Haiti - Second Power Project : Credit 0895 - Project Agreement - Conformed

CONFORMED COPY CREDIT NUMBER 895 HA SPECIAL ACTION CREDIT NUMBER 4 HA Joint Projeet Agreement (Second Power Project) among INTERNATIONAL DEVELOPHENT ASSOCIATION and INTERNATIONAL DEVELOPMENT ASSOCIATION as ADMINISTRATOR of the SPECIAL ACTION ACCOUNT established with funds contributed by the MEMBER STATES of the EUROPEAN ECONOMIC COMMUNITY and ELECTRICITE D'HAITI Dated May 31, 1979 CREDIT NUMBER 895 HA SPECIAL ACTION CREDIT NUMBER 4 HA JOINT PROJECT AGREEMENT AGREEMENT, dated May 31, 1979, between INT1 RNATIONAL DEVELOPMENT ASSOCIATION (hereinafter called the Asbociation), INTERNATIONAL DEVELOPMENT ASSOCIATION as ADMINISTRATOR of the SPECIAL ACTION ACCOUNT established with the funds contributed by the MEMBER STATES of the EUROPEAN ECONOMIC COMMUNITY (hereinafter called the Administrator), and ELECTRICITE D'HAITI (hereinafter called EdH). WHEREAS by the Development Credit Agreement of even date herewith (hereinafter called the IDA Credit Agreement) between Republic of Haiti (hereinafter called the Borrower) and the Association, the Association has agreed to make available to the Borrower an amount in various currencies equivalent to sixteen million five hundred thousand dollars ($16,500,000), on the terms and conditions set forth in the IDA Credit Agreement, but only on condition that EdH agree to undertake such obligations toward the Association as are hereinafter set forth; WHEREAS by a Special Action Credit Agreement of even date herewith (hereinafter called the Special Action Credit Agreement) between the Borrower and the Administrator, the Administrator has agreed to make available to the Borrower an amount in various currencies equivalent to six million dollars ($6,000,000) (herein- after called the Special Action Credit), on the terms and condi- tions set forth in the Special Action Credit Agreement, but only on condition that EdH agree to undertake such obligations toward the Administrator as are hereinafter set forth; WHEREAS by a subsidiary loan agreement to be entered into between the Borrower and EdH, the proceeds of the credit provided for under the IDA Credit Agreement and the proceeds of the special action credit provided for under the Special Action Credit Agreement will be made available to EdH on the terms and condi- tions therein set forth; and WHEREAS EdH, in consideration of the Association's and the Administrator's entering into the IDA Credit Agreement and the Special Action Credit Agreement, respectively, with the Borrower, EdH has agreed to undertake the obligations hereinafter set f or th; NOW THEREFORE the parties hereto hereby agree as follows: -2- ARTICLE I Definitione Section 1.01. Wherever used in this Agreement, unless the context shall otherwise require, the several terms defined in the IDA Credit Agreement, in the Special Action Credit Agreement, and in the General Conditions (as so defined) have theorespective meanings therein set forth. ARTICLE II Execution of the Project Section 2.01. EdH shall carry out the Project described in Schedule 2 to the IDA Credit Agreement and in Schedule 2 to the Special Action Credit Agreement with due diligence and efficiency and in conformity with 'appropriate administrative, financial and engineering and public utilities practices. Section 2.02. (a) In order to assist EdH in the carrying out of detailed engineering and the preparation of bidding docu- ments for, and supervision of the execution of, Parts (A) (i) and (ii), (B) (iv) and (v) and (C) (i) of the Project, EdH shall continue to employ engineering consultants whose qualifications, experience and terms and conditions of employment shall be satis- factory to the Association and the Administrator. (b) In order to assist EdH in the preparation of a pre- liminary design for its new head office building, EdH shall employ consultants whose qualifications, experience and terms and conditions of employment shall be satisfactory to the Association and the Administrator, and shall cause said preliminary design to be completed not later than June 30, 1980. Section 2.03. Except as the Association and the Administrator shall otherwise agree, procurement of the goods and civil works to be financed out of the proceeds of the Credit and of the Special Action Credit shallobe governed by the provisions of the .Schedule to this Agreement. Section 2.04. (a) EdH undertakes to insure, or make adequate provision for the insurance of, the imported goods to be financed out of the proceeds of the Credit and the Special Action Credit relent to it by the Borrower against hazards incident to the -3- acquisition, transportation and delivery thereof to the place of use or installation, and for such insurance any indemnity shall be payable in a currency freely usable by EdH to replace or repair such goods. (b) Except as the Association and the Administrator may otherwise agree, EdH shall cause all goods and services financed out of the proceeds of the Credit and the Special Action Credit relent to it by the.Borrc.wer to be used exclusively for the Project. Section 2.05. EdH shall take or cause to be taken all such action as shall be necessary to acquire as and when needed all such land and rights in respect of land as shall be required for the construction (and operation) of the facilities included in the Project. Section 2.06. (a) EdH shall furnish to the Association and the Administrator, promptly upon their preparation, the plans, specifications, reports, contract documents and