Transformation Capacity Building Project)
BANK FOR RECONSTRUCTION
March 4, 2010
LOAN NUMBER 7815-JM
dated March 4, 2010, between JAMAICA (the Borrower) and INTERNATIONAL
BANK FOR RECONSTRUCTION AND DEVELOPMENT (the Bank). The Borrower and
the Bank hereby agree as follows:
I — GENERAL CONDITIONS; DEFINITIONS
General Conditions (as defined in the Appendix to this Agreement)
constitute an integral part of this Agreement.
the context requires otherwise, the capitalized terms used in this
Agreement have the meanings ascribed to them in the General
Conditions or in the Appendix to this Agreement.
II — LOAN
Bank agrees to lend to the Borrower, on the terms and conditions set
forth or referred to in this Agreement, the amount of sixteen million
Dollars ($16,000,000) (the Loan), to assist in financing the project
described in Schedule 1 to this Agreement (the Project).
Borrower may withdraw the proceeds of the Loan in accordance with
Section IV of Schedule 2 to this Agreement.
Front-end Fee payable by the Borrower shall be equal to one quarter
of one percent (0.25%) of the Loan amount.
interest payable by the Borrower for each Interest Period shall be
at a rate equal to LIBOR for the Loan Currency plus the Variable
Spread; provided, that upon a Conversion of all or any portion of
the principal amount of the Loan, the interest payable by the
Borrower during the Conversion Period on such amount shall be
determined in accordance with the relevant provisions of Article IV
of the General Conditions. Notwithstanding the foregoing, if any
amount of the Withdrawn Loan Balance remains unpaid when due and
such non-payment continues for a period of thirty days, then the
interest payable by the Borrower shall instead be calculated as
provided in Section 3.02 (d) of the General Conditions.
Payment Dates are May 15 and November 15 in each year.
principal amount of the Loan shall be repaid in accordance with the
amortization schedule set forth in Schedule 3 to this Agreement.
2.07. (a) The
Borrower may at any time request any of the following Conversions of
the terms of the Loan in order to facilitate prudent debt management:
(i) a change of the Loan Currency of all or any portion of the
principal amount of the Loan, withdrawn or unwithdrawn, to an
Approved Currency; (ii) a change of the interest rate basis
applicable to all or any portion of the principal amount of the Loan
from a Variable Rate to a Fixed Rate, or vice versa; and (iii) the
setting of limits on the Variable Rate applicable to all or any
portion of the principal amount of the Loan withdrawn and outstanding
by the establishment of an Interest Rate Cap or Interest Rate Collar
on the Variable Rate.
conversion requested pursuant to paragraph (a) of this Section that
is accepted by the Bank shall be considered a “Conversion”, as
defined in the General Conditions, and shall be effected in
accordance with the provisions of Article IV of the General
Conditions and of the Conversion Guidelines.
III — PROJECT
Borrower declares its commitment to the objective of the Project.
To this end, the Borrower, through the MOE, shall carry out the
Project in accordance with the provisions of Article V of the
limitation upon the provisions of Section 3.01 of this Agreement,
and except as the Borrower and the Bank shall otherwise agree, the
Borrower shall ensure that the Project is carried out in accordance
with the provisions of Schedule 2 to this Agreement.
IV — REMEDIES OF THE BANK
Additional Events of Suspension consist of the following, namely that
the ESTP has been amended, suspended, abrogated, repealed or waived
so as to affect materially and adversely the implementation of the
Additional Event of Acceleration consists of the following, namely,
that the event specified in Section 4.01 of this Agreement occurs.
V — EFFECTIVENESS; TERMINATION
Additional Condition of Effectiveness consists of the following:
Operations Manual has been adopted by the Borrower, as set forth in
Section I.B of Schedule 2 to this Agreement, as approved by the Bank.
prejudice to the provisions of the General Conditions, the
Effectiveness Deadline is the date ninety (90) days after the date of
this Agreement, but in no case later than the eighteen (18) months
after the Bank’s approval of the Loan which expire on May 24, 2011.
VI — REPRESENTATIVE; ADDRESSES
Borrower’s Representative is the Minister of Finance and the Public
Service of the Borrower.
Borrower’s Address is:
Ministry of Finance and the
30 National Heroes Circle
Bank’s Address is:
Bank for Reconstruction and Development
X Xxxxxx, X.X.
