Conformed Copy - L3242 - First Water Supply, Sewerage and Sanitation Project - Loan Agreement

Page 1 CONFORMED COPY LOAN NUMBER 3242 PH (First Water Supply, Sewerage and Sanitation Project) between REPUBLIC OF THE PHILIPPINES and INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT Dated July 9, 1990 LOAN NUMBER 3242 PH LOAN AGREEMENT AGREEMENT, dated July 9, 1990, between REPUBLIC OF THE PHILIPPINES (the Borrower) and INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT (the Bank). WHEREAS the Borrower, having satisfied itself as to the feasibility and priority of the Project described in Schedule 2 to this Agreement, has requested the Bank to assist in the financing of the Project; and WHEREAS the Bank has agreed, on the basis, inter alia, of the foregoing, to extend the Loan to the Borrower upon the terms and conditions set forth in this Agreement; NOW THEREFORE the parties hereto hereby agree as follows: ARTICLE I General Conditions; Definitions Section 1.01. The "General Conditions Applicable to Loan and Guarantee Agreements" of the Bank, dated January 1, 1985, with the last sentence of Section 3.02 deleted (the General Conditions) Page 2 constitute an integral part of this Agreement. Section 1.02. Unless the context otherwise requires, the several terms defined in the General Conditions and in the Preamble to this Agreement have the respective meanings therein set forth and the following additional terms have the following meanings: (a) "DoH" means the Department of Health of the Borrower and includes any successors thereto; (b) "DLG" means the Department of Local Government of the Borrower and includes any successors thereto; (c) "DPWH" means the Department of Public Works and Highways of the Borrower and includes any successors thereto; (d) "LWUA" means the Local Water Utilities Administration of the Borrower and includes any successors thereto; (e) "PCC" means the Project Coordination Committee estab- lished pursuant to paragraph 1 of Schedule 5 to this Agreement; (f) "Project Provinces" mean the thirty-seven provinces in Regions I to V and the Cordillera Administrative Region, generally referred to as the Luzon region, of the Borrower and such other provinces in other Regions of the Borrower as may be agreed to between the Borrower and the Bank; (g) "Provincial Sector Plans" mean the Provincial Water Supply, Sewerage and Sanitation Sector Plans prepared, adopted and made effective pursuant to paragraph 2 of Schedule 5 to this Agreement; and (h) "Special Account" means the account referred to in Section 2.02 (b) of this Agreement. ARTICLE II The Loan Section 2.01. The Bank agrees to lend to the Borrower, on the terms and conditions set forth or referred to in the Loan Agreement, various currencies that shall have an aggregate value equivalent to the amount of eighty-five million dollars ($85,000,000), being the sum of withdrawals of the proceeds of the Loan, with each withdrawal valued by the Bank as of the date of such withdrawal. Section 2.02. (a) The amount of the Loan may be withdrawn from the Loan Account in accordance with the provisions of Schedule 1 to this Agreement for expenditures made (or, if the Bank shall so agree, to be made) in respect of the reasonable cost of goods and services required for the Project and to be financed out of the pro- ceeds of the Loan. (b) The Borrower shall, for the purposes of the Project, open and maintain in dollars a special deposit account in the Central Bank of the Philippines on terms and conditions satisfactory to the Bank. Deposits into, and payments out of, the Special Account shall be made in accordance with the provisions of Schedule 6 to this Agreement. Section 2.03. The Closing Date shall be December 31, 1995 or such later date as the Bank shall establish. The Bank shall promptly notify the Borrower of such later date. Section 2.04. The Borrower shall pay to the Bank a commitment charge at the rate of three-fourths of one percent (3/4 of 1%) per annum on the principal amount of the Loan not withdrawn from time to time. Section 2.05. (a) The Borrower shall pay interest on the prin- cipal amount of the Loan withdrawn and outstanding from time to time, at a rate for each Interest Period equal to the Cost of Quali- Page 3 fied Borrowings determined in respect of the preceding Semester, plus one-half of one percent (1/2 of 1%). On each of the dates specified in Section 2.06 of this Agreement, the Borrower shall pay interest accrued on the principal amount outstanding during the preceding Interest Period, calculated at the rate applicable during such Interest Period. (b) As soon as practicable after the end of each Semester, the Bank shall notify the Borrower of the Cost of Qualified Borrowings determined in respect of such Semester. (c) For the purposes of this Section: (i) "Interest Period" means a six-month period ending on the date immediately preceding