Conformed Copy - C2067 - Second Urban Project - Project Agreement 2

Page 1 CONFORMED COPY CREDIT NUMBER 2067 BUR (Second Urban Project) between INTERNATIONAL DEVELOPMENT ASSOCIATION and CITY OF BOBO-DIOULASSO Dated December 22, 1989 CREDIT NUMBER 2067 BUR BOBO-DIOULASSO PROJECT AGREEMENT AGREEMENT, dated December 22, 1989, between INTERNATIONAL DEVELOPMENT ASSOCIATION (the Association) and the CITY OF BOBO-DIOULASSO (Bobo-Dioulasso). WHEREAS (A) by the Development Credit Agreement of even date herewith between Burkina Faso (the Borrower) and the Association, the Association has agreed to make available to the Borrower an amount in various currencies equivalent to eighteen million Special Drawing Rights (SDR 18,000,000), on the terms and conditions set forth in the Development Credit Agreement, but only on condition that Bobo-Dioulasso agrees to undertake such obligations toward the Association as are set forth in this Agreement; (B) by a subsidiary loan agreement to be entered into between the Borrower and Bobo-Dioulasso, part of the proceeds of the credit provided for under the Development Credit Agreement will be made available to Bobo-Dioulasso on the terms and conditions set forth in said Bobo-Dioulasso Subsidiary Loan Agreement; and Page 2 WHEREAS Bobo-Dioulasso, in consideration of the Association's entering into the Development Credit Agreement with the Borrower, has agreed to undertake the obligations set forth in this Agreement; NOW THEREFORE the parties hereto hereby agree as follows: ARTICLE I Definitions Section 1.01. Unless the context otherwise requires, the several terms defined in the Development Credit Agreement, the Preamble to this Agreement and in the General Conditions (as so defined) have the respective meanings therein set forth. ARTICLE II Execution of the Project Section 2.01. Bobo-Dioulasso declares its commitment to the objectives of the Project as set forth in Schedule 2 to the Development Credit Agreement, and, to this end shall: (a) carry out Parts D.1 through D.4, D.6 and E of the Project within Bobo-Dioulasso, with due diligence and efficiency and in conformity with appropriate administrative, financial, engineering, budgetting and environmental practices; (b) cooperate with ONEA in carrying out Part D.5 of the Project under the overall coordination of the Project Unit; and (c) provide, or cause to be provided, promptly as needed, the funds, facilities, services and other resources required for the Project. Section 2.02. Without limitation or restriction upon any of its obligations under Section 2.01 of this Agreement, Bobo-Dioulasso shall: (a) open, on terms and conditions satisfactory to the Association, and thereafter maintain a Project Account in a commercial bank, for payment of expenditures under the Project, carried out in or for Bobo-Dioulasso, and not financed out of the proceeds of the Credit; and (b) make into such Project Account deposits so that the funds available in the Project Account shall at all times be sufficient to permit timely and efficient execution of the Project carried out in or for Bobo-Dioulasso. Section 2.03. Except as the Association shall otherwise agree, procurement of the goods, works and consultants' services required for the Project and to be financed out of the proceeds of the Credit shall be carried out on behalf of Bobo-Dioulasso by the Project Unit, and shall be governed by the provisions of Schedule 3 to the Development Credit Agreement. Section 2.04. Bobo-Dioulasso shall assist the Project Unit in carrying out the obligations set forth in Sections 9.03, 9.04, 9.05, 9.06, 9.07 and 9.08 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) in respect of the Project carried out in or for Bobo-Dioulasso. Section 2.05. Bobo-Dioulasso shall duly perform all its obligations under the Bobo-Dioulasso Subsidiary Loan Agreement. Except as the Association shall otherwise agree, Bobo-Dioulasso shall not take or concur in any action which would have the effect of amending, abrogating, assigning or waiving the Bobo-Dioulasso Subsidiary Loan Agreement or any provision thereof. Section 2.06. (a) Bobo-Dioulasso shall, at the request of the Association, exchange views with the Association with regard to the progress of the Project carried out in or for Bobo-Dioulasso, the allocations to the infrastructure sector within its budget for the current and the previous year, the performance of its obligations under this Agreement and under the Bobo-Dioulasso Subsidiary Loan Agreement and other matters relating to the purposes of the Credit. (b) Bobo-Dioulasso shall promptly inform the Association of any condition Page 3 which interferes or threatens to interfere with the progress of the Project, the accomplishment of the purposes of the Credit, or the performance by Bobo-Dioulasso of its obligations under this Agreement and under the Bobo-Dioulasso Subsidiary Loan Agreement. ARTICLE III Financial Covenants Section 3.01. (a) Bobo-Dioulasso shall maintain records and accounts adequate to reflect in accordance with sound accounting practices its operations and financial condition. (b) Bobo-Dioulasso shall: (i) have its records, accounts and financial statements (administrative and city accounts and related statements, Project Account) for each fiscal year audited, in accordance with appropriate auditing principles consistently applied, by independent auditors acceptable to the Association; (ii) furnish to the Association as soon as available, but in any case not later than six 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 shall have reasonably requested; and (iii) furnish to the Association such other information concerning said records, accounts and financial statements as well as the audit thereof, as the Association shall from time to time reasonably request. 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 Development Credit Agreement becomes effective. Section 4.02. (a) This Agreement and all obligations of the Association and of Bobo-Dioulasso thereunder shall terminate on the earlier of the following two dates: (i) the date on which the Development Credit Agreement shall terminate in accordance with its terms; or (ii) the date 40 years after the date of this Agreement. (b) If the Development Credit Agreement terminates in accordance with its terms before the date specified in paragraph (a) (ii) of this Section, the Association shall promptly notify Bobo-Dioulasso of this event. Section 4.03. All the provisions of this Agreement shall continue in full force and effect notwithstanding any cancellation or suspension under the General Conditions. 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 Page 4 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.C. 248423 (RCA) or 64145 (WUI) For Bobo-Dioulasso: Haut Commissariat du Houet Bobo-Dioulasso Burkina Faso Telex: 5555 SEGEGOUV Section 5.02. Any action required or permitted to be taken, and any document required or permitted to be executed, under this Agreement on behalf of Bobo-Dioulasso, may be taken or executed by the central mayor of Bobo-Dioulasso or such other person or persons as said central mayor shall designate in writing, and Bobo-Dioulasso shall furnish to the Association sufficient evidence of the authority and the authenticated specimen signature of each such person. Section 5.03. 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 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. INTERNATIONAL DEVELOPMENT ASSOCIATION By /s/ Edward V. K. Jaycox Regional Vice President Africa CITY OF BOBO-DIOULASSO By /s/ Paul-Desire Kabore Authorized Representative