Xxxxxx of America
address: Telex: Facsimile:
AGREED at Kingston, Jamaica,
as of the day and year first above written.
RECONSTRUCTION AND DEVELOPMENT
/s/ Xxxxxxxxxx Xxxxxx
objective of the Project is to build the capacity of the emerging key
agencies (NEI, JTC, REAs, and NET) that are being established to
support the national Education System Transformation Programme
Project consists of the following parts subject to such modifications
thereof as the Borrower and the Bank may agree upon from time to time
to achieve such objective:
Performance and Accountability
Education Inspectorate (NEI)
Provision of support to the
NEI to establish a systematic inspection process and baseline data on
school and student performance including, inter
establishment of an inspection management information system
(including the provision of technical assistance, procurement and
installation of software and hardware, and training in the use of the
system); (b) carrying out of training of inspectors; (c) carrying out
of baseline inspections (including the contracting of inspectors,
inspection costs and publications); and (d) carrying out of national
consultation meetings on NEI mandates.
Jamaica Teaching Council (JTC)
Provision of support to
operationalize the JTC including, inter
establishment and implementation of a licensing and registration
system for teachers; (b) carrying out of training of teachers and
JTC staff, as well as orienting teachers in the licensing process and
procedures; (c) review of the existing mentoring program; (d)
professional development of JTC staff and college lecturers; (e)
carrying out of in-service teacher training in areas required for
licensing; (f) publishing of a journal describing best practices in
teaching and school leadership; (g) development of a teacher
management information system; and (h) establishment of programs for
the National College for Education Leadership (NCEL).
Regional Education Authorities (REAs)
of support for the setting up and operationalization of the REAs,
alia: (a) capacity
building for School Improvement Officers and School Support Officers;
(b) carrying out of specialist training in areas to support children
with special learning needs; (c) carrying out of training of school
boards to understand and carry out the mandates of the Education Act
and other new legislation and MOE policies; and (d) provision of
equipment and software for the REAs.
Resources to the National Education Trust (NET)
Provision of support to set up
and operationalize the NET including inter
alia: (a) carrying
out of training for NET and other relevant staff in the
implementation of public-private partnerships (PPP); and (b) carrying
out of a marketing campaign to mobilize resources for the NET.
Project Management, and Monitoring and Evaluation
support for the implementation of a communications strategy to raise
public awareness and seek support for the ESTP, including, inter
alia, the carrying
out of: (a) public meetings on the ESTP across the Borrower’s
territory, for all interested citizens; (b) stakeholder consultations
for the new education agencies; (c) internal meetings on the human
resource policy for the MOE staff; and (d) media campaigns.
of support to the CMU in its oversight of the ESTP including the
monitoring and evaluation of the Project, the hiring of staff and
consultants, conducting of audits, provision of training and of
necessary equipment and materials and other operational costs.
and Other Arrangements
The Borrower shall
operate and maintain within the MOE, at all times during Project
implementation, a unit (CMU) with structure, functions and
responsibilities acceptable to the Bank, including, inter alia,
the responsibility to assist the Borrower in: (a) procurement,
disbursement and financial management aspects of the Project,
including fiduciary reporting; (b) coordination, monitoring and
supervision of the Project; and (c) development and execution of the
Annual Work Program.
Borrower shall establish
and thereafter maintain, throughout the implementation of the
Project, a Programme Management Steering Committee (PMSC), in charge
of overseeing the management of the Education Transformation
Capacity Building Programme and providing strategic guidance for the
implementation of the ETCBP.
EEPs shall comply with the eligibility criteria and procedures set
forth in the Programme Operations Manual.
Borrower shall furnish to the Bank every six months after the
Effective Date, regular reports (the Project Reports and the Interim
Unaudited Financial Reports) prepared in accordance with the
provisions of the Programme Operations Manual and the additional
instructions referred to in Section IV.A.1 of this Schedule.
at any time, the Bank determines that any portion of the Loan
proceeds was used for items improperly procured in violation of
Section III to this Schedule, was not used for Eligible Expenditures
or, in case of the Eligible Expenditure Programs of Part 1 of the
Project, was not supported by evidence of actual spending by the
Borrower under said Eligible Expenditure Programs and/or by evidence
of satisfaction of other criteria set forth in this Agreement or in
the Programme Operations Manual, the Borrower shall promptly refund
any such portion to the Bank as the Bank shall specify by notice to
The Borrower and the Bank will jointly review, each year through the
Annual Work Programme, the amounts detailed in
Section IV(i) (Withdrawal
of the additional instructions referred to in Section IV.A.1 of
Schedule 2 to this
Agreement, and adjust, as necessary, in a manner satisfactory to the
Borrower and the Bank.
