contribution rate payable by the Borrower from time to expenditures under Parts B and D time pursuant to Section 2.04 of the Projectthis Agreement. (bc) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements Agreement with ECEPGC in such manner as to protect the interests of the Borrower and the Bank and to accomplish the purposes of the Loan, and, except as the Bank shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either the Subsidiary Loan Agreement or any provision thereof. Section 3.063.02. For Except as the purposes of Section 9.07 Bank shall otherwise agree, procurement of the General Conditions goods and without limitation thereto, consultants' services required for the Borrower shall: (a) prepare, on Project and to be financed out of the basis proceeds of guidelines acceptable the Loan shall be governed by the provisions of Schedule 1 to the Bank, and furnish to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Project Agreement. Section 3.03. The Borrower and the Bank, a plan for the continued achievement of the objectives of the Project; and, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.07. The Bank and the Borrower hereby agree that the obligations set forth in Sections 9.04, 9.05, 9.06, 9.07, 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by each of the Water Companies ECEPGC pursuant to Section 2.03 of the respective Project Agreement.

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the ProjectProject as set forth in Schedule 2 to this Agreement, and, to this end, without any limitation or restriction upon any of its other obligations under the Loan Development Credit Agreement, shall cause each of the Water Companies ADF to perform, perform in accordance with the provisions of their respective the Project Agreements, Agreement all the respective obligations of the Water Companies ADF therein set forth, shall take or and cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies ADF to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon the provisions of paragraph (a) of this Section and except as the Borrower and the Bank shall otherwise agree, the The Borrower shall cause the Water Companies to: (i) carry out their obligations in accordance with the provisions of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the Project. (a) Except as the Bank shall otherwise agree, procurement of the goods, works, and consultants’ services, required for the Project and to be financed out of make the proceeds of the Loan shall be governed by the provisions of Schedule 1 Credit available to the Project Agreements, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company ADF under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water CompanyADF, under financial terms and conditions identical acceptable to those governing the LoanAssociation. (bc) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements Agreement in such manner as to protect the interests of the Borrower and the Bank Association and to accomplish the purposes of the LoanCredit, and, and except as the Bank Association shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either the Subsidiary Loan Agreement or any provision thereof. Section 3.063.02. For Except as the purposes Association shall otherwise agree, procurement of the goods, works and consultants’ services required for the Project and to be financed out of the proceeds of the Credit shall be governed by the provisions of Schedule 1 to the Project Agreement. Section 9.07 3.03. Without limitation upon the provisions of Article IX of the General Conditions and without limitation theretoConditions, the Borrower shall: (a) prepare, on the basis of guidelines acceptable to the Bank, prepare and furnish to the Bank Association not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the BankAssociation, a plan plan, of such scope and in such detail as the Association shall reasonably request for the continued achievement of the objectives future operation of the Project; and,; (b) afford the Bank Association a reasonable opportunity to exchange views with the Borrower on said plan; and (c) thereafter, carry out said plan with due diligence and efficiency and in accordance with appropriate practices, taking into account the Association’s comments thereon. Section 3.04. The Borrower shall cause ADF, until the Project completion, to employ an executive director whose experience and qualifications shall be at all times acceptable to the Association and to consult with the Association with respect to the replacement of the executive director of ADF prior to any such replacement. Section 3.05. Unless the Bank shall otherwise agree, the Borrower shall not amend or otherwise alter and shall not cause or enable ADF to amend or otherwise alter the Regulations and Operational Guidelines. Section 3.06. The Borrower shall, by June 30, 1997, furnish to the Association a satisfactory plan to treat the reflows under Part A of the Project. Section 3.07. The Bank Borrower and the Borrower Association hereby agree that the obligations set forth in Sections 9.03, 9.04, 9.05, 9.06, 9.07, 9.07 and 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by each of the Water Companies ADF pursuant to Section 2.03 of the respective Project Agreement.

Execution of the Project. (a) Section 3.01. The Borrower declares its commitment to the objectives of the ProjectProject as set forth in Schedule 2 to this Agreement, and, to this end, without any limitation or restriction upon any of its other obligations under the Loan Agreement, shall shall: (a) carry out the Project, through MOE, with due diligence and efficiency and in conformity with appropriate administrative, financial and education practices; (b) cause each of the Water Companies NTF to perform, perform in accordance with the provisions of their respective Project Agreements, Implementation Agreement all the respective obligations of NTF therein set forth; (c) cause the Participating Regions to perform in accordance with the Subsidiary Loan Agreements all the obligations of the Water Companies Participating Regions therein set forth, shall ; (d) take or cause to be taken all action, including the provision of funds, facilities, services and other resources, action necessary or appropriate to enable each of the Water Companies NTF and the Participating Regions to perform such obligationsthe obligations referred to in paragraphs (b) and (c) of this Section, and shall not take or permit to be taken any action which would prevent or interfere with such performance; and (e) provide promptly as needed, the funds, facilities, services and other resources required for the Project. (b) Section 3.02. Without limitation upon the provisions of paragraph (a) Section 3.01 of this Section Agreement, and except as the Borrower and the Bank shall otherwise agree, the Borrower shall cause the Water Companies toshall: (ia) carry out their obligations in accordance with the provisions of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; Implementation Program set forth in Schedule 5 to this Agreement; (b) through the Land Acquisition Plan; MOF and MOE, enter into an agreement with NTF (the Procurement Plan; and the Resettlement Policy FrameworkProject Implementation Agreement), and except on such terms as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, in the opinion of be acceptable to the Bank, which shall include terms specifying the responsibilities of NTF in respect of coordination of Project activities, accounting, preparation of requests for withdrawals from the Loan Account, procurement and administrative support of the Regional PIUs, and make available to NTF the portion of the proceeds of the Loan corresponding to Parts A and C.1 of the Project on a non-reimbursable basis; (c) for purposes of Parts B and C.2 of the Project make available the proceeds of the Loan allocated from time to time to Category (2) of the table set forth in paragraph 1 of Schedule 1 to this Agreement, to the Participating Regions under agreements (the Subsidiary Loan Agreements) to be entered into between the Borrower, represented by the MOF and MOE, and each such amendment Participating Region not later than within six (6) months from the date of this Agreement’s effectiveness, on terms and conditions satisfactory to the Bank, including, without limitation, the terms and conditions set forth or waiver referred to in the Annex to Schedule 5 to this Agreement, containing a description, satisfactory to the Bank, of the activities to be carried out by the Participating Region pursuant to the Project and undertakings related thereto (the Regional Implementation Plans), and containing other provisions as may materially and adversely affect be necessary for the implementation of the Project; and (d) exercise its rights under the Subsidiary Loan Agreements in such a manner as to protect the interests of the Borrower and the Bank, and to accomplish the purposes of the Project, and not assign, amend, abrogate or waive any Subsidiary Loan Agreement or any provision thereof without a prior agreement with the Bank. (a) Section 3.03. Except as the Bank shall otherwise agree, procurement of the goods, works, works and consultants’ services, services required for the Project and to be financed out of the proceeds of the Loan shall be governed by the provisions of Schedule 1 4 to this Agreement. Section 3.04. The Borrower shall ensure that the Project Agreements, as such provisions may be further elaborated per capita financing schemes for general education expenditures in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan Participating Regions are implemented in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water Company, under financial terms and conditions identical to those governing the Loan. (b) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the ProjectOperational Manual. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements in such manner as to protect the interests of the Borrower and the Bank and to accomplish the purposes of the Loan, and, except as the Bank shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either Subsidiary Loan Agreement or any provision thereof. Section 3.06. For the purposes of Section 9.07 of the General Conditions and without limitation thereto, the Borrower shall: (a) prepare, on the basis of guidelines acceptable to the Bank, Bank and furnish to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the Bank, a plan for designed to ensure the continued achievement of the objectives of the Project’s objectives; and, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.07. The Bank and the Borrower hereby agree that the obligations set forth in Sections 9.04, 9.05, 9.06, 9.07, 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by each of the Water Companies pursuant to Section 2.03 of the respective Project Agreement.

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the ProjectProject as set forth in Schedule 2 to this Agreement, and, to this end: (i) shall carry out Parts B and C of the Project with due diligence and efficiency and in conformity with appropriate administrative, financial and energy sector practices, and in accordance with sound environmental and social practices, and shall provide, promptly as needed, the funds, facilities, services and other resources required for the Project; and (ii) without any limitation or restriction upon any of its other obligations under the Loan Development Credit Agreement, shall cause each of the Water Companies Songas to perform, perform in accordance with the provisions of their respective the Project Agreements, Agreement all the respective obligations of the Water Companies Songas therein set forth, shall take or and cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies Songas to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) The Borrower shall relend the proceeds of the Credit allocated from time to time to Categories (1) and (2) (a) of the table in paragraph 1 of Schedule 1 to this Agreement to Songas under a subsidiary loan agreement to be entered into between the Borrower and Songas under terms and conditions which shall have been approved by the Association and which shall include: (i) interest payable by Songas of at least 7.1% per annum; (ii) repayment by Songas of principal in 20 years including a grace period of three and one half years; and (iii) the principal amount of the Subsidiary Loan repayable by Songas being the equivalent in dollars of the currency or currencies withdrawn from the Credit Account in respect of the above-mentioned Categories, such equivalent to be determined as of the date or respective dates of repayment. (c) The Borrower shall exercise its rights under the Subsidiary Loan Agreement in such manner as to protect the interests of the Borrower and the Association and to accomplish the purposes of the Credit, and, except as the Association shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive the Subsidiary Loan Agreement or any provision thereof. (d) Without limitation upon the provisions of paragraph (a) of this Section and except as the Borrower and the Bank Association shall otherwise agree, the Borrower shall cause the Water Companies to: (i) carry out their obligations in accordance with the provisions Parts B and C of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, Implementation Program set forth in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the ProjectSchedule 4 to this Agreement. (a) Section 3.02. Except as the Bank Association shall otherwise agree, procurement of the goods, works, works and consultants’ services, services required for Parts B and C of the Project and to be financed out of the proceeds of the Loan Credit shall be governed by the provisions of Schedule 1 3 to the Project Agreements, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water Company, under financial terms and conditions identical to those governing the Loan. (b) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Projectthis Agreement. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements in such manner as to protect the interests of the Borrower and the Bank and to accomplish the purposes of the Loan, and, except as the Bank shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either Subsidiary Loan Agreement or any provision thereof. Section 3.063.03. For the purposes of Section 9.07 of the General Conditions and without limitation thereto, the Borrower shall: (a) prepare, on the basis of guidelines acceptable to the BankAssociation, and furnish to the Bank Association not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the BankAssociation, a plan for designed to ensure the continued achievement of the objectives sustainability of the Project; and, (b) afford the Bank Association a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.073.04. The Bank Borrower and the Borrower Association hereby agree that the obligations set forth in Sections 9.03, 9.04, 9.05, 9.06, 9.07, 9.07 and 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) in respect of Part A of the Project shall be carried out by each of the Water Companies Songas pursuant to Section 2.03 of the respective Project Agreement. Section 3.05. The Borrower shall, until the completion of the Project, seek the Association’s approval, such approval to be communicated within a reasonable time, prior to any amendment or waiver of any provision of the Project Contractual Agreements to which it is a party which, in the opinion of the Association, would materially and adversely affect the implementation of the Project. Section 3.06. The Borrower shall: (a) fund the Liquidity Facility to the agreed levels in accordance with the agreed time table; and (b) maintain the funding level to conform to the Project Contractual Agreements.

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the ProjectProject as set forth in Schedule 2 to this Agreement, and, to this end, without any limitation or restriction upon any of its other obligations under shall carry out the Loan AgreementProject through the PCU with due diligence and efficiency and in conformity with appropriate public health, technical, administrative, financial, educational and environmental standards and practices, and shall cause each of provide, promptly as needed, the Water Companies to perform, in accordance with the provisions of their respective Project Agreements, all the respective obligations of the Water Companies therein set forth, shall take or cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of resources required for the Water Companies to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performanceProject. (b) Without limitation upon to the provisions of paragraph (a) of this Section and except as the Borrower and the Bank shall otherwise agreeabove, the Borrower shall cause the Water Companies to: (i) carry out their obligations in accordance with the provisions of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with an operational manual, satisfactory to the Environmental Management PlanBank, containing the detailed procedures for the implementation of the Project, including, inter alia: (A) the organization, terms of reference and staffing of the PCU; (B) the Land Acquisition Planinstitutional organization and flow of funds; (C) the Procurement Planfinancial management procedures for the Project; (D) terms of reference for all PCU staff; (E) standard bidding documents and letters of invitation to consultants; (F) mandatory safeguards and mitigation actions for the collection, disposal and treatment of medical waste, which safeguards and actions would be applied to prevent or mitigate any possible negative environmental impact said disposal might otherwise cause; (G) mandatory safeguards and mitigation actions for the rehabilitation and construction of the health facilities, which safeguards and actions would be applied to prevent or mitigate any possible negative environmental impact said construction may otherwise cause, such as, in particular, increase in deforestation, pollution of groundwater, negative impacts on endangered species, increased soil erosion, and encroachment on natural habitats; and (H) the Resettlement Policy Framework, and except guidelines for the preparation of the Annual Action Plans. (c) Except as the Bank shall otherwise agree, the Borrower shall not amend amend, waive or waive fail to enforce the Operational Manual, or any provision thereof if, in thereof. In case of any conflict between the opinion provisions of this Agreement and those of the BankOperational Manual, such amendment or waiver may materially and adversely affect the implementation provisions of the Projectthis Agreement shall prevail. (a) Section 3.02. Except as the Bank shall otherwise agree, procurement of the goods, works, works and consultants’ services, services required for the Project and to be financed out of the proceeds of the Loan shall be governed by the provisions of Schedule 1 4 to this Agreement. Section 3.03. Without limitation to the provisions of Section 3.01 above, the Borrower shall make available an amount in EC Dollars equivalent to four hundred sixty-five thousand two hundred Dollars (USD465,200) as counterpart funds for the Project. To that effect, the Borrower shall establish and thereafter maintain, until the completion of the Project, an account (the Project AgreementsAccount) in a commercial bank acceptable to the Bank, as such provisions may be further elaborated on terms and conditions acceptable to the Bank, with an initial deposit of fifty-five thousand Dollars (USD55,000) equivalent prior to the Effective Date. (a) The Borrower shall maintain a Project coordination unit (the PCU) within the office of the Borrower’s MOF during the implementation of the Project, with functions, staff and responsibilities satisfactory to the Bank which shall include, inter alia: (i) coordination and implementation of the Project; (ii) monitoring and evaluation of the Project; (iii) processing of documentation required for disbursement of the Loan proceeds and for procurement of goods, works and services under the Project; and (iv) preparation and maintenance of the records, accounts and financial statements referred to in the Procurement PlanArticle IV of this Agreement. (b) The Borrower shall: (i) ensure that the PCU is at all times staffed with at least a Project manager, or shall cause a procurement officer, an accountant, and an administrative assistant; and (ii) ensure that the Water Companies toPCU is provided with adequate facilities, update the Procurement Plan in accordance with the terms of reference acceptable satisfactory to the Bank, and to carry out its responsibilities. Section 3.05. The Borrower shall: (a) not later than November 30 of each year during Project implementation, starting November 30, 2003, furnish such update to the Bank not later than twelve for its approval an annual action plan (12the Annual Action Plan), each said plan to include, inter alia: (i) months after the date project activities to be carried out by the Borrower during the calendar year following the presentation of each said plan; and (ii) the preceding Procurement procurement plan for each said calendar year; and (b) thereafter implement each said Annual Action Plan, for approved by the Bank’s approval, in accordance with its terms. (a) The the Borrower shall relend shall, no later than 3 months after the Effective Date, enter into an agreement with the OECS/PPS, under terms and conditions satisfactory to the Bank (the OECS/PPS Agreement), whereby: (i) the Borrower will authorize OECS/PPS to undertake, on behalf of the Borrower, and the OECS/PPS will so undertake, the procurement of drugs (including anti-retroviral drugs), condoms, and pharmaceuticals under the Project, in accordance with the procedures set forth or referred to in this Agreement; (ii) the OECS/PPS will undertake to keep separate records and accounts in respect of such drugs, condoms, and pharmaceuticals; (iii) the Borrower may transfer directly to the OECS/PPS the proceeds of the Loan as required for the OECS/PPS to effect the payments for drugs, condoms, and pharmaceuticals under the Project; (iv) the Borrower will undertake to transfer to the Guilan Water Company under a subsidiary loan agreement OECS/PPS the counterpart (i.e., non-Loan) funds as required for the OECS/PPS to be entered into between effect the payment of such drugs, condoms, and pharmaceuticals; and (v) the OECS/PPS will provide the Borrower and in a timely manner with whatever information the Guilan Water Company, Borrower needs to comply with the Borrower’s obligations under financial terms and conditions identical Article IV of this Agreement pertaining to those governing Project funds handled by the LoanOECS/PPS. (b) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights and comply with its obligations under the Subsidiary Loan Agreements OECS/PPS Agreement in such manner as to protect the interests of the Borrower and the Bank and to accomplish the purposes of the Loan, and, except as the Bank shall otherwise agree, the Borrower shall not assign, amend, abrogate abrogate, waive or fail to enforce such agreement or any provision thereof. (a) no later than 3 months after the Effective Date and for the purposes of assisting in the carrying out of Part C.2 of the Project, the Borrower shall enter into an agreement with PAHO (the PAHO/CAREC Agreement), under terms and conditions satisfactory to the Bank, for the purposes of having CAREC: (i) process PCR and viral load testing; (ii) confirm HIV/AIDS diagnostic tests; and (iii) provide specialized training. (b) The Borrower shall exercise its rights and comply with its obligations under the PAHO/CAREC Agreement in such manner as to protect the interests of the Borrower and the Bank and to accomplish the purposes of the Loan, and, except as the Bank shall otherwise agree, the Borrower shall not assign, amend, abrogate, waive either Subsidiary Loan Agreement or fail to enforce such agreement or any provision thereof. Section 3.063.08. For the purposes of Section 9.07 of the General Conditions and without limitation thereto, the Borrower shall: (a) prepare, on the basis of guidelines acceptable to the Bank, and furnish to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the Bank, Bank a plan for designed to ensure the continued achievement of the objectives of the Project; and, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.073.09. The Bank and Without limitation on the provisions of Section 9.01 of the General Conditions, the Borrower hereby agree that shall: (a) maintain procedures adequate to enable it to monitor and evaluate, on an ongoing basis, in accordance with the obligations indicators set forth in Sections 9.04the Implementation Letter, 9.05, 9.06, 9.07, 9.08 and 9.09 the carrying out of the General Conditions Project; (relating b) in the last FMR of each calendar year, recommend the measures deemed necessary to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by each ensure the efficient completion of the Water Companies pursuant to Section 2.03 Project and the achievement of the respective objectives thereof, inform about the availability of counterpart funds, and provide an implementation plan satisfactory to the Bank, updating (if necessary) the targets to be achieved for the implementation of the Project Agreementduring the succeeding calendar year as set forth in the Implementation Letter; and (c) review with the Bank, on an annual basis upon request by the Bank until the completion of the Project, the relevant FMRs, and thereafter take all measures, satisfactory to the Bank, required to ensure the efficient completion of the Project and the achievement of the objectives thereof. Section 3.10. The Borrower shall appoint and maintain during Project implementation, a national AIDS council (the NCHA), for the purposes of: (a) advising the Borrower on HIV/AIDS policy; and (b) assisting in the coordination and implementation of the Project.

Execution of the Project. (a) Execution of the Project Section 3.01. The Borrower declares its commitment to the objectives of the Project, and, to this end, without any limitation or restriction upon any of its other obligations under the Loan Agreement, shall shall: (a) carry out the Project through MOH with the assistance of RHCF, with due diligence and efficiency and in conformity with appropriate administrative, financial and health care practices; (b) cause each of the Water Companies RHCF to perform, perform in accordance with the provisions of their respective Project Agreements, Agency Agreement all the respective obligations of RHCF therein set forth; (c) cause the Participating Regions to perform in accordance with the Subsidiary Loan Agreements all the obligations of the Water Companies Participating Regions therein set forth, shall ; (d) take or cause to be taken all action, including the provision of funds, facilities, services and other resources, action necessary or appropriate to enable each of RHCF and the Water Companies Participating Regions to perform such obligationsthe obligations referred to in paragraphs (b) and (c) of this Section, and shall not take or permit to be taken any action which would prevent or interfere with such performance; and (e) cause to be provided, promptly as needed, the funds, facilities, services and other resources required for Parts A.1, B, C and D of the Project. (b) Section 3.02. Without limitation upon the provisions of paragraph (a) Section 3.01 of this Section Agreement, and except as the Borrower and the Bank shall otherwise agree, the Borrower shall cause the Water Companies toshall: (ia) carry out their obligations in accordance with the provisions Parts A.1, B, C and D of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; Project Operational Manual and the Resettlement Policy FrameworkImplementation Program set forth in Schedule 5 to this Agreement;. (b) through MOF and MOH, and except enter into an aagency aagreement with RHCF (the Agency Agreement) (the Agency Agreement), on such terms as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, in the opinion of be acceptable to the Bank, such amendment which shall include terms specifying the responsibilities of RHCF in respect of coordination of Project activities, accounting, preparation of requests for withdrawals from the Loan Account, procurement, and administrative support to of the Participating Regions, al PIUs and make available to RHCF the portion of the proceeds of the Loan corresponding to Parts A.1, B, C, and D of the Project on a non-reimbursable basis; (c) for the purposes of Part A.2 of the Project, make available the proceeds of the Loan allocated from time to time to Categories (1) through (3), and (4) through (6) of the table set forth in paragraph 1 of Schedule 1 to this Agreement, to each of the Participating Regions, under agreements subsidiary loan agreements (the Subsidiary Loan Agreements) to be entered into by the Borrower, represented by MOF and , MOH, and the Participating Regions , not later than six (6) months from the date of this Agreement’s effectiveness, under terms and conditions satisfactory to the Bank, including, without limitation, the terms and conditions set forth or waiver referred to in Schedule 7 to this Agreement, and containing a description, satisfactory to the Bank, of the activities to be carried out in the health sector of the Participating Region pursuant to the Project and the undertakings of the Participating Region related thereto (the Regional Restructuring Plans), and containing other provisions as may materially and adversely affect be necessary for the implementation of the Project; and (d) exercise its rights under the Subsidiary Loan Agreements in such a manner as to protect the interests of the Borrower and the Bank, and to accomplish the purposes of the Project, and not assign, amend, abrogate or waive any Subsidiary Loan Agreement or any provision thereof without a prior agreement with the Bank. Section 3.03. At any time up to the date ninety (a90) days after the Effectiveness Date, upon a determination that a Participating Region identified in Section Article 1.02 (gf) of Schedule 2 to this Agreement would not be a suitable for the Project implementation, the Borrower may propose the replacement of a Participating Region by a Reserve Region. Substitution of any Participating Region under this Section shall be subject to the approval of the Bank. Section 3.04. Except as the Bank shall otherwise agree, procurement of the goods, works, works and consultants’ services, services and training required for the Project and to be financed out of the proceeds of the Loan shall be governed by the provisions of Schedule 1 4 to the Project Agreements, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water Company, under financial terms and conditions identical to those governing the Loan. (b) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Projectthis Agreement. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements in such manner as to protect the interests of the Borrower and the Bank and to accomplish the purposes of the Loan, and, except as the Bank shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either Subsidiary Loan Agreement or any provision thereof. Section 3.06. For the purposes of Section 9.07 of the General Conditions and without limitation thereto, the Borrower shall: (a) prepare, on the basis of guidelines acceptable to the Bank, and furnish to the Bank not later than six (6) months after before the Closing Date or such later date as may be agreed for this purpose between the Borrower and the Bank, a plan for designed to ensure the continued achievement of the objectives of the Project’s objectives; and, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.07. The Bank and the Borrower hereby agree that the obligations set forth in Sections 9.04, 9.05, 9.06, 9.07, 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by each of the Water Companies pursuant to Section 2.03 of the respective Project Agreement.

