Dominican Republic - Emergency Road Reconstruction Project : Loan 1783 - Loan Agreement - Conformed

LOAN NUMBER 1783 DO Loan Agreement (Emergency Road Reconstruction Project) between DOMINICAN REPUBLIC and INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT Dated OUI, 1980 LOAN NUMBER 1783 X0 LOAN AGREEMENT AGREEMENT, dated 6TrcJaA I , 1980, between DOMINICAN REPUBLIC (herei2fter calle the Borrower) and INTER- NATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT (hereinafter called the Bank). WHEREAS (A) the Borrower has requested the Bank to assist in financing reconstruction works of certain productive facilities of the Borrower damaged by the hurricanes David and Frederick that devastated the territory of the Borrower on August 31, 1979 and September 5, 1979, respectively; (B) as part of such request, the Borrower has requested the Bank to assist in the financing of the Project described in Schedule 2 to this Agreement by making the Loan as hereinafter provided; and WHEREAS the Bank has agreed, on the basis inter alia of the foregoing, to make the Loan to the Borrower upon the terms and conditions hereinafter set forth; NOW THEREFORE the parties hereto hereby agree as follows: ARTICLE I General Conditions; Definitions Section 1.01. The parties to this Agreement accept all the provisions of the General Conditions Applicable to Loan and Guarantee Agreements of the Bank, dated March 15, 1974, with the same force and effect as if they were fully set fort... herein (said General Conditions Applicable to Loan and Guarantee Agreements of the Bank being hereinafter called the General Conditions). Section 1.02. Wherever used in this Agreement, 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) "SEOPC" means Secretarfa de Estado de Obras Pfblicas y Comunicaciones of the Borrower; -2- (b) "Construction Management Unit" means the unit to be established for purposes of the Project within SEOPC by the Borrower's Decree No. 1276, dated October 27, 1979; (c) "DP$" means Dominican Peso, the currency unit of the Borrower; (d) "Road Maintenance and Reconstruction Project" means the Project financed under the Loan Agreement Number 1316 T-DO signed between the Borrower and the Bank on August 10, 1976; and (e) "Special Account" means the revolving account estab- lished in the name of the Borrower pursuant to 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 in the Loan Agreement set forth or referred to, an amount in various currencies equivalent to twenty-five million dollars ($25,000,000). 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, as such Schedule may be amended from time to time by agreement between the Borrower and the Bank, 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 proceeds of the Loan. (b) The Borrower shall, for the purposes of the Project, open through SEOPC a Special Account in the Borrower's Banco de Reservas on terms and conditions satisfactory to the Bank. Dis- bursements from such Special Account shall be made exclusively to finance the cost of civil works under the Project and to be partially financed out of the proceeds of the Loan. (c) The Bank shall, promptly after the Effective Date, provided the Borrower has furnished to the Bank evidence satisfac- tory to the Bank that the Borrower has deposited the equivalent of $1,200,000 in the Special Account, withdraw, on behalf of the -3- Borrower, from the Loan Account out of Category (6) of Schedule 1, paragraph 1, and deposit in the Special Account an amount in DP$ not exceeding the equivalent of $2,200,000 and shall thereafter, upon application by the Borrower, further withdraw, on behalf of the Borrower, from the Loan Account, out of Category (5) of such Schedule, and deposit in the Special Account such amounts as shall be required to reimburse the Borrower for 65% of the payments made out of the Special Account for expenditures for civil works included in such Category (5) and eligible to be financed under this Agreement, but only to the extent that the amount of any such deposit, together with any amount already on deposit in the Special Account (including deposits made by the Borrower in accordance with paragraph (f) (i) of this Section) as of the date of the application of the Borrower referred to above, shall not exceed in the aggregate the equivalent of $3,400,000. (d) The Borrower shall furnish to the Bank in respect of each payment out of the Special Account such documents and other evidence as the Bank shall reasonably request showing that the payment was made on account of the reasonable cost of civil works required for the Project and to be financed out of the proceeds of the Loan. (e) If the Bank shall have determined that any payment out of the Special Account: (i) was made for expenditures not eligible for financing under this Agreement; or (ii) was not justified by the evidence furnished pursuant to the preceding paragraph, the Borrower shall, promptly upon notice from the Bank and prior to any further deposit in the Special Account by the Bank, deposit in the Special Account an amount equal to the amount of such payment. (f) Notwithstanding the provisions of paragraph (c) above, no further deposit in the Special Account shall be made: (i) unless the Bank has been furnished with evidence satisfactory to the Bank showing that the Borrower has deposited in the Special Account an amount (other than the $1,200,000 equivalent referred to in paragraph (c) above) equivalent to 35% of each payment made out of the Special Account and for which reimbursement has been applied for by the Borrower in accordance with the provisions of paragraph (c) above; or (ii) (A) if the Bank shall have determined that further withdrawals from the Loan Account for purposes of the Project can be made without utilizing the Special Account or (B) when the amount of the Loan deposited in the Special Account in accordance with the provisions of this Section has reached the equivalent of the amount allocated from time to time to Category (5) of the table set forth in Schedule 1 to this Agreement minus -4- the double of the amount allocated to Category (6) of such table, whichever shall be sooner. Section 2.03. (a) Except as the Bank shall otherwise agree, procurement of the goods and civil works to be financed out of the proceeds of the Loan shall be governed by the provisions of Schedule 4 to this Agreement. (b) Before any contract for civil works or purchase of equipment is awarded, but in any event not later than six months from the date of this Agreement, the Borrower shall prepare a Civil. Works Procurement Program and a Program for the Purchase of Equipment, both satisfactory to the Bank. (c) The Civil Works Procurement Program shall indicate, inter alia, the parts of the civil works included in the Project to be carried out by the Borrower by force account. (d) On a date not later than six months after the date on which each of the Programs is approved by the Bank, and at inter- vals of not more than six month periods thereafter, the Borrower and the Bank shall review jointly the Program in question in respect of the parts of the works carried out, and of the lots of equipment purchased thereunder, and, after each such review, the Borrower shall, if necessary, modify each Program in agreement with the Bank. Section 2.04. The Closing Date shall be September 30, 1982 or such later date as the Bank shall establish. The Bank shall promptly notify the Borrower of such later date. Section 2.05. The Borrower shall pay to the Bank a commitment charge at the rate of three-fourths of one per cent (3/4 of 1%) per annum on the principal amount of the Loan not withdrawn from time to time. Section 2.06. The Borrower shall pay interest at the rate of seven and ninety-five hundredths per cent (7.95%) per annum on the principal amount of the Loan withdrawn and outstanding from time to time. Section 2.07. Interest and other charges shall be payable semiannually on March 1 and September 1 in each year. Section 2.08. The Borrower shall repay the principal amount of the Loan in accordance with the amortization schedule set forth in Schedule 3 to this Agreement. -5- ARTICLE III Execution of the Project Section 3.01. (a) The Borrower shall carry out the Project through SEOPC with due diligence and efficiency and in conformity with appropriate administrative, financial and engineering prac- tices, and shall provide, promptly as needed, the funds, faci- lities, services and other resources required for the purpose. (b) For purposes of (a) above, the Borrower shall, inter alia, take all such action as shall be necessary or convenient to facilitate the timely importation of goods to be financed out of the proceeds of the Loan. Section 3.02. In order to assist the Borrower in updating engineering designs and tender documenti for and supervising the execution of the roads included in the Project, and monitor..ng the costs thereof, the Borrower shall employ engineering co. ..ultants whose qualifications, experience and terms and conditions of employment shall be satisfactory to the Bank. Section 3.03. (a) The Borrower undertakes to insure, or make adequate provision for the insurance of, the imported goods to be financed out of the proceeds of the Loan against hazards incident to the 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 the Borrower to replace or repair such goods. (b) Except as the Bank shall otherwise agree, all goods and services financed out of the proceeds of the Loan shall be used exclusively for the Project until its completion. (c) Upon the completion of the Project, the Borrower shall assign the equipment purchased under the Loan to SEOPC for use in its regular road maintenance operations. Upon said assign- ment, the maintenance of the equipment, replacement of spare parts thereof and services related thereto shall be solely SEOPC's responsibility. Section 3.04. The Borrower shall: (a) maintain, until the Closing Date, the Construction Management Unit which shall manage construction works under, -6- update engineering for, and supervise the execution of, the Project; (b) (i) staff the Construction Management Unit, not later than April 1, 1980 and in accordance with Schedule 5 to this Agreement, as such Schedule may be amended from time to time between the Borrower and the Bank, with experienced and competent staff who, in the case of the director and co-director of such Unit, shall have such qualifications and experience as shall be satisfactory to the Bank; and (ii) if necessary for the execution of the Project, hire, and also put under the authority of such Unit such additional qualified staff as shall be agreed from time to time between the Borrower and the Bank, on a fixed term basis until Project completion; (c) assign to the