Borrower and the Bank may jointly review, by mid-term, the DLTs
referred to in Schedule 4 of this Agreement and adjust as necessary,
in a manner satisfactory to the Borrower and the Bank.
limitation to the provisions of Article V of the General Conditions,
the Borrower shall ensure that:
Project is carried out in accordance with the Programme Operations
Programme Operations Manual or any part thereof is not amended,
waived, suspended or abrogated without the Bank’s prior written
concurrence, and in case of any inconsistency between the provisions
of the Programme Operations Manual and those of this Agreement, the
provisions of this Agreement shall prevail.
Borrower shall ensure that the Project is carried out in accordance
with the provisions of the Anti-Corruption Guidelines.
Borrower commits not to carry out under the Project any construction,
expansion or maintenance of infrastructure.
Monitoring Reporting and Evaluation
Borrower, through the MOE, shall monitor and evaluate the progress of
the Project and prepare Project Reports in accordance with the
provisions of Section 5.08 of the General Conditions and on the basis
the Annual Work Program; (b) the indicators
agreed with the Bank and set forth in the Programme Operations
(c) the applicable Disbursement-Linked Targets; (d) the Interim
Unaudited Financial Reports; and (e) the Procurement Plan.
Each Project Report shall cover the period of six months, from April
1 to September 30 and from October 1 to March 31, and shall be
furnished to the Bank not later than 45 days after the end of the
period covered by such report.
Management, Financial Reports and Audits
Borrower shall maintain or cause to be maintained a financial
management system in accordance with the provisions of Section 5.09
of the General Conditions.
limitation on the provisions of Part A of this Section, the Borrower
shall prepare and furnish to the Bank not later than 45 days after
the end of each FY Semester, interim unaudited financial reports for
the Project covering the six-month period, in form and substance
satisfactory to the Bank.
Borrower shall have its Financial Statements audited in accordance
with the provisions of Section 5.09 (b) of the General Conditions.
Each audit of the Financial Statements shall cover the period of
April 1 to March 31. The audited Financial Statements for each such
period shall be furnished to the Bank not later than four months
after the end of such period.
and Non-consultant services.
All goods and non-consultant services required for the Project and to
be financed out of the proceeds of the Loan shall be procured in
accordance with the requirements set forth or referred to in Section
I of the Procurement Guidelines, and with the provisions of this
consultants’ services required for the Project and to be financed
out of the proceeds of the Loan shall be procured in accordance with
the requirements set forth or referred to in Sections I and IV of the
Consultant Guidelines and with the provisions of this Section.
The capitalized terms used below in this Section to describe
particular procurement methods or methods of review by the Bank of
particular contracts refer to the corresponding method described in
the Procurement Guidelines, or Consultant Guidelines, as the case may
Methods of Procurement of Goods and Non-Consultant Services
Except as otherwise provided in paragraph 2 below, goods and
non-consultant services shall be procured under contracts awarded on
the basis of International Competitive Bidding procedures.
Methods of Procurement of Goods and Non-Consultant Services.
The following table specifies the methods of procurement, other than
International Competitive Bidding, which may be used for goods and
non-consultant services. The Procurement Plan shall specify the
circumstances under which such methods may be used.
(a) National Competitive
(c) Direct Contracting
Methods of Procurement of Consultants’ Services
1. Quality- and Cost-based
Selection. Except as otherwise provided in paragraph 2 below,
consultants’ services shall be procured under contracts awarded on
the basis of Quality and Cost-based Selection.
Methods of Procurement of Consultants’ Services.
The following table specifies the methods of procurement, other than
Quality and Cost-based Selection, which may be used for consultants’
services. The Procurement Plan shall specify the circumstances under
which such methods may be used.