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the ProjectProject as set forth in Schedule 2 to this Agreement, and, to this end, without any limitation or restriction upon any of its other obligations under the Loan Agreement, shall cause each of the Water Companies TCZB to perform, perform in accordance with the provisions of their respective the Project Agreements, Agreement all the respective obligations of the Water Companies TCZB therein set forth, shall take or cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies TCZB to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon the provisions of paragraph (a) of this Section and except as the Borrower and the Bank shall otherwise agree, the Borrower shall cause the Water Companies to: (i) carry out their obligations in accordance with the provisions of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the Project. (a) Except as the Bank shall otherwise agree, procurement of the goods, works, and consultants’ services, required for the Project and to be financed out of the proceeds of the Loan shall be governed by the provisions of Schedule 1 to the Project Agreements, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company TCZB under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water CompanyTCZB, under financial terms and conditions identical to those governing the Loan. (b) The Borrower which shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into have been agreed upon between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the LoanBank. (ac) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements Agreement in such manner as to protect the interests of the Borrower and the Bank and to accomplish the purposes of the Loan, and, except as the Bank shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either the Subsidiary Loan Agreement or any provision thereof. (d) The Borrower shall provide TCZB with equity contribution at a level which shall enable TCZB to maintain an appropriate ratio of net worth to average total assets. Section 3.063.02. For The Borrower shall cause MAFRA to conclude the purposes of Section 9.07 MAFRA Protocol with TCZB, and to assign to the Project area the staff required for the implementation of the General Conditions monitoring and without limitation thereto, evaluation activities under the Project. Section 3.03. The Borrower shall: shall cause MAFRA to: (a) prepareaudit, on at least once every two fiscal years, the basis accounts and financial statements of guidelines acceptable to the BankTKK and the individual cooperatives partici- pating in the provision of credit under Part B of the project in accordance with appropriate auditing principles consistently applied, and (b) furnish to TCZB the Bank report of such audit not later than six (6) nine months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the Bank, a plan for the continued achievement end of the objectives of the Project; and, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said planfiscal year in which such audit was undertaken. Section 3.073.04. The Borrower shall carry out at least an annual review of the appopriateness of agricultural interest rates on an agreed basis. Section 3.05. Except as the Bank shall otherwise agree, procurement of the goods, works and consultants’ services required for the Project and to be financed out of the proceeds of the Loan shall be governed by the provisions of Section 2.03 of the Project Agreement. Section 3.06. The Bank and the Borrower hereby agree that the obligations set forth in Sections 9.04, 9.05, 9.06, 9.07, 9.08 9.06 and 9.09 9.07 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, schedules and records and reports, maintenance and land acquisition, respectivelyrespec- tively) shall be carried out by each of the Water Companies TCZB pursuant to Section 2.03 2.04 of the respective Project Agreement.

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the Project, Project as set forth in Schedule 2 to this Agreement and, to this end, without any limitation or restriction upon any of its other obligations under the Loan Development Credit Agreement, shall cause each of the Water Companies Andhra Pradesh to perform, perform in accordance with the provisions of their respective the Project Agreements, Agreement all the respective obligations of the Water Companies Andhra Pradesh therein set forth, shall take or and cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies Andhra Pradesh to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon the provisions of its obligations under paragraph (a) of this Section and except as the Borrower and the Bank shall otherwise agree, the Borrower shall cause the Water Companies to: (i) carry out their obligations in accordance with the provisions of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the Project. (a) Except as the Bank shall otherwise agree, procurement of the goods, works, and consultants’ services, required for the Project and to be financed out of the proceeds of the Loan shall be governed by the provisions of Schedule 1 to the Project Agreements, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water Company, under financial terms and conditions identical to those governing the Loan. (b) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through undertakes to approve and implement an annual five percent increase in the Borrower’s contribution, to budgetary allocations of its Communes for the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D entire duration of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Projectbeginning in Fiscal Year 2001. Section 3.053.02. The Borrower shall exercise its rights under make the Subsidiary Loan Agreements in such manner as to protect the interests entire proceeds of the Borrower and Credit available to Andhra Pradesh in accordance with the Bank and Borrower’s standard arrangements for development assistance to accomplish the purposes States of the Loan, and, except as the Bank shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either Subsidiary Loan Agreement or any provision thereofIndia. Section 3.063.03. For the purposes of Section 9.07 9.06 of the General Conditions and without limitation thereto, the Borrower shall: (a) prepare, on the basis of guidelines acceptable to the BankAssociation, and furnish to the Bank Association not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the BankAssociation, a plan for designed to ensure the continued achievement of the objectives of the Project; and, (b) afford the Bank Association a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.073.04. Except as the Association shall otherwise agree, procurement of the goods, works and consultants’ services required for the Project, and to be financed out of the proceeds of the Credit, shall be governed by the provisions of Schedule 1 to the Project Agreement. Section 3.05. The Bank Borrower and the Borrower Association hereby agree that the obligations set forth in Sections 9.03, 9.04, 9.05, 9.06, 9.07, 9.07 and 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by each Andhra Pradesh in respect of the Water Companies Project pursuant to Section 2.03 of the respective Project Agreement.

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the Project, Project and, to this endend shall carry out the Project through MED, without any limitation or restriction upon any with the participation of its other obligations under FONCODES in respect of Infrastructure Subprojects pursuant to the Loan FONCODES Agreement, all with due diligence and efficiency and in conformity with appropriate managerial, administrative, financial, education, social and environmental practices, and shall cause each of provide, promptly as needed, the Water Companies to perform, in accordance with the provisions of their respective Project Agreements, all the respective obligations of the Water Companies therein set forth, shall take or cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of resources required for the Water Companies to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performanceProject. (b) Without limitation upon or restriction to the provisions of paragraph (a) of this Section and except as the Borrower and the Bank shall otherwise agreeabove, the Borrower shall cause the Water Companies to: (i) carry out their obligations in accordance with the provisions of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with with: (i) the Environmental Management PlanIndigenous Peoples Strategy; the Land Acquisition Plan; and (ii) the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the ProjectImprovement Action Plans. (a) Section 3.02. Except as the Bank shall otherwise agree, procurement of the goods, works, works and consultants’ services, services required for the Project and to be financed out of the proceeds of the Loan shall be governed by the provisions of Schedule 1 4 to the Project Agreements, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approvalthis Agreement. (a) The Borrower shall relend At all times during the proceeds execution of the Loan Project, the Borrower (through MED) shall maintain: (i) a Project steering committee with membership structure and responsibilities satisfactory to the Guilan Water Company under Bank, including the following responsibilities: (A) to review Project implementation reports and audits; and (B) to approve the Operational Manual, each Annual Operations Plan, and any modification thereof; and (ii) a subsidiary loan agreement to be entered into between Project coordinating unit responsible for overall Project coordination, supervision, monitoring and evaluation, including: (A) preparing each Annual Operations Plan; (B) issuing Project implementation guidelines; (C) maintaining the Borrower Project impact monitoring system; (D) procuring goods and consultants’ services for the Guilan Water Company, under financial terms Project; and conditions identical to those governing the Loan(E) preparing FMRs and processing withdrawal applications. (b) The Borrower shall relend ensure that PCU is staffed, at all times during the execution of the Project, by core professional staff in numbers and with experience and qualifications acceptable to the Bank, operating under terms of reference satisfactory to the Bank, and selected in accordance with competitive and transparent procedures satisfactory to the Bank, all as prescribed in the Operational Manual. Section 3.04. With regard to Part B.3 of the Project, the Borrower (through MED) shall enter into an agreement with FONCODES, under terms and conditions satisfactory to the Bank, for the purposes of ensuring the participation of FONCODES in the implementation of such Part of the Project, said agreement to provide, inter alia: (a) the transfer to FONCODES of the proceeds of the Loan allocated to Category (1) of the Mazandaran Water Company under a subsidiary loan agreement table in Part A.1 of Schedule 1 to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan.this Agreement; (ab) Without limitation upon the provisions obligation of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, FONCODES to the Guilan Water Company: carry out Infrastructure Subprojects in accordance with: (i) the proceeds of the LoanOperational Manual; and and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D applicable Annual Operations Plan; and (c) the administration by FONCODES of the Project. (b) Without limitation upon FONCODES Special Account in accordance with the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, Part B of Schedule 1 to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Projectthis Agreement. Section 3.05. The Borrower shall exercise its rights and comply with its obligations under the Subsidiary Loan Agreements FONCODES Agreement in such a manner as to protect the interests of the Borrower and the Bank and to accomplish the purposes of the Loan, Loan and, except as the Bank shall otherwise agree, the Borrower shall not assign, amend, abrogate abrogate, waive or waive either Subsidiary Loan fail to enforce the FONCODES Agreement or any provision thereof. (a) The Borrower (through MED) shall carry out the Project in accordance with an operational manual, satisfactory to the Bank, said manual to provide the rules and procedures for the implementation of the Project, in the areas of: (i) Project institutional setup, including organization and functions of PCU; (ii) Disbursement procedures, internal controls, accounting, auditing and reporting procedures; (iii) procurement responsibilities; (iv) monitoring and evaluation plans for the Project; and (v) procedures for identification, preparation, approval, execution and supervision of Infrastructure Subprojects, including environmental assessment procedures and guidelines, and a list of non-eligible civil works. (b) If any provision of the Operational Manual is inconsistent with a provision of this Agreement, the provisions of this Agreement shall govern. (a) The Borrower, through MED, shall: (i) not later than December 15 of each year during Project implementation, furnish to the Bank, for its review and approval, a proposed annual operations plan for the following calendar year, such proposed plan to specify: (A) the activities to be financed out of the proceeds of the Loan during such calendar year, including Infrastructure Subprojects; and (B) the required financial and human resources; and (ii) upon the Bank’s approval, carry out such Annual Operations Plan in accordance with its terms. (b) The Bank may refrain from approving any Annual Operations Plan if the Bank has determined that the Borrower is not carrying out the Project as provided in this Agreement and no appropriate remedial actions, satisfactory to the Bank, have been taken therefore. Section 3.063.08. The Borrower, through PCU, shall: (a) maintain policies and procedures adequate to enable it to monitor and evaluate on an ongoing basis, in accordance with the Performance Indicators, the carrying out of the Project and the achievement of the objectives thereof; and (b) not later than February 28 and August 30 of each year of Project implementation, starting in August 31, 2004, furnish to the Bank progress reports on the execution of the Project during the preceding calendar semester, of such scope and in such detail as the Bank may reasonably request. Section 3.09. The Borrower, through PCU, shall: (a) not later than September 30 of each year of Project implementation, starting in September 30, 2004, hold a Project annual review with the Bank, such review to be based on the reports referred to in Section 3.08 (b) of this Agreement; (b) if, as a result of any of the above reviews, the Bank shall have reasonably determined that the progress in the execution of the Project or in the achievement of its objectives is not satisfactory, promptly take or cause to be taken all such remedial action, satisfactory to the Bank, as shall be necessary for the efficient execution of the Project or the timely achievement of its objectives. Section 3.10. The Borrower, through PCU, shall: (a) not later than January 31, 2006, carry out an assessment of overall Project impact, such assessment to be conducted with the assistance of independent consultants of experience and qualifications satisfactory to the Bank, operating under terms of reference satisfactory to the Bank; (b) not later than October 31, 2006, furnish to the Bank, for its review and comments, the findings and recommendations of such assessment; and (c) not later than November 30, 2006, discuss the results of such assessment with representatives of DRE, other regional or provincial offices of MED, FONCODES and school networks and schools in the Project Area, taking into account the Bank’s comments thereon. (a) Prior to the approval of any proposed Infrastructure Subproject, the Borrower shall ensure that FONCODES follows the environmental procedures and guidelines set forth in the Operational Manual, in order to: (i) carry out an environmental screening and assessment of such proposed Infrastructure Subproject; and (ii) prepare recommendations for the prevention, mitigation and remediation of any potential environmental damage arising from the implementation of such proposed Infrastructure Subproject. (b) During the implementation of any Infrastructure Subproject, the Borrower shall ensure that FONCODES carries out the recommendations referred to in subparagraph (a) (ii) above as prescribed in the Operational Manual. Section 3.12. For the purposes of Section 9.07 of the General Conditions and without limitation thereto, the Borrower (through MED) shall: (a) prepare, on the basis of guidelines acceptable to the Bank, and furnish to the Bank not later than six (6) months after before the Closing Date or such later date as may be agreed for this purpose between the Borrower and the Bank, a plan for the continued achievement of the objectives of the ProjectProject objectives; and, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.07. The Bank and the Borrower hereby agree that the obligations set forth in Sections 9.04, 9.05, 9.06, 9.07, 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by each of the Water Companies pursuant to Section 2.03 of the respective Project Agreement.

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the ProjectProject as set forth in Schedule 2 to this Agreement, and, to this end, without any limitation or restriction upon any of its other obligations under the Loan Agreement, shall cause each of the Water Companies WAPDA to perform, perform in accordance with the provisions of their respective the Project Agreements, Agreement all the respective obligations of the Water Companies WAPDA therein set forth, shall take or cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies WAPDA to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon the provisions of paragraph (a) of this Section and except as the Borrower and the Bank shall otherwise agree, the Borrower shall cause the Water Companies to: (i) carry out their obligations in accordance with the provisions of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the Project. (a) Except as the Bank shall otherwise agree, procurement of the goods, works, and consultants’ services, required for the Project and to be financed out of the proceeds of the Loan shall be governed by the provisions of Schedule 1 to the Project Agreements, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company WAPDA under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water CompanyWAPDA, under financial terms and conditions identical which shall have been approved by the Bank which shall include the terms and conditions set forth in Schedule 4 to those governing the Loanthis Agreement. (bc) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements Agreement in such manner as to protect the interests of the Borrower and the Bank and to accomplish the purposes of the Loan, and, except as the Bank shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either the Subsidiary Loan Agreement or any provision thereof. Section 3.063.02. Except as the Bank shall otherwise agree, procurement of the goods, works and consultants’ services required for the Project and to be financed out of the proceeds of the Loan shall be governed by the provisions of Schedule 1 to the Project Agreement. Section 3.03. The Bank and the Borrower hereby agree that the obligations set forth in Sections 9.04, 9.05, 9.06, 9.07, 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by WAPDA pursuant to Section 2.03 of the Project Agreement. Section 3.04. For the purposes of Section 9.07 9.08 of the General Conditions and without limitation thereto, the Borrower shall: (a) prepare, on the basis of guidelines acceptable to the Bank, and furnish to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the Bank, a plan for the continued achievement of the objectives future operation of the Project; and, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.07. The Bank and the Borrower hereby agree that the obligations set forth in Sections 9.04, 9.05, 9.06, 9.07, 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by each of the Water Companies pursuant to Section 2.03 of the respective Project Agreement.

Execution of the Project. (a) The Borrower Tamil Nadu declares its commitment to the objectives of the ProjectProject as set forth in Schedule 2 to the Loan Agreement, and, to this end, without shall carry out Part A of the Project through CMA with due diligence and efficiency and in conformity with appropriate administrative, financial, engineering and technical practices and environmental and social standards, and shall provide, or cause to be provided, promptly as needed, the funds, facilities, services and other resources required for the Project. (b) Without any limitation or restriction upon any of its other obligations under the Loan this Agreement, Tamil Nadu shall cause each of the Water Companies cause: (i) TNUDF to perform, perform in accordance with the provisions of their respective the TNUDF Project Agreements, Agreement all the respective obligations of the Water Companies therein set forth, shall take or cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each TNUDF to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance; and (ii) CMDA to perform in accordance with the CMDA Project Agreement all the obligations therein set forth, shall take or cause to be taken all action, including the provision of the Water Companies funds, facilities, services and other resources, necessary or appropriate to enable CMDA to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (bc) Without limitation upon the provisions of paragraph (a) of this Section and except as the Borrower Bank and the Bank Tamil Nadu shall otherwise agree, the Borrower Tamil Nadu shall cause the Water Companies to: (i) carry out their obligations in accordance with the provisions Part A of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, Implementation Program set forth in the opinion Schedule to this Agreement. Section 2.02. (a)(i) In respect of the Bank, such amendment or waiver may materially and adversely affect the implementation Part B.1(a) of the Project. (a) Except as the Bank shall otherwise agree, procurement of the goodsTamil Nadu shall, works, and consultants’ services, required for the Project and to be financed out of the proceeds of the Loan shall be governed made available to it by the provisions of Schedule 1 Borrower, onlend a portion thereof to the Project Agreements, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company TNUDF under a subsidiary loan agreement Subsidiary Loan Agreement to be entered into between the Borrower Tamil Nadu and the Guilan Water Company, TNUDF under financial terms and conditions identical to those governing the Loan. (b) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements in such manner as to protect the interests of the Borrower and the Bank and to accomplish the purposes of the Loan, and, except as the Bank shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either Subsidiary Loan Agreement or any provision thereof. Section 3.06. For the purposes of Section 9.07 of the General Conditions and without limitation thereto, the Borrower shall: (a) prepare, on the basis of guidelines acceptable satisfactory to the Bank, including: that the Subsidiary Loan shall be denominated in Indian Rupees; that TNUDF shall pay interest on the principal amount so onlent and furnish withdrawn on a specific date (the Reference Date) and outstanding from time to time at a fixed rate set equal to the Bank not later than average yield of the Government of India 10-year securities issuances in the primary market (the Index) in the six (6) months after preceding the Closing Date or such later date as may Reference Date; plus a margin that is mutually acceptable to Tamil Nadu and TNUDF, with said margin not to exceed 100 basis points and to be agreed determined for this purpose between each drawdown from Tamil Nadu. In the Borrower and event that there are no Government of India 10-year securities issuances in the Bankprimary market in the six (6) months preceding the Reference Date, a plan for the continued achievement average yield of the objectives Government of India 10-year securities issuances in the Projectprimary market in the twelve (12) month period immediately preceding the Reference Date shall serve as the Index. TNUDF shall repay the principal amount so re-lent over a period of 20 years including therein a grace period of five (5) years; and, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.07. The Bank and the Borrower hereby agree that the obligations set forth in Sections 9.04, 9.05, 9.06, 9.07, 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by each of the Water Companies pursuant to Section 2.03 of the respective Project Agreement.

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the Project, and, to this end, without any limitation or restriction upon any of its other obligations under the Loan this Agreement, shall cause each of the Water Companies Rajasthan and RCPE to perform, perform in accordance with the provisions of their respective the Project AgreementsAgreement and the Memorandum of Understanding respectively, all the respective obligations of the Water Companies Rajasthan and RCPE therein set forth, shall take or cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies Rajasthan and RCPE to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon the provisions of paragraph (a) of this Section and except as the Borrower and the Bank shall otherwise agree, the The Borrower shall cause make the Water Companies to: (i) carry out their obligations proceeds of the Credit available to RCPE in accordance with the provisions of this Agreement and the applicable Project Agreements; andMemorandum of Understanding. (iic) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agreeWithout prejudice to any other provision of this Agreement, the Borrower shall not amend or waive any provision thereof ifensure that RCPE receives adequate funds on a six-monthly basis, in the opinion of the Banka timely manner, such amendment or waiver may materially and adversely affect the implementation of the Projectfor anticipated expenditures under its approved annual work plans. (a) Section 3.02. Except as the Bank Association shall otherwise agree, procurement of the goods, works, works and consultants’ services, services required for the Project and to be financed out of the proceeds of the Loan Credit shall be governed by the provisions of Schedule 1 to the Project Agreements, as such provisions may be further elaborated in the Procurement PlanAgreement. (b) Section 3.03. The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water Company, under financial terms and conditions identical to those governing the Loan. (b) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements in such manner as to protect the interests of the Borrower and the Bank and to accomplish the purposes of the Loan, and, except as the Bank shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either Subsidiary Loan Agreement or any provision thereof. Section 3.06. For the purposes of Section 9.07 of the General Conditions and without limitation thereto, the Borrower shall: (a) prepare, on the basis of guidelines acceptable to the Bank, and furnish to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the Bank, a plan for the continued achievement of the objectives of the Project; and, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.07. The Bank and the Borrower Association hereby agree that the obligations set forth in Sections 9.03, 9.04, 9.05, 9.06, 9.07, 9.07 and 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by each of the Water Companies Rajasthan and RCPE pursuant to Section 2.03 of the respective Project Agreement. Section 3.04. The Borrower shall cause Rajasthan and RCPE to carry out the DPEP in Rajasthan in accordance with the DPEP Guidelines and shall not make any change to the DPEP or the DPEP Guidelines, including in respect of its financial and administrative procedures, which would, in the reasonable opinion of the Association, materially and adversely affect the ability of Rajasthan or RCPE to carry out the Project or to perform any of their respective obligations under the Project. Section 3.05. The Borrower shall: (a) maintain policies and procedures adequate to enable it to monitor and evaluate on an ongoing basis, in accordance with the agreed indicators, the carrying out of the Project and the achievement of the objectives thereof; and (b) carry out with the Association, Rajasthan and RCPE the two reviews referred to in paragraph 12 (c) of Schedule 2 to the Project Agreement, and after the first review, take all measures required to ensure the efficient completion of the Project and the achievement of the objectives thereof, based on the conclusions and recommendations of the first report referred to therein and the Association’s views on the matter.

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the ProjectProject as set forth in Schedule 2 to this Agreement, and, to this end, without any limitation or restriction upon any of its other obligations under the Loan Agreement, shall cause each of the Water Companies ECEPUC to perform, perform in accordance with the provisions of their respective the Project Agreements, Agreement all the respective obligations of the Water Companies ECEPUC therein set forth, shall take or cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies ECEPUC to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon the provisions of paragraph (a) of this Section and except as the Borrower and the Bank shall otherwise agree, the Borrower shall cause the Water Companies to: (i) carry out their obligations in accordance with the provisions of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the Project. (a) Except as the Bank shall otherwise agree, procurement of the goods, works, and consultants’ services, required for the Project and to be financed out of the proceeds of the Loan shall be governed by the provisions of Schedule 1 to the Project Agreements, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company ECEPUC, under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water CompanyECEPUC, under financial terms and conditions identical satisfactory to those governing the Loan. Bank including the following: (bi) The ECEPUC shall repay the Subsidiary Loan over a period not to exceed twenty years, including a period of grace of five years, (ii) ECEPUC shall pay to the Borrower shall relend a commitment charge on the proceeds principal amount of the Subsidiary Loan not withdrawn from time to time at the Mazandaran Water Company under a subsidiary loan agreement rate stated in Section 2.04 of this Agreement, (iii) ECEPUC shall pay interest, on the principal amount of the Subsidiary Loan withdrawn and outstanding from time to be entered into time, calculated in accordance with Section 2.05 of this Agreement, and (iv) ECEPUC shall bear all foreign exchange risks between the currency of the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the LoanBank’s currency pool. (ac) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements Agreement in such manner as to protect the interests of the Borrower and the Bank and to accomplish the purposes of the Loan, and, except as the Bank shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either the Subsidiary Loan Agreement or any provision thereof. Section 3.063.02. For Except as the purposes of Section 9.07 Bank shall otherwise agree, procurement of the General Conditions goods, works and without limitation thereto, consultants’ services required for the Borrower shall: (a) prepare, on Project and to be financed out of the basis proceeds of guidelines acceptable the Loan shall be governed by the provisions of Schedule 1 to the Bank, and furnish to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the Bank, a plan for the continued achievement of the objectives of the Project; and, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said planProject Agreement. Section 3.073.03. The Bank and the Borrower hereby agree that the obligations set forth in Sections 9.04, 9.05, 9.06, 9.07, 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by each of the Water Companies ECEPUC pursuant to Section 2.03 of the respective Project Agreement.

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the ProjectProject as set forth in Schedule 2 to this Agreement, and, to this end, without shall carry out Parts A.8, B and C.2 of the Project through the Other Implementing Agencies with due diligence and efficiency and in conformity with appropriate financial, administrative and engineering practices, and shall provide, promptly as needed, the funds, facilities, services and other resources required for the Project. (b) Without any limitation or restriction upon any of its other obligations under the Loan Development Credit Agreement, the Borrower shall cause each of the Water Companies DCC to perform, perform in accordance with the provisions of their respective the Project Agreements, Agreement all of the respective obligations of the Water Companies DCC therein set forth, shall take or and cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies DCC to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (bc) Without limitation upon the provisions of paragraph (a) of this Section and except as the Borrower and the Bank Association shall otherwise agree, the Borrower shall cause the Water Companies to: (i) carry out their obligations in accordance with the provisions its part of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, Implementation Program set forth in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the ProjectSchedule 4 to this Agreement. (ad) Except as the Bank The Borrower shall otherwise agree, procurement of the goods, works, and consultants’ services, required for the Project and to be financed out make part of the proceeds of the Loan shall be governed by the provisions of Schedule 1 Credit available to the Project Agreements, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company DCC under a subsidiary loan grant agreement to be entered into between the Borrower and the Guilan Water CompanyDCC, under financial terms and conditions identical to those governing which shall have been approved by the LoanAssociation which shall include adequate Project management arrangements and procedures. (be) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements Grant Agreement in such manner as to protect the interests of the Borrower and the Bank Association and to accomplish the purposes of the LoanCredit, and, and except as the Bank Association shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either the Subsidiary Loan Grant Agreement or any provision thereof. Section 3.063.02. For Except as the purposes of Section 9.07 Association shall otherwise agree, procurement of the General Conditions goods, works and without limitation thereto, consultants’ services required for the Borrower shall:Project and to be financed out of the proceeds of the Credit shall be governed by the provisions of Schedule 3 to this Agreement. (a) prepare, on the basis of guidelines acceptable to the Bank, and furnish to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Section 3.03. The Borrower and the Bank, a plan for the continued achievement of the objectives of the Project; and, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.07. The Bank and the Borrower Association hereby agree that the obligations set forth in Sections 9.03, 9.04, 9.05, 9.06, 9.07, 9.07 and 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) in respect of Parts A (other than Part A.8) and C.1 of the Project shall be carried out by each of the Water Companies DCC pursuant to Section 2.03 of the respective Project Agreement.