each date specified in Section 2.06 of this Agreement, beginning with the Interest Period in which this Agreement is signed. (ii) "Cost of Qualified Borrowings" means the cost, as reasonably determined by the Bank and expressed as a percentage per annum, of the outstanding borrowings of the Bank drawn down after June 30, 1982, excluding such borrowings or portions there-of as the Bank has allocated to fund: (A) the Bank's investments; and (B) loans which may be made by the Bank after July 1, 1989 bearing interest rates determined otherwise than as provided in paragraph (a) of this Section. (iii) "Semester" means the first six months or the second six months of a calendar year. (d) On such date as the Bank may specify by no less than six months' notice to the Borrower, paragraphs (a), (b) and (c) (iii) of this Section shall be amended to read as follows: "(a) The Borrower shall pay interest on the principal amount of the Loan withdrawn and outstanding from time to time, at a rate for each Quarter equal to the Cost of Qualified Borrowings determined in respect of the preceding Quarter, plus one-half of one percent (1/2 of 1%). On each of the dates specified in Section 2.06 of this Agreement, the Borrower shall pay interest accrued on the principal amount outstanding during the preceding Interest Period, calculated at the rates applicable during such Interest Period." "(b) As soon as practicable after the end of each Quarter, the Bank shall notify the Borrower of the Cost of Qualified Borrowings determined in respect of such Quarter." "(c) (iii) `Quarter' means a three-month period commencing on January 1, April 1, July 1 or October 1 in a calendar year." Section 2.06. Interest and other charges shall be payable semiannually on March 15 and September 15 in each year. Section 2.07. The Borrower shall repay the principal amount of the Loan in accordance with the amortization schedule set forth in Schedule 3 to this Agreement. ARTICLE III Execution of the Project Section 3.01. (a) The Borrower declares its commitment to the objectives of the Project as set forth in Schedule 2 to this Agree- ment, and, to this end, shall carry out the Project through DoH, DLG, DPWH and LWUA with due diligence and efficiency and in con- Page 4 formity with appropriate administrative, financial, health and public utility practices, and shall provide, promptly as needed, the funds, facilities, services and other resources required for the Project. (b) Without limitation upon the provisions of paragraph (a) of this Section and except as the Borrower and the Bank shall other- wise agree, the Borrower shall carry out the Project in accordance with the Implementation Program set forth in Schedule 5 to this Agreement. Section 3.02. Except as the Bank shall otherwise agree, pro- curement of the civil works, goods 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 4 to this Agreement. ARTICLE IV Financial Covenants Section 4.01. (a) The Borrower shall maintain or cause to be maintained records and accounts adequate to reflect in accordance with sound accounting practices the operations, resources and expen- ditures in respect of the Project of the departments or agencies of the Borrower responsible for carrying out the Project or any part thereof. (b) The Borrower shall: (i) have the records and accounts referred to in paragraph (a) of this Section including those for the Special Account for each fiscal year audited, in accordance with appropriate auditing principles consistently applied, by independent auditors acceptable to the Bank; (ii) furnish to the Bank as soon as available, but in any case not later than nine months after the end of each such year, the report of such audit by said auditors, of such scope and in such detail as the Bank shall have reasonably requested; and (iii) furnish to the Bank such other information con- cerning said records and accounts and the audit thereof as the Bank shall from time to time reasonably request. (c) For all expenditures with respect to which withdrawals from the Loan Account were made on the basis of statements of expenditure, the Borrower shall: (i) maintain or cause to be maintained, in accordance with paragraph (a) of this Section, records and accounts reflecting such expenditures; (ii) retain, until at least one year after the Bank has received the audit report for the fiscal year in which the last withdrawal from the Loan Account or payment out of the Special Account was made, all records (contracts, orders, invoices, bills, receipts and other documents) evidencing such expenditures; (iii) enable the Bank's representatives to examine such records; and (iv) ensure that such records and accounts are included in the annual audit referred to in paragraph (b) of this Section and that the report of such audit contains a separate opinion by said auditors as to whether the statements of expenditure submitted