construction and procurement schedules for the Project, and any material modifica- tions thereof or additions thereto, in such detail as the Associa- tion or the Administrator shall reasonably request. (b) EdH: () shall maintain records and procedures adequate to record and monitor the progress of the Project (including its cost and the benefits to be derived from it), to identify the goods and services financed out of the proceeds of the Credit and of the Special Action Credit, and to disclose their use in the Project; (ii) shall enable the Association's and the Administra- tor's accredited representatives to visit the facilities and construction sites included in the Project and to examine the goods financed out of the proceeds of the Credit and the Special Action Credit and any relevant records and documents; and (iii) shall furnish to the Association and the Administrator at regular intervals eall such information as the Association or the Adminis- trator shall reasonably request concerning the Project, its cost and, where appropriate, the benefits to be derived from it, the expenditures of such proceeds and the goods and services financed out of such proceeds. (c) Promptly after completion of the Project, but in any event not later than six months after the Closing Date or such later date as may be agreed for this purpose between EdH, the Association and the Administrator, Edh shall prepare and furnish to the Association and the Administrator a report, of such scope and in such detail as the Association or the Administrator shall reasonably request, on the execution and initial operation of the Project, its cost and the benefits derived and to be derived from it, the performance by EdH, the Association and the Administrator of their respective obligations under the Joint Project Agreement and the accomplishment of the purposes of the Credit and the Special Action Credit., (d) EdH shall enable the Association's and the Admini- strator's representatives to examine all plants, installations, sites, works, buildings, property and equipment of EdH and any relevant records and documents. Section 2.07. EdH, shall duly perform all its obligations under the Subsidiary Loan Agreement. Except as the Association and the Administrator shall otherwise agree, EdH 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. Section 2.08. (a) EdH shall, at the request of the Associ- ation and the Administrator, exchange views with the Association and the Administrator with regard to the progress of the Project, the performance of its obligations under this Agreement and under the Subsidiary Loan Agreement, and other matters relating to the purposes of the Credit and the Special Action Credit. (b) EdH shall promptly inform the Association and the Administrator of any condition which interferes or threatens to interfere with the progress of the Project, the accomplishment of the purposes of the Credit and the Special Action Credit, or the performance by EdH of its obligations under this Agreement and under the Subsidiary Loan Agreement. Section 2.09. (a) For the purpose of overall coordination in the carrying out of the Project, EdH shall establish a coordi- nation committee to be chaired by EdH's Director of Planning and Dispatch. The committee shall include the Director of EdH's Technical Department, the chiefs of missions of the consultants employed under the Project, and the chief of the planning section to be appointed pursuant to Sub-section (b) of this Section. (b) EdH shall, not later than October 1, 1979, establish a planning section within its Department of Planning and Dispatch, Alp,5 5- and shall employ an appropriately qualified person to serve as the chief of said section and as coordinator of the Project. Section 2.10. EdH shall carry out a program satisfactory to the Association and the Administrator for the. training of EdH staff in the fields oft (i) planning, (ii) standardization of materials, equipment, design and work rules; (iii) computer programming and operation; and (iv) power Operation and load management. ARTICLE III Management and Operations of EdH Section 3.01. (a) EdH shall at all times carry out its operations, manage its affairs, plan its future expansion and maintain its financial position in accordance with appropriate engineering, business, .financial and public utility principles and practices and under the supervision of experienced and com- petent management, assisted by qualified and competent staff in adequate numbers. (b) Without limitation on the provisions of Sub-section (a) of this Section, EdH shall cause the positions of General Manager, Technical Director, Planning and Dispatch Director and Administrative Director to be filled at all times with competent and experienced persons whose qualifications shall be satisfactory to the Borrower, the Association, the Administrator and EdH. Section 3.02. EdH shall take all measures required to system- atically reduce losses of electricity pursuant to targets estab- lished. in consultation with the Association and the Administrator and shall monitor decreases in such losses. Section 3.03, EdH shall take out and maintain with respon- sible insurers, or make other provisions satisfactory to the Association and the Administrator for, insurance against such risks and in such amounts as shall be consistent with appropriate practice. Section 3.04 (a) In order to assist EdH in the management of its affairs and in tho carrying out of its operations, EdH shall employ consultants whose qualifications, experience