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the ProjectProject as set forth in Schedule 2 to this Agreement, and, to this end, without any limitation or restriction upon any of its other obligations under the Loan Agreement, shall cause each of AGEOPPE to carry out the Water Companies to performProject with due diligence and efficiency and in conformity with appropriate financial, in accordance with the provisions of their respective Project Agreementsadministrative, all the respective obligations of the Water Companies therein set forthengineering, environmental and technical practices, shall take or cause to be taken taken, all actionactions, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of AGEOPPE to carry out the Water Companies to perform such obligationsProject, and shall not take or permit to be taken any action which would prevent or interfere with such performancethe carrying out of the Project by AGEOPPE. (b) Without limitation upon For the provisions purpose of paragraph carrying out the Project, the Borrower shall enter into an agreement with AGEOPPE (athe Subsidiary Agreement), on terms and conditions satisfactory to the Association, which shall include, inter alia: (i) delegation of this Section authority for all procurement actions and except for award, signature and payment of contracts; (ii) provision for the transfer of the proceeds of the Credit; (iii) the methods and procedures applicable to the passing of the Credit proceeds to AGEOPPE; (iv) the obligation of AGEOPPE to promptly inform the Borrower and the Association of any condition which interferes, or threatens to interfere, with the progress of the Project, the accomplishment of the purposes of the Credit, or the performance by AGEOPPE of its obligations under the Subsidiary Agreement; (v) the obligation of AGEOPPE to provide semiannual reports of such scope and in such detail as the Borrower and the Bank Association shall otherwise agree, the Borrower shall cause the Water Companies to: (i) carry out their obligations in accordance with the provisions of this Agreement and the applicable Project Agreementsreasonably request; and (iivi) implement the obligation of AGEOPPE to take all measures necessary to ensure that the Project is carried out with due diligence and efficiency and in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; appropriate administrative, technical, environmental and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the Projectfinancial practices. (ac) Except as the Bank shall otherwise agree, procurement of the goods, works, and consultants’ services, required for the Project and to be financed out of the proceeds of the Loan shall be governed by the provisions of Schedule 1 to the Project Agreements, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water Company, under financial terms and conditions identical to those governing the Loan. (b) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements Agreement in such manner as to protect the interests of the Borrower and the Bank Association and to accomplish the purposes of the Loan, Credit and, except as the Bank Association shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either the Subsidiary Loan Agreement or any provision thereof. (d) Without limitation upon the provisions of paragraph (a) of this Section 3.06. For and except as the purposes of Section 9.07 Borrower and the Association shall otherwise agree, the Borrower shall cause AGEOPPE to carry out the Project in accordance with the Implementation Program set forth in Schedule 4 to this Agreement, and the terms and provisions of the General Conditions and without Manual of Procedures. Section 3.02. Without any limitation theretoupon any of its obligations under Section 3.01 of this Agreement, the Borrower shall: (a) prepare, establish and maintain a Project Account in pesos in a commercial bank on the basis of guidelines acceptable terms and conditions satisfactory to the Bank, and furnish Association to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the Bank, a plan used exclusively for the continued achievement purposes of meeting the objectives of Borrower’s counterpart expenditures for the Project; and, (b) afford in addition to the Bank a reasonable opportunity initial deposit referred to exchange views in Section 7.01 (c) of this Agreement, deposit into the Project Account, promptly before each fiscal semester, sufficient funds to pay the Borrower’s contribution to the financing of the Project required for such fiscal semester, as estimated by the Borrower in consultation with the Borrower on said planAssociation and AGEOPPE. Section 3.073.03. Except as the Association shall otherwise agree, procurement of the goods, works and consultants’ services required for the Project and to be financed out of the proceeds of the Credit shall be governed by the provisions of Schedule 3 to this Agreement. Section 3.04. The Bank Association and the Borrower hereby agree that the obligations set forth in Sections 9.04, . 9.05, 9.06, 9.07, 9.07 and 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by each AGEOPPE. Section 3.05. The Borrower shall: (a) not later than December 31, 1997, carry out jointly with the Association a midterm review of the Water Companies pursuant to Section 2.03 Project, during which they shall exchange views generally on the progress achieved in the carrying out of the respective Project Agreement.and the performance by the Borrower of its obligations under this Agreement and, in particular, the overall performance of AGEOPPE as measured against the performance monitoring indicators setforth in the Manual of Procedures;

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the Project, Project as set forth in Schedule 2 to this Agreement and, to this end, without any limitation or restriction upon any of its other obligations under the Loan this Agreement, shall cause each of the Water Companies KWS to perform, perform in accordance with the provisions of their respective the Project Agreements, Agreement all the respective obligations of the Water Companies KWS therein set forth, shall take or cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies KWS to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) The Borrower shall pass on the proceeds of the Credit to KWS as equity under terms and conditions which shall have been approved by the Association. Section 3.02. Without limitation upon the provisions any of paragraph (a) its obligations under Section 3.01 of this Section and except as the Borrower and the Bank shall otherwise agreeAgreement, the Borrower shall cause ensure that sufficient annual budgetary allocations for KSW will be made in each of its recurrent budget, namely not less than the Water Companies to: (i) carry out their obligations equivalent of $3,500,000 in accordance with Fiscal Year 1992/93, not less than the provisions equivalent of this Agreement and the applicable Project Agreements; and (ii) implement the Project $1,700,000 in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy FrameworkFiscal Year 1993/94, and except as not less than the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, equivalent of $500,000 in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the ProjectFiscal Year 1994/95. (a) Section 3.03. Except as the Bank Association shall otherwise agree, procurement of the goods, works, works and consultants’ services, services required for the Project and to be financed out of the proceeds of the Loan Credit shall be governed by the provisions of Schedule 1 to the Project Agreements, as such provisions may be further elaborated in the Procurement PlanAgreement. (b) Section 3.04. The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water Company, under financial terms and conditions identical to those governing the Loan. (b) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements in such manner as to protect the interests of the Borrower and the Bank and to accomplish the purposes of the Loan, and, except as the Bank shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either Subsidiary Loan Agreement or any provision thereof. Section 3.06. For the purposes of Section 9.07 of the General Conditions and without limitation thereto, the Borrower shall: (a) prepare, on the basis of guidelines acceptable to the Bank, and furnish to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the Bank, a plan for the continued achievement of the objectives of the Project; and, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.07. The Bank and the Borrower Association hereby agree that the obligations set forth in Sections 9.04, 9.05, 9.06, 9.07, 9.03 through 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by each of the Water Companies KWS pursuant to Section 2.03 of the respective Project Agreement. Section 3.05. The Borrower shall take all necessary measures to ensure that the costs for improving tourist access roads leading to Amboseli National Park, Meru National Park and Aberdare National Park are included in the Ministry of Public Works Printed Estimates for financial year 1992/93 and its Forward Budget Estimates for 1993/94. Section 3.06. The Borrower shall implement or shall cause to be implemented action plans, satisfactory to the Association, developed pursuant to reviews carried out by KWS under Section 3.04 (vi) of the Project Agreement.

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the Project, Project as set forth in Schedule 2 to this Agreement and, to this end, without any limitation or restriction upon any of its other obligations under the Loan Development Credit Agreement, shall cause each of the Water Companies OPTB to perform, perform in accordance with the provisions of their respective the Project Agreements, Agreement all the respective obligations of the Water Companies OPTB therein set forth, shall take or and cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies OPTB to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon the provisions of paragraph (a) of this Section and except as the Borrower and the Bank shall otherwise agree, the Borrower shall cause the Water Companies to: (i) carry out their obligations in accordance with the provisions of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the Project. (a) Except as the Bank shall otherwise agree, procurement of the goods, works, and consultants’ services, required for the Project and to be financed out of the proceeds of the Loan shall be governed by the provisions of Schedule 1 to the Project Agreements, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan Credit to the Guilan Water Company OPTB under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water Company, OPTB under financial terms and conditions identical which shall have been approved by the Association which shall include: (i) repayments terms over a period of twenty years, including a five-year grace period on the principal amount; (ii) interest at an annual rate of 7.5% and capitalization of interest; (iii) payment, by OPTB during said grace period, of amounts equal to those governing the Loancommitment charges and service charges to be paid by the Borrower to the Association pursuant to Sections 2.04 and 2.05 of this Agreement, such amounts to be paid at the dates specified in Section 2.06 of this Agreement; the total amount of such payments by OPTB will be deducted from the amount of capitalized interest to be paid by OPTB; and (iv) the foreign exchange risk being borne by OPTB. (bc) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements Agreement in such manner as to protect the interests of the Borrower and the Bank Association and to accomplish the purposes of the Loan, Credit and, except as the Bank Association shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either the Subsidiary Loan Agreement or any provision thereof. Section 3.063.02. For Except as the purposes of Section 9.07 Association shall otherwise agree, procurement of the General Conditions goods, works and without limitation thereto, consultants’ services required for the Borrower shall: (a) prepare, on Project and to be financed out of the basis proceeds of guidelines acceptable the Credit shall be governed by the provisions of Schedule 1 to the Bank, and furnish to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Project Agreement. Section 3.03. The Borrower and the Bank, a plan for the continued achievement of the objectives of the Project; and, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.07. The Bank and the Borrower Association hereby agree that the obligations set forth in Sections 9.03, 9.04, 9.05, 9.06, 9.07, 9.07 and 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by each of the Water Companies OPTB pursuant to Section 2.03 of the respective Project Agreement.

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the Project, and, Project as set forth in Schedule 2 to this Agreement and to this end, without any limitation or restriction upon any of its other obligations under the Loan Development Credit Agreement, the Borrower shall cause each of Changchun to perform all its obligations set forth in the Water Companies Changchun Project Agreement, and shall cause CWSC and CSC to perform, in accordance with the provisions perform all of their respective obligations set forth in the CWSC and CSC Project Agreements, all the respective obligations of the Water Companies therein set forthAgreement, shall take or cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies Changchun, CWSC and CSC to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon the provisions of paragraph (a) of this Section and except as the Borrower and the Bank shall otherwise agree, the The Borrower shall cause onlend the Water Companies to: proceeds of the Credit to Changchun on the following principal terms and conditions: (i) carry out their obligations in accordance with the provisions term for repayment of this Agreement and the applicable Project Agreementssuch proceeds shall not exceed fifteen years, including five years of grace; and (ii) implement interest shall be paid on all outstanding amounts of such proceeds from time to time at a fixed rate of 5.1 percent per annum; (iii) a commitment charge shall be paid by Changchun on the Project in accordance with amount of the Environmental Management Plan; the Land Acquisition Plan; the Procurement PlanCredit proceeds not withdrawn from time to time at a fixed rate of one-half of one percent; and (iv) all foreign exchange risks incurred during the Resettlement Policy Framework, and except as the Bank period of repayment by Changchun shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the Projectbe born by Changchun. (a) Section 3.02. Except as the Bank Association shall otherwise agree, procurement of the goods, works, works and consultants’ services, services required for the Project and to be financed out of the proceeds of the Loan Credit shall be governed by the provisions of Schedule 1 to the Project Agreements, as such provisions may be further elaborated in the Procurement PlanAgreement. (b) Section 3.03. The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water Company, under financial terms and conditions identical to those governing the Loan. (b) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements in such manner as to protect the interests of the Borrower and the Bank and to accomplish the purposes of the Loan, and, except as the Bank shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either Subsidiary Loan Agreement or any provision thereof. Section 3.06. For the purposes of Section 9.07 of the General Conditions and without limitation thereto, the Borrower shall: (a) prepare, on the basis of guidelines acceptable to the Bank, and furnish to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the Bank, a plan for the continued achievement of the objectives of the Project; and, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.07. The Bank and the Borrower Association hereby agree that the obligations set forth in Sections 9.03, 9.04, 9.05, 9.06, 9.07, 9.07 and 9.08 and 9.09 of the General Conditions (relating respectively to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition) in respect of Parts C, respectively) D.2 and E of the Project shall be carried out by each of the Water Companies Changchun pursuant to Section 2.03 of the respective Changchun Project Agreement, and by CWSC in respect of Parts A, D.1(a) and (b), and E of the Project and by CSC in respect of Parts B, D.1(c) and (d), and E of the Project pursuant to Section 2.03 of the CWSC and CSC Project Agreement. Section 3.04. Without limitation to the provisions of Section 3.01 (a) of this Agreement, the Borrower agrees that: (a) all funds made available by the Borrower (other than the proceeds of the Credit) shall be made available through Changchun in Renminbi and that: (i) for purposes of carrying out Parts A and D.1(a) and (b) of the Project such funds shall be considered equity capital of CWSC; and (ii) for purposes of carrying out Parts B and D.1(c) and (d) of the Project such funds shall be considered equity capital of CSC; (b) it shall cause Jilin to make available funding through Changchun in Renminbi and that: (i) for purposes of carrying out Parts A and D.1(a) and (b) of the Project such funds shall be considered equity capital of CWSC; and (ii) for purposes of carrying out Parts B, D.1(c) and (d) of the Project such funds shall be considered equity capital of CSC. Section 3.05. The Borrower shall cause Jilin to enter into and perform all its obligations under the Jilin Water Supply Contract.

Execution of the Project. (a) Section 3.01. The Borrower declares its commitment to Recipient shall carry out the objectives of Project with due diligence and efficiency and in conformity with appropriate administrative, financial, engineering and health practices, and shall provide, promptly as needed, the Project, and, to this end, without any limitation or restriction upon any of its other obligations under the Loan Agreement, shall cause each of the Water Companies to perform, in accordance with the provisions of their respective Project Agreements, all the respective obligations of the Water Companies therein set forth, shall take or cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon the provisions of paragraph (a) of this Section and except as the Borrower and the Bank shall otherwise agree, the Borrower shall cause the Water Companies to: (i) carry out their obligations in accordance with the provisions of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of resources required for the Project. (a) Section 3.02. Except as the Bank Administrator shall otherwise agree, procurement of the goods, works, and consultants’ services, ' services required for the Project and to be financed out of the proceeds of the Loan Grant shall be governed by the provisions of Schedule 1 3 to this Agreement. (a) The Recipient shall maintain or cause to be maintained records and accounts adequate to reflect in accordance with sound accounting practices the operations, resources and expenditures in respect of the Project Agreements, as such provisions may be further elaborated in of the Procurement Plandepartments or agencies of the Recipient responsible for carrying out the Project or any part thereof. (b) The Borrower Recipient shall: (i) have the records and accounts referred to in paragraph (a) of this Section and those for the Special Account for each fiscal year audited, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference appropriate auditing principles consistently applied, by independent auditors acceptable to the Bank, and Administrator; (ii) furnish such update to the Bank Administrator as soon as available, but in any case not later than twelve (12) four months after the date end of each such year, the preceding Procurement Planreport of such audit by said auditors, for of such scope and in such detail as the Bank’s approval.Administrator shall have reasonably requested; (aiii) The Borrower shall relend the proceeds of the Loan furnish to the Guilan Water Company under a subsidiary loan agreement to be entered into between the Borrower Administrator such other information concerning said records and accounts and the Guilan Water Company, under financial terms audit thereof as the Administrator shall from time to time reasonably request; and (iv) ensure that such records and conditions identical accounts are included in the annual audit referred to those governing the Loan. in paragraph (b) The Borrower shall relend of this Section and that the proceeds report of such audit contains a separate opinion by said auditors as to whether the Loan statements of expenditure submitted during such fiscal year, together with the procedures and internal controls involved in their preparation, can be relied upon to support the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loanrelated withdrawals. (a) Section 3.04. Without limitation upon the applicable provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements in such manner as to protect the interests of the Borrower and the Bank and to accomplish the purposes of the Loan, and, except as the Bank shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either Subsidiary Loan Agreement or any provision thereof. Section 3.06. For the purposes of Section 9.07 Article IX of the General Conditions and without limitation theretoConditions, the Borrower Recipient shall: (a) prepare, on the basis of guidelines acceptable to the BankAdministrator, and furnish to the Bank Administrator not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Borrower Recipient and the BankAdministrator, a plan for the continued achievement of the objectives future operation of the Project; and,; (b) afford the Bank Administrator a reasonable opportunity to exchange views with the Borrower Recipient on said plan; and (c) thereafter, carry out said plan with due diligence and efficiency and in accordance with appropriate practices, taking into account the Administrator’s comments thereon. Section 3.07. The Bank and the Borrower hereby agree that the obligations set forth in Sections 9.04, 9.05, 9.06, 9.07, 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by each of the Water Companies pursuant to Section 2.03 of the respective Project Agreement.

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the ProjectProject as set forth in Schedule 2 to this Agreement, and, to this end, without any limitation or restriction upon any of its other obligations under the Loan Development Credit Agreement, shall cause each of the Water Companies SF to perform, perform in accordance with the provisions of their respective the Project Agreements, Agreement all the respective obligations of the Water Companies SF therein set forth, shall take or and cause to be taken all actionactions, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies SF to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon the provisions of paragraph (a) of this Section and except as the Borrower and the Bank shall otherwise agree, the The Borrower shall cause the Water Companies to: (i) carry out their obligations in accordance with the provisions of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the Project. (a) Except as the Bank shall otherwise agree, procurement of the goods, works, and consultants’ services, required for the Project and to be financed out of make available the proceeds of the Loan shall be governed by the provisions of Schedule 1 Credit to the Project Agreements, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company SF under a subsidiary loan agreement Subsidiary Financing Agreement to be entered into between the Borrower and the Guilan Water CompanySF, under financial terms and conditions identical which shall have been approved by the Association, which shall include, inter alia, those set forth or referred to those governing the Loanin Schedule 3 to this Agreement. (bc) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements Financing Agreement and in such manner as to protect the interests of the Borrower and the Bank Association, comply with its obligations under this Agreement, and to accomplish the purposes of the LoanCredit, and, and except as the Bank Association shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either the Subsidiary Loan Financing Agreement or any provision thereof. Section 3.063.02. For Except as the purposes of Section 9.07 Association shall otherwise agree, procurement of the General Conditions goods, works and without limitation thereto, consultants’ services required for the Borrower shall: (a) prepare, on Project and to be financed out of the basis proceeds of guidelines acceptable the Credit shall be governed by the provisions of Schedule 1 to the Bank, and furnish to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Project Agreement. Section 3.03. The Borrower and the Bank, a plan for the continued achievement of the objectives of the Project; and, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.07. The Bank and the Borrower Association hereby agree that the obligations set forth in Sections 9.03, 9.04, 9.05, 9.06, 9.07, 9.07 and 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by each of the Water Companies SF pursuant to Section 2.03 of the respective Project Agreement. Section 3.04. The Borrower shall by June 30, 2000, lease to SF the two remaining seed grainages referred to in Part B.2 of the Project under terms and conditions satisfactory to the Association. Section 3.05. The Borrower shall by June 30, 1998, take all action necessary on its part to restructure BSB and BSRTI into an autonomous technical organization with representatives of the private sector engaged in silk activities having a majority on its Governing Board. To this end, the Borrower shall, by March 31, 1998, prepare and furnish to the Association, for its approval, the proposed restructuring plan. Section 3.06. Without limitation to the generality of Section 3.01 (a) hereof, the Borrower shall take all action necessary on its part to ensure: (a) that SF will maintain and operate its facilities after completion of the Project; and (b) that all other facilities under the Project will be maintained and operated after completion of the Project for the objectives set forth in Schedule 2 to this Agreement.

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the ProjectProject as set forth in Schedule 2 to this Agreement, and, to this end, without any limitation or restriction upon any of its other obligations under shall carry out the Loan AgreementProject through the MOE with due diligence and efficiency and in conformity with appropriate educational, administrative, financial, engineering, and environmental practices, and shall cause each of provide, promptly as needed, the Water Companies to perform, in accordance with the provisions of their respective Project Agreements, all the respective obligations of the Water Companies therein set forth, shall take or cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of resources required for the Water Companies to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performanceProject. (b) Without limitation upon to the provisions of paragraph (a) of this Section and except as the Borrower and the Bank shall otherwise agreeabove, the Borrower shall cause carry out the Water Companies toProject in accordance with: (i) carry out their obligations in accordance with an operational manual, satisfactory to the provisions Bank, containing the detailed procedures for the implementation of this Agreement the Project, including, inter alia: (A) the organization, functions and staffing of the applicable Project AgreementsPMU; (B) the financial management procedures; (C) terms of reference for all PMU staff; (D) standard bidding documents and letters of invitation to consultants; (E) the rules, procedures for entry, and selection criteria for winners of the nationwide competitions on art, essay, poetry or debate; and (F) mandatory safeguards and mitigation actions for the expansion and rehabilitation of the Secondary Education schools, which safeguards and actions would be applied to prevent or mitigate any possible negative environmental impact said expansion or rehabilitation might otherwise cause; and (ii) implement a manual, satisfactory to the Project in accordance with Bank, which shall contain, inter alia: (A) the Environmental Management Plandetailed rules and procedures for the financing mechanism of the School Improvement Projects and Co-Curricular Activities; the Land Acquisition Plan; the Procurement Plan(B) procedures for monitoring and evaluation of School Improvement Projects; and (C) the Resettlement Policy Framework, procedures for procurement of goods and except services under School Improvement Projects. (c) Except as the Bank shall otherwise agree, the Borrower shall not amend amend, waive or waive fail to enforce the Operational Manual or the School Improvement Projects and Co-Curricular Activities Manual or any provision thereof if, in thereof. In case of any conflict between the opinion provisions of this Agreement and those of the BankOperational Manual or the School Improvement Projects and Co-Curricular Activities Manual, such amendment or waiver may materially and adversely affect the implementation provisions of the Projectthis Agreement shall prevail. (a) Section 3.02. Except as the Bank shall otherwise agree, procurement of the goods, works, works and consultants’ services, services required for the Project and to be financed out of the proceeds of the Loan shall be governed by the provisions of Schedule 1 4 to this Agreement. Section 3.03. Without limitation to the provisions of Section 3.01 above, the Borrower shall make available an amount in EC Dollars equivalent to two million five hundred thousand Dollars ($2,500,000) as counterpart funds for the Project. To that effect, the Borrower shall establish and thereafter maintain, until the completion of the Project, an account (the Project AgreementsAccount) in a commercial bank, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the on terms of reference and conditions acceptable to the Bank, with an initial deposit equivalent to four hundred and furnish such update fifty thousand Dollars ($450,000) prior to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approvalEffective Date. (a) The Borrower shall relend maintain a Project management unit (the proceeds PMU) within the MOE during the implementation of the Project, with functions and responsibilities satisfactory to the Bank which shall include, inter alia: (i) coordination and implementation of the Project; (ii) monitoring and evaluation of the Project; (iii) processing of documentation required for disbursement of the Loan and Credit proceeds and for procurement of goods, works and services under the Project; and (iv) preparation and maintenance of the records, accounts and financial statements referred to the Guilan Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water Company, under financial terms and conditions identical to those governing the Loanin Article IV of this Agreement. (b) The Borrower shall relend ensure: that the proceeds PMU is at all times staffed with at least a Project manager, a procurement officer, a Project accountant, an accounts clerk, a school supplies officer, a secretary and an assistant; that the financial analyst of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds MOE is at all times in charge of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements in such manner as to protect the interests of the Borrower and the Bank and to accomplish the purposes of the Loan, and, except as the Bank shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either Subsidiary Loan Agreement or any provision thereof. Section 3.06. For the purposes of Section 9.07 of the General Conditions and without limitation thereto, the Borrower shall: (a) prepare, on the basis of guidelines acceptable to the Bank, and furnish to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the Bank, a plan for the continued achievement of the objectives financial aspects of the Project; and, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.07. The Bank and the Borrower hereby agree that the obligations set forth in Sections 9.04, 9.05, 9.06, 9.07, 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by each of the Water Companies pursuant to Section 2.03 of the respective Project Agreement.

