Tunisia - Tourism Infrastructure Project : Credit 0329 - Project Agreement - 2 - Conformed

CONFORMED COPY LOAN NUMBER 858 TUN CREDIT NUMBER 329 TUN Project Agreement (Tourism Infrastructure Project) BETWEEN INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT AND INTERNATIONAL DEVELOPMENT ASSOCIATION AND SOCIETE NATIONALE D'EXPLOITATION ET DE DISTRIBUTION DES EAUX DATED SEPTEMBER 28, 1972 CONFORMED COPY LOAN NUMBER 858 TUN CREDIT NUMBER 329 TUN Project Agreement (Tourism Infrastructure Project) BETWEEN INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT AND INTERNATIONAL DEVELOPMENT ASSOCIATION AND SOCIETE NATIONALE D'EXPLOITATION ET DE DISTRIBUTION DES EAUX DATED SEPTEMBER 28, 1972 PROJECT AGREEMENT AGREEMENT, dated September 28, 1972, between INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT (hereinafter called the Bank), INTERNATIONAL DEVELOPMENT ASSOCIATION (hereinafter called the Association) and SOCIETE NATIONALE D'EXPLOITATION ET DE DISTRIBUTION DES EAUX (hereinafter called SONEDE). WHEREAS by the Loan Agreement of even date herewith between Republic of Tunisia (hereinafter called the Borrower) and the Bank, the Bank has agreed to make available to the Borrower an amount in various currencies equivalent to fourteen million dollars ($14,000,000), on the terms and conditions set forth in the Loan Agreement, but only on condition that SONEDE agree to undertake such obligations toward the Bank as hereinafter set forth; WHEREAS by the Development Credit Agreement of even date herewith between Republic of Tunisia (hereinafter called the Borrower) and the Association, the Association has also agreed to make available to the Borrower an amount in various currencies equivalent to ten million dollars ($10,000,000), on the terms and conditions set forth in the Development Credit Agreement, but only on condition that SONEDE agree to undertake such obligations toward the Association as hereinafter set forth; and WHEREAS SONEDE, in consideration inter alia of the foregoing, has agreed to undertake the obligations hereinafter set forth; NOW THEREFORE the parties hereto hereby agree as follows; ARTICLE I Definitions Section 1.01. Wherever used in this Agreement, unless the context shall otherwise require, the several terms defined in the Loan Agreement and in the General Conditions (as so defined) have the respective meanings therein set forth and the term "Project" means the Project described in Schedule 1 to the Loan Agreement. 4 ARTICLE II Water Rates and Sewerage Charges Section 2.01. Without any limitation and restriction upon the provisions of Article IV of the Joint Financing Agreement between the Borrower, the Kingdom of Sweden, the Association and SONEDE dated June 30, 1970, SONEDE shall, upon completion of the hydrogeological and water consumption studies that SONEDE is presently undertaking, establish for the Project Zones water rate schedules acceptable to the Bank and the Association. Such water rate schedules shall be determined so as to charge large consumers with progressive seasonal rates reasonably related to the costs of the services and facilities provided. Section 2.02. Unless the Bank and the Association shall otherwise agree, SONEDE shall, before commencing to operate the sewerage and water pollution abatement facilities in the Project Zones, set and, thereafter, maintain, in such zones, sewerage charges which shall provide revenues sufficient to cover all the operating costs of such facilities, including adequate maintenance of such facilities and annual provision for depreciation or renewal of the fixed assets put in service for the benefit of such zones; such annual provision shall be (i) based on the lifespan of the sewerage and pollution control works, facilities and equipment operated by SONEDE and (ii) computed at the rates specified in Schedule 1 to this Agreement. ARTICLE III Consultation, Information and Inspection Section 3.01. The Bank, the Association and SONEDE shall cooperate fully to assure that the purposes of this Agreement will be accomplished. To that end, the Bank, the Association and SONEDE shall from time to time, at the request of either party, exchange views through their representatives with regard to the performance of their respective obligations under this Agreement. Section 3.02. The Bank, the Association and SONEDE shall promptly inform each other of any condition which interferes with, or threatens to interfere with the performance by either of them of its obligations under this Agreement. ARTICLE IV Effective Date; Termination; Cancellation and Suspension Section 4.01. This Agreement shall come into force and effect on the date upon which the Loan Agreement becomes effective. 5 Section 4.02. This Agreement and all -obligations of the Bank, the Association and SONEDE thereunder shall terminate on the later of the following two dates: (a) the date on which the Loan Agreement shall terminate in accordance with its terms; or (b) the date on which the obligations of the Borrower under Section 6.03 of the Development Credit Agreement shall terminate in accordance with the terms of such Section. Section 4.03. All the provisions of this Agreement shall continue in full force and effect notwithstanding any cancellation or suspension under the Loan Agreement or the Development Credit Agreement. ARTICLE V Miscellaneous Provisions Section 5.01. Any notice or request required or permitted to be given or made under this Agreement and any agreement between the parties contemplated by this Agreement shall be in writing. Such notice or request shall be deemed to have been duly given or made when it shall be delivered by hand or by mail, telegram, cable, telex or radiogram to the party to which it is required or permitted to be given or made at such party's address hereinafter specified or at such other address as such party shall have designated by notice to the party giving such notice or making such request. The addresses so specified are: For the Bank: International Bank for Reconstruction and Development 1818 H Street, N.W. Washington, D.C. 20433 United States of America Cable address: Intbafrad Washington, D.C. For the Association: International Development Association 1818 H Street, N.W. Washington, D.C. 20433 United States of America 6 Cable address: Indevas Washington, D.C. For SONEDE: Soci6te Nationale d'Exploitation et de Distribution des Eaux 23, Rue Docteur Braquehaye Tunis, Tunisia Cable address: Societ6 Nationale d'Exploitation et de Distribution des Eaux Tunis Section 5.02. Any action required or permitted to be taken, and any documents required or permitted to be executed, under this Agreement on behalf of SONEDE may be taken or executed by its Directeur Gndral or such other person or persons as such Directeur Gendral shall designate in writing. Section 5.03. SONEDE shall furnish to the Bank and the Association sufficient evidence of the authority and the authenticated specimen signature of the person or persons who will, on behalf of SONEDE, take any action or execute any documents required or permitted to be taken or executed by SONEDE pursuant to any of the provisions of this Agreement. Section 5.04. This Agreement may be executed in several counterparts, each of which shall be an original, and all collectively but one instrument. IN WITNESS WHEREOF, the parties hereto, acting through their representatives thereunto duly authorized, have caused this Agreement to be signed 7 in their respective names and delivered in the District of Columbia, United States of America, as of the day and year first above written. INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT By /s/ S. Aldewereld Vice President INTERNATIONAL DEVELOPMENT ASSOCIATION By /s / S. Aldewerela Vice President SOCIETE NATIONALE D'EXPLOITATION ET DE DISTRIBUTION DES EAUX By /s / Slaheddine El Goulli Authorized Representative 8 SCHEDULE I Annual Depreciation and Renewal Rates for Sewerage and Pollution Control Works, Facilities and Equipment Operated by SONEDE Life Span of Sewerage and Pollution Annual Control Works, Depreciation or Facilities and Renewal Rate Equipment 1. Vehicles and mobile pump units 20% 5 years 2. Maintenance, equipment and tools 10% 10 years 3. Pumping units 10% 10 years 4. Equipment for treatment plants and stabilization ponds 6-2/3% 15 years 5. Buildings and civil works 4% 25 years