and terms and conditions of employment shall be satisfactory to the Association and the Administrator. IN AW -6- (b) EdH shall carry out, with the assistance of the consul- tants referred to in Section 2.02 (b) of this Agreement and under terms of reference which shall have been approved by the Associ- ation and the Administrator, a study of its manpower requirements through 1985, and shall furnish said study to the Association and the Administrator not later than December 31, 1979. Section 3.05. (a) EdH shall operate and maintain its plants, equipment and property, and from time to time make all necessary renewals and repairs thereof, 4Jni accordance with appropriate engineering and public utility practices. (b) Except as the Association and, the Administrator shall otherwise agree, EdH shall not sell, lease, transfer, assign or otherwise dispose of any of its rights, property or assets except in the ordinary course of business. Section 3.06. EdH shall: (i) carry out a study of the organ- ization of its regional operations; (ii) furnish to the Associ- ation and the Administrator, not later than December 31, 1979, the findings and recommendations thereof; and (iii) thereafter imple- ment such recommendations as shall be acceptable to EdH, the Association and the Administrator. Section 3.07. In order to strengthen its financial planning and improve management reporting and internal contiol system, EdH shall: (i) employ, not later than September 30, 1979, consul- tants whose qualifications, experience and terms and conditions of employment shall be satisfactory to the Association and the Administrator to study its existing procedures pertaining to the foregoing, to make recommendations on the measures required for the improvement thereof and to formulate internal auditing proce- dures; (ii) furnish to the Association and the Administrator the aforementioned recommendations and proposed internal auditing procedures; and (iii) put into effect, not later than March 31, 1980, such recommendations and internal auditing procedures as shall be agreed between EdH, the Association and the Admini- strator. ARTICLE IV Financial Covenants Section 4.01. EdH shall.maintain records adequate to reflect in accordance with consistently maintained appropriate accounting practices its operations and financial condition. A N . -7- Section 4.02. EdH shall: (i) have its accounts and financial statements (balance sheets, statements of income and expenses and related statements), for each fiscal year audited, in accordance with appropriate auditing principles consistently applied, by independent auditors acceptable to the Associatioti and the Admin- istrator; (ii) furnish to the Association and the Administrator as soon as available, but in any case not later than four months after the end of each such year, (A) certified copies of its financial statements for such year as so audited and (B) the report of such audit by said auditors, of such scope and in such detail as the Association or the Administrator shall have reason- ably requested; and (iii) furnish to the Association and the Administrator such other information concerning the accounts and financial statements of EdH and the audit thereof as the Associa- tion or the Administrator shall from time to time reasonably request. Section 4.03. (a) Except as the Association and the Admin- istrator shall otherwise agree, EdH shall from time to time take all steps necessary or desirable to obtain such adjustments in its power tariffs, as shall be required to earn an annual rate of return at least of seven per cent (7%) in fiscal year 1979, seven and one-half per cent (7-1/2%) in fiscal year 1980 and eight per cent (8%) in fiscal year 1981 and thereafter. (b) For the purposes of this Section: (i) the annual rate of return shall be calculated in respect of each fiscal year by relating the net operating revenue for that year to the average of the net value of fixed assets in operation at the beginning and at the end of that year; (ii) the term "net operating revenue" means gross operating revenues less operating and admini- strative expenses, including adequate maintenance, straightline depreciation based on the useful life of assets and taxes, if any, but excluding interest and other charges on debt; and (iii) the"term "net yalue of fixed assets in operation" means the gross value of fixed assets in operation less ,the related accumulated depreciation, all as revalued in accordance with Section 4.04 of this Agreement. IN -8- Section 4.04. Except as the Association and the Administrator shall otherwise agree, EdH shall: (a) revalue its fixed assets annually, to such extent as shall be necessary to reflect adequately, at the time of each such revaluation, the current value .thereof, "in accordance with a sound and consistently applied method of valuation acdeptable to the Association and the Admini- strator; and (b) register, annually, the result of such revalu- ation on its books. Section 4.05. Except as the Association and the Administrator shall otherwise agree, EdH shall not incur: (a) any long-term debt, unless its internally generated funds for the fiscal year next preceding such iLicurrence or for a later twelve-month period ended prior to such incurrence, whichever is the greater, shall be not less than 1.5 times the maximum long-term debt service requirements for any succeeding fiscal year on all long-term debt of EdH (including the long-term debt to be incurred). For the purposes of this Section: (i) the term "long-term debt" means all indebtedness of EdH maturing by its terms one year or more after the date on which it is originally incurred; (ii) the term "internally generated funds" means the j aggregate revenues from all sources, adjusted to take account of EdH's power tariffs in effect at the time of incurrence of debt even though they were not in effect during the twelve conse- cutive months to which such revenues related, less operating and administrative expenses, including adequate maintenance, taxes, if any, but before provision for depreciation and. interest and other charges on long-term debt; and (iii) the term "debt service requirements" means the aggregate amount of amortization (including sink- ing fund payments, if any), interest and other charges in respect of debt. (b) any short-term debt, unless the aggregate of all short- term debt incurred by EdH, including the short-term debt to be incurred, is equal to or less than one-sixth (1/6) of the operating, maintenance and administrative expenses (excluding -9- depreciation and other non-cash provisions) of EdH for the twelve- month period preceding such incurrence. For the purpose of this paragraph, the term "short-term debt" means all debt of EdH for money borrowed, including bank overdrafts, maturing by its terms on demand or less than one year after the date on which it was incurred. For the purposes of this Section, debt shall be deemied to be incurred on the date of execution and delivery of a contract, loan agreement or other instrument providing for such debt; provided, however, that in the case of guarantee of debt, debt shall be deemed to be incurred on the day the agreement guaranteeing such debt has been entered into but only to the extent that the guaranteed debt is outstanding. Section 4.06. (a) EdH shall not undertake, prior to the completion of the Project, any investment in the power sector exceeding the equivalent of one per cent (1%) of the net value of EdH's fixed assets in operation without the Association's and the Administrator's prior approval. (b) For the purpose of Sub-section (a) of this Section, the term "net value of fixed assets in operation" means the gross value of fixed assets in operation less the related accumulated depreciation, all as revalued -in accordance with Section 4.04 of this Agreement. Section 4.07.. EdH undertakes not to use its resources for any purpose other than the financing of its investment program, its operational expenses and for the servicing of its debt. ARTICLE V Effective Date; Termination; Cancellation and Suspension Section 5.01. This Agreement shall come into force and effect on the date upon which the IDA Credit Agreement and the Special Action Credit Agreement become effective. Section 5.02. (a) This Agreement and all obligations of the Association, of the Administrator and of EdH thereunder shall terminate on the earlier of the following dates: i-I -10- (i) the date on which the IDA Credit Agreement or the Special Action Credit Agreement shall terminate in accordance with its terms, whichever shall be the later; (ii) a date twenty years after the date of this Agree- ment. (b) If the IDA Credit Agreement or the Special Action Credit Agreement terminatel in accordance with its terms before the date specified in paragraph (a) (ii) of this Section, the Association or the Administrator, as the case may be, shall promptly notify EdH of this event. Section 5.03. All the provisions of this Agreement shall continue in full force and effect notwithstanding any cancellation or suspension under the General Conditions. ARTICLE VI Miscellaneous Provisions Section 6.01. 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 herein- after 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 Association: International Development Association 1818 H Street, N.W. Washington, D.C. 20433 United States of America Cable address: Telex: INDEVAS 440098 (ITT) Washington, D.Ci 248423 (RCA) or 64145 (WUI) - 11 - For the Administrator: Administrator of the Special Action Account (International Development Association) 1818 H Street, N.W. Washington, D.C. 20433 United States of America Cable address: Telex: INDEVAS 440098 (ITT) Washington, D.C. 248423 (RCA) or 64145 (WUI) For EdH: Electricité d'Haiti Port-au-Prince Botte Postale D Haiti Cable address: Telex: ELECDHA 3490113 Port-au-Prince Section 6.02. Any action required or,permitted to be taken, and an' document required or permitted to be executed, under this Agreement on behalf of EdH may be taken or executed by its General Manager or such other person or persons as the General Manager shall designate in writing, and EdH shall furnish to the Association and the Administrator sufficient evidence of the authority and the authenticated specimen signature of each such person. Section 6.03. This Agreement may be executed in several counterparts, each of whith shall be an original, and all collec- tively but one instrument. IN WITNESS WHEXEOF, the parties hereto, acting through their representatives thereunto duly authorized, haye caused this Agreement to be signed in their respective names in the District - ). - 12 - Columbia, United States of America, as of the day and year -first above written. INTERNATIONAL DEVELOPMENT ASSOCIATION By s/ Nicolgs Ardito Barletta Regional Vice President Latin America and the Caribbean ADMINISTRATOR OF THE SPECIAL ACTION ACCOUNT By /s/ Nicolgs Ardito Barletta Regional Vice President Latin Ainerica and the Caribbean (b ELECTRICITE DHAITI By /s/ Emmanuel Bros Authorized Representative