Execution of the Project. (a) The Borrower Hubei Province declares its commitment to the objectives objective of the ProjectProject as set forth in Schedule 2 to the Loan Agreement, and, to this end, without any limitation or restriction upon any of its other obligations under shall carry out the Loan AgreementProject with due diligence and efficiency and in conformity with appropriate administrative, financial, engineering and economic practices, and social and environmental standards acceptable to the Bank, and shall cause each of the Water Companies to performprovide, in accordance with the provisions of their respective Project Agreements, all the respective obligations of the Water Companies therein set forth, shall take or cause to be taken all actionprovided, including promptly as needed, the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of resources required for the Water Companies to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performanceProject. (b) Without limitation upon the provisions of paragraph (a) of this Section and except as the Borrower Bank and the Bank Hubei Province shall otherwise agree, the Borrower Hubei Province shall cause the Water Companies to: (i) carry out their obligations in accordance with the provisions of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, Implementation Program set forth in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the ProjectSchedule 2 to this Agreement. (a) Section 2.02. Except as the Bank shall otherwise agree, procurement of the goods, works, works and consultants’ services, services required for the Project and to be financed out of the proceeds of the Loan shall be governed by the provisions of Schedule 1 to the Project Agreements, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approvalthis Agreement. (a) The Borrower Hubei Province shall relend the proceeds of the Loan to the Guilan Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water Company, under financial terms and conditions identical to those governing the Loan. (b) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements in such manner as to protect the interests of the Borrower and the Bank and to accomplish the purposes of the Loan, and, except as the Bank shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either Subsidiary Loan Agreement or any provision thereof. Section 3.06. For the purposes of Section 9.07 of the General Conditions and without limitation thereto, the Borrower shall: (a) prepare, on the basis of guidelines acceptable to the Bank, and furnish to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the Bank, a plan for the continued achievement of the objectives of the Project; and, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.07. The Bank and the Borrower hereby agree that carry out the obligations set forth in Sections 9.04, 9.05, 9.06, 9.07, 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by each in respect of the Water Companies pursuant to Section 2.03 of the respective Project Agreement. (b) For the purposes of Section 9.07 of the General Conditions and without limitation thereto, Hubei Province shall: prepare, on the basis of guidelines acceptable to the Bank, and furnish to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Bank and Hubei Province, a plan for the future operation of the Project; and (ii) afford the Bank a reasonable opportunity to exchange views with Hubei Province on said plan. (a) Hubei Province shall, at the request of the Bank, exchange views with the Bank with regard to the progress of the Project, the performance of its obligations under this Agreement and other matters relating to the purposes of the Loan. (b) Hubei Province shall promptly inform the Bank of any condition which interferes or threatens to interfere with the progress of the Project, the accomplishment of the purposes of Loan, or the performance by Hubei Province of its obligations under this Agreement.

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the ProjectProject as set forth in Schedule 2 to this Agreement, and, to this end, without any limitation or restriction upon any of its other obligations under the Loan Agreement, shall cause each of the Water Companies CDR to perform, perform in accordance with the provisions of their respective the Project Agreements, Agreement all the respective obligations of the Water Companies CDR therein set forth, shall take or cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies CDR to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon the provisions of paragraph (a) of this Section and except as the Borrower and the Bank shall otherwise agree, the The Borrower shall cause the Water Companies to: (i) carry out their obligations in accordance with the provisions of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except make available as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the Project. (a) Except as the Bank shall otherwise agree, procurement of the goods, works, and consultants’ services, required for the Project and a grant to be financed out of CDR the proceeds of the Loan shall be governed by the provisions of Schedule 1 to the Project Agreements, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water CompanyCDR, under financial terms and conditions identical to those governing which shall have been approved by the LoanBank. (bc) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements Agreement in such manner as to protect the interests of the Borrower and the Bank and to accomplish the purposes of the Loan, and, except as the Bank shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either the Subsidiary Loan Agreement or any provision thereof. Section 3.063.02. For Except as the purposes of Section 9.07 Bank shall otherwise agree, procurement of the General Conditions goods, works and without limitation thereto, consultants’ services required for the Borrower shall: (a) prepare, on Project and to be financed out of the basis proceeds of guidelines acceptable the Loan shall be governed by the provisions of Schedule 1 to the Bank, and furnish to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Project Agreement. Section 3.03. The Borrower and the Bank, a plan for the continued achievement of the objectives of the Project; and, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.07. The Bank and the Borrower hereby agree that the obligations set forth in Sections 9.04, 9.05, 9.06, 9.07, 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by each of the Water Companies CDR pursuant to Section 2.03 of the respective Project Agreement. Section 3.04. The Borrower shall, not later than December 31, 1995, establish, and thereafter maintain, PCU within MMRA, with members whose qualifications, experience and terms of reference shall be acceptable to the Bank, to provide assistance to CDR and the Participating Municipalities in carrying out their respective Project implementation functions.

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the Project, and, and to this end, without any limitation or restriction upon any of its other obligations under the Loan Agreement, shall cause each DNV (pursuant to the terms of the Water Companies Subsidiary Agreement) to performcarry out the Project with due diligence and efficiency and in conformity with appropriate administrative, in accordance with the provisions of their respective Project Agreementsfinancial, all the respective obligations of the Water Companies therein set forthtechnical, engineering, social and environmental practices, shall take or and/or cause to be taken (as the case may be) all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of DNV to carry out the Water Companies to perform such obligationsProject, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon the provisions of paragraph (a) of this Section and except as the Borrower and the Bank shall otherwise agree, the Borrower shall cause the Water Companies to: (i) carry carrying out their obligations in accordance with the provisions of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the Project. (a) Except as the Bank shall otherwise agree, procurement of the goods, works, and consultants’ services, required for the Project and to be financed out of the proceeds of the Loan shall be governed by the provisions of Schedule 1 to the Project Agreements, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water Company, under financial terms and conditions identical to those governing the Loan. (b) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon to the provisions of Section 3.03(bparagraph (a) above, the Borrower, through MPFIPS, shall, during Project implementation, make available to DNV promptly as needed, the amount of $108,100,000 (in Pesos equivalent), as counterpart funds for the Project. (c) The Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the LoanLoan (minus the amount under the Loan to be paid by the Borrower to the Bank pursuant to Section 2.04 of this Agreement) available to DNV under a subsidiary agreement (the Subsidiary Agreement) to be entered into between the Borrower and DNV, under terms and conditions which shall have been approved by the Bank which shall include, inter alia: the obligation of the Borrower to promptly provide the necessary funds to enable DNV to carry out the Project as provided in this Section; andand the obligation of DNV: (A) to carry out the Project in accordance with the pertinent provisions of this Agreement; (B) to comply with the obligations referred to in Sections 9.03, 9.04, 9.05, 9.06, 9.07 and 9.08 of the General Conditions (iirelating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I in respect of the Project; (C) to take or permit to be taken all action to enable the Borrower to comply with its obligations under Sections 3.08 (b) and 3.10 (a) of this Agreement; (D) to participate in the review referred to in Section 3.10 (c) of this Agreement; and (E) not to assign, amend, terminate, abrogate, repeal, waive or fail to enforce the Subsidiary Agreement or any provision thereof. Section 3.05. (i) The Borrower shall exercise its rights and carry out its obligations under the Subsidiary Loan Agreements Agreement in such manner as to protect the interests of the Borrower and the Bank and to accomplish the purposes of the Loan, ; and, (ii) except as the Bank shall otherwise agree, the Borrower shall not assign, amend, abrogate abrogate, terminate, waive or waive either fail to enforce the Subsidiary Loan Agreement or any provision thereof. (a) Except as the Bank shall otherwise agree, procurement of the goods, works and consultants’ services required for Parts A.1, A.2, B, C and D of the Project and to be financed out of the proceeds of the Loan shall be governed by the provisions of Schedule 4 to this Agreement, as said provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall update the Procurement Plan in accordance with guidelines acceptable to the Bank, and furnish such update to the Bank not later than 12 months after the date of the preceding Procurement Plan, for the Bank’s approval. Section 3.063.03. For the purposes of Section 9.07 of the General Conditions and without limitation thereto, the Borrower shall: (a) prepare, on the basis of guidelines acceptable to the Bank, and furnish to the Bank not later than six (6) months after before the Closing Date or such later date as may be agreed for this purpose between the Borrower and the Bank, a plan for the continued achievement of the objectives future operation of the Project; and, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said plan. (a) Without limitation to the provisions of Section 3.07. The Bank and 3.01 (a) of this Agreement, the Borrower hereby agree that shall cause DNV to carry out the obligations set forth Project in Sections 9.04accordance with a manual (the Operational Manual), 9.05acceptable to the Bank, 9.06said manual to include, 9.07inter alia: (i) the Project’s chart of accounts and internal controls; (ii) the FMR formats; (iii) the terms of reference for carrying out the Project audits; (iv) the Project monitoring indicators; (v) the Project disbursement procedures; and (vi) the Project procurement procedures, 9.08 including a price methodology whereby the price of CREMA Contracts under Parts A.1 and 9.09 A.2 of the General Conditions Project will be adjusted as provided in Part D of Section I of Schedule 4 to this Agreement. (relating b) In case of any conflict between the terms of the Operational Manual and those of this Agreement, the terms of this Agreement shall prevail. (a) Without limitation to insurancethe provisions of Sections 3.01 (a) and 3.04 (a) of this Agreement, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectivelythe Borrower shall cause DNV: (i) shall to carry out and/or cause to be carried out Part A.1 of the Project in accordance with the provisions of the Environmental Evaluation and Management Manual; (ii) to: (A) not later than November 30, 2004 update the Environmental Evaluation and Management Manual (the Updated Environmental Evaluation and Management Manual) in a manner and on terms acceptable to the Bank, which updated version will include, inter alia: (1) the guidelines and procedures to be followed by DNV in the carrying out of environmental screenings and/or environmental assessments (as the case may be) in respect of the works under Parts A.2, A.3, B.1, C.1 (d) and C.2 (a) of the Project; (2) the standard environmental provisions to be included in the bidding documents for the works to be carried out under said Parts of the Project (including provisions to minimize natural habitat conversion or degradation and to permit the maximum growth of natural vegetation (whether it is native grasslands, scrublands, or forests) within the pertinent right of way); (3) the guidelines for the preparation of the appropriate environmental management plan for each of the Water Companies pursuant works to Section 2.03 be carried out under said Parts of the respective Project; and (4) the procedures for the approval of environmental management plans; and (B) thereafter carry out and/or cause to be carried out said Parts of the Project in accordance with said updated version. (b) In case of any conflict amongst the terms of the Operational Manual, the Environmental Evaluation and Management Manual, the Updated Environmental Evaluation and Management Manual and those of this Agreement, the terms of this Agreement shall prevail. (a) The Borrower shall cause DNV to operate and maintain, at all times during Project implementation, the PCU with a structure, functions and responsibilities acceptable to the Bank, including, inter alia, the responsibility of the PCU to assist DNV in the coordination, monitoring and supervision of the carrying out of the Project. (b) The Borrower shall cause DNV to ensure that the PCU is, at all times during Project implementation, headed by a General Coordinator and assisted by other adequate professional staff (with expertise in engineering, administrative, procurement and financial matters) and administrative staff, all with qualifications and experience acceptable to the Bank. (a) The Borrower shall cause DNV to operate and maintain, at all times during Project implementation, the EU with a structure, functions and responsibilities acceptable to the Bank, including, inter alia, the responsibility of the EU to assist DNV in: (i) the environmental screening and/or environmental assessment of each of the works to be carried out under the Project (as mentioned in Section 3.08 of this Agreement); and (ii) taking the appropriate actions to prevent and/or mitigate any potential negative environmental impacts under the Project which are within DNV’s jurisdiction. The Borrower shall cause DNV to ensure that the EU is at all times during Project implementation staffed with adequate professional and administrative personnel, all with qualifications and experience acceptable to the Bank.

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the ProjectProject as set forth in Schedule 2 to this Agreement, and, to this end, without any limitation or restriction upon any of its other obligations under the Loan Agreement, shall cause each of the Water Companies RCC and GLE to perform, perform in accordance with the provisions of their respective the Project Agreements, Agreement all the respective obligations of the Water Companies RCC and GLE therein set forth, shall take or cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies RCC and GLE to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon the provisions of paragraph (a) of this Section and except as the Borrower and the Bank shall otherwise agree, the Borrower shall cause the Water Companies to: (i) carry out their obligations in accordance with the provisions of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the Project. (a) Except as the Bank shall otherwise agree, procurement of the goods, works, and consultants’ services, required for the Project and to be financed out of the proceeds of the Loan shall be governed by the provisions of Schedule 1 to the Project Agreements, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company RCC under a subsidiary loan agreement Subsidiary Loan Agreement to be entered into between the Borrower and the Guilan Water Company, RCC under financial terms and conditions identical which shall have been approved by the Bank and which shall include the provisions set forth in Schedule 5 to those governing the Loanthis Agreement. (bc) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements Agreement in such manner as to protect the interests of the Borrower and the Bank and to accomplish the purposes of the Loan, and, except as the Bank shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either the Subsidiary Loan Agreement or any provision thereof. Section 3.063.02. For Except as the purposes of Section 9.07 Bank shall otherwise agree, procurement of the General Conditions goods, works and without limitation thereto, consultants’ services required for the Borrower shall: (a) prepare, on Project and to be financed out of the basis proceeds of guidelines acceptable the Loan shall be governed by the provisions of Schedule 1 to the Bank, and furnish to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the Bank, a plan for the continued achievement of the objectives of the Project; and, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said planProject Agreement. Section 3.073.03. The Bank and the Borrower hereby agree that the obligations set forth in Sections 9.04, 9.05, 9.06, 9.07, 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by each of the Water Companies RCC and GLE pursuant to Section 2.03 of the respective Project Agreement.

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the ProjectProject as set forth in Schedule 2 to this Agreement, and, to this end, without any limitation or restriction upon any of its other obligations under the Loan Development Credit Agreement, shall cause each of the Water Companies KESH to perform, perform in accordance with the provisions of their respective the Project Agreements, Agreement all the respective obligations of the Water Companies KESH therein set forth, shall take or and cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies KESH to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon the provisions of paragraph (a) of this Section and except as the Borrower and the Bank shall otherwise agree, the Borrower shall cause the Water Companies to: (i) carry out their obligations in accordance with the provisions of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the Project. (a) Except as the Bank shall otherwise agree, procurement of the goods, works, and consultants’ services, required for the Project and to be financed out of the proceeds of the Loan shall be governed by the provisions of Schedule 1 to the Project Agreements, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan Credit to the Guilan Water Company KESH under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water CompanyKESH, under financial terms and conditions identical to those governing which shall have been approved by the Loan. (b) The Borrower Association which shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Companyinclude: (i) ten years maturity with four years grace period; (ii) interest at a rate equal to the proceeds yield on the 10-year U.S. Treasury Bonds, plus a margin, as shall be reasonably determined by the Borrower on the basis of guidelines acceptable to the LoanAssociation; and (iiiii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Projectforeign exchange risk borne by KESH. (bc) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements Agreement in such manner as to protect the interests of the Borrower and the Bank Association and to accomplish the purposes of the LoanCredit, and, and except as the Bank Association shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either the Subsidiary Loan Agreement or any provision thereof. Section 3.063.02. For Except as the purposes of Section 9.07 Association shall otherwise agree, procurement of the General Conditions goods required for the Project and without limitation thereto, to be financed out of the Borrower shall: (a) prepare, on proceeds of the basis Credit shall be governed by the provisions of guidelines acceptable the Schedule to the Bank, and furnish to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Project Agreement. Section 3.03. The Borrower and the Bank, a plan for the continued achievement of the objectives of the Project; and, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.07. The Bank and the Borrower Association hereby agree that the obligations set forth in Sections 9.03, 9.04, 9.05, 9.06, 9.07, 9.07 and 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and servicesgoods, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by each of the Water Companies KESH pursuant to Section 2.03 of the respective Project Agreement.

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the ProjectProject as set forth in Schedule 2 to this Agreement, and, to this end, end without any limitation or restriction upon any of its other obligations under the Loan Development Credit Agreement, shall cause each of the Water Companies Executing Agency to perform, perform in accordance with the provisions of their respective Project Agreements, the Convention all the respective obligations of the Water Companies Executing Agency therein set forth, shall take or and cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies Executing Agency to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon For the provisions purpose of paragraph (a) of this Section and except as carrying out the Borrower and the Bank shall otherwise agreeProject, the Borrower shall cause enter into an agreement or agreements with the Water Companies toExecuting Agency (the Convention) on terms and conditions satisfactory to the Association which shall include, inter alia: (i) carry out their obligations in accordance with the provisions of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the Project. (a) Except as the Bank shall otherwise agree, procurement of the goods, works, and consultants’ services, required for the Project and to be financed out transfer of the proceeds of the Loan shall be governed Credit on a non reimbursable basis: (A) for purposes of financing expenditures incurred by Imple- ▇▇▇▇▇▇▇ Entities in the provisions carrying out of Schedule 1 SubProjects; (B) for operating costs and equipment of the Executing Agency, including the obligation of the Executing Agency to return all of its equipment to the Borrower upon completion of the Project Agreements, as such provisions may be further elaborated in or the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan day before its dissolution in accordance with the terms statutes of reference acceptable the Executing Agency, whatever happens first; and (C) for the activities to be carried out under Part B of the Project; (ii) the obligation of the Executing Agency to take all measures necessary to ensure that the Project is carried out with due diligence and efficiency and in accordance with appropriate administrative, technical and financial practices; (iii) the ▇▇▇▇▇▇ de Procedures specifying the obligations of the Executing Agency relating to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date execution of the preceding Procurement PlanProject, selection of Sub- Projects, procurement and preparation of evidence required for withdrawal requests and replenishment of the Bank’s approval.Special Account; (aiv) The Borrower shall relend the proceeds obligation of the Loan Executing Agency to keep the Guilan Water Company under a subsidiary loan agreement positions of General Manager, Technical Director and Financial Director filled with employees with adequate experience and qualifications; (v) the obligation of the Executing Agency to be entered into between promptly inform the Borrower and the Guilan Water CompanyAssociation of any condition which interferes, or threatens to interfere, with the progress of the Project and Sub- Projects, the accomplishment of the purposes of the Credit, or the performance of the Executing Agency of its obligations under financial terms the Convention, or the performance of the Executing Agency and conditions identical Implementing Entities under the Sub- Project Contracts; (vi) the obligation of the Executing Agency to those governing provide by the Loanfifteenth day of each month reports of such scope and in such detail as the Borrower or the Association shall reasonably request; (vii) a sample Sub-Project Contract; (viii) a sample Beneficiary Agreement; and (ix) the obligation of the Executing Agency to submit to the Association, not later than October 15, 1990, a new program of proposed Sub-Projects aggregating the estimated cost of $7,5 million satisfactory to the Association. (bc) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements Convention in such manner as to protect the interests of the Borrower and the Bank Association and to accomplish the purposes of the LoanCredit, and, and except as the Bank Association shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either Subsidiary Loan Agreement the Convention or any provision thereof. Section 3.06. For (d) Without limitation upon the purposes provisions of Section 9.07 Sec- tion 3.01 (a) of the General Conditions and without limitation thereto, this Agreement the Borrower shall: (ai) preparecause the Executing Agency to execute new SubProjects aggregating the equivalent of $5 million before June 30, on 1992, out of which Sub-Projects aggregating the basis equivalent of guidelines acceptable at least $2,5 million shall be completed before June 30, 1991; and (ii) make available to the BankExecuting Agency out of its own resources all the necessary funds needed for the execution of the Sub-Projects referred to in sub- paragraph (i) of this Section. Section 3.02. Except as the Association shall otherwise agree, procurement of works and consultants’ services required for the Project and to be financed out of the proceeds of the Credit shall be governed by the provisions of Schedule 3 to this Agreement. Section 3.03. Without any limitation to or restriction upon its other reporting requirements under the General Conditions and this Agreement, the Borrower shall exchange views, and furnish shall cause the Executing Agency to exchange views, with the Bank Association, at all such times as the Association shall reasonably request, but in any event not later than six (6) months after the Closing Date January 31, 1991, or such later other date as may be agreed for this purpose between the Borrower and the BankAssociation shall agree, a plan for with regard to the continued achievement progress of the objectives Project and Sub-Projects, the management of the Project; and, operations of the Executing Agency, the performance by the Executing Agency of its obligations under the Convention, (bincluding procurement procedures) afford the Bank a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.07. The Bank and the Borrower hereby agree that performance by the Executing Agency and Implementing Enterprises of their respective obligations set forth in Sections 9.04under Sub-Project Agreements, 9.05, 9.06, 9.07, 9.08 and 9.09 other matters relating to the purposes of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by each of the Water Companies pursuant to Section 2.03 of the respective Project AgreementCredit.

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the ProjectProject as set forth in Schedule 2 to this Agreement, and, to this end, without any limitation or restriction upon any of its other obligations under the Loan this Agreement, shall cause each of the Water Companies PSF to perform, perform in accordance with the provisions of their respective the Project Agreements, Agreement all the respective obligations of the Water Companies PSF therein set forth, shall take or and cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies PSF to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon on the provisions of paragraph (a) of this Section and except as the Borrower and the Bank shall otherwise agreeabove, the Borrower shall cause appoint and maintain a duly qualified liaison officer within MFEP in order to facilitate the Water Companies to: (i) carry out their obligations in accordance with the provisions coordination of this Agreement cooperation between PSF and the applicable Project Agreements; and (ii) implement the Project Borrower in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the Project. (ac) Except as the Bank The Borrower shall otherwise agree, procurement of the goods, works, and consultants’ services, required for the Project and to be financed out of make the proceeds of the Loan shall be governed by the provisions of Schedule 1 Credit available to the Project AgreementsPSF, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shalla grant, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water CompanyPSF, under financial terms and conditions identical to those governing which shall have been approved by the LoanAssociation. (bd) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements Agreement in such manner as to protect the interests of the Borrower and the Bank Association and to accomplish the purposes of the LoanCredit, and, and except as the Bank Association shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either the Subsidiary Loan Agreement or any provision thereof. Section 3.063.02. Except as the Association shall otherwise agree, the procurement of goods, and consultants’ services required for the Project and to be financed out of the proceeds of the Credit shall be governed by the provisions of Schedule 1 to the Project Agreement. Section 3.03. The Borrower shall appoint two duly qualified and experienced representatives to serve as members of the PSC. Section 3.04. The Borrower shall, within thirty months after the Effective Date, but in any event not later than December 31, 1998, carry out jointly with the Association and PSF, a comprehensive review of the Project, during which they shall exchange views generally on all matters relating to the progress made in the carrying out of the Project and the performance by the Borrower of its obligations under this Agreement including, but not limited to: (i) a review of the achievements of the Project, (ii) the implementation and management aspects of the Project, (iii) performance and use of technical assistance personnel, (iv) reporting, accounting and audit performance, (v) disbursement procedures, and (vi) the sustainability of the Project. Section 3.05. For the purposes of Section 9.07 of the General Conditions and without limitation thereto, the Borrower shall: (a) prepare, on the basis of guidelines acceptable to the BankAssociation, and furnish to the Bank Association not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the Bank, a plan for the continued achievement of the objectives of the Project; and, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.07. The Bank and the Borrower hereby agree that the obligations set forth in Sections 9.04, 9.05, 9.06, 9.07, 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by each of the Water Companies pursuant to Section 2.03 of the respective Project Agreement.six

Execution of the Project. (a) Section 2.01. The Borrower State declares its commitment to the objectives of the Project, andand covenants and warrants that the Project is of paramount importance to the transportation development plans of the State and that, consequently, the State shall: (a) take all such action as shall be necessary to this endenable the Borrower to carry out the Project with due diligence and efficiency, without any limitation and in conformity with appropriate administrative, financial, engineering and railway practices; and (b) not take or restriction upon cause or permit any of its other obligations under the Loan Agreement, shall cause each of the Water Companies agencies to perform, in accordance with the provisions of their respective Project Agreements, all the respective obligations of the Water Companies therein set forth, shall take or cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performancethe performance by the Borrower of its convenants, agreements and obligations contained in the Loan Agreement. (b) Section 2.02. Without limitation upon the provisions of paragraph (a) of this Section and except as the Borrower and the Bank shall otherwise agree, the Borrower shall cause the Water Companies to: (i) carry out their obligations in accordance with the provisions of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the Project. (a) Except as the Bank shall otherwise agree, procurement of the goods, works, and consultants’ services, required for the Project and to be financed out of the proceeds of the Loan shall be governed by the provisions of Schedule 1 to the Project Agreements, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water Company, under financial terms and conditions identical to those governing the Loan. (b) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation restriction upon the provisions of Section 3.03(a) above2.01 of this Agreement, the State specifically undertakes, whenever there is reasonably cause to believe that the funds available to the Borrower shall make available, through will be inadequate to meet the Borrower’s contributionestimated expenditures required for the carrying out of the Project, to make arrangements, satisfactory to the Guilan Water CompanyBank, promptly to provide the Borrower or cause the Borrower to be provided with such funds as are needed to meet such expenditures. Section 2.03. Without limitation or restriction upon the provision of Sections 2.01 and 2.02 of this Agreement, the State covenants that it shall take all such action on its part as shall be necessary: (i) to maintain and ensure full compliance with the proceeds State’s undertakings in respect of the LoanBorrower as expressed in the State - FEPASA Agreement and in the Guarantor and State Protocolo, to the extent said undertakings are consistent with the Borrower’s obligations under the Loan Agreement; and (ii) such to ensure that all amounts as may due to the Borrower on account of Normalization will be needed paid promptly, subject, however, to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b2.04 of this Agreement. Section 2.04. (a) aboveThe State shall take all such action on its part as shall be necessary: (A) to enable it to reduce its Normalization payments, the Borrower shall make available through during the Borrower’s contributionfiscal years 1987 up to and including 1993, according to the Mazandaran Water Company: limits set forth below in this Section; and (iB) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance without adversely affecting the Borrower’s contribution financial condition or ability, to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise comply with its rights obligations under the Subsidiary Loan Agreements in such manner as to protect the interests of the Borrower and the Bank and to accomplish the purposes of the Loan, and, except as the Bank shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either Subsidiary Loan Agreement or any provision thereof. Section 3.06. For the purposes of Section 9.07 of the General Conditions and without limitation thereto, the Borrower shall: (a) prepare, on the basis of guidelines acceptable to the Bank, and furnish to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the Bank, a plan for the continued achievement of the objectives of the Project; and, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.07. The Bank and the Borrower hereby agree that the obligations set forth in Sections 9.04, 9.05, 9.06, 9.07, 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by each of the Water Companies pursuant to Section 2.03 of the respective Project Agreement.