Construction Management Unit such part of the equipment of SEOPC, as required for the Construction Manage- ment Unit to start operations; and (d) for purposes of operating the Construction Management Unit: (i) open, and maintain until the Closing Date, an account in the Borrower's Banco de Reservas and deposit in such account, not later than April 1, 1980, the equivalent in DP$ of not less than $75,000; (ii) allow withdrawals from such account only for operat- ing expenses for the Pro.ject, other than civil works, of the Construction Management Unit; and (iii),deposit into such account, upon request of the director of such Unit and promptly after every withdrawal from such account has been made, the equivalent in DP$ required to maintain in such account an average semiannual calance equivalent to not less than $75,000. Section 3.05. (a) The Borrower shall furnish to the Bank, promptly upon their preparation, the plans, specifications, reports, contract documents and construction and procurement schedulei for the Project, and any material modifications thereof or additions thereto, in such detail as the Bank shall reasonably request. (b) The Borrower: (i) shall maintain records and procedures adequate to record and monitor the progress of the Project (in- cluding .its cost and the benefits to be derived from it), to identify the goods and services financed out of the proceeds of the Loan, and to disclose their use in the Project; (ii) shall enable the Bank's accredited representatives to visit the facili- ties and construction sites included in the Project and to examine -7- the goods financed out of the proceeds of the Loan and any rele- vant records and documents; and (iii) shall furnish to the Bank at regular intervals all such information as the Bank shall reason- ably request concerning the Project, its cost and, where appro- priate, the benefits to be derived from it, the expenditure of the proceeds of the Loan 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 the Borrower and the Bank, the Borrower shall prepare and furnish to the Bank a report, of such scope and in such detail as the Bank shall reason- ably 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 the Borrower and the Bank of their respec- tive obligations under the Loan Agreement and the accomplishment of the purposes of the Loan. Section 3.06. The Borrower shall take all such action as shall be necessary to acquire all such land and rights in respect of land as shall be required for carrying out the Project and shall furnish to the Bank, promptly after such acquisition, evidence satisfactory to the Bank that such land and rights in respect of land are available for purposes related to the Project. ARTICLE IV Other Covenants Section 4.01. (a) It is the policy of the Bank, in making loans to, or with the guarantee of, its members not to seek, in normal circumstances, special security from the member con- cerned but to ensure that no other external debt shall have priority over its loans in the allocation, realization or distri- bution of foreign exchange held under the control or for the benefit of such member. To that end, if any lien shall be created on any public assets (as hereinafter defined), as security for any external debt, which will or might result in a priority for the benefit of the creditor of such external debt in the alloca- tion, realization or distribution of foreign exchange, such lien shall, unless the Bank shall otherwise agree, ipso facto and at no cost to the Bank, equally and ratably secure the principal of, and interest and other charges on, the Loan, and the Borrower, in creating or permitting the creation of such lien, shall make -8- express provision to that effect; provided, however, that, if for any constitutional or other legal reason such provision cannot be made with respect to any lien created on assets of any of its political or administrative subdivisions, the Borrower shall promptly and at no cost to the Bank secure the principal of, and interest and other charges on, the Loan by an equivalent lien on other public assets satisfactory to the Bank. (b) The foregoing undertaking shall not apply to: (i) any lien created on property, at the time of purchase thereof, solely as security for payment of the purchase price of such property; and (ii) any lien arising in the ordinary course of banking transactions and securing a debt maturing not more than one year after its date. (c) As used in this Section, the term "public assets" means assets of the Borrower, of any political or administrative subdivision thereof and of any entity owned or controlled by, or operating for the account or benefit of, the Borrower or any such subdivision, including gold and other foreign exchange assets held by any institution performing the functions of a central bank or exchange stabilization fund, or similar functions, for the Borrower. Section 4.02. The Borrower shall maintain or cause to be maintained records, including separate accounts for the Project, adequate to reflect in accordance with consistently maintained sound accounting practices the operations, resources and expendi- tures, in respect of the Project, of the departments and agencies of the Borrower responsible for carrying out the Project or any part thereof. Section 4.03. The Borrower shall have, and cause Banco de Reservas to have: (i) the accounts referred to in