during such fiscal year, Page 5 together with the proce-dures and internal controls involved in their preparation, can be relied upon to support the related withdrawals. ARTICLE V Effective Date; Termination Section 5.01. The following event is specified as an addi- tional condition to the effectiveness of the Loan Agreement within the meaning of Section 12.01 (c) of the General Conditions: Prepara- tion, adoption and putting into effect of Provincial Sector Plans pursuant to paragraph 2 of Schedule 5 to this Agreement by at least eight Project Provinces. Section 5.02. The date ninety (90) days after the date of this Agreement is hereby specified for the purposes of Section 12.04 of the General Conditions. ARTICLE VI Representative of the Borrower; Addresses Section 6.01. The Secretary of Finance of the Borrower is designated as representative of the Borrower for the purposes of Section 11.03 of the General Conditions. Section 6.02. The following addresses are specified for the purposes of Section 11.01 of the General Conditions: For the Borrower: Secretary of Finance Department of Finance Manila, Philippines Cable address: Telex: MINFIN 7550 CBP-PH Manila 40268 CB-CONF For the Bank: International Bank for Reconstruction and Development 1818 H Street, N.W. Washington, D.C. 20433 United States of America Cable address: Telex: INTBAFRAD 197688 (TRT) Washington, D.C. 248423 (RCA) 64145 (WUI) or 82987 (FTCC) IN WITNESS WHEREOF, the parties hereto, acting through their duly authorized representatives, have caused this Agreement to be signed in their respective names in the District of Columbia, United States of America, as of the day and year first above written. REPUBLIC OF THE PHILIPPINES By /s/ Emmanuel Pelaez Authorized Representative Page 6 INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT By /s/ Gautam Kaji Acting Regional Vice President Asia SCHEDULE 1 Withdrawal of the Proceeds of the Loan 1. The table below sets forth the Categories of items to be financed out of the proceeds of the Loan, the allocation of the amounts of the Loan to each Category and the percentage of expen- ditures for items so to be financed in each Category: Amount of the Loan Allocated % of (Expressed in Expenditures Category Dollar Equivalent) to be Financed (1) Goods consisting 38,340,000 100% of foreign of equipment, expenditures, 100% materials and of local expen- vehicles ditures (ex- factory cost) and 65% of local expenditures for other items pro- cured locally (2) Civil Works: (a) shallow wells 2,700,000 57% of Unit Cost with pump per completed unit (b) deep wells 17,190,000 57% of Unit Cost with pump per completed unit (c) spring deve- 2,100,000 57% of Unit Cost lopment per completed unit (d) well rehabi- 510,000 57% of Unit Cost litation per completed unit (e) workshop 200,000 57% of Unit Cost buildings per completed unit (f) household 4,830,000 57% of Unit Cost latrines per completed unit (g) school 2,670,000 57% of Unit Cost toilets per completed unit (h) minor water 1,310,000 57% supply works including water treatment units and rain- water collectors Page 7 (i) minor sanitation 940,000 57% works including public/communal toilets, sullage removal units and waste water treatment units __________ Sub-total 32,450,000 (3) Consultants' 4,410,000 100% services (4) Unallocated 9,800,000 __________ TOTAL 85,000,000 ========== 2. For the purposes of this Schedule: (a) the term "foreign expenditures" means expenditures in the currency of any country other than that of the Borrower for goods or services supplied from the territory of any country other than that of the Borrower; (b) the term "local expenditures" means expenditures in the currency of the Borrower or for goods or services supplied from the territory of the Borrower; and (c) the term "Unit Cost" means the cost of each unit of civil work, referred to in sub-categories (a), (b), (c), (d), (e), (f), and (g) of Category (2) of the table in paragraph 1 hereof, as may be determined by the Borrower and the Bank from time to time. 3. Notwithstanding the provisions of paragraph 1 above, no with- drawals shall be made in respect of payments made for expenditures prior to the date of this Agreement, except that withdrawals, in an aggregate amount not to exceed $8,500,000, may be made in respect of Categories (1), (2) and (3) on account of payments made for expenditures before that date but after January 1, 1990. SCHEDULE 2 Description of the Project The objectives of the Project are to assist the Borrower to meet the basic needs of the rural population through the provision of safe, adequate and easily accessible water supplies as well as proper sanitation. The 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 objectives: Part A: Rural Water Supply 1. Provision of point source water supply to about 18,000 rural barangays in the Project Provinces through the: (a) construction of about 11,000 shallow wells (up to a depth of 12 meters) and about 7,000 deep wells (up to a depth of 60 meters) all equipped with handpumps; (b) rehabilitation of about 5,000 existing wells including the supply of cylinders and replacement parts; (c) development of about 1,000 springs including construc- tion of spring boxes and laying of about 3,000 kilometers of trans- Page 8 mission pipelines; (d) other minor civil works including provision of about 200 rainwater collectors and about 1,000 water treatment units; and (e) construction of about twenty-five workshop buildings. 