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the Project, Project as set forth in Schedule 2 to this Agreement and, to this end, without any limitation or restriction upon any of its other obligations under the Loan Development Credit Agreement, shall cause each of the Water Companies FOFIFA to perform, perform in accordance with the provisions of their respective the Project Agreements, Agreement all the respective obligations of the Water Companies FOFIFA therein set forth, shall take or and cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies FOFIFA to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon The Borrower shall make the provisions proceeds of paragraph the Credit allocated and withdrawn from Categories (a1) through (5) of the table set forth in paragraph 1 to Schedule 1 to this Section and except Agreement available to FOFIFA as a grant. (c) For the Borrower and purposes of carrying out Part F of the Bank shall otherwise agreeProject, the Borrower shall cause the Water Companies to: (i) carry out their obligations in accordance with the provisions of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the Project. (a) Except as the Bank shall otherwise agree, procurement of the goods, works, and consultants’ services, required for the Project and to be financed out of make the proceeds of the Loan shall be governed by Credit allocated to Categories (6) through (9) of the provisions table set forth in paragraph 1 of Schedule 1 to the Project Agreements, this Agreement available to ESSA as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company a grant under a subsidiary loan agreement (the ESSA Subsidiary Agreement) to be entered into between the Borrower and the Guilan Water Company, ESSA under financial terms and conditions identical to those governing which shall have been approved by the LoanAssociation. (bd) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the ESSA Subsidiary Loan Agreements Agreement in such manner as to protect the interests of the Borrower and the Bank Association and to accomplish the purposes of the Loan, Credit and, except as the Bank Association shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either the ESSA Subsidiary Loan Agreement or any provision thereof. Section 3.063.02. For Except as the purposes of Section 9.07 Association shall otherwise agree, procurement of the General Conditions goods, works and without limitation thereto, consultants’ services required for the Borrower shall:Project and to be financed out of the proceeds of the Credit shall be governed by the provisions of Schedule 3 to this Agreement. (a) prepare, on the basis of guidelines acceptable to the Bank, and furnish to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Section 3.03. The Borrower and the Bank, a plan for the continued achievement of the objectives of the Project; and, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.07. The Bank and the Borrower Association hereby agree that the obligations set forth in Sections 9.03, 9.04, 9.05, 9.06, 9.07, 9.07 and 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) in respect of Parts A through E of the Project shall be carried out by each of the Water Companies FOFIFA pursuant to Section 2.03 of the respective Project Agreement. Section 3.04. At all times during execution of the Project the Borrower shall take all measures necessary to ensure that: (i) all positions, which shall include three scientists of international repute with experience and qualifications acceptable to the Association, of the Steering Committee shall be filled; (ii) the Steering Committee shall carry out a mid-term review of the Project not later than November 30, 1993; (iii) the Steering Committee shall operate in accordance with operating procedures which shall be satisfactory to the Association; (iv) Cofinancing obtained by the Borrower and FOFIFA from Cofinanciers shall be coordinated and approved by the Steering Committee; and (v) other agencies financing agricultural research not carried out by FOFIFA shall be invited to attend the meetings of the Steering Committee as observers.

Execution of the Project. (a) The Borrower Recipient declares its commitment to the objectives of the Project, as set forth in Schedule 2 to this Agreement, and, to this end, without any limitation or restriction upon any of its other obligations under the Loan this Agreement, shall cause each of the Water Companies KWS to perform, in accordance with the provisions of their respective the Project AgreementsAgreement, all the respective obligations of the Water Companies KWS therein set forth, shall take or cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies KWS to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon The Recipient shall make the provisions proceeds of paragraph the Grant available to KWS as a grant under an agreement (athe Subsidiary Grant Agreement) to be entered into between the Recipient and KWS, under terms and conditions which shall have been approved by the Bank. (c) The Recipient shall exercise its rights under the Subsidiary Grant Agreement in such manner as to protect the interests of this Section and except as the Borrower Recipient and the Bank shall otherwise agreeand to accomplish the purposes of the Grant, the Borrower shall cause the Water Companies to: (i) carry out their obligations in accordance with the provisions of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower Recipient shall not amend assign, amend, abrogate or waive the Subsidiary Grant Agreement or any provision thereof if, in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the Projectthereof. (a) Section 3.02. Except as the Bank shall otherwise agree, procurement of the goods, works, works and consultants’ services, services required for the Project and to be financed out of the proceeds of the Loan Grant shall be governed by the provisions of Schedule 1 to the Project Agreements, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water Company, under financial terms and conditions identical to those governing the Loan. (b) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the ProjectAgreement. Section 3.053.03. The Borrower shall exercise its rights under the Subsidiary Loan Agreements in such manner as to protect the interests of the Borrower Recipient and the Bank and to accomplish the purposes of the Loan, and, except as the Bank shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either Subsidiary Loan Agreement or any provision thereof. Section 3.06. For the purposes of Section 9.07 of the General Conditions and without limitation thereto, the Borrower shall: (a) prepare, on the basis of guidelines acceptable to the Bank, and furnish to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the Bank, a plan for the continued achievement of the objectives of the Project; and, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.07. The Bank and the Borrower hereby agree that the obligations set forth in Sections 9.04, 9.05, 9.06, 9.07, 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by each of the Water Companies KWS pursuant to Section 2.03 of the respective Project Agreement. Section 3.04. The Recipient shall participate in the midterm review referred to in Section 2.07 of the Project Agreement and shall ensure that KWS shall implement the Project in accordance with agreements reached during said review. Section 3.05. The Recipient shall, before carrying out any development project upstream on the ▇▇▇▇ River: (a) carry out, in consultation with the Bank, an environmental impact assessment on the proposed development project to assess whether such development project will have a serious and irreversible impact on the ecology of TRPNR; and (b) implement any mitigation plan resulting from the environmental impact assessment referred to in paragraph (a) of this Section, in consultation with the Bank and other interested parties.

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the ProjectProject as set forth in Schedule 2 to this Agreement, and, to this end, without shall carry out Part B of the Project with due diligence and efficiency and in conformity with appropriate administrative, financial, and technical practices, and shall provide, promptly as needed, the funds, facilities, services and other resources required for the Project. (b) Without any limitation or restriction upon any of its other obligations under the Loan Development Credit Agreement, the Borrower shall cause each SII to carry out Part A of the Water Companies Project and to perform, perform in accordance with the provisions of their respective the Project Agreements, Agreement all the respective obligations of the Water Companies SII therein set forth, shall take or and cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies SII to perform such other obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (bc) Without any limitation or restriction upon the provisions of paragraph paragraph (a) of this Section Section, and except as the Borrower and the Bank Association shall otherwise agree, the Borrower shall cause the Water Companies to: (i) carry out their obligations in accordance with the provisions Part B of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, Implementation Program set forth in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the ProjectSchedule 3 to this Agreement. (ad) Except as the Bank The Borrower shall otherwise agree, procurement of the goods, works, and consultants’ services, required for the Project and to be financed out make a portion of the proceeds of the Loan shall be governed by the provisions of Schedule 1 Credit available to the Project AgreementsSII on a grant basis, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company under a subsidiary loan agreement Subsidiary Agreement to be entered into between the Borrower and the Guilan Water CompanySII, under financial terms and conditions identical to those governing which shall have been approved by the LoanAssociation. (be) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements Agreement in such manner as to protect the interests of the Borrower Association and the Bank Borrower and to accomplish the purposes purpose of the LoanCredit, and, and except as the Bank Association shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either the Subsidiary Loan Agreement or any provision thereof. Section 3.063.02. For Except as the purposes of Section 9.07 Association shall otherwise agree, procurement of the General Conditions goods, works and without limitation thereto, the Borrower shall: (a) prepare, on the basis of guidelines acceptable to the Bank, and furnish to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed consultants’ services required for this purpose between the Borrower and the Bank, a plan for the continued achievement Part B of the objectives Project and to be financed out of the Project; and, (b) afford proceeds of the Bank a reasonable opportunity Credit shall be governed by the provisions of Schedule 3 to exchange views with the Borrower on said planthis Agreement. Section 3.073.03. The Bank Association and the Borrower hereby agree that the obligations set forth in Sections 9.03, 9.04, 9.05, 9.06, 9.07, 9.07 and 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) in respect of Part A of the Project shall be carried out by each of the Water Companies SII pursuant to Section 2.03 of the respective Project Agreement.

Execution of the Project. Section 3.01. The Borrower declares its commitment to the objectives of the Project as set forth in Schedule 2 to this Agreement and, to this end, shall carry out the Project with due diligence and efficiency and in conformity with appropriate financial, technical, administrative and environmental practices, and shall provide, promptly as needed, the funds, facilities, services and other resources required for the Project. Section 3.02. Except as the Association shall otherwise agree, procurement of the goods required for the Project and to be financed out of the proceeds of the Credit shall be governed by the provisions of Schedule 3 to this Agreement. (a) The Borrower declares its commitment to the objectives of the ProjectProject as set forth in Schedule 2 to this Agreement, and, to this end: (i) shall carry out Parts A and , C and D of the Project [pursuant to the provisions of the Implementation Agreement] with due diligence and efficiency and in conformity with appropriate financial, technical, administrative, engineering and environmental practices, and shall provide promptly as needed the funds, facilities, services and other resources required for the Project; and (ii) without any limitation or restriction upon any of its other obligations under the Loan this Agreement, shall cause each MASAF MU to carry out Part B of the Water Companies to performProject with due diligence and efficiency and in conformity with appropriate financial, in accordance with technical, administrative, engineering and environmental practices, and shall provide promptly as needed the provisions of their respective Project Agreements, all the respective obligations of the Water Companies therein set forth, shall take or cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate resources to enable each of the Water Companies MASAF MU to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance.; (b) Without limitation upon the provisions of paragraph (a) of this Section and except as the Borrower and the Bank Association shall otherwise agree, the Borrower shall carry out Parts A, C and DA and C of the Project in accordance with the Implementation Program set forth in Schedule 4 to this Agreement; and (c) Without limitation upon the provisions of paragraph (a) of this Section and except as the Borrower and the Association shall otherwise agree, the Borrower shall cause the Water Companies to: (i) MASAF MU to carry out their obligations in accordance with the provisions Part B of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, Implementation Program set forth in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the ProjectSchedule 4 to this Agreement. (a) Section 3.02. Except as the Bank Association shall otherwise agree, procurement of the goods, works, works and consultants’ services, services required for the Project and to be financed out of the proceeds of the Loan Credit shall be governed by the provisions of Schedule 1 3 to the Project Agreements, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water Company, under financial terms and conditions identical to those governing the Loan. (b) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Projectthis Agreement. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements in such manner as to protect the interests of the Borrower and the Bank and to accomplish the purposes of the Loan, and, except as the Bank shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either Subsidiary Loan Agreement or any provision thereof. Section 3.063.03. For the purposes of Section 9.07 9.06 of the General Conditions and without limitation thereto, the Borrower shall: (a) prepare, on the basis of guidelines acceptable to the BankAssociation, and furnish to the Bank Association not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the BankAssociation, a plan for designed to ensure the continued achievement of the objectives sustainability of the Project; and, (b) afford the Bank Association a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.073.04. The Bank and Without limitation to its obligations under Section 3.01 of this Agreement, the Borrower hereby agree that shall: (a) open and thereafter maintain, until the obligations set forth in Sections 9.04, 9.05, 9.06, 9.07, 9.08 and 9.09 completion of the General Conditions Project, a project account for Part B of the Project (relating the Project Account A), and a project account for Part C (the Project Account B), in MK and in a commercial bank acceptable to insurance, use of goods the Association; (b) thereafter deposit into the Project Account A and services, plans and schedules, records and reports, maintenance and land acquisitionProject Account B, respectively) , by the first day of each quarter each year during Project implementation, such amounts as shall be carried out by each of required and agreed upon with the Water Companies pursuant Association to Section 2.03 of the respective timely replenish Project Agreement.Account A and Project Account B, respectively; and

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the ProjectProject as set forth in Schedule 2 to this Agreement, and, to this end: (i) shall carry out, or cause to be carried out, Parts A, C, D and E of the Project with due diligence and efficiency and in conformity with appropriate administrative and financial prac- tices and shall provide, promptly as needed, the funds, facilities, services and other resources required for such Parts of the Project; and (ii) without any limitation or restriction upon any of its other obligations under the Loan Development Credit Agreement, the Borrower shall cause each NHC to carry out Part B of the Water Companies Project and to perform, per- form all its obligations set forth in accordance with the provisions of their respective Project Agreements, all the respective obligations of the Water Companies therein set forthPro- ject Agreement, shall take or cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary neces- sary or appropriate to enable each of the Water Companies NHC to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon the provisions of paragraph (a) of this Section and except as the Borrower and the Bank shall otherwise agree, the Borrower shall cause the Water Companies to: (i) carry out their obligations in accordance with the provisions of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the Project. (a) 3.02. Except as the Bank Association shall otherwise agree, procurement of the goods, works, works and consultants’ services, services required for Parts B, C, D and E of the Project and to be financed out of the proceeds of the Loan Credit shall be governed by the provisions of Schedule 1 3 to the Project Agreements, as such provisions may be further elaborated in the Procurement Planthis Agreement. (b) Section 3.03. The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water Company, under financial terms and conditions identical to those governing the Loan. (b) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements in such manner as to protect the interests of the Borrower and the Bank and to accomplish the purposes of the Loan, and, except as the Bank shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either Subsidiary Loan Agreement or any provision thereof. Section 3.06. For the purposes of Section 9.07 of the General Conditions and without limitation thereto, the Borrower shall: (a) prepare, on the basis of guidelines acceptable to the Bank, and furnish to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the Bank, a plan for the continued achievement of the objectives of the Project; and, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.07. The Bank and the Borrower Association hereby agree that the obligations set forth in Sections 9.03, 9.04, 9.05, 9.06, 9.07, 9.07 and 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) in respect of Part B of the Project shall be carried out by each of the Water Companies NHC pursuant to Section 2.03 of the respective Project Agreement. Section 3.04. The Borrower shall establish, or cause to be established, a housing refinance facility to refinance through Participating Intermediaries mortgages for the purchase of lots developed by NHC and for the construction of homes by eligible beneficiaries in Port Vila and Luganville, which facility shall be satisfactory to the Association and shall include, inter alia, those provisions set out in Schedule 5 to this Agreement. Section 3.05. The Borrower shall enter into a Participation Agreement with each Participating Intermediary on terms and conditions satisfactory to the Association, including those set out in Schedule 5 to this Agreement. Section 3.06. The Borrower shall each year until completion of the Project, beginning June 30, 1992: (a) review jointly with the Association, the operation and performance of the HRF, including compliance with the relevant HRF guidelines, and furnish to the Association a copy of the results of such review as soon as available; and (b) review the achievement of the following performance targets of NHC: deposits shall have been received for at least 75% of all lots prior to start of construction, an average margin on direct development costs of at least 25% shall have been achieved by NHC on lots sold during the year, at least 95% of all leases shall have been converted into mortgages at the end of the original lease term, and arrears on lease payment collections shall be no more than 5%.

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the ProjectProject as set forth in Schedule 2 to this Agreement, and, to this end, without any limitation or restriction upon any of its other obligations under the Loan Agreement, shall cause each of the Water Companies XPB to perform, perform in accordance with the provisions of their respective the Project Agreements, Agreement all the respective obligations of the Water Companies XPB therein set forth, shall take or cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies XPB to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon the provisions of paragraph (a) of this Section and except as the Borrower and the Bank shall otherwise agree, the Borrower shall cause the Water Companies to: (i) carry out their obligations in accordance with the provisions of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the Project. (a) Except as the Bank shall otherwise agree, procurement of the goods, works, and consultants’ services, required for the Project and to be financed out of the proceeds of the Loan shall be governed by the provisions of Schedule 1 to the Project Agreements, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend through XMG the proceeds of the Loan to the Guilan Water Company XPB under a subsidiary loan agreement agreements to be entered into between the Borrower and the Guilan Water CompanyXMG, and XMG and XPB, under financial terms and conditions identical to those governing which shall have been approved by the Loan. (b) The Borrower Bank and shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Companyinclude that: (i) the proceeds subsidiary loan shall be repaid over a period of the Loan20 years, including five years of grace, and accrue interest at a rate of five percent (5%) per annum; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B commitment charges and D the foreign exchange risk on the repayment of the Projectsubsidiary loan shall be borne by XPB. (bc) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements in such manner as to protect the interests of the Borrower and the Bank and to accomplish the purposes of the Loan, and, except as the Bank shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either the Subsidiary Loan Agreement Agreements or any provision thereof. Section 3.063.02. For Except as the purposes of Section 9.07 Bank shall otherwise agree, procurement of the General Conditions goods, works and without limitation thereto, the Borrower shall: (a) prepare, on the basis of guidelines acceptable to the Bank, and furnish to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the Bank, a plan consultants’ services required for the continued achievement Project and to be financed out of the objectives proceeds of the Project; and, (b) afford Loan shall be governed by the Bank a reasonable opportunity provisions of Schedule 4 to exchange views with the Borrower on said planthis Agreement. Section 3.073.03. The Bank and the Borrower hereby agree that the obligations set forth in Sections 9.04, 9.05, 9.06, 9.07, 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by each of the Water Companies XPB pursuant to Section 2.03 of the respective Project Agreement.

Execution of the Project. (a) Section 3.01. The Borrower declares its commitment to the objectives of the ProjectProject as set forth in Schedule 2 to this Agreement, and, and to this end, without any limitation or restriction upon any of its other obligations under shall provide promptly as needed, the Loan Agreement, shall cause each of the Water Companies to perform, in accordance with the provisions of their respective Project Agreements, all the respective obligations of the Water Companies therein set forth, shall take or cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of resources required for the Water Companies to perform such obligationsProject, and shall not take or permit cause CONAFE to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon the provisions of paragraph (a) of this Section and except as the Borrower and the Bank shall otherwise agree, the Borrower shall cause the Water Companies to: (i) carry out their obligations the Project, in coordination with SEP, SEPEs, States, School Councils, Parents’ Associations and municipalities, with due diligence and efficiency and in conformity with appropriate educational, financial, social, environmental, technical and administrative standards and practices, as well as in accordance with the provisions of this Agreement Operational Manual and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, monitoring indicators set forth in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the ProjectImplementation Letter. (a) Except as the Bank shall otherwise agree, procurement of the goods, works, works and consultants’ services, services required for the Project and to be financed out of the proceeds of the Loan shall be governed by the provisions of Schedule 1 4 to the Project Agreementsthis Agreement, as such said provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, CONAFE to update the Procurement Plan in accordance with the terms of reference guidelines acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) 12 months after the date of the preceding Procurement Plan, for the Bank’s approval. (c) Throughout the course of Project implementation, the Borrower shall cause CONAFE to maintain or cause to be maintained, in a manner satisfactory to the Bank, an annually adjustable data base of reference prices of the same technical quality to serve as a reference for Project procurement costing in those cases where direct contracting is allowed for goods. (a) The Without prejudice to the provisions related to Project implementation set forth in this Agreement including, but not limited to, Section 3.01, the Borrower shall relend cause CONAFE to issue and carry out the proceeds of the Loan Project in accordance with an operational manual satisfactory to the Guilan Water Company under a subsidiary loan agreement Bank, which shall include, inter alia: (i) special provisions to address the needs of indigenous peoples, as provided for in Section 3.09 of this Agreement; (ii) specific prohibition of construction of new schools, application of simple environmental design specifications for the rehabilitation of existing schools, and environmental guidelines for construction activities (e.g. materials procurement to avoid asbestos and lead paint, minimize use of scarce timber sources, proper solid and liquid waste disposal practices to be applied); (iii) the targeting criteria for the schools and communities that will benefit from the Project; (iv) the model form for Participation Agreements; (v) the model forms for the agreements to be entered into between the Borrower CONAFE and the Guilan Water Companyrelevant State, under financial terms municipality, School Council or Parents’ Association, for the execution of Part B.1 of the Project; and conditions identical (vi) the model forms for the agreements to those governing be entered into between CONAFE and the Loanrelevant Parents’ Association for the execution of Part B.4 (a) of the Project. (b) The Borrower shall relend not amend the proceeds Operational Manual without the Bank’s approval. (c) In case of discrepancy between the provisions of the Loan to Operational Manual and those of this Agreement, the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loanprovisions set forth in this Agreement shall prevail. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make availableThe Borrower, through the Borrower’s contributionSHCP, shall enter into an agreement (Contrato ▇▇ ▇▇▇▇▇▇▇) with CONAFE and NAFIN, satisfactory to the Guilan Water Company: Bank (the Implementation Agreement), in which agreement: (i) CONAFE shall agree to carry out the proceeds Project and coordinate the participation of the Loan; and Borrower (iithrough SEP) such amounts as may be needed to finance in the Borrower’s contribution to expenditures under Parts B and D Project (including the carrying out of the Project. Part C.3 (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements in such manner as to protect the interests of the Borrower and the Bank and to accomplish collaboration in the purposes carrying out of the LoanPart C.3 (d) (vi), C.3 (d) (ix) and, except as the Bank shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either Subsidiary Loan Agreement or any provision thereof. Section 3.06. For the purposes of Section 9.07 of the General Conditions and without limitation thereto, the Borrower shall: (a) prepare, on the basis of guidelines acceptable to the Bank, and furnish to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the Bank, a plan for the continued achievement of the objectives of the Project; and, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.07. The Bank and the Borrower hereby agree that the obligations set forth in Sections 9.04, 9.05, 9.06, 9.07, 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by each of the Water Companies pursuant to Section 2.03 of the respective Project Agreement.

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the Project, and, to this end, shall (i) carry out Parts A.2 and D.1 of the Project through the MHCS with due diligence and efficiency and in conformity with appropriate administrative, financial engineering, and environmental practices, and shall provide, promptly as needed, the funds, facilities, services and other resources required for the Project and (ii) without any limitation or restriction upon any of its other obligations under the Loan Agreement, shall cause each the Utilities to perform the activities related to the carrying out of Parts A.1, A.3, B, C and D.2 of the Water Companies to performProject, in accordance with the provisions of their respective the Project Agreements, all the respective obligations of the Water Companies therein set forth, Agreements and shall take or cause the Utilities to be taken take all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies Utilities to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon the provisions of paragraph (a) of this Section and except as the Borrower and the Bank shall otherwise agree, the Borrower Borrower, through MHCS, shall cause the Water Companies to: (i) carry out their obligations in accordance with the provisions Parts A.2 and D.1 of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; Implementation Program set forth in Schedule 5 to this Agreement. (c) The Borrower shall relend the Land Acquisition Plan; part of proceeds of the Procurement Plan; Loan to the Utilities under subsidiary loan agreements entered or to be entered into between the Borrower, through MOF and MHCS, and the Resettlement Policy FrameworkUtilities, under terms and conditions which shall have been approved by the Bank. (d) The Borrower, through the MOF and MHCS, shall exercise its rights under the Subsidiary Loan Agreement in such manner as to protect the interests of the Borrower and the Bank and to accomplish the purposes of the Project, and, except as the Bank shall otherwise agree, the Borrower shall not amend assign, amend, abrogate or waive the Subsidiary Loan Agreement or any provision thereof if, in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the Projectthereof. (a) Except as the Bank shall otherwise agree, procurement of the goods, works, works and consultants’ services, services required for the Project and to be financed out of the proceeds of the Loan shall be governed by the provisions of Schedule 1 4 to the Project Agreementsthis Agreement, as such said provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) 12 months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water Company, under financial terms and conditions identical to those governing the Loan. (b) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements in such manner as to protect the interests of the Borrower and the Bank and to accomplish the purposes of the Loan, and, except as the Bank shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either Subsidiary Loan Agreement or any provision thereof. Section 3.063.03. For the purposes of Section 9.07 of the General Conditions and without limitation thereto, the Borrower shall, through the MHCS: (a) prepare, on the basis of guidelines acceptable to the Bank, and furnish to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the Bank, a plan for designed to ensure the continued achievement of the objectives of the Project’s objectives; and, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.073.04. The Bank and the Borrower hereby agree that the obligations set forth in Sections 9.04, 9.05, 9.06, 9.07, 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) in respect of Part B and C of the Project shall be carried out by each of the Water Companies Utilities and Municipalities pursuant to Section 2.03 of the respective Project AgreementAgreement(s).