Section 4.02 of this Agreement and 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 four 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 concerning the accounts referred to in (i) above and the audit thereof as the Bank shall from time to time reasonably request. -9- Section 4.04. The Borrower shall: (i) cause all of its roads, including the roads to be reconstructed under the Project, to be adequately maintained and cause all necessary repairs thereof to be made, all in accordance with appropriate engineering practices; (ii) cause all of its road maintenance equipment and workshops to be adequately maintained and cause all necessary repairs and renewals thereof to be made, all in accordance with appropriate engineering practices; and 'iii) provide, promptly as needed, the funds, facilities, services and other resources required for the foregoing. ARTICLE V Termination Section 5.01. The date IAvC -,?i/ 9a(J , :s hereby speci- fied for the purposes of SectNQd 12.04 of the General Conditions. ARTICLE VI Representatives of the Borrower; Addresses Section 6.01. The Secretario de Estado de Obras P'blicas y Comunicaciones 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: Secretaria de Estado de Obras P5blicas y Comunicaciones Ave. San Crist6bal, Ensanche la Fe Santo Domingo, DN Dominican Republic Cable address: Telex: Secretarlia de Estado de SEOPC 3460232 (ITT) Obras Publicas y Comunicaciones Santo Domingo, D.N. - 10 - 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 440098 (ITT) Washington, D.C. 248423 (RCA) or 64145 (WUI) IN WITNESS WHEREOF, the parties hereto, acting through their representatives thereunto duly authorized, have caused this Agreement to be signed in their respective names in Santo Domingo, DN, Dominican Republic, and delivered in the District of Columbia, United States of America, as of the day and year first above written. DOMINICAN REPUBLIC By Authorized Representative INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT By Regional Vice President Latin merica and the Caribbean - 11 - 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 expenditures 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) Equipment 1,400,000 (a) directly 100% of for- imported eign expendi- tures (b) imported and 95% of local procured locally expenditures (2) Consultants for 1,100,000 65% supervision of Project execution (3) Technical assistance 100,000 100% of for- to Construction eign expendi- Management Unit tures (4) Operating costs of 200,000 30% Construction Management Unit (5) Civil works 15,100,000 65% (6) Initial deposit in 2,200,000 Special Account (7) Unallocated 4,900,000 TOTAL 25,000,000 - 12 - 2. For the purposes of this Schedule: (a) the term "foreign expenditures" means expenditures in the currency of any country other than the Borrower and for goods or services supplied from the territory of any country other than the Borrower; and (b) the term "local expenditures" means expenditures in the currency of the Borrower and for goods or services supplied from the territory of the Borrower. 3. The disbursement percentages have been calculated in com- pliance with the policy of the Bank that no proceeds of the Loan shall be disbursed on account of payments for taxes levied by, or in the territory of, the Borrower on goods or services, or on the importation, manufacture, procurement or supply thereof; to that end, if the amount of any such taxes levied on or in respect of any item to be financed out of the proceeds of the Loan decreases or increases, the Bank may, by notice to the Borrower, increase or decrease the disbursement percentage then applicable to such item as required to be consistent with the aforementioned policy of the Bank. 4. Notwithstanding the provisions of paragraph 1 above, no withdrawals shall be made in respect of payments made for expen- ditures: (i) prior to the date of this Agreement except that with- drawals, in an aggregate amount not exceeding the equivalent of $2,500,000 may be made in respect of any Category of the table set forth in paragraph 1 above on account of payments made for such expenditures before that date but after November 1, 1979; (ii) in respect of Categories (3), (4), (5) and (6) of such table, unless the Bank has been furnished with evidence satisfactory to the Bank that the Construction Management Unit has been estab- lished to the Bank's satisfaction, the co-director thereof have been hired, and the consultants referred to in Section 3.02 of this Agreement have been hired; and (iii) in respect of Category (4) of such table, if withdrawals in respect of such Category will exceed 2%, or such other percentage as shall be agreed from time to time between the Borrower and the Bank, of withdrawals made in respect of Category (5) of such table. 