(b) Fixed Budget Selection
(c) Least Cost Selection
(d) Selection Based on
(e) Single Source
Selection of Individual Consultants
by the Bank of Procurement Decisions
Procurement Plan shall set forth those contracts which shall be
subject to the Bank’s Prior Review. All other contracts shall be
subject to Post Review by the Bank.
of Loan Proceeds
Borrower may withdraw the proceeds of the Loan in accordance with the
provisions of Article II of the General Conditions, this Section, and
such additional instructions as the Bank shall specify by notice to
the Borrower (including the “World Bank Disbursement Guidelines for
Projects” dated May 2006, as revised from time to time by the Bank
and as made applicable to this Agreement pursuant to such
instructions), to finance Eligible Expenditures as set forth in the
table in paragraph 2 below.
following table specifies the categories of Eligible Expenditures
that may be financed out of the proceeds of the Loan (“Category”),
the allocation of the amounts of the Loan to each Category, and the
percentage of expenditures to be financed for Eligible Expenditures
in each Category.
Amount of the Loan
Expenditures to be financed
(1) Eligible Expenditures
Program (EEP), except as covered by Category (2) below
100% subject to Part B
paragraphs 1 to 3 below
(2) Goods and consultants’
services for NEI software and/or marketing
(3) Front-end Fee
Amount payable pursuant to
Section 2.03 of this Agreement in accordance with Section 2.07 (b)
of the General Conditions
Conditions; Withdrawal Period
the provisions of Part A of this Section, no withdrawal shall be
payments made prior to the date of this Agreement, except that
withdrawals up to an aggregate amount not to exceed US$500,000
equivalent may be made for payments made prior to this date but on
or after February 1, 2009 but in no case earlier than one year from
the date of this Agreement), for Eligible Expenditures under
Category (1); and
subsequent payments made under Category (1) unless: (i)
the relevant IUFR have been submitted to, and found satisfactory by,
the Bank, in accordance with the provisions of the Programme
Operations Manual and the additional instructions referred to in
Section IV.A.1 of this Schedule; and (ii)
all other conditions referred to in the Programme
Operations Manual and in the additional instructions referred to in
Section IV.A.1 of this Schedule (including, when applicable,
compliance with the Disbursement-Linked Targets referred to in
Schedule 4 to this Agreement for the respective semester)
have been met by the Borrower in form and substance satisfactory to
If, with regard to advances to be made in November 2010, November
2011, November 2012 and November 2013, as referred to
in Section IV (i) in the additional instructions referred to in
Section IV.A.1 of this Schedule,
the Bank has received evidence of non-compliance of one or more
Disbursement-linked Targets (DLTs) referred to in Schedule 4 to this
Agreement in respect of any such withdrawal,
the Bank shall: (i) allocate a base value of US$200,000 to each DLT
and deduct said base value from the maximum amount of the
corresponding disbursement for each DLT not complied with; (ii)
request the Borrower to prepare a time-bound action plan to achieve
such DLT or DLTs in a manner satisfactory to the Bank; and (iii) when
satisfied that the DLT or DLTs have been complied with and/or such
action plan has been implemented, authorize that the unwithdrawn
amount by which the corresponding disbursement had been reduced be
carried forward to the immediately subsequent withdrawal.
the event that the Bank has not approved a full withdrawal by the
Borrower of the Loan proceeds under Category (1), the Bank may by
notice to the Borrower cancel the corresponding amount of the Loan at
the time of the ninth withdrawal (as referred to in Section IV (i) of
the additional instructions referred to in Section IV.A.1 of this
Closing Date is March 31, 2014.
months after the Effective Date, the Borrower shall hire a
procurement manager, according to the terms of reference included in
the Programme Operations Manual.
to the provisions of paragraph 2 of this Schedule, the Borrower shall
repay each Disbursed Amount in semiannual installments payable on
each May 15 and November 15, the first installment to be payable on
the eleventh (11 th) Interest Payment Date following the Maturity
Fixing Date for the Disbursed Amount and the last installment to be
payable on the fifty-second (52nd)
Date following the Maturity Fixing Date for the Disbursed Amount.
Each installment except for the last one shall be equal to
one-forty-two (1/42) of the Disbursed Amount. The last installment
shall be equal to the remaining outstanding amount of the Disbursed
any one or more installments of principal of the Disbursed Amount
would, pursuant to the provisions of paragraph 1 of this Schedule, be
payable after November 15, 2039, the Borrower shall also pay on such
date the aggregate amount of all such installments.