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the ProjectProject as set forth in Schedule 2 to this Agreement, and, to this end, without any limitation or restriction upon any of its other obligations under the Loan Development Credit Agreement, shall cause each of the Water Companies ECG to perform, perform in accordance with the provisions pro- visions of their respective the Project Agreements, Agreement all the respective obligations of the Water Companies ECG therein set forth, shall take or and cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies ECG to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon the provisions of paragraph (a) of this Section and except as the Borrower and the Bank shall otherwise agree, the Borrower shall cause the Water Companies to: (i) carry out their obligations in accordance with the provisions of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the Project. (a) Except as the Bank shall otherwise agree, procurement of the goods, works, and consultants’ services, required for the Project and to be financed out of the proceeds of the Loan shall be governed by the provisions of Schedule 1 to the Project Agreements, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan Credit to the Guilan Water Company ECG under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water Company, ECG under financial terms and conditions identical to those governing which shall have been approved by the LoanAssociation. (bc) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Subsi- diary Loan Agreements Agreement in such manner as to protect the interests of the Borrower and the Bank Association and to accomplish the purposes of the LoanCredit, and, and except as the Bank Association shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either Subsidiary the Subsi- diary Loan Agreement or any provision thereof. Section 3.063.02. For Except as the purposes of Section 9.07 Association shall otherwise agree, procurement of the General Conditions goods, works and without limitation thereto, consultants’ services required for the Borrower shall: (a) prepare, on Project and to be financed out of the basis proceeds of guidelines acceptable the Credit shall be governed by the provisions of the Schedule to the Bank, and furnish to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Project Agreement. Section 3.03. The Borrower and the Bank, a plan for the continued achievement of the objectives of the Project; and, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.07. The Bank and the Borrower Association hereby agree that the obligations set forth in Sections 9.03, 9.04, 9.05, 9.06, 9.07, 9.07 and 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by each of the Water Companies ECG pursuant to Section 2.03 of the respective Project Agree- ment. Section 3.04. The Borrower shall: (a) enter into a performance agreement with ECG acceptable to the Association which shall include annual performance targets and indicators to be used as the basis of monitoring ECG’s insti- tutional progress; (b) duly perform all its obligations under the Performance Agreement; and (c) exchange views annually with the Association with regard to the performance of its obligations and ECG’s obligations under the Performance Agreement. Section 3.05. The Borrower shall: (a) exchange views with the Association on the findings of the study to prepare the plans referred to in Part F.1 of the Project; and (b) based on the findings of this study, adopt economic and financial criteria acceptable to the Association for future elec- trification programs.

Execution of the Project. (a) Section 3.01. The Borrower declares its commitment to the objectives of the Project, Project as set forth in Schedule 2 to this Agreement and, to this end, without any limitation or restriction upon any of its other obligations under shall carry out the Loan AgreementProject through MOW with due diligence and efficiency and in conformity with appropriate administrative, financial and engineering practices, and shall cause each of provide, promptly as needed, the Water Companies to perform, in accordance with the provisions of their respective Project Agreements, all the respective obligations of the Water Companies therein set forth, shall take or cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon the provisions of paragraph (a) of this Section and except as the Borrower and the Bank shall otherwise agree, the Borrower shall cause the Water Companies to: (i) carry out their obligations in accordance with the provisions of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of resources required for the Project. (a) Section 3.02. Except as the Bank shall otherwise agree, procurement of the goods, works, works and consultants’ services, services required for the Project and to be financed out of the proceeds of the Loan shall be governed by the provisions of Schedule 1 4 to this Agreement. Section 3.03. The Borrower shall cause HOW to prepare and furnish to the Project AgreementsBank by not later than December 31, as such provisions may be further elaborated in 1991, an action program for the Procurement Planmonitoring of ambient air quality standards for vehicle emissions and proposed standards for vehicle emissions. After review and comment of said program and standards by the Bank, the Borrower shall adopt and implement a program satisfactory to the Bank. Section 3.04. The Borrower shall cause MOW to prepare and furnish to the Bank, by not later than December 31, 1991, an action program to ensure effective traffic control. After review and comment of said program by the Bank, the Borrower shall adopt and implement a program satisfactory to the Bank. Section 3.05. For the purpose of implementing Part F of the Project, the borrower shall furnish to the Bank, by not later than December 31, 1990, a time-bound training program covering its fiscal years 1991-1993. (a) Not later than December 31 each year, the Borrower shall cause MOW to prepare and furnish to the Bank for its review and comments, a road maintenance work program covering the period of twelve months commencing on the following July 1. (b) The Borrower shall, or Each road maintenance work program shall cause set out detailed proposals for the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable period to which it relates and shall contain information satisfactory to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (ac) The Borrower shall relend After review and comment on each such work program by the proceeds of the Loan to the Guilan Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water Company, under financial terms and conditions identical to those governing the Loan. (b) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) aboveBank, the Borrower shall cause MOW to make available, through the Borrower’s contribution, such revisions to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed work program paying due regard to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements in such manner as to protect the interests of the Borrower and any comments emanating from the Bank and to accomplish the purposes of the Loan, and, except as the Bank bank shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either Subsidiary Loan Agreement or any provision thereof. Section 3.06. For the purposes of Section 9.07 of the General Conditions and without limitation thereto, the Borrower shall: (a) prepare, on the basis of guidelines acceptable cause MOW to the Bank, and furnish to the Bank not later than six (6) months after the Closing Date or carry out such later date as may be agreed for this purpose between the Borrower and the Bank, a plan work program for the continued achievement of the objectives of the Project; and, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said planyear in question as shall have been so revised. Section 3.07. The Bank and the Borrower hereby agree that the obligations set forth in Sections 9.04, 9.05, 9.06, 9.07, 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by each of the Water Companies pursuant to Section 2.03 of the respective Project Agreement.

Execution of the Project. (a) Section 3.01. The Borrower declares its commitment to the objectives of the ProjectProject as set forth in Schedule 2 to this Agreement, and, to this end: (i) shall carry out Part B of the Project through MCI with due diligence and efficiency and in conformity with appropriate administrative and financial practices and shall provide, promptly as needed, the funds, facilities, services and other resources required for the Project; and (ii) without any limitation or restriction upon any of its other obligations under the Loan Agreement, the Borrower shall cause each of the Water Companies Company to perform, perform all its obligations set forth in accordance with the provisions of their respective Project Agreements, all the respective obligations of the Water Companies therein set forthAgreement, shall take or cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies Company to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon the provisions of paragraph (a) of this Section and except as the Borrower and the Bank shall otherwise agree, the Borrower shall cause the Water Companies to: (i) carry out their obligations in accordance with the provisions of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the Project. (a) Except as the Bank shall otherwise agree, procurement of the goods, works, and consultants’ services, required for the Project and to be financed out of the proceeds of the Loan shall be governed by the provisions of Schedule 1 to the Project Agreements, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water Company, Company under financial terms and conditions identical to those governing which shall have been approved by the LoanBank and which shall include, inter alia: (i) interest payable at 105% of the variable rate payable under Section 2.05 of this Agreement; (ii) commitment charge calculated in accordance with Section 2.04 of this Agreement; (iii) repayment period of 20 years, including a grace period of five years; and (iv) the Company shall bear the foreign exchange risk for its subsidiary loan. (b) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements Agreement in such a manner as to protect the interests of the Borrower and the Bank and to accomplish the purposes of the Loan, and, except as the Bank shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either the Subsidiary Loan Agreement or any provision thereofto affect the provisions of paragraph (a) above. Section 3.063.03. For The Borrower shall maintain the purposes of Section 9.07 Project Coordination Unit established within MCI to coordinate implementation of the General Conditions Project, with staff and without limitation thereto, the Borrower shall: (a) prepare, on the basis of guidelines responsibilities acceptable to the Bank, and furnish to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the Bank, a plan for the continued achievement of the objectives of the Project; and, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.073.04. Except as the Bank shall otherwise agree, procurement of the goods and employment of engineering firms and consultants required for the Project, to be financed out of the proceeds of the Loan, shall be governed by the provisions of Schedule 4 to this Agreement. Section 3.05. The Bank and the Borrower hereby agree that the obligations set forth in Sections 9.04, 9.05, 9.06, 9.07, 9.07 and 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance reports and land acquisitionmaintenance, respectively) in respect of Part A of the Project, shall be carried out by each of the Water Companies Company pursuant to Section 2.03 2.04 of the respective Project Agreement. Section 3.06. In order to assist in carrying out Part A of the Project, the Borrower shall: (a) furnish to the Bank semi-annually a report on the progress towards completion of downstream phosphate fertilizer plants necessary to assure full use of the output of phosphate concentrate of the project mine (Wengfu) including: the diammonium phosphate plant at Tonglin, Anhui Province; the diammonium phosphate plant at Guixi, Jiangxi Province; the diammonium phosphate plant at Dongting, Hunan Province; the nitrophosphate plant at Jinan, Shandong Province; and the nitrophosphate plant at Kaifeng, Henan Province; and (b) ensure that the Company completes the triple superphosphate plant at Wengfu in accordance with Section 2.08 of the Project Agreement.

Execution of the Project. (a) Section 3.01. The Borrower declares its commitment to the objectives of the ProjectProject as set forth in Schedule 2 to this Agreement, and, to this end, without any limitation or restriction upon any of its other obligations under shall carry out the Loan Project with due diligence and efficiency, in conformity with appropriate administrative, business and financial practices and in accordance with the Implementation Program set forth in Schedule 4 to this Agreement, as the same may be amended from time to time by mutual agreement of the Borrower and the Administrator, and shall provide, promptly as needed, the funds, facilities, services and other resources required for the Project. (a) The Borrower shall make the proceeds of the Credit available to the PA under a subsidiary agreement to be entered into between the Borrower and the PA, under terms and conditions which shall have been approved by the Administrator; (b) The Borrower shall cause each of the Water Companies PA to perform, perform in accordance with the provisions of their respective Project Agreements, the Subsidiary Agreement all of the respective obligations of the Water Companies PA therein set forth, shall cause the PA: (i) to take or cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of PA to carry out the Water Companies Project; and (ii) not to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon the provisions of paragraph (a) of this Section and except as the Borrower and the Bank shall otherwise agree, the Borrower shall cause the Water Companies to: (i) its ability to carry out their obligations in accordance with the provisions of this Agreement and the applicable Project AgreementsProject; and (iic) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the Project. (a) Except as the Bank shall otherwise agree, procurement of the goods, works, and consultants’ services, required for the Project and to be financed out of the proceeds of the Loan shall be governed by the provisions of Schedule 1 to the Project Agreements, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water Company, under financial terms and conditions identical to those governing the Loan. (b) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements Agreement in such manner as to protect the interests of the Borrower and the Bank Administrator and to accomplish the purposes of the LoanCredit, and, except as the Bank Administrator shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either the Subsidiary Loan Agreement or any provision thereof. Section 3.063.02. Except as the Administrator shall otherwise agree, procurement of the goods and consultants’ services required for the Project and to be financed out of the proceeds of the Credit shall be governed by the provisions of Schedule 3 to this Agreement. Section 3.03. For the purposes of Section 9.07 of the General Conditions and without limitation thereto, the Borrower shallshall cause the PA to: (a) prepare, on the basis of guidelines acceptable to the BankAdministrator, and furnish to the Bank Administrator not later than six (6) months after the Closing Date Date, or such later date as may be agreed for this purpose between the Borrower PA and the BankAdministrator, a plan for to ensure the continued achievement of the objectives of the Project’s objectives; and, (b) afford the Bank Administrator a reasonable opportunity to exchange views with the Borrower PA on said plan. Section 3.07. The Bank and the Borrower hereby agree that the obligations set forth in Sections 9.04, 9.05, 9.06, 9.07, 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by each of the Water Companies pursuant to Section 2.03 of the respective Project Agreement.

Execution of the Project. (a) The Borrower declares its commitment to the objectives objective of the ProjectProject as set forth in Schedule 2 to this Agreement, and, to this end, without any limitation or restriction upon any of its other obligations under the Loan Development Credit Agreement, shall cause each of the Water Companies Himachal Pradesh to perform, perform in accordance with the provisions of their respective the Project Agreements, Agreement all the respective obligations of the Water Companies Himachal Pradesh as therein set forth, shall take or and cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies Himachal Pradesh to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon the provisions of paragraph (a) of this Section and except as the Borrower and the Bank shall otherwise agree, the The Borrower shall cause make the Water Companies to: (i) carry out their obligations proceeds of the Credit available to Himachal Pradesh in accordance with the provisions Borrower’s standard arrangements for developmental assistance to the States of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the ProjectIndia. (a) Section 3.02. Except as the Bank Association shall otherwise agree, procurement of the goods, works, works and consultants’ services, services required for the Project and to be financed out of the proceeds of the Loan Credit shall be governed by the provisions of Schedule 1 to the Project AgreementsAgreement, as such said provisions may be further elaborated in the Procurement PlanManual. (b) Section 3.03. The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water Company, under financial terms and conditions identical to those governing the Loan. (b) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) participate in the proceeds exchange of views with the Association and Himachal Pradesh on the plan for the future operation of the LoanProject to be provided by Himachal Pradesh pursuant to Section 2.03(b) of the Project Agreement; and (ii) such amounts as may be needed to finance participate with the Borrower’s contribution to expenditures under Parts B Association and D of Himachal Pradesh in the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the ProjectMid- term Review. Section 3.053.04. The Borrower shall exercise its rights under the Subsidiary Loan Agreements in such manner as to protect the interests of the Borrower and the Bank and to accomplish the purposes of the Loan, and, except as the Bank shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either Subsidiary Loan Agreement or any provision thereof. Section 3.06. For the purposes of Section 9.07 of the General Conditions and without limitation thereto, the Borrower shall: (a) prepare, on the basis of guidelines acceptable to the Bank, and furnish to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the Bank, a plan for the continued achievement of the objectives of the Project; and, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.07. The Bank and the Borrower Association hereby agree that the obligations set forth in Sections 9.03, 9.04, 9.05, 9.06, 9.07, 9.07 and 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) in respect of the Project shall be carried out by each of the Water Companies Himachal Pradesh pursuant to Section 2.03 of the respective Project Agreement. (a) The Borrower shall, at the request of the Association, exchange views with the Association with regard to the progress of the Project, the performance of obligations under this Agreement, and other matters relating to the purposes of the Credit. (b) The Borrower shall promptly inform the Association, of any condition which interferes or threatens to interfere with the progress of the Project, the accomplishment of the purposes of the Credit, or the performance by the Borrower of its obligations under this Agreement.

Execution of the Project. (a) Section 3.01. The Borrower declares its commitment to the objectives of the ProjectProject as set forth in Schedule 2 to this Agreement, and, to this end, without any shall carry out the Project with the assistance of the Privatization Center with due diligence and efficiency and in conformity with appropriate administrative and financial practices and shall provide, promptly as needed, the funds, facilities, services and other resources required for this purpose. Section 3.02. Without limitation or restriction upon any of its other obligations under the Loan Agreement, shall the Borrower shall: (a) cause each of the Water Companies Privatization Center to perform, perform in accordance with the provisions of their respective Project AgreementsAgreement, the Subsidiary Project Management Arrangements and the Statutes, all the respective obligations and activities of the Water Companies Privatization Center therein set forth, shall forth which may affect the Project; and take or cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies Privatization Center to perform such obligations, ; and shall not take or permit to be taken any action which would prevent or interfere with such performance.; and (b) exercise its rights under the Subsidiary Project Management Arrangements in such a manner as to protect the interests of the Borrower and the Bank, to comply with the provisions of this Agreement, and to accomplish the purposes of the Loan, and, except as the Bank shall otherwise agree, not assign, amend, abrogate or waive the Subsidiary Project Management Arrangements or any provision thereof. Section 3.03. For purposes of implementing the Project, the Borrower shall enter into subsidiary project management arrangements, satisfactory to the Bank, with the Privatization Center, whereby the Privatization Center shall be appointed executing agent of the Borrower for carrying out such activities under the Project and obligations of the Borrower as shall have been specified therein and in respect of which the Borrower shall have made all necessary provision, including, inter alia: (a) the carrying out by the Privatization Center of Parts A and B of the Project with due diligence and efficiency and in conformity with appropriate practices and in accordance with the GKI-FPF Operational Coordination Agreement and the applicable provisions of the Schedule to the Project Agreement; (b) the carrying out by the Privatization Center of the procurement and related accounting for the goods and consultants’ services required for the Project and to be financed out of the proceeds of the Loan; (c) the utilization of funds by the Privatization Center, including the proceeds of the Loan, required for the support of the operations of the Privatization Center undertaken in accordance with subparagraphs (a) and (b) of this Section, and the manner of effecting compliance with the obligations of the Borrower under Section 4.01 of this Agreement in respect of the expenditures to be made with such funds; and (d) the establishment and continuous operation by the Privatization Center of all facilities necessary for the appropriate administration of Project activities and related management functions undertaken by the Privatization Center in accordance with subparagraphs (a), (b) and (c) of this Section. Section 3.04. Without limitation upon the provisions of paragraph (a) Section 3.03 of this Section Agreement, and except as the Borrower and the Bank shall otherwise agree, the Borrower shall carry out, or cause the Water Companies to: (i) carry out their obligations in accordance with the provisions of this Agreement and the applicable Project Agreements; and (ii) implement to be carried out, the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; Implementation Programs set forth in Schedule 5 to this Agreement and the Resettlement Policy Framework, and except as Schedule to the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the ProjectProject Agreement. (a) Section 3.05. Except as the Bank shall otherwise agree, procurement of the goods, works, goods and consultants’ services, services required for Part C of the Project and to be financed out of the proceeds of the Loan shall be governed by the provisions of Schedule 1 4 to the Project Agreements, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water Company, under financial terms and conditions identical to those governing the Loan. (b) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements in such manner as to protect the interests of the Borrower and the Bank and to accomplish the purposes of the Loan, and, except as the Bank shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either Subsidiary Loan Agreement or any provision thereofthis Agreement. Section 3.06. For the purposes of Section 9.07 of the General Conditions and without limitation thereto, the Borrower shall: (a) prepare, on the basis of guidelines acceptable to the Bank, and furnish to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the Bank, a plan for the continued achievement of the objectives of the Project; and, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.07. The Bank and the Borrower hereby agree that the obligations set forth in Sections 9.04, 9.05, 9.06, 9.07, 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by each of the Water Companies pursuant to Section 2.03 of the respective Project Agreement.and

Execution of the Project. (a) The Borrower Recipient declares its commitment to the objectives of the ProjectProject as set forth in Schedule 2 to this Agreement, and, to this end, without any limitation or restriction upon any of its other obligations under the Loan this Agreement, shall cause each of the Water Companies ARIS to perform, perform in accordance with the provisions of their respective the Project Agreements, Agreement all the respective obligations of the Water Companies ARIS therein set forth, shall take or and cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies ARIS to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon The Recipient shall make the provisions proceeds of paragraph the Grant available to ARIS under a subsidiary grant agreement to be entered into between the Recipient and ARIS, under terms and conditions which shall have been approved by the Association. (ac) The Recipient shall exercise its rights under the Subsidiary Grant Agreement in such manner as to protect the interests of this Section the Recipient and the Association and to accomplish the purposes of the Grant, and, except as the Borrower and the Bank Association shall otherwise agree, the Borrower shall cause the Water Companies to: (i) carry out their obligations in accordance with the provisions of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower Recipient shall not amend assign, amend, abrogate or waive the Subsidiary Grant Agreement or any provision thereof if, in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the Projectthereof. (a) Section 3.02. Except as the Bank Association shall otherwise agree, procurement of the goods, works, works and consultants’ services, services required for the Project and to be financed out of the proceeds of the Loan Grant shall be governed by the provisions of Schedule 1 to the Project AgreementsAgreement. Section 3.03. The Recipient shall maintain ARIS until completion of the Project with staff, as such provisions may be further elaborated in resources and terms of reference satisfactory to the Procurement Plan.Association, shall not amend and shall cause ARIS not to amend its Charter without prior approval by the Association and shall assign to ARIS the responsibility for overall Project management and coordination, including: (a) preparation of withdrawal applications under the Grant; (b) The Borrower shall, or shall cause management of the Water Companies to, update the Procurement Plan Special Account referred to in accordance with the terms Section 2.02 (b) of reference acceptable this Agreement; (c) maintenance of records and accounts related to the Bank, Project and furnish such update arranging for the audit thereof; (d) participation in administration of bidding procedures and of contracts under the Project; and (e) preparation of quarterly progress reports and submission thereof to the Bank Recipient and the Association not later than twelve (12) months 45 days after the date end of each quarter, the first such report to be furnished to the Association not later than 45 days after the end of the preceding Procurement Plan, for first full calendar quarter after the Bank’s approvaleffectiveness of this Agreement. Section 3.04. The Recipient shall cause ARIS to maintain the Operational Manual in form and content satisfactory to the Association and not to assign, amend, abrogate or waive the Operational Manual without obtaining the prior approval of the Association. The Operational Manual shall cover, inter alia, the following matters: (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company under a subsidiary loan agreement to be entered into between the Borrower eligibility criteria for Community Grants and the Guilan Water Company, under financial terms and conditions identical to those governing the Loan. Micro-projects; (b) The Borrower shall relend the proceeds principles and procedures to be followed for the approval of Community Grants and Micro-projects; (c) regional allocation of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. Grant funds; (ad) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loancommunity contribution requirements for Micro-projects; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (ie) the proceeds of indicators to be utilized by the Loan; and, (ii) such amounts as may be needed to finance ARIS in monitoring the Borrower’s contribution to expenditures under Parts F, H and I progress of the Project. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements in such manner as to protect the interests of the Borrower Recipient and the Bank and to accomplish the purposes of the Loan, and, except as the Bank shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either Subsidiary Loan Agreement or any provision thereof. Section 3.06. For the purposes of Section 9.07 of the General Conditions and without limitation thereto, the Borrower shall: (a) prepare, on the basis of guidelines acceptable to the Bank, and furnish to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the Bank, a plan for the continued achievement of the objectives of the Project; and, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.07. The Bank and the Borrower Association hereby agree that the obligations set forth in Sections 9.03, 9.04, 9.05, 9.06, 9.07, 9.07 and 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by each of the Water Companies ARIS pursuant to Section 2.03 of the respective Project Agreement.

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the ProjectProject as set forth in Schedule 2 to this Agreement, and, to this end, without any limitation or restriction upon any of its other obligations under the Loan Development Credit Agreement, shall cause each of the Water Companies KRC to perform, in accordance with the provisions of their respective the Project AgreementsAgreement, all the respective obligations of the Water Companies KRC therein set forth, shall take or and cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies KRC to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon the provisions of paragraph (a) of this Section and except as the The Borrower and the Bank shall otherwise agree, the Borrower shall cause the Water Companies toshall: (i) carry out their obligations in accordance with make the provisions proceeds of the Credit, allocated from time to time to Category (3) of paragraph 1 of Schedule 1 to this Agreement and Agreement, available to KRC on the applicable Project Agreementssame terms as the Borrower receives the proceeds; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the Project. (a) Except as the Bank shall otherwise agree, procurement of the goods, works, and consultants’ services, required for the Project and to be financed out of the proceeds of the Loan shall be governed by the provisions of Schedule 1 to the Project Agreements, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan Credit, allocated from time to the Guilan Water Company time to Categories (1) and (2) of paragraph 1 of Schedule 1 of this Agreement, to KRC under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water CompanyKRC, under financial terms and conditions identical to those governing which shall have been approved by the Loan.Association which shall include, inter alia, that: (b) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (iA) the proceeds of the LoanCredit shall be relent at an interest rate of not less than 8.8 percent per annum, for a term of twenty (20) years, including a grace period not exceeding four (4) years; and and (iiB) such amounts as may be needed KRC shall bear the risk resulting from fluctuations in the value of currencies relent to finance the Borrower’s contribution to expenditures under Parts B and D of the Projectit. (bc) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements Agreement in such manner as to protect the interests of the Borrower and the Bank Association and to accomplish the purposes of the Loan, Credit and, except as the Bank Association shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either the Subsidiary Loan Agreement or any provision thereof. Section 3.063.02. For Except as the purposes of Section 9.07 Association shall otherwise agree, procurement of the General Conditions goods, works and without limitation thereto, consultants’ services required for the Borrower shall: (a) prepare, on Project and to be financed out of the basis proceeds of guidelines acceptable the Credit shall be governed by the provisions of Schedule 1 to the Bank, and furnish to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Project Agreement. Section 3.03. The Borrower and the Bank, a plan for the continued achievement of the objectives of the Project; and, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.07. The Bank and the Borrower Association hereby agree that the obligations set forth in Sections 9.03, 9.04, 9.05, 9.06, 9.07, 9.07 and 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by each of the Water Companies KRC pursuant to Section 2.03 of the respective Project Agreement.