2. Provision of equipment, materials and vehicles required for carrying out Part A (1) of the Project. Part B: Rural Sanitation 1. Provision of sanitation facilities to all the rural areas of the Borrower including: (a) provision of about 1,000,000 water-sealed pour-flush toilet bowls for individual household latrines; (b) construction of toilet facilities for about 1,000 schools; (c) disinfection of about 1,000,000 contaminated wells; (d) other minor civil works including construction and provision of about 100 pilot communal/public toilets, about 1,000 sullage removal units, and about 100 wastewater treatment units; and (e) provision of laboratory equipment for water quality surveillance. 2. Equipment and vehicles to carry out activities under Part B (1) of the Project. Part C: Technical Assistance Provision of technical assistance for Project implementation, preparation of Provincial Sector Plans, training and community development, quality assurance and control, improvement of private sector manufacturing and production capabilities of handpumps, updating of the Sector Master Plan of the Borrower regarding the water supply, sewerage and sanitation sector, and undertaking feasibility and other studies for the preparation of future projects. * * * The Project is expected to be completed by June 30, 1995. SCHEDULE 3 Amortization Schedule Payment of Principal Date Payment Due (expressed in dollars)* March 15, 1996 1,545,000 September 15, 1996 1,605,000 March 15, 1997 1,670,000 September 15, 1997 1,735,000 March 15, 1998 1,800,000 September 15, 1998 1,870,000 March 15, 1999 1,945,000 September 15, 1999 2,020,000 March 15, 2000 2,100,000 September 15, 2000 2,180,000 March 15, 2001 2,265,000 September 15, 2001 2,350,000 March 15, 2002 2,440,000 September 15, 2002 2,535,000 March 15, 2003 2,635,000 September 15, 2003 2,735,000 March 15, 2004 2,845,000 Page 9 September 15, 2004 2,955,000 March 15, 2005 3,070,000 September 15, 2005 3,185,000 March 15, 2006 3,310,000 September 15, 2006 3,440,000 March 15, 2007 3,570,000 September 15, 2007 3,710,000 March 15, 2008 3,855,000 September 15, 2008 4,005,000 March 15, 2009 4,160,000 September 15, 2009 4,320,000 March 15, 2010 4,485,000 September 15, 2010 4,660,000 _____________________________ * The figures in this column represent dollar equivalents determined as of the respective dates of withdrawal. See General Conditions, Sections 3.04 and 4.03. Premiums on Prepayment Pursuant to Section 3.04 (b) of the General Conditions, the premium payable on the principal amount of any maturity of the Loan to be prepaid shall be the percentage specified for the applicable time of prepayment below: Time of Prepayment Premium The interest rate (expressed as a per- centage per annum) applicable to the Loan on the day of prepayment multiplied by: Not more than three years 0.15 before maturity More than three years but 0.30 not more than six years before maturity More than six years but 0.55 not more than 11 years before maturity More than 11 years but not 0.80 more than 16 years before maturity More than 16 years but not 0.90 more than 18 years before maturity More than 18 years before 1.00 maturity SCHEDULE 4 Procurement and Consultants' Services Section I. Procurement of Goods and Works Part A: International Competitive Bidding Except as provided in Part C hereof, goods shall be procured under contracts awarded in accordance with procedures consistent with those set forth in Sections I and II of the "Guidelines for Procurement under IBRD Loans and IDA Credits" published by the Bank in May 1985 (the Guidelines). Part B: Preference for Domestic Manufacturers In the procurement of goods in accordance with the procedures described in Part A hereof, goods manufactured in Republic of the Page 10 Philippines may be granted a margin of preference in accordance with, and subject to, the provisions of paragraphs 2.55 and 2.56 of the Guidelines and paragraphs 1 through 4 of Appendix 2 thereto. Part C: Other Procurement Procedures 1. Goods estimated to cost less than $200,000 per contract, up to an aggregate amount equivalent to $1,300,000, may be procured under contracts awarded on the basis of competitive bidding, adver-tised locally, in accordance with procedures satisfactory to the Bank. 2. Except as provided in paragraph 3 