5. Notwithstanding the allocation of an amount of the Loan or the disbursement percentages set forth in the table in para- graph I above, if the Bank has reasonably estimated that the amount of the Loan then allocated to any Category will be insuffi- cient to finance the agreed percentage of all expenditures in - 13 - that Category or, in respect of Category (5), when no further deposits shall be made in the Special Account in accordance with the provisions of Section 2.02 (f) of this Agreement, the Bank may, by notice to the Borrower: (i) reallocate to such Category, to the extent required to meet the estimated shortfall, proceeds of the Loan which are then allocated to another Category and which in the opinion of the Bank are not needed to meet other expen- ditures; and (ii) if such reallocation cannot fully meet the estimated shortfall, reduce the disbursement percentage then applicable to such expenditures in order that further withdrawals under such Category may continue until all expenditures thereunder shall have been made. 6. If the Bank shall have reasonably determined that the procurement of any item in any Category is inconsistent with the procedures set forth or referred to in this Agreement, no expenditures for such item shall be financed out of the proceeds of the Loan and the Bank may, without in any way restricting or limiting any other right, power or remedy of the Bank under the Loan Agreement, by notice to the Borrower, cancel such amount of the Loan as, in the Bank's reasonable opinion, represents the amount of such expenditures which would otherwise have been eligible for financing out of the proceeds of the Loan. - 14 - SCHEDULE 2 Description of the Project The Project consists of: (i) the reconstruction of two roads connecting Cruce de Guayacanes, Santiago Rodrfguez and Santiago de la Cruz (about 85 km), and Azua and Barahona (about 65 km). The roads will be reconstructed in accordance with the Road Design Standards specified in the Annex to this Schedule. The roads are located in two highly agricultural areas, and the objective of the Project is to limit economic loss resulting from the road floodings caused by the hurricanes David and Frederick; and (ii) the purchase and utilization of equipment for the aforesaid. The Project is expected to be completed by December 31, 1981. ANNEX TO SCHEDULE 2 Design Standards for Roads Primary = Azua - Barahona Secondary = Cruce de Guayacanes - Santiago Rodrfguez - Santiago de la Cruz Design Profile Profile Bridges R.O.W. Speed Minim. Horiz. Max. Grade Grade Roadbed Pav't Shoulder Overall Design Load Road Class Meters KPH Curve Radius Super Elev. Max. Absol.Max. Width Width Width Width Factor Mtr % % % Mtr 1.25 Primary 60 100 340 10 5 6 11 7 2 10.5 HS-20-44 Secondary 40 80 210 10 6 7 9.5 6.5 1.5 10.5 HS-20-44 Mountainous Terrain 40 60 110 10 7 9 9.5 6.5 1.5 10.5 JS-20-44 (primary and secondary) - 16 - SCHEDULE 3 Amortization Schedule Payment of Principal Date Payment Due (expressed in dollars)* On each March 1 and September 1 beginning September 1, 1984 through September 1, 1996 960,000 On March 1, 1997 1000,000 * To the extent that any portion of the Loan is repayable in a currency other than dollars (see General Conditions, Section 4.02), the figures in this column represent dollar equiva- lents determined as for purposes of withdrawal. - 17 - Premiums on Prepayment The following percentages are specified as the premiums payable on repayment in advance of maturity of any portion of the principal amount of the Loan pursuant to Section 3.05 (b) of the General Conditions: Time of Prepayment Premium Not more than three years before maturity 1.40% More than three years but not nore than six years before maturity 2.80% More than six years but not more than eleven years before maturity 5.15% More than eleven years but not more than fifteen years before maturity 7.00% More than fifteen years before maturity 7.95% - 18 - SCHEDULE 4 Procurement A. International Competitive Bidding 1. Except as provided in Part B hereof, goods and civil works 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 Bank in March 1977 (hereinafter called the Guidelines), on the basis of international competitive bidding as described in Part A of the Guidelines. 2. For goods and works to be procured on the basis of international competitive bidding, in addition to the requirements of paragraph 1.2 of the Guidelines, the Borrower shall prepare and forward to the Bank as soon as possible, and 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 Bank shall reasonably request; the Bank will arrange for the publication of such notice in order to provide timely notification to prospective bidders of the opportunity to bid for the goods and works in question. The Borrower 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 the imported goods, or the ex-factory price or off-the-shelf price of other goods, offered in such bid; and (ii) customs duties and other import taxes levied in connection with the importation, or the sales and similar taxes levied in connection with the sale or delivery, pursuant to the bid, of the goods shall not be taken into account in the evaluation of the bids. B. Other Procurement Procedures 11. Goods to be purchased under contracts awarded before March 1, 1980, may be procured after having solicited price quotations from a group of established suppliers, which shall - 19 - include all those suppliers who bid under any bidding which has taken place, for the procurement of equipment, for purposes of the Road Maintenance and Reconstruction Project. 2. Among the terms and conditions of such solicitation, the Borrower will include the following requirements: (a) whenever possible, the specifications will be the same as for the equipment that has been purchased under the Road Maintenance and Reconstruction Project for SEOPC's regular main- tenance operations; and (b) the time to deliver the equipment shall not exceed 90 days from the date of the award. 