Execution of the Project. (a) Section 2.01. The Borrower Corporation declares its commitment to the objectives of the ProjectProject as set forth in Schedule 2 to the Loan Agreement, and, to this end, without any limitation or restriction upon any of its other obligations under the Loan Agreement, shall cause each carry out Part A of the Water Companies to performProject with due diligence and efficiency and in conformity with appropriate administrative, in accordance with the provisions of their respective Project Agreementsfinancial, all the respective obligations of the Water Companies therein set forthengineering and public utility practices, and shall take provide, or cause to be taken all actionprovided, including promptly as needed, the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon the provisions of paragraph (a) of this Section and except as the Borrower and the Bank shall otherwise agree, the Borrower shall cause the Water Companies to: (i) carry out their obligations in accordance with the provisions of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of resources required for the Project. (a) Section 2.02. Except as the Bank shall otherwise agree, procurement pro- curement of the goods, works, works and consultants’ services, services required for the Project and to be financed out of the proceeds of the Loan shall be governed by the provisions of the Schedule 1 to the Project Agreements, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water Company, under financial terms and conditions identical to those governing the Loan. (b) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Projectthis Agreement. Section 3.052.03. The Borrower Corporation shall exercise its rights under the Subsidiary Loan Agreements in such manner as to protect the interests of the Borrower and the Bank and to accomplish the purposes of the Loan, and, except as the Bank shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either Subsidiary Loan Agreement or any provision thereof. Section 3.06. For the purposes of Section 9.07 of the General Conditions and without limitation thereto, the Borrower shall: (a) prepare, on the basis of guidelines acceptable to the Bank, and furnish to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the Bank, a plan for the continued achievement of the objectives of the Project; and, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.07. The Bank and the Borrower hereby agree that carry out the obligations set forth in Sections 9.04, 9.05, 9.06, 9.07, 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and servicesser- vices, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by each in respect of the Water Companies pursuant to Section 2.03 Project Agree- ment and Part A of the respective Project Project. Section 2.04. The Corporation shall duly perform all its obligations under the Subsidiary Loan Agreement. Except as the Bank shall otherwise agree, the Corporation shall not take or concur in any action which would have the effect of amending, abrogating, assigning or waiving the Subsidiary Loan Agreement or any provision thereof. (a) The Corporation shall, at the request of the Bank, exchange views with the Bank with regard to progress of the Project, the performance of its obligations under this Agree- ment and under the Subsidiary Loan Agreement, and other matters relating to the purposes of the Loan. (b) The Corporation shall promptly inform the Bank of any condition which interferes or threatens to interfere with the progress of the Project, the accomplishment of the purposes of the Loan, or the performance by the Corporation of its obligations under this Agreement and under the Subsidiary Loan Agreement. Section 2.06. The Corporation shall, not later than June 30, 1989, issue a letter of intent to the consultants selected for the detailed design and supervision of construction in respect of the power station to be constructed under Part A of the Project, and shall, within 60 days thereafter, conclude the appointment of said consultants.

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the ProjectProject as set forth in Schedule 2 to this Agreement, and, to this end: (i) shall carry out Parts A and B of the Project with due diligence and efficiency and in conformity with appropriate administrative and financial practices and shall provide, promptly as needed, the funds, facilities, services and other resources required for such Parts of the Project; and (ii) without any limitation or restriction upon any of its other obligations under the Loan Development Credit Agreement, the Borrower shall cause each of TEEF to perform all its obligations set forth in the Water Companies to perform, in accordance with the provisions of their respective Project Agreements, all the respective obligations of the Water Companies therein set forthAgreement, shall take or cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies TEEF to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon the provisions of paragraph (a) of this Section Section, and except as the Borrower and the Bank Association shall otherwise agree, the Borrower shall cause the Water Companies to: (i) carry out their obligations in accordance with the provisions Parts A and B of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, Implementation Program set forth in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the ProjectSchedule 4 to this Agreement. (ac) The Borrower shall make available a portion of the proceeds of the Credit to TEEF in accordance with arrangements satisfactory to the Association. Section 3.02. Except as the Bank Association shall otherwise agree, procurement of the goods, works, works and consultants’ services, services required for the Project and to be financed out of the proceeds of the Loan Credit shall be governed by the provisions of Schedule 1 3 to this Agreement. Section 3.03. The Borrower shall cause TEEF to employ an executive director whose experience and qualifications shall be at all times acceptable to the Project Agreements, as Association and to consult with the Association with respect to the replacement of the executive director of TEEF prior to any such provisions may be further elaborated in the Procurement Planreplacement. (b) Section 3.04. The Borrower shallundertakes that, or unless the Association shall cause the Water Companies tootherwise agree, update the Procurement Plan Sub-projects shall be identified, appraised, approved, carried out, and maintained in accordance with the terms of reference acceptable procedures set forth or referred to in the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water Company, under financial terms and conditions identical to those governing the Loan. (b) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the ProjectRegulations. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements in such manner as to protect the interests of the Borrower and the Bank and to accomplish the purposes of the Loan, and, except as the Bank shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either Subsidiary Loan Agreement or any provision thereof. Section 3.06. For the purposes of Section 9.07 of the General Conditions and without limitation thereto, the Borrower shall: (a) prepare, on the basis of guidelines acceptable to the Bank, and furnish to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the Bank, a plan for the continued achievement of the objectives of the Project; and, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.07. The Bank and the Borrower Association hereby agree that the obligations set forth in Sections 9.03, 9.04, 9.05, 9.06, 9.07, 9.07 and 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) in respect of Part C of the Project shall be carried out by each of the Water Companies TEEF pursuant to Section 2.03 of the respective Project Agreement.

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the ProjectProject as set forth in Schedule 2 to this Agreement, and, to this end, without shall carry out Part C of the Project and, through the Local Utilities, Part A of the Project, with due diligence and efficiency and in conformity with appropriate administrative, financial, engineering and public utility practices, and shall provide, promptly as needed, the funds, facilities, services and other resources required for said Parts of the Project. (b) Without any limitation or restriction upon any of its other obligations under the Loan Agreement, the Borrower shall cause each of the Water Companies ONEP to perform, perform in accordance with the provisions of their respective the Project Agreements, Agreement all the respective obligations of the Water Companies ONEP therein set forth, shall take or cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies ONEP to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (bc) Without limitation upon For the provisions purpose of paragraph (a) carrying out Part A of this Section and except as the Borrower and the Bank shall otherwise agreeProject, the Borrower shall cause relend to the Water Companies to: (i) carry out their obligations in accordance with the provisions of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the Project. (a) Except as the Bank shall otherwise agree, procurement of the goods, works, and consultants’ services, required for the Project and to be financed out of Local Utilities the proceeds of the Loan allocated from time to time to Category (1) under sub-loan agreements to be entered into between the Borrower and the Local Utilities, under terms and conditions which shall be governed have been approved by the provisions of Schedule 1 to the Project Agreements, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update which shall include, without limitation, those set forth in Section I of Schedule 4 to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approvalthis Agreement. (ad) The For the purpose of carrying out Part B of the Project, the Borrower shall relend to ONEP the proceeds of the Loan allocated from time to the Guilan Water Company time to Category (2) under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water CompanyONEP, under financial terms and conditions identical which shall have been approved by the Bank and which shall include, without limitation, those set forth in Section II of Schedule 4 to those governing the Loanthis Agreement. (be) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Companyshall: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreement and each of the Sub-loan Agreements in such manner as to protect the interests of the Borrower and the Bank and to accomplish the purposes of the Loan, and, except as the Bank shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either the Subsidiary Loan Agreement Agreement, any Sub-loan Agreement, or any provision thereof; and (ii) cause each of the Local Utilities to perform in accordance with the provisions of its Sub-loan Agreement all the obligations of the Local Utility therein set forth and shall take all action necessary or appropriate to enable the Local Utility to perform such obligations, and shall not take or permit to be taken any such action which would prevent or interfere with such performance. Section 3.063.02. For Without limitation upon the purposes provisions of Section 9.07 3.01 of the General Conditions and without limitation thereto, this Agreement the Borrower shall: (a) preparetake all measures necessary to ensure that Parts A and C of the Project shall, on except as the basis Borrower and the Bank may otherwise agree, be carried out in accordance with the Action Plan set forth in Schedule 5 to this Agreement; and (b) establish and thereafter maintain a project unit with organization, membership, terms of guidelines acceptable reference and resources satisfactory to the Bank, to be responsible for appraising the Rehabilitation and furnish Institutional Restructuring Projects to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the Bank, a plan for the continued achievement of the objectives carried out under Part A of the Project; and, (b) afford , and for supervising and monitoring the Bank a reasonable opportunity to exchange views with carrying out thereof by the Borrower on said planLocal Utilities. Section 3.073.03. In order to assist the Borrower in the technical appraisals of, the coordination and supervision of procurement for, and the supervision and monitoring of the carrying out by the Local Utilities of, the Rehabilitation and Institutional Restructuring Projects under Part A of the Project, the Borrower shall employ consultants whose qualifications, experience and terms of reference shall be satisfactory to the Bank. Section 3.04. Except as the Bank shall otherwise agree, procurement of the goods, works and services required for the Project and to be financed out of the proceeds of the Loan shall be governed by the provisions of Schedule 6 to this Agreement. Section 3.05. The Bank and the Borrower hereby agree that the obligations set forth in Sections 9.04, 9.05, 9.06, 9.07, 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) in respect of Part B of the Project, shall be carried out by each of the Water Companies ONEP pursuant to Section 2.03 of the respective Project Agreement.

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the ProjectProject as set forth in Schedule 2 to this Agreement, and, to this end: (i) shall carry out through ▇▇▇▇, MPWH and PRC Parts A, C and D of the Project with due diligence and efficiency and in conformity with appropriate administrative, financial, environmental, and eco-tourism practices, and shall provide, promptly as needed, the funds, facilities, services and other resources required for the Project; and (ii) without any limitation or restriction upon any of its other obligations under the Loan Agreement, shall cause each of the Water Companies ARA to perform, perform in accordance with the provisions of their respective the Project Agreements, Agreement all the respective obligations of the Water Companies ARA therein set forth, shall take or cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies ARA to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon the provisions of paragraph (a) of this Section and except as the Borrower and the Bank shall otherwise agree, the Borrower shall cause the Water Companies to: (i) carry out their obligations Parts A, C and D of the Project, and cause ARA to carry out Part B of the Project, in accordance with the provisions of Implementation Program set forth in Schedule 5 to this Agreement and the applicable Project Agreements; andAgreement. (iic) implement For the Project in accordance with purposes of Part B of the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agreeProject, the Borrower shall not amend or waive any provision thereof if, in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the Project. (a) Except as the Bank shall otherwise agree, procurement of the goods, works, and consultants’ services, required for the Project and to be financed out of the proceeds of the Loan shall be governed by the provisions of Schedule 1 to the Project Agreements, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water Company, under financial ARA and on terms and conditions identical to those governing which shall have been approved by the Loan. (b) The Borrower shall relend Bank, transfer the proceeds of the Loan allocated from time to time to Categories 1(b), 2(b) and 3(b) of the Mazandaran Water Company under table in paragraph 1 of Schedule 1 to this Agreement to ARA as a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loangrant. (ad) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements Agreement in such manner as to protect the interests of the Borrower and the Bank and to accomplish the purposes of the Loan, and, except as the Bank shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either the Subsidiary Loan Agreement or any provision thereof. Section 3.063.02. Except as the Bank shall otherwise agree, procurement of the goods, works, and consultants' services required for the Project and to be financed out of the proceeds of the Loan shall be governed by the provisions of Schedule 4 to this Agreement. Section 3.03. The Borrower and the Bank hereby agree that the obligations set forth in Sections 9.03, 9.04, 9.05, 9.06, 9.07 and 9.08 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) in respect of Part B of the Project shall be carried out by ARA pursuant to Section 2.03 of the Project Agreement. Section 3.04. For the purposes of Section 9.07 9.08 of the General Conditions and without limitation thereto, the Borrower shall: (a) prepare, on the basis of guidelines acceptable to the Bank, and furnish to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the Bank, a plan for designed to ensure the continued achievement of the objectives of the Project’s objectives; and, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.07. The Bank and the Borrower hereby agree that the obligations set forth in Sections 9.04, 9.05, 9.06, 9.07, 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by each of the Water Companies pursuant to Section 2.03 of the respective Project Agreement.

Execution of the Project. (a) Section 3.01. The Borrower declares its commitment to the objectives of the Project, and, to this end, without any limitation or restriction upon any of its other obligations under shall carry out the Loan Agreement, shall cause each Project through the Office of the Water Companies to performPrime Minister with due diligence and efficiency and in conformity with appropriate health, in accordance with technical, administrative, financial, educational and environmental practices, and shall provide, promptly as needed, the provisions of their respective Project Agreements, all the respective obligations of the Water Companies therein set forth, shall take or cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon the provisions of paragraph (a) of this Section and except as the Borrower and the Bank shall otherwise agree, the Borrower shall cause the Water Companies to: (i) carry out their obligations in accordance with the provisions of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of resources required for the Project. (a) Section 3.02. Except as the Bank shall otherwise agree, procurement of the goods, works, works and consultants’ services, services required for the Project and to be financed out of the proceeds of the Loan shall be governed by the provisions of Schedule 1 4 to the Project Agreements, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water Company, under financial terms and conditions identical to those governing the Loan. (b) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Projectthis Agreement. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements in such manner as to protect the interests of the Borrower and the Bank and to accomplish the purposes of the Loan, and, except as the Bank shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either Subsidiary Loan Agreement or any provision thereof. Section 3.063.03. For the purposes of Section 9.07 of the General Conditions and without limitation thereto, the Borrower shall: (a) prepare, on the basis of guidelines acceptable to the Bank, and furnish to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the Bank, a plan for the continued achievement of the objectives future operation of the Project; and, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said plan. (a) Except as the Borrower and the Bank may otherwise agree, the Borrower shall carry out the Project in accordance with the Operational Manual. (b) The Borrower shall issue an operational manual, satisfactory to the Bank, containing, inter alia, specific provisions on detailed arrangements for the carrying out of the Project, including: the annual action plan for the first year of Project implementation; mandatory safeguards and mitigation actions for the collection, disposal and treatment of medical waste, which safeguards and actions shall be applied to prevent or mitigate any possible negative environmental impact said disposal might otherwise cause as a result of Project implementation; mandatory safeguards and mitigation actions for the construction, rehabilitation and expansion of health facilities, which safeguards and actions shall be applied to prevent or mitigate any possible negative environmental impact said construction may otherwise cause, such as, in particular, increase in deforestation, pollution of groundwater, negative impacts on endangered species, increased soil erosion, and encroachment on natural habitats; personal health and safety provisions for the handling and disposal of hazardous wastes; the Resettlement Framework; and guidelines for the preparation of Annual Action Plans. (c) If any provision of the Operational Manual is inconsistent with a provision of this Agreement, the provision of this Agreement shall prevail. (a) The Borrower shall operate and maintain within NACC, at all times during Project implementation, a Project coordination unit (the PCU) satisfactory to the Bank, with a structure, functions and responsibilities acceptable to the Bank, including, inter alia, the responsibility of the PCU to coordinate, monitor and supervise the carrying out of the Project. (b) The Borrower shall ensure that the PCU is, at all times during Project implementation, headed by a technical director and assisted by adequate professional and administrative staff in numbers and with experience and qualifications acceptable to the Bank (including an accounts manager and a procurement officer), all selected in accordance with competitive and transparent procedures satisfactory to the Bank. Section 3.073.06. The Bank and Borrower shall: (a) not later than August 31 of each year of Project implementation, starting in year 2004, furnish to the Borrower hereby agree that Bank, for its approval, an annual action plan, each said plan to include, inter alia: (i) the obligations set forth in Sections 9.04, 9.05, 9.06, 9.07, 9.08 and 9.09 of the General Conditions (relating Project activities to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by the Borrower during the calendar year following the presentation of each said plan; and (ii) the procurement plan and disbursement plan for said Project activities; (b) thereafter implement each said Bank-approved Annual Action Plan in accordance with its terms; and (c) carry out the Annual Action Plan for the year 2004 as approved by the Bank prior to the date of this Agreement. Section 3.07. Without limitation to the provisions of Sections 9.01 and 9.07 of the Water Companies pursuant to Section 2.03 General Conditions, the Borrower shall, not later than thirty days after the conclusion of each semester during the implementation of the respective Project, starting with the semester which begins on June 1 and ends on December 31, 2003, prepare and furnish to the Bank a report of such scope and in such detail based on the Performance Indicators, as the Bank shall reasonably request with respect to the progress made in carrying out the Project during the semester immediately preceding the date of presentation of such report. Section 3.08. (a) Without limitation to the provisions of Sections 9.01 and 9.07 of the General Conditions, the Borrower shall, not later than September 1 of each year of Project implementation, starting in September 2004, review jointly with the Bank the progress made in: (i) carrying out the Project; and (ii) achieving the objectives of the Project, based on the relevant report referred to in Section 3.07 of this Agreement.

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the ProjectProject as set forth in Schedule 2 to this Agreement, and, to this end: (i) shall carry out Parts A, B, C, D, and E of the Project through MORPWH, and Part H through MOTC with due diligence and efficiency and in conformity with appropriate administrative, financial, engineering, and environmental practices, and shall provide, promptly as needed, the funds, facilities, services and other resources required for the Project; (ii) without any limitation or restriction upon any of its other obligations under the Loan Development Credit Agreement, shall cause each of the Water Companies KAA to perform, perform in accordance with the provisions of their respective the KAA Project Agreements, Agreement all the respective obligations of the Water Companies KAA therein set forth, shall take or and cause to be taken all actionactions, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies KAA to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance.; and (iii) without any limitation or restriction upon any of its other obligations under the Development Credit Agreement, shall cause KCAA to perform in accordance with the provisions of the KCAA Project Agreement all the obligations of KCAA therein set forth, shall take and cause to be taken all actions, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable KCAA to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance (b) Without limitation upon the provisions of paragraph (a) of this Section and except as the Borrower and the Bank Association shall otherwise agree, the Borrower shall cause the Water Companies to: (i) carry out their obligations in accordance with the provisions of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, Implementation Program set forth in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the ProjectSchedule 4 to this Agreement. (ac) Except as the Bank The Borrower shall otherwise agree, procurement of the goods, works, and consultants’ services, required for the Project and to be financed out relend part of the proceeds of the Loan shall be governed by the provisions of Schedule 1 Credit to the Project Agreements, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company KAA under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water CompanyKAA (KAA Subsidiary Loan Agreement), under financial terms and conditions identical which shall have been approved by the Association which shall include: (i) repayment of principal in 23 years including a grace period of 8 years; (ii) the payment of interest at the rate of 7% per annum; and (iii) the foreign exchange risk to those governing be borne by the LoanBorrower. (bd) The Borrower shall relend part of the proceeds of the Loan Credit to the Mazandaran Water Company KCAA under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water CompanyKCAA (KCAA Subsidiary Loan Agreement), under financial terms and conditions identical to those governing which shall have been approved by the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower Association which shall make available, through the Borrower’s contribution, to the Guilan Water Companyinclude: (i) repayment of principal in 23 years including a grace period of 8 years; (ii) the proceeds payment of interest at the Loanrate of 7% per annum; and (iiiii) such amounts as may the foreign exchange risk to be needed to finance borne by the Borrower’s contribution to expenditures under Parts B and D of the Project. (be) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the KAA Subsidiary Loan Agreements Agreement, and KCAA Subsidiary Loan Agreement in such manner as to protect the interests of the Borrower and the Bank Association and to accomplish the purposes of the LoanCredit, and, except as the Bank Association shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either the KAA Subsidiary Loan Agreement, KCAA Subsidiary Loan Agreement or any provision thereof. Section 3.063.02. Except as the Association shall otherwise agree, procurement of the goods, works and consultants’ services required for the Project and to be financed out of the proceeds of the Credit shall be governed by the provisions of Schedule 3 to this Agreement. Section 3.03. Without limitation upon the provisions of paragraph (a) of Section 3.01 of this Agreement, and except as the Borrower and the Association shall otherwise agree, the Borrower shall: (a) open an account in Kenya Shillings in a commercial bank acceptable to the Association (the Project Account), and thereafter maintain the Project Account under terms and conditions acceptable to the Association until the completion of the Project; (b) deposit into the Project Account: (i) an initial amount of KES 90,000,000 (the Initial Deposit); and (ii) thereafter, at quarterly intervals, replenish the Project Account by the amounts required to finance the Borrower’s contribution for expenditures under the Project other than those financed from the proceeds of the Credit, as shall be agreed upon between the Borrower and the Association; and (c) ensure that funds deposited into the Project Account in accordance with paragraph (b) of this Section shall be used exclusively to finance expenditures under Parts A through E of the Project other than those financed from the proceeds of the Credit. Section 3.04. For the purposes of Section 9.07 9.06 of the General Conditions and without limitation thereto, the Borrower shall: (a) prepare, on the basis of guidelines acceptable to the BankAssociation, and furnish to the Bank Association not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the BankAssociation, a plan for the continued achievement of the objectives future operation of the Project; and, (b) afford the Bank Association a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.073.05. The Bank Borrower and the Borrower Association hereby agree that the obligations set forth in Sections 9.03, 9.04, 9.05, 9.06, 9.07, 9.07 and 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively): (i) in respect of Part F of the Project shall be carried out by each KAA; and (ii) in respect of Part G of the Water Companies Project shall be carried out by KCAA pursuant to Section 2.03 of the respective Project AgreementAgreements.

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the Project, Project as set forth in Schedule 2 to this Agreement and, to this end, without shall carry out Parts D, E and F of the Project through CMB and R & SS under the supervision of MLARR, with due diligence and efficiency and in conformity with appropriate administrative, financial, engineering and agricultural practices, and shall provide, promptly as needed, the funds, facilities, services and other resources required for the Project. (b) Without any limitation or restriction upon any of its other obligations under the Loan Agreement, the Borrower shall cause each of the Water Companies AFC to perform, perform in accordance with the provisions of their respective the AFC Project Agreements, Agreement all the respective obligations of the Water Companies AFC therein set forth, shall take or cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies AFC to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (bc) Without any limitation or restriction upon any of its other obligations under the provisions Loan Agreement, the Borrower shall: (i) relend part of paragraph the proceeds of the Loan to AFC and CMB, for the respective parts for which they are responsible for executing, under subsidiary loan agreements to be entered into between the Borrower and AFC and CMB respectively and, under terms and conditions which shall have been approved by the Bank which shall include, inter alia, interest at a rate of 9.75% per annum, repayment of principal in 15 years including 3 years of grace and the foreign exchange risk to be borne by the Borrower; (aii) exercise its rights under each Subsidiary Loan Agreement in such manner as to protect the interests of this Section and except as the Borrower and the Bank shall otherwise agreeand to accomplish the purposes of the Loan and, the Borrower shall cause the Water Companies to: (i) carry out their obligations in accordance with the provisions of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend assign, amend, abrogate or waive each such Subsidiary Loan Agreement or any provision thereof if, in thereof; and (iii) adopt appropriate procedures to ensure the opinion allocation of the Bank, such amendment or waiver may materially and adversely affect the implementation of the Projectforeign exchange required to finance imported items under Sub-loans made by AFC to Sub-borrowers. (a) Section 3.02. Except as the Bank shall otherwise agree, procurement of the goods, works, works and consultants’ services, services required for Parts D, E and F of the Project and to be financed out of the proceeds of the Loan shall be governed by the provisions of Schedule 1 7 to this Agreement, and procurement of goods, works and consultants’ services for Parts A, B and C of the Project shall be governed by the provisions set forth in Schedule 3 to the AFC Project Agreements, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water Company, under financial terms and conditions identical to those governing the Loan. (b) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the ProjectAgreement. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements in such manner as to protect the interests of the Borrower and the Bank and to accomplish the purposes of the Loan, and, except as the Bank shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either Subsidiary Loan Agreement or any provision thereof. Section 3.06. For the purposes of Section 9.07 of the General Conditions and without limitation thereto, the Borrower shall: (a) prepare, on the basis of guidelines acceptable to the Bank, and furnish to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the Bank, a plan for the continued achievement of the objectives of the Project; and, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.073.03. The Bank and the Borrower hereby agree that the obligations set forth in Sections 9.04, 9.05, 9.06, 9.07, 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) in respect of Parts A, B and C of the Project shall be carried out by each of the Water Companies AFC pursuant to Section 2.03 2.04 of the respective AFC Project Agreement. (a) The Borrower shall take all necessary measures to complete the studies referred to in Parts F.1 and F.2 respectively of the Project by no later than December 31, 1990 and June 30, 1990 respectively and shall furnish to the Bank the reports of such studies for its review and comments. (b) Following review and comment by the Bank, the Borrower shall implement appropriate recommendations of the studies paying due regard to any comments which shall have been made by the Bank. Section 3.05. Without any limitation or restriction upon its obligations under Section 3.01 of this Agreement, the Borrower shall furnish to the Bank for its review and comment by no later than March 31, 1992, a detailed assessment of overall Project implementation on the basis of terms of reference satisfactory to the Bank. After review of such assessment by the Borrower and the Bank, the Borrower shall, after consultation with the Bank, implement such changes in Project execution which are considered necessary to ensure the achievement of the objectives of the Project as set forth in the introductory paragraph of Schedule 2 to this Agreement. Section 3.06. The Borrower shall ensure that producer prices will continue to be maintained at levels adequate to provide producers with appropriate incentives.