á - -~13- SCHEDULE Procurement A. International Competitive Bidding 1. Except as provided in Part D hereof: (i) goods and civil works to be financed out of the proceeds qf the IDA Credit shall be procured under contracts awarded in accordance with procedures consistent with those set forth in the "Guidelines for Procurement under World Bank Loans and IDA CredIts" published by the International Bank for Reconstruction and Development in March 1977 (hereinafter called the Guidelines), on the basis of interna- tional competitive bidding as described in Part A of the Guide- lines; and (ii) goods and civil works to be financed out of the Special Action Credit shall, subject to the eligibility limitations and restrictions set forth in Section 2.02 of the Special Action Credit Agreement, be procured under contracts awarded in accordance with procedures consistent with those set forth in Part A of the Guidelines. 2. For goods and works to be procured on the basis of inter- national competitive bidding, in addition to the requirements of paragraph 1.2 of the Guidelines, EdH shall prepare and forward to the Association and the Administrator as soon as possible, _nd in any event not later than 60 days prior to the date of availability to the public of the first tender or prequalification documents relating thereto, as the case may be, a general procurement notice, in such form and detail and containing such information as the Association or the Administrator shall reasonably request; the Association and the Administrator will arrange for the publica- tion of such notice in order to provide timely notification to prospective bidders of the opportunity to bid for the goods and works in question. EdH shall provide the necessary information to update such notice annually so long as any goods or works remain to be procured on the basis of international competitive bidding. 3. For the purpose of evaluation and comparison of bids for the supply of goods to be procured on the basis of international competitive bidding, (i) bidders shall be required to state in their bid the c.i.f. (port of entry) price for imported goods, or the ex-factory price for domestically manufactured goods; (ii) customs duties and other import taxes on imported goods, and sales and similar taxes on domestically supplied goods, shall be excluded; and (iii) the cost to EdH of inland freight and other ......... -14- expenditures incidental to the delivery of goods to the place of their use or installation shall be included. B. Preference for Domestic Manufacturers In the procurement of goods in accordance with the procedures described in Part A of this Schedule, goods manufactured in Haiti may be granted a margin of preference in accordance with, and subject to, the following provisions: 1. All bidding documents for the procurement of goods shall clearly indicate any preference which will be granted, the infor- mation required to establish the eligibility of a bid for such preference and the following methods and stages that will be followed in the evaluation and comparison of bids. 2. After evaluation, responsive bids will be classified in one of the following three groups: (1) Group A: bids offering goods manufactured in Haiti if the bidder shall have established to the satisfaction of EdH, the Association and the Administrator that the manufacturing cost of such goods includes a value added in Haiti equal to at least 20% of the ex-factory bid price of such goods. (2) Group B: all other bids ofie-Ang goods manufactured in Haiti. (3) Group C: bids offering any other goods. 3. All evaluated bids in each group shall be first compared among themselves, excluding any customs duties and other import taxes on goods to be imported and any sales or similar taxes on goods to be supplied domestically, to determine the lowest evaluated bid of each group. Such lowest evaluated bids shall then be compared with each other, and if, as a result of this comparison, a bid from group A or group B is the lowest, it shall be selected for the award. 4e If, as a result of the comparison under paragraph 3 above, the lowest bid is a bid from group C, all group C bids shall be further compared with the lowest evaluated bid from group A after adding to the evaluated bid price of the imported goods offered in AW - 15 - each group C bid, for the purpose of this further comparlson only, an amount equal to: (i) the amount of customs duties and other import taxes which a non-exempt importer would have to pay for the importation of the goods offered in such group C bid; or (ii) 15% of the c.i.f. bid price of such goods if said customs duties and taxes exceed 15% of such price. If the group A bid in such further comparison is the lowest, it shall be selected for the award; if not, the bid from group C which as a result of the comparison under paragraph 3 is the lowest evaluated bid shall be selected'. C. Preference for Domestic Contractors With respect to the evaluation of bids for any contract for civil works included under Category (3) of the table set forth in Schedule 1 to the Development Credit Agreement and to be procured in accordance with the procedures described in Part A of this Schedule, EdH may grant a margin of preference of 7-1/2% to domestic contractors, in accordance with, and subject to, the following provisions: 1. Contractors applying for such preference shall be asked to provide, as part of the data for qualification, such informa- tion, including details of ownership, as shall be required to determine whether, according to the classifi/:ation established by the Borrower and accepted by the Association, a particular firm or group of firms qualifies for a domestic preference. The bidding documents shall clearly indicate the preference and the method that will be followed in the evaluation and comparison of bids to give effect to such preference. 