3. Goods to be purchased under contracts estimated to cost less than the equivalent of $50,000 may be procured on the basis of other procedures satisfactory to the Bank; provided, however, that the aggregate of the contracts so procured shall not exceed the equivalent of $200,000. 4. Subject to paragraph 5 below, contracts for civil works may be awarded on the basis of competitive bidding locally advertised under procedures satisfactory to the Bank; provided, however, that if such contracts are to be awarded before March 1, 1980, the bidding could be limited to a group of not less than three contractors satisfactory to the Bank. 5. Certain parts of the civil works under the Project, to the extent provided for in the Civil Works Procurement Program referred to in Section 2.03 (b) of this Agreement, as such Program may be modified from time to time in accordance with such Section, may be carried out by force account by the Borrower. C. 1. Review of invitations to bid and of proposed awards and final contracts: With respect to all contracts other than contracts for the purchase of goods estimated to cost the equivalent of $50,000 or less: (a) Before bids are invited or price quotations solicited, the Borrower shall furnish to the Bank, for its comments, the text of the invitations to bid and the specifications and other bidding - 20 - documents and of the solicitations, together with a descrip- tion of the advertising procedures to be followed for the bidding, and shall make such modifications in the said documents or proce- dures as the Bank shall reasonably request. Any further modifica- tion to the bidding documents or to the solicitations shall require the Bank's concurrence before it is issued to the pros- pective bidders or quoters, as the case may be. (b) After bids or quotations, as the case may be, have been received and evaluated, the Borrower shall, before a final deci- sion on the award is made, inform the Bank of the name of the bidder or quoter to which it intends to award the contract and shall furnish to the Bank, in sufficient time for its review, a detailed report on the evaluation and comparison of the bids and quotations received, and such other information as the Bank shall reasonably request. The Bank shall, if it determines that the intended award would be inconsistent with the Guidelines or this Schedule, promptly inform the Borrower and state the reasons for such determination. (c) The terms and conditions of the contract shall not, without the Bank's concurrence, materially differ from those on which bids were asked or price quotations solicited. (d) Two conformed copies of the contract shall be furnished to the Bank promptly after its execution and prior to the delivery to the Bank of the first application for withdrawal of funds from the Loan Account in respect of such contract. 2. With respect to each contract not governed by the preceding paragraph, the Borrower shall furnish to the Bank, promptly after its execution and prior to the delivery to the Bank of the first application for withdrawal of funds from the Loan Account in respect of such contract, two conformed copies of such contract, together with the analysis of the respective bids or price quotation, as the case may be, recommendations for award and such other information as the Bank shall reasonably request. The Bank shall, if it determines that the award of the contract was not consistent with the Guidelines or this Schedule, promptly inform the Borrower 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 - 21 - extreme urgency) which would increase the cost of the contract by more than 20% of the original price, the Borrower shall inform the Bank of the proposed modification, waiver, extension or change order and the reasons therefor. The Bank, if it determines that the proposal would be inconsistent with the provisions of this Agreement, shall promptly inform the Borrower and state the reasons for its determination. - 22 - SCHEDULE 5 Title, Qualifications and Experience and Functions of Key Staff for the Construction Management Unit Title Qualifications and Experience Functions Director Civil Engineer, with 20 years Overall manage- of experience in administration, ment of the Con- management and supervision of struction Manage- civil works ment Unit Co-director Civil Engineer, fluent in Spanish, Assistant and with 15 years of experience in technical advisor administration and execution of to the director civil works of which no less than 10 years will be in highway con- struction 2 Resident Civil Engineer with a minimum of In charge of con- Engineers 10 years experience in highway struction unit construction which carries out force account work Financial Graduate public accountant or Preparation of Manager economist with 10 years of financial state- experience in administration ments and periodic of financial and accounting reports; control (including cost accounting) of invoices re- aspects of civil works exe- sulting from work cution done by force account and con- tractors INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT CERTIFICATE I hereby certify that the foregoing is a true copy of the original in the archives of the Interna- tional Bank for Reconstruction and Develop- ment. In witness whereof I have signed this Certifi- cate and affixed the Seal of the Bank thereunto this -day of , 19vo FOR SECRETARY