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the ProjectProject as set forth in Schedule 2 to this Agreement, and, to this end, without any limitation or restriction upon any of its other obligations under the Loan this Agreement, shall cause each of the Water Companies Chongqing to perform, perform in accordance with the provisions of their respective the Project Agreements, Agreement all the respective obligations of the Water Companies Chongqing therein set forth, shall take or and cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies Chongqing to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon the provisions of paragraph (a) of this Section and except as the Borrower and the Bank shall otherwise agree, the The Borrower shall cause make the Water Companies toproceeds of the Loan available to Chongqing on the following principal terms: (i) carry out their obligations The principal amount shall be made available in accordance with Dollars (determined on the provisions date, or respective dates, of this Agreement and withdrawal from the applicable Project Agreements; andLoan Account) of the value of the currency or currencies so withdrawn. (ii) implement The following shall be recovered over a period of twenty (20) years, inclusive of a grace period of five (5) years: (A) the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Planprincipal amount so made available; and (B) an amount equal to the Resettlement Policy Framework, fee paid pursuant to Section 2.04 of this Agreement. (iii) Interest shall be charged on such principal amount withdrawn and except as outstanding from time to time at a rate equal to the Bank rate of interest applicable from time to time to the Loan pursuant to the provisions of Section 2.06 of this Agreement. (iv) A commitment fee shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, in the opinion be charged on such principal amount of the Bank, such amendment or waiver may materially Loan so made available and adversely affect the implementation not withdrawn from time to time at a rate equal to three fourths of the Projectone percent (3/4 of 1%) per annum. (a) Except as the Bank shall otherwise agree, procurement of the goods, works, works and consultants’ services, services required for the Project and to be financed out of the proceeds of the Loan shall be governed by the provisions of Schedule 1 to the Project AgreementsAgreement, as such said provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference guidelines acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water Company, under financial terms and conditions identical to those governing the Loan. (b) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements in such manner as to protect the interests of the Borrower and the Bank and to accomplish the purposes of the Loan, and, except as the Bank shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either Subsidiary Loan Agreement or any provision thereof. Section 3.06. For the purposes of Section 9.07 of the General Conditions and without limitation thereto, the Borrower shall: (a) prepare, on the basis of guidelines acceptable to the Bank, and furnish to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the Bank, a plan for the continued achievement of the objectives of the Project; and, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.073.03. The Bank and the Borrower hereby agree that the obligations set forth in Sections 9.04, 9.05, 9.06, 9.07, 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by each of the Water Companies Chongqing pursuant to Section 2.03 of the respective Project Agreement.

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the ProjectProject as set forth in Schedule 2 to this Agreement, and, to this end, without any limitation or restriction upon any of its other obligations under the Loan Development Credit Agreement, shall cause each of the Water Companies SFD to perform, perform in accordance with the provisions of their respective the Project Agreements, Agreement all the respective obligations of the Water Companies SFD therein set forth, shall take or and cause to be taken all actionactions, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies SFD to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon the provisions of paragraph (a) of this Section and except as the Borrower and the Bank shall otherwise agree, the The Borrower shall cause the Water Companies to: (i) carry out their obligations in accordance with the provisions of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the Project. (a) Except as the Bank shall otherwise agree, procurement of the goods, works, and consultants’ services, required for the Project and to be financed out of make the proceeds of the Loan shall be governed by the provisions of Schedule 1 Credit available to the Project Agreements, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company SFD under a subsidiary loan agreement Subsidiary Grant Agreement to be entered into between the Borrower and the Guilan Water CompanySFD, under financial terms and conditions identical to those governing which shall have been approved by the LoanAssociation. (bc) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements Grant Agreement in such manner as to protect the interests of the Borrower and the Bank Association and to accomplish the purposes of the LoanCredit, and, except as the Bank Association shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either the Subsidiary Loan Grant Agreement or any provision thereof. Section 3.063.02. For Except as the purposes of Section 9.07 Association shall otherwise agree, procurement of the General Conditions goods, works and without limitation thereto, consultants’ services required for the Borrower shall: (a) prepare, on Project and to be financed out of the basis proceeds of guidelines acceptable the Credit shall be governed by the provisions of Schedule 1 to the Bank, and furnish to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Project Agreement. Section 3.03. The Borrower and the Bank, a plan for the continued achievement of the objectives of the Project; and, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.07. The Bank and the Borrower Association hereby agree that the obligations set forth in Sections 9.03, 9.04, 9.05, 9.06, 9.07, 9.07 and 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by each of the Water Companies SFD pursuant to Section 2.03 of the respective Project Agreement. Section 3.04. The Borrower shall: (a) take all measures necessary on its part to enable SFD to carry out SFD’s obligations referred to under Section 2.03 (b) of, and paragraph B of Schedule 2 to, the Project Agreement; and (b) except as the Association shall otherwise agree, undertake not to amend the Operations Manual in any manner so as to reduce the operational autonomy of SFD.

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the ProjectProject as set forth in Schedule 2 to this Agreement, and, to this end, without any limitation or restriction upon any of its other obligations under the Loan Development Credit Agreement, shall cause each shall: (i) carry out, with the assistance of AGETIP, Part B of the Water Companies Project with due diligence and efficiency and in conformity with appropriate administrative, financial and management practices and in accordance with the Implementation Program set forth in Schedule 3 to performthis Agreement, and shall provide, promptly as needed, the funds, facilities, services and other resources required for such Part B of the Project; (ii) cause AGETIP to carry out Part A of the Project, with due diligence and efficiency and in conformity with appropriate administrative, financial and management practices, and in accordance with the provisions of their respective the Convention; (iii) cause AGETIP to perform in accordance with the provisions of the Project Agreements, Agreement all the respective obligations obli- gations of the Water Companies AGETIP therein set forth, shall ; (iv) take or and cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies AGETIP to perform such obligations, and shall not take ; and (v) refrain from taking or permit permitting to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon the provisions performance of paragraph (a) of this Section and except as the Borrower and the Bank shall otherwise agree, the Borrower shall cause the Water Companies to: (i) carry out their obligations in accordance with the provisions of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the Project. (a) Except as the Bank shall otherwise agree, procurement of the goods, works, and consultants’ services, required for the Project and to be financed out of the proceeds of the Loan shall be governed by the provisions of Schedule 1 to the Project Agreements, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water Company, under financial terms and conditions identical to those governing the LoanAGETIP. (b) The Borrower shall relend make the proceeds of the Loan Credit, allocated to Part A of the Mazandaran Water Company Project, available to AGETIP on a non- reimbursable basis and under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial such terms and conditions identical to those governing which shall have been approved by the LoanAssociation. (ac) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements Convention in such manner as to protect the interests of the Borrower and the Bank Association and to accomplish the purposes of the Loan, Credit and, except as the Bank Association shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either Subsidiary Loan Agreement the Convention or any provision thereof. Section 3.063.02. Except as the Association shall otherwise agree, procurement of the goods, and consultants’ services required for Part B of the Project and to be financed out of the proceeds of the Credit shall be governed by the provisions of Schedule 1 to the Project Agreement. Section 3.03. For the purposes of Section 9.07 of the General Conditions and without limitation thereto, the Borrower shall: (a) prepare, on the basis of guidelines acceptable to the BankAssociation, and furnish to the Bank Association not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the BankAssociation, a plan for the continued achievement future operation of the objectives Part B of the Project; and, (b) afford the Bank Association a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.07. The Bank and the Borrower hereby agree that the obligations set forth in Sections 9.04, 9.05, 9.06, 9.07, 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by each of the Water Companies pursuant to Section 2.03 of the respective Project Agreement.

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the ProjectProject as set forth in Schedule 2 to this Agreement, and, to this end, without any limitation or restriction upon any of its other obligations under the Loan Development Credit Agreement, shall cause each of the Water Companies FODEFCA to perform, perform in accordance with the provisions of their respective the Project Agreements, Agreement all the respective obligations of the Water Companies FODEFCA therein set forth, shall take or and cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies FODEFCA to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon the provisions of paragraph (a) of this Section and except as the Borrower and the Bank Association shall otherwise agree, the Borrower shall cause assist FODEFCA in the Water Companies to: (i) carry carrying out their obligations in accordance with the provisions of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, Implementation Program set forth in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the ProjectSchedule 3 to this Agreement. (ac) Except as the Bank The Borrower shall otherwise agree, procurement of the goods, works, and consultants’ services, required for the Project and to be financed out of make the proceeds of the Loan shall be governed by the provisions of Schedule 1 Credit available to the Project Agreements, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company FODEFCA under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water CompanyFODEFCA, under financial terms and conditions identical which shall have been approved by the Association which shall include, but without being limited to, the provision set forth in Part A of Schedule 3 to those governing the Loanthis Agreement. (bd) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements Agreement in such manner as to protect the interests of the Borrower and the Bank Association and to accomplish the purposes of the LoanCredit, and, except as the Bank Association shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either the Subsidiary Loan Agreement or any provision thereof. Section 3.063.02. Except as the Association shall otherwise agree, procurement of the goods, works and consultants’ services required for the Project and to be financed out of the proceeds of the Credit shall be governed by the provisions of Schedule 1 to the Project Agreement. Section 3.03. For the purposes of Section 9.07 of the General Conditions and without limitation thereto, the Borrower shallshall take steps, or cause FODEFCA to take steps, to: (a) prepare, on the basis of guidelines acceptable to the BankAssociation, and furnish to the Bank Association not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the BankAssociation, a plan for the continued achievement of the objectives future operation of the Project; and, (b) afford the Bank Association a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.073.04. The Bank Borrower and the Borrower Association hereby agree that the obligations set forth in Sections 9.03, 9.04, 9.05, 9.06, 9.07, 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by each of the Water Companies pursuant to Section 2.03 of the respective Project Agreement.9.07 and

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the ProjectProject as set forth in Schedule 2 to this Agreement, and, to this end, without any limitation or restriction upon any of its other obligations under the Loan Agreement, shall cause each of the Water Companies EMBRAPA to perform, perform in accordance with the provisions of their respective the Project Agreements, Agreement all the respective obligations of the Water Companies EMBRAPA therein set forth, shall take or cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies EMBRAPA to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon The Borrower shall make the provisions proceeds of paragraph (a) of this the Loan available to EMBRAPA under the Subsidiary Agreement. Section and except 3.02. Except as the Borrower and the Bank shall otherwise agree, the Borrower shall cause the Water Companies to: (i) carry out their obligations in accordance with the provisions of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the Project. (a) Except as the Bank shall otherwise agree, procurement of the goods, works, works and consultants’ services, services required for the Project and to be financed out of the proceeds of the Loan shall to be governed by the provisions of Schedule 1 to the Project Agreements, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water Company, under financial terms and conditions identical to those governing the Loan. (b) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the ProjectAgreement. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements in such manner as to protect the interests of the Borrower and the Bank and to accomplish the purposes of the Loan, and, except as the Bank shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either Subsidiary Loan Agreement or any provision thereof. Section 3.06. For the purposes of Section 9.07 of the General Conditions and without limitation thereto, the Borrower shall: (a) prepare, on the basis of guidelines acceptable to the Bank, and furnish to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the Bank, a plan for the continued achievement of the objectives of the Project; and, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.073.03. The Bank and the Borrower hereby agree that the obligations set forth in Sections 9.04, 9.05, 9.06, 9.07, 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) in respect of the Project shall be carried out by each of the Water Companies EMBRAPA pursuant to Section 2.03 of the respective Project Agreement, or by an Executing Entity, in accordance with its obligations under the relevant Contractual Arrangement or the Other Contractual Arrangement. Section 3.04. The Borrower shall take, or cause to be taken, all reasonable action required for the issuance to EMBRAPA of all import and other licenses or permits as shall be necessary for the acquisition and importation of goods and services required for the carrying out of the Project in accordance with the provisions of this Agreement and the Project Agreement.

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the ProjectProject as set forth in Schedule 2 to this Agreement, and, to this end, without any limitation or restriction upon any of its other obligations under the Loan Agreement, shall cause each shall: (i) carry out Part C of the Water Companies Project through Goskomstat, with assistance provided, as needed, by the BEA in respect of procurement and disbursement, with due diligence and efficiency and in conformity with appropriate practices and provide, promptly as needed, the funds, facilities, services and other measures required for Part C of the Project; and (ii) cause the BEA to perform, perform in accordance with the provisions of their respective the Project Agreements, Agreement all the respective obligations of the Water Companies BEA therein set forth, shall take or cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies BEA to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon on the generality of the provisions of set forth in paragraph (a) of this Section and except as the Borrower and the Bank shall otherwise agreeSection, the Borrower shall cause make adequate arrangements for making available to Goskomstat the Water Companies to: (i) carry out their obligations in accordance with the provisions of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, in the opinion proceeds of the Bank, such amendment or waiver may materially and adversely affect Loan withdrawn from the implementation Loan Account for the execution of Part C of the Project. (ac) Except as the Bank The Borrower shall otherwise agree, procurement of the goods, works, and consultants’ services, required for the Project and to be financed out make part of the proceeds of the Loan shall be governed by the provisions of Schedule 1 available to the Project Agreements, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company BEA under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water Company, BEA under financial terms and conditions identical acceptable to those governing the LoanBank. (bd) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements Agreement in such manner as to protect the interests of the Borrower and the Bank and to accomplish the purposes of the Loan, and, except as the Bank shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either the Subsidiary Loan Agreement or any provision thereof. Section 3.063.02. For Except as the purposes of Section 9.07 Bank shall otherwise agree, procurement of the General Conditions goods and without limitation thereto, the Borrower shall: (a) prepare, on the basis of guidelines acceptable to the Bank, and furnish to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed consultants’ services required for this purpose between the Borrower and the Bank, a plan for the continued achievement Part C of the objectives Project and to be financed out of the Project; and, (b) afford proceeds of the Bank a reasonable opportunity Loan shall be governed by the provisions of Schedule 4 to exchange views with the Borrower on said planthis Agreement. Section 3.073.03. The Bank and the Borrower hereby agree that the obligations set forth in Sections 9.04, 9.05, 9.06, 9.07, 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by each the BEA in respect of Parts A and B of the Water Companies Project pursuant to Section 2.03 of the respective Project Agreement.

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the ProjectProject as set forth in Schedule 2 to this Agreement, and, to this end, without any limitation or restriction upon any of its other obligations under the Loan Agreement, Agreement shall cause each of the Water Companies ANEP to perform, perform in accordance with the provisions of their respective the Project Agreements, Agreement all the respective obligations of the Water Companies ANEP therein set forth, shall take or cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies ANEP to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon the provisions of paragraph (a) of this Section and except as the Borrower and the Bank shall otherwise agree, the Borrower shall cause the Water Companies to: (i) carry out their obligations in accordance with the provisions of this Agreement and the applicable Project Agreements; and (ii) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, in the opinion of the Bank, such amendment or waiver may materially and adversely affect the implementation of the Project. (a) Except as the Bank shall otherwise agree, procurement of the goods, works, and consultants’ services, required for the Project and to be financed out of the proceeds of the Loan shall be governed by the provisions of Schedule 1 to the Project Agreements, as such provisions may be further elaborated in the Procurement Plan. (b) The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend transfer, on a grant basis, the proceeds of the Loan to the Guilan Water Company ANEP under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water CompanyANEP, under financial terms and conditions identical to those governing which shall have been approved by the LoanBank. (bc) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights and carry out its obligations under the Subsidiary Loan Agreements Agreement in such manner as to protect the interests of the Borrower and the Bank and to accomplish the purposes of the Loan, and, except as the Bank shall otherwise agree, the Borrower shall not assign, amend, abrogate suspend, abrogate, terminate or waive either the Subsidiary Loan Agreement or any provision thereof. Section 3.06. For (d) In case of discrepancy between the purposes provisions of Section 9.07 of this Loan Agreement and the General Conditions Subsidiary Agreement or between the Project Agreement and without limitation theretothe Subsidiary Agreement, the Borrower shall: (a) prepare, on the basis provisions of guidelines acceptable to the Bank, and furnish to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Borrower Loan Agreement and the Bank, a plan for the continued achievement of the objectives of the Project; and, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said planProject Agreement shall prevail. Section 3.073.02. Except as the Bank shall otherwise agree, procurement of the goods, works and consultants’ services required for the Project and to be financed out of the proceeds of the Loan shall be governed by the provisions of Schedule 1 to the Project Agreement. Section 3.03. The Bank and the Borrower hereby agree that the obligations set forth in Sections 9.04, 9.05, 9.06, 9.07, 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) in respect of the Project shall be carried out by each of the Water Companies ANEP pursuant to Section 2.03 (a) of the respective Project Agreement. Section 3.04. The Borrower shall participate in the annual reviews referred to in Section 2.07 (c) of the Project Agreement. Section 3.05. The Borrower shall not use Loan proceeds to finance textbooks, teachers’ salaries or any other non-incremental recurrent costs already financed by the Borrower including, but not limited to, costs financed by the Bank under Project 4381-UR. Section 3.06. The Borrower shall ensure that as a consequence of the execution of the Project: (a) no involuntary taking of land (including anything growing on or permanently affixed to land, such as buildings and crops) resulting in: (i) relocation or loss of shelter; (ii) lost of assets or access to assets; or (iii) loss of income sources or means of livelihood (whether or not the affected persons must move to another location) shall take place; and (b) no involuntary restriction of access to legally designated parks and protected areas resulting in adverse impacts on the livelihoods of displaced persons shall take place. Section 3.07. Without limitation to the provisions of Section 3.01 above, Borrower shall assist ANEP to: (a) implement, by not later than June 30, 2005 or such later date as the Bank may agree, the provisions set forth in ANEP’s Resolution No. 1, Acta 392, Circular 441 of November 17, 1999 (especially, paragraphs 3 to 5 of the concluding part of such resolution) in all full-time schools in the Borrower’s territory in a manner satisfactory to the Bank; (b) ensure that, by not later than June 30, 2005 or such later date as the Bank may agree, a management information system –satisfactory to the Bank- be functioning and fully implemented in at least ninety percent of all schools of more than 50 students in the Borrower’s territory; (c) reduce the frequency of textbook publishing reviews; (d) publish supplementary education materials and carry out in-service teacher training on environment, public health, race and gender issues in all full-time schools in the Borrower’s territory; (e) disseminate the lessons from the best practice PMEs dealing with vulnerable groups, environment and public health among all schools in the Borrower’s territory; (f) establish and maintain throughout Project implementation a mechanism –satisfactory to the Borrower and the Bank- to guarantee timely execution of the Project and an efficient coordination of Project activities between the PCU and the Borrower’s central council of the national administration of public education (Consejo Directivo Central de la Administración Nacional de Educación Pública- CODICEN), such mechanism to include a consultant with qualifications and functions satisfactory to the Bank; (g) carry out, not later than in the year 2005, a student performance assessment of all sixth grade students in the Borrower’s territory; and (h) develop, by not later than 6 months after the Effective Date, or such later date as the Bank may agree, an index –satisfactory to the Bank- to track student achievement by income level. Section 3.08. The Borrower, through ANEP, shall, starting in 2005, participate in an international student assessment for primary education - satisfactory to the Borrower and the Bank - and continue to participate in the Programme for International Student Assessment..

Execution of the Project. (a) The Borrower declares its commitment to the objectives of the ProjectProject as set forth in Schedule 2 to this Agreement, and, to this end, without any limitation or restriction upon any of its other obligations under the Loan Development Credit Agreement, shall cause each of the Water Companies Project Provinces to perform, perform in accordance with the provisions of the Project Agreement all their respective Project Agreements, all the respective obligations of the Water Companies therein set forth, shall take or and cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable each of the Water Companies Project Provinces to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) Without limitation upon For the provisions purpose of paragraph (a) having each Project Province carry out its Respective Part of this Section and except as the Borrower and the Bank shall otherwise agreeProject, the Borrower shall cause make available to each Project Province part of the Water Companies toproceeds of the Credit on the following principal terms and conditions: (i) carry the principal amount so made available to said Project Province shall be the equivalent in terms of Special Drawing Rights (determined as of the dates of withdrawal from the Credit Account) of the value of the currency or currencies so withdrawn on account of the cost of items required for said Project Province’s Respective Part of the Project and to be financed out their obligations of the proceeds of the Credit (the Credit Amount), and shall be recovered by the Borrower in accordance with Dollars; (ii) the provisions Borrower shall recover the Credit Amount from said Project Province in semi-annual installments over a period of this Agreement seventeen (17) years, including five (5) years of grace; (iii) the Borrower shall charge a service charge on the Credit Amount withdrawn and the applicable Project Agreementsoutstanding from time to time at a rate equal to three-fourths of one percent (3/4 of 1%) per annum; and (iiiv) implement the Project in accordance with the Environmental Management Plan; the Land Acquisition Plan; the Procurement Plan; and the Resettlement Policy Framework, and except as the Bank shall otherwise agree, the Borrower shall not amend or waive any provision thereof if, in charge a commitment charge on the opinion principal amount of the Bank, such amendment or waiver may materially Credit so made available and adversely affect the implementation not withdrawn from time to time at a rate equal to one-half of the Projectone percent (1/2 of 1%) per annum. (a) Section 3.02. Except as the Bank Association shall otherwise agree, procurement of the goods, works, works and consultants’ services, ' services required for the Project and to be financed out of the proceeds of the Loan Credit shall be governed by the provisions of Schedule 1 to the Project Agreements, as such provisions may be further elaborated in the Procurement PlanAgreement. (b) Section 3.03. The Borrower shall, or shall cause the Water Companies to, update the Procurement Plan in accordance with the terms of reference acceptable to the Bank, and furnish such update to the Bank not later than twelve (12) months after the date of the preceding Procurement Plan, for the Bank’s approval. (a) The Borrower shall relend the proceeds of the Loan to the Guilan Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Guilan Water Company, under financial terms and conditions identical to those governing the Loan. (b) The Borrower shall relend the proceeds of the Loan to the Mazandaran Water Company under a subsidiary loan agreement to be entered into between the Borrower and the Mazandaran Water Company, under financial terms and conditions identical to those governing the Loan. (a) Without limitation upon the provisions of Section 3.03(a) above, the Borrower shall make available, through the Borrower’s contribution, to the Guilan Water Company: (i) the proceeds of the Loan; and (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts B and D of the Project. (b) Without limitation upon the provisions of Section 3.03(b) above, the Borrower shall make available through the Borrower’s contribution, to the Mazandaran Water Company: (i) the proceeds of the Loan; and, (ii) such amounts as may be needed to finance the Borrower’s contribution to expenditures under Parts F, H and I of the Project. Section 3.05. The Borrower shall exercise its rights under the Subsidiary Loan Agreements in such manner as to protect the interests of the Borrower and the Bank and to accomplish the purposes of the Loan, and, except as the Bank shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either Subsidiary Loan Agreement or any provision thereof. Section 3.06. For the purposes of Section 9.07 of the General Conditions and without limitation thereto, the Borrower shall: (a) prepare, on the basis of guidelines acceptable to the Bank, and furnish to the Bank not later than six (6) months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the Bank, a plan for the continued achievement of the objectives of the Project; and, (b) afford the Bank a reasonable opportunity to exchange views with the Borrower on said plan. Section 3.07. The Bank and the Borrower Association hereby agree that the obligations set forth in Sections 9.03, 9.04, 9.05, 9.06, 9.07, 9.07 and 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) shall be carried out by each of the Water Companies Project Provinces pursuant to Section 2.03 of the respective Project Agreement. Section 3.04. The Borrower shall maintain a central project management office in UMRB, with functions and responsibilities acceptable to the Association, staffed by competent staff in adequate numbers, to provide technical oversight of the implementation of the Project, and to coordinate Project activities among the Project Provinces, including procurement and training activities. Section 3.05. The Borrower shall: (a) prepare, through CPMO, in accordance with guidelines acceptable to the Association, and furnish to the Association not later than December 31 of each year for the Association’s review, a work plan and budget for implementation of the Project during the following calendar year and a plan for implementation of training and study tours during the same period, summarizing the work plans, budgets and implementation plans furnished by the Project Provinces pursuant to Parts A.2(a) and A.3(b) of Schedule 2 to the Project Agreement, for said following calendar year, together with copies of said plans and budgets furnished by the Project Provinces; and (b) thereafter, ensure the carrying out during said following calendar year, of such plans as shall have been approved by the Association.