Bank shall notify the Loan Parties of the amortization schedule for
each Disbursed Amount promptly after the Maturity Fixing Date for the
the provisions of paragraphs 1 through 3 of this Schedule, in the
event of a Currency Conversion of all or any portion of a Disbursed
Amount to an Approved Currency, the amount so converted in the
Approved Currency that is repayable on any Principal Payment Date
occurring during the Conversion Period, shall be determined by the
Bank by multiplying such amount in its currency of denomination
immediately prior to the Conversion by either: (i) the exchange rate
that reflects the amounts of principal in the Approved Currency
payable by the Bank under the Currency Hedge Transaction relating to
the Conversion; or (ii) if the Bank so determines in accordance with
the Conversion Guidelines, the exchange rate component of the Screen
the Withdrawn Loan Balance is denominated in more than one Loan
Currency, the provisions of this Schedule shall apply separately to
the amount denominated in each Loan Currency.
program for NEI inspectors initiated
least 10 Quality Education Circles in operation
profiles for the REAs’ operations approved by MOE
commenced for REA staff for five regions
inspections completed and reports published on MOE’s website
handbook approved by MOE
least 300 school inspections completed and inspection reports
published on MOE’s website
least 600 school inspections completed and inspection reports
published on MOE’s website
registration system is operational
least 3,000 teachers registered by the JTC
least 10,000 teachers registered by the JTC
system fully established by JTC
framework for NCEL approved by the Borrower’s Cabinet
plan for stakeholders developed and approved by MOE
training programs developed for delivery through NCEL
least one group of education leaders certified by NCEL
formally established (incorporated as a Limited Liability Company
operational plan approved by MOE
legal and financial staff trained in relevant areas
international marketing campaign launched
Work Program” or “AWP” means the document, to be prepared by
the CMU and reviewed by the Borrower and the Bank at the beginning
of each new fiscal year (April), that will present
a detailed budget and work plan for the year and delineate the use
of the Project funds by component and activity. The AWP will also
discuss the likelihood of meeting the annual DLTs and other
challenges facing Project implementation.
Guidelines” means the “Guidelines on Preventing and Combating
Fraud and Corruption in Projects Financed by IBXX Loans and IDA
Credits and Grants”, dated October 15, 2006.
means a category set forth in the table in Section IV of Schedule 2
to this Agreement.
means Change Management Unit, the unit referred to in Section I.A.
of Schedule 2 to this Agreement, which was established in the MOE to
oversee implementation of the ESTP.
Guidelines” means the “Guidelines: Selection and Employment of
Consultants by World Bank Borrowers” published by the Bank in May
2004 and revised in October 2006.
Targets” or “DLTs” mean any of the targets set forth in
Schedule 4 to this Agreement.
Act” means the Borrower’s Education Act (Act VIII), dated 1965
as amended to the date of this Agreement.
Transformation Capacity Building Programme” or “ETCBP” means
the Borrower’s program funded by development partners (the Bank,
IDB, UNICEF, USAID and others) and government funds to support the
Expenditures Program” or “EEP” means the expenditures for the
reasonable cost of goods, non-consultant services, consultants’
services, and operational costs necessary to carry out Part 1 of the
Project (and thus constitutes a subset of the Eligible Expenditures
defined in the General Conditions), which are contained
in the following five ESTP’s budget sub-objects for the NEI, JTC,
REAs, NET, and the CMU, as defined in the Borrower’s Estimates of
Expenditures which is governed by the Appropriations Act (Act VI)
22-Travel Expenses and
23-Rental of Property,
Machinery and Equipment
25-Purchases of Other
Goods and Services, and
31-Purchases of Equipment
means the Borrower’s Education System Transformation Programme,
the Borrower’s national education reform program to improve the
efficiency, accountability, and performance of the education system.
means the fiscal year of the Borrower (April 1-March 31).
Semester” means a semester of the fiscal year of the Borrower
(April 1-September 30 or October 1-March 31).
Conditions” means the “International Bank for Reconstruction and
Development General Conditions for Loans”, dated July 1, 2005 (as
amended through February 12, 2008), as modified pursuant to Section
II of this Appendix.
means the interim unaudited financial reports referred to in Section
II.B.2 of Schedule 2 to this Agreement.
means the MOE's Jamaica Teaching Council, the agency established to
ensure minimum quality standards and professional development
opportunities for teachers and education leaders.
means the Borrower’s Ministry of Education.
means the National College for Education Leadership, the institution
to be established by the Borrower to set the standards and
qualifications for school principals and education leaders and
develop a program to prepare staff to assume positions of
means the MOE’s National Education Inspectorate, the agency which
will strengthen the monitoring and evaluation of school performance.
means the MOE’s National Education Trust, the agency to be
established to seek non-traditional sources of funds to support
capital programs in education.