hereof, civil works shall be procured under contracts awarded on the basis of competitive bidding, advertised locally, in accordance with procedures satis- factory to the Bank. 3. Civil works estimated to cost up to an aggregate amount equi- valent to $9,000,000 may be carried out by force account. Part D: Review by the Bank of Procurement Decisions 1. Review of invitations to bid and of proposed awards and final contracts: (a) With respect to each contract for goods estimated to cost the equivalent of $100,000 or more and civil works estimated to cost the equivalent of $500,000 or more, the procedures set forth in paragraphs 2 and 4 of Appendix 1 to the Guidelines shall apply. Where payments for such contract are to be made out of the Special Account, such procedures shall be modified to ensure that the two conformed copies of the contract required to be furnished to the Bank pursuant to said paragraph 2 (d) shall be furnished to the Bank prior to the making of the first payment out of the Special Account in respect of such contract. (b) with respect to each contract not governed by the pre- ceding paragraph, the procedures set forth in paragraphs 3 and 4 of Appendix 1 to the Guidelines shall apply. Where payments for such contract are to be made out of the Special Account, said procedures shall be modified to ensure that the two conformed copies of the contract together with the other information required to be fur- nished to the Bank pursuant to said paragraph 3 shall be furnished to the Bank as part of the evidence to be furnished pursuant to paragraph 4 of Schedule 6 to this Agreement. 2. The figure of 15% is hereby specified for purposes of para- graph 4 of Appendix 1 to the Guidelines. Section II. Employment of Consultants In order to assist the Borrower in carrying out the Project, the Borrower shall employ consultants whose qualifications, experience and terms and conditions of employment shall be satisfactory to the Bank. Such consultants shall be selected in accordance with principles and procedures satisfactory to the Bank on the basis of the "Guidelines for the Use of Consultants by World Bank Borrowers and by the World Bank as Executing Agency" published by the Bank in August 1981. SCHEDULE 5 Implementation Program The Borrower shall implement the Project in accordance with a program acceptable to the Bank, which shall include the following: 1. The Borrower shall, for the purpose of ensuring overall coor- dination of Project activities, establish and maintain a Project Coordination Committee with functions, powers, funds and facilities satisfactory to the Bank. 2. The Borrower shall cause the provincial governments of the Page 11 Project Provinces to prepare, adopt and put into effect Provincial Water Supply, Sewerage and Sanitation Sector Plans. The said plans shall be satisfactory to the Bank and shall be prepared in accord- ance with a format and schedule agreed to by the Borrower and the Bank. 3. The Borrower shall, to facilitate the preparation and imple- mentation of the Provincial Sector Plans, designate one DLG staff member to act as a Community Organizer in each of the Project Provinces. 4. The Borrower shall implement the Training and Community Devel- opment Program agreed to by the Borrower and the Bank. 5. The Borrower shall, through DPWH, provide one-year warranties to Barangay Waterworks and Sanitation Associations against defective materials and faulty workmanship on completed wells and handpumps. 6. The Borrower shall ensure quality control and obtain quality assurance as agreed with the Bank in respect of specified goods provided under the Project. 7. The Borrower shall, by December 31, 1990, organize and conduct a Project Launching Workshop in a manner satisfactory to the Bank. 8. The Borrower shall, commencing in 1991, undertake biennial reviews of its water pricing policy and cost recovery principles and shall discuss and implement the results and recommendations of such review with the Bank by the end of the calendar year in which the review is undertaken. 9. The Borrower shall provide the Bank such information about the involvement of women in the Project as may be reasonably requested by the Bank and shall ensure that women have equal access to membership and management roles in Barangay Waterworks and Sanitation Associations. SCHEDULE 6 Special Account 1. For the purposes of this Schedule: (a) the term "eligible Categories" means Categories (1), (2) and (3) set forth in the table in paragraph 1 of Schedule 1 to this Agreement; (b) the term "eligible expenditures" means expenditures in respect of the reasonable cost of goods and services required for the Project and to be financed out of the proceeds of the Loan allo- cated from time to time to the eligible Categories in accordance with the provisions of Schedule 1 to this Agreement; and (c) the term "Authorized Allocation" means an amount equi- valent to $5,000,000 to be withdrawn from the Loan Account and deposited in the Special Account pursuant to paragraph 3 (a) of this Schedule. 