2. After bids have been received and reviewed by EdH, responsive bids will be.classified into the following groups: (i) bids offered by 'domestic contractors eligible for preference; and (ii) bids offered by other contractors. For the purpose of evaluation and comparison of bids an amount equal to 7-1/2% of the bid amount shall be added to bids received under group (ii) above. D. Other Procurement Procedures Contracts for: (i) substation equipment under Part (B) (i) of the Project costing in the aggregate the equivalent of $800,000 -16- or less; (ii) power and control panels for the three diesel units provided under Part (A) (i) of the Project costing the equivalent of $750,000 or less; (iii) telecommunications equipment under Part (B) (v) of the Project costing in the aggregate the equivalent of $500,000 or less; and (iv) protection equipment under Part (B) (vi) of the Project costing in the aggregate the equivalent of $200,000 or less, may be negotiated with the original suppliers of existing equipment, provided that all terms and conditions of the contract are satisfactory to the Association and the Administrator. E. Review of Procurement Decisions by the Association and the Administrator 1. Review of invitations to bid and of proposed awards and final contracts: With respect to all contracts for civil works and equipment (except contracts referred to in Part D of this Schedule) esti- mated to cost the equivalent of $50,000 or more: (a) Before bids are invited, EdH shall furnish to the Association and the Administrator, for their comments, the text of the invitations to bid and the specifications and other bidding documents, together with a description of the advertising proce- dures to be followed for the bidding, and shall make such modifi- cations in the said documents or procedures as the Association,or the Administrator shall reasonably request. Any further modifica- tion to the bidding documents shall require the Association's and the Administrator's concurrence before it is issued to the prospective bidders. (b) After bids have been received and evaluated, EdH shall, before a final decision on the award is made, inform the Associa- tion and the Administrator of the name of the bidder to which it intends to award the contract and shall furnish to the Association and the Administrator, in sufficient time for their review, a detailed report, by the consultants referred to in Section 2.02 (a) of this Agreement, on the evaluation and comparison of the bids received, together with the recommendations for award of the said consultants and such other information as the Association or the Administrator shall reasonably request. The Association and the Administrator shall, if they determine that the intended award would be inconsistent with the Guidelines or this Schedule, promptly inform EdH and state the reasons for such determination., -17- (c) The terms and conditions of the contract shall not, without the Association's and the Administrator's concurrence, materially differ from those on which bids were asked or prequali- fication invited. (d) Two conformed copies of the contract shall be furnished to the Association and the Administrator promptly after its execution and prior to the submission to the Association and the Administrator of the first application for withdrawal of funds from the Credit Account in respect of such contract. 2. With respect to each contract not governed by the preceding paragraph, EdH shall furnish to the Association and the Admin- istrator, promptly after its execution and prior to the submission to the Association and the Administrator of the first application for withdrawal of funds from the Credit Account in respect of such contract, two conformed copies of such contract, together with the analysis of the respective bids, recommendations for award and such other information as the Association or the Administrator shall reasonably request. The Association and the Administrator shall, if they determine that the award of the contract was not consistent with the Guidelines or this Schedule, promptly inform EdH and state the reasons for such determination. 3. Before agreeing to any material modification or waiver of the terms and conditions of a contract, or granting an exten- sion of the stipulated time for performance of such contract, or issuing any change order under such contract (except in cases of extreme urgency) which would increase the cost of the contract by more than $50,000 above the original price, EdH sha l1 inform the Association and the Administrator of the proposed modifi- cation, waiver, extension or change order and the reasons there- for. The Association and the Administrator, if they determine that the proposal would be inconsistent with the provisions of this Agreement, shall promptly inform EdH and state the reasons for its determination. Any modification, waiver, extension or change order shall be sequentially numbered and each subsequent change order shall indicate the total contract price as agreed under the previous change order, the details of the agreed change in contract price (if any) under the change order and the total revised price resulting therefrom. z~.2