Guidelines” means the “Guidelines: Procurement undex XBRD Loans
and IDA Credits” published by the Bank in May 2004 and revised in
Plan” means the Borrower’s procurement plan for the Project,
dated October 16, 2009 and referred to in paragraph 1.16 of the
Procurement Guidelines and paragraph 1.24 of the Consultant
Guidelines, as the same shall be updated from time to time in
accordance with the provisions of said paragraphs.
Operations Manual” means the manual, including all appendices and
schedules thereto, satisfactory to the Bank, which sets forth the
policies and procedures that apply to the carrying out of the
Project, which include, inter
alia: (a) the
procedures for the carrying out, monitoring and evaluation of the
Project, including detailed description of the EEPs; (b) the
indicators to be used for Project monitoring and evaluation; (c) the
organizational structure of the Project (including the roles and
responsibilities of the CMU); (d) the Project procurement and
financial management requirements and procedures; (f) the Project’s
chart of accounts and internal controls; (g) reporting procedures
and the format of: (i) the interim unaudited financial reports
referred to in Section II.B. 2 of Schedule 2 to this Agreement; and
(ii) the Financial Statements; (g) the terms of reference for
carrying out the Project audits under Section II.B.3 of Schedule 2
to this Agreement; and (h) the detailed criteria for the monitoring
of the Disbursement-Linked Targets.
Education Circles” means the MOE’s education communities,
defined geographically, to be used as a strategy to facilitate
teacher training activities and professional sharing of experiences.
means the MOE’s Regional Education Authorities, the agencies to be
established to provide direct, enhanced support to schools.
Improvement Officers” means the REA staff who will provide direct
support to schools to improve education service delivery.
Support Officers” means the REA staff who will provide direct
support to schools at risk.
II. Modifications to the General Conditions
modifications to the General Conditions are as follows:
(a) of Section 2.07 is modified to read as follows:
“Section 2.07. Refinancing
Preparation Advance; Capitalizing Front-end Fee and Interest
(a) If the Loan
Agreement provides for the repayment out of the proceeds of the Loan
of an advance made by the
Bank or the
Association (“Preparation Advance”), the Bank shall, on behalf of
such Loan Party, withdraw from the Loan Account on or after the
Effective Date the amount required to repay the withdrawn and
outstanding balance of the advance as at the date of such withdrawal
from the Loan Account and to pay all accrued
charges, if any,
on the advance as
at such date. The Bank shall pay the amount so withdrawn to itself or
the Association, as the case may be, and shall cancel the remaining
unwithdrawn amount of the advance.”
(l) of Section 7.02 is
modified to read as follows:
“Section 7.02. Suspension
by the Bank
... (l) Ineligibility.
The Bank or the Association has declared the Borrower (other than the
Member Country) or the Project Implementing Entity ineligible to
receive proceeds of any financing made by the Bank or the Association
or otherwise to participate in the preparation or implementation of
any project financed in whole or in part by the Bank or the
Association, as a result of a determination by the Bank or the
Association that the Borrower or the Project Implementing Entity has
engaged in fraudulent, corrupt, coercive or collusive practices in
connection with the use of the proceeds of any financing made by the
Bank or the Association.”
following terms and definitions set forth in the Appendix are
modified or deleted as follows, and the following new terms and
definitions are added in alphabetical order to the Appendix as
follows, with the terms being renumbered accordingly:
definition of the term “Conversion Date” is modified to read as
means, in respect of a Conversion, the Execution Date (as herein
defined) or such other date as requested by the Borrower and accepted
by the Bank, on which the Conversion enters into effect, and as
further specified in the Conversion Guidelines.”
definition of the term “Variable Rate” is modified, in relevant
part, to read as follows:
a Currency Conversion to an Approved Currency of an amount of the
Withdrawn Loan Balance that accrues interest at a variable rate
during the Conversion Period, the variable rate of interest
applicable to such amount shall be equal to either: (i) the sum of:
(A) LIBOR, or such other base rate as may be agreed by the Borrower
and the Bank, for the Approved Currency; plus (B) the spread to LIBOR
or to such other base rate, if any, payable by the Bank under the
Currency Hedge Transaction relating to said Currency Conversion; or
(ii) if the Bank so determines in accordance with the Conversion
Guidelines, the interest rate component of the Screen Rate.”