2. Payments out of the Special Account shall be made exclusively for eligible expenditures in accordance with the provisions of this Schedule. 3. After the Bank has received evidence satisfactory to it that the Special Account has been duly opened, withdrawals of the Autho- rized Allocation and subsequent withdrawals to replenish the Special Account shall be made as follows: (a) For withdrawals of the Authorized Allocation, the Borrower shall furnish to the Bank a request or requests for a deposit or deposits which do not exceed the aggregate amount of the Authorized Allocation. On the basis of such request or requests, the Bank shall, on behalf of the Borrower, withdraw from the Loan Page 12 Account and deposit in the Special Account such amount or amounts as the Borrower shall have requested. (b) (i) For replenishment of the Special Account, the Borrower shall furnish to the Bank requests for deposits into the Special Account at such inter- vals as the Bank shall specify. (ii) Prior to or at the time of each such request, the Borrower shall furnish to the Bank the documents and other evidence required pursuant to para- graph 4 of this Schedule for the payment or payments in respect of which replenishment is requested. On the basis of each such request, the Bank shall, on behalf of the Borrower, withdraw from the Loan Account and deposit into the Special Account such amount as the Borrower shall have requested and as shall have been shown by said documents and other evidence to have been paid out of the Special Account for eligible expenditures. All such deposits shall be withdrawn by the Bank from the Loan Account under the respective eligible Categories, and in the res- pective equivalent amounts, as shall have been justified by said documents and other evidence. 4. For each payment made by the Borrower out of the Special Account, the Borrower shall, at such time as the Bank shall rea- sonably request, furnish to the Bank such documents and other evidence showing that such payment was made exclusively for eligible expenditures. 5. Notwithstanding the provisions of paragraph 3 of this Sche- dule, the Bank shall not be required to make further deposits into the Special Account: (a) if, at any time, the Bank shall have determined that all further withdrawals should be made by the Borrower directly from the Loan Account in accordance with the provisions of Article V of the General Conditions and paragraph (a) of Section 2.02 of this Agreement; or (b) once the total unwithdrawn amount of the Loan allocated to the eligible Categories, less the amount of any outstanding special commitment entered into by the Bank pursuant to Section 5.02 of the General Conditions with respect to the Project, shall equal the equivalent of twice the amount of the Authorized Allocation. Thereafter, withdrawal from the Loan Account of the remaining unwithdrawn amount of the Loan allocated to the eligible Categories shall follow such procedures as the Bank shall specify by notice to the Borrower. Such further withdrawals shall be made only after and to the extent that the Bank shall have been satisfied that all such amounts remaining on deposit in the Special Account as of the date of such notice will be utilized in making payments for eligible expenditures. 6. (a) If the Bank shall have determined at any time that any payment out of the Special Account: (i) was made for an expenditure or in an amount not eligible pursuant to paragraph 2 of this Schedule; or (ii) was not justified by the evidence furnished to the Bank, the Borrower shall, promptly upon notice from the Bank: (A) provide such additional evidence as the Bank may request; or (B) deposit into the Special Account (or, if the Bank shall so request, refund to the Bank) an amount equal to the amount of such payment or the portion thereof not so eligible or justified. Unless the Bank shall otherwise agree, no further deposit by the Bank into the Special Account shall be made until the Borrower has provided such evidence or made such deposit or refund, as the case may be. (b) If the Bank shall have determined at any time that any Page 13 amount outstanding in the Special Account will not be required to cover further payments for eligible expenditures, the Borrower shall, promptly upon notice from the Bank, refund to the Bank such outstanding amount. (c) The Borrower may, upon notice to the Bank, refund to the Bank all or any portion of the funds on deposit in the Special Account. (d) Refunds to the Bank made pursuant to paragraphs 6 (a), (b) and (c) of this Schedule shall be credited to the Loan Account for subsequent withdrawal or for cancellation in accordance with the relevant provisions of this Agreement, including the General Conditions.