Conformed Copy - L2999 CM - Second Urban Project - Project Agreement 2

Page 1 CONFORMED COPY LOAN NUMBER 2999 CM (Second Urban Project) between INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT and CREDIT FONCIER DU CAMEROUN Dated January 25, 1989 LOAN NUMBER 2999 CM CFC PROJECT AGREEMENT AGREEMENT, dated January 25, 1989, between INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT (the Bank) and CREDIT FONCIER DU CAMEROUN (CFC). WHEREAS (A) by the Loan Agreement of even date herewith between Republic of Cameroon (the Borrower) and the Bank, the Bank has agreed to make available to the Borrower an amount in various currencies equivalent to one hundred forty-six million dollars ($146,000,000) on the terms and conditions set forth in the Loan Agreement, but only on condition that CFC agree to undertake such obligations toward the Bank as are set forth in this Agreement; and (B) by a financing agreement to be entered into between the Borrower and CFC, part of the proceeds of the Loan provided for under the Loan Agreement will be made available to CFC on the terms and conditions set forth in said CFC Financing Agreement; and WHEREAS CFC, in consideration of the Bank's entering into the Loan Agreement with the Borrower, has agreed to undertake the obligations set forth in this Agreement; Page 2 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 Loan Agreement, the Preamble to this Agreement and the General Conditions (as so defined) have the respective meanings therein set forth. ARTICLE II Execution of the Project Section 2.01. (a) CFC declares its commitment to the objectives of the Project as set forth in Schedule 2 to the Loan Agreement and, to this end, shall carry out Part A.4 of the Project and, in cooperation with MAETUR, Parts B.1 (d)(ii) and (iii) and B.1 (e)(ii) and (iii) of the Project, with due diligence and efficiency and in conformity with appropriate administrative, financial and housing credit practices, and shall provide, or cause to be provided, promptly as needed, the funds, facilities, services and other resources required for said Parts of the Project. (b) For the carrying out of the program of loans for income-generating projects included in Part A.4 of the Project, CFC shall cause said projects to be carried out in accordance with the policies and procedures set forth in the Schedule in this Agreement. Section 2.02. Except as the Bank 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 Loan shall be governed by the provisions of Section 3.03 of the Loan Agreement. Section 2.03. CFC shall carry out the obligations set forth in Sections 9.04, 9.05, 9.06, 9.07, 9.08 and 9.09 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 CFC Project Agreement and Parts A.4, B.1 (d)(iii) and B.1 (e)(iii) of the Project. Section 2.04. CFC shall duly perform all its obligations under the CFC Financing Agreement and the MAETUR Financing Agreement. Except as the Bank shall otherwise agree, CFC shall not take or concur in any action which would have the effect of amending, abrogating, assigning or waiving the CFC Financing Agreement, the MAETUR Financing Agreement or any provision thereof. Section 2.05. (a) CFC shall, at the request of the Bank, exchange views with the Bank with regard to the progress of Parts A.4, B.1 (d)(iii) and B.1 (e)(iii) of the Project, the performance of its obligations under this Agreement, the CFC Financing Agreement and the MAETUR Financing Agreement and other matters relating to the purposes of the Loan. (b) CFC shall promptly inform the Bank of any condition which interferes or threatens to interfere with the progress of Parts A.4, B.1(d)(iii) and B.1(e)(iii) of the Project, the accomplishment of the purposes of the Loan, or the performance by CFC of its obligations under this Agreement, the CFC Financing Agreement and the MAETUR Financing Agreement. ARTICLE III Management and Operations of CFC Section 3.01. CFC shall carry on its operations and conduct its affairs in accordance with sound administrative, economic andfinancial practices under the supervision of qualified and experienced management assisted by competent staff in adequate numbers. Section 3.02. CFC shall at all times operate and maintain its equipment and other property and, from time to time, promptly as needed, make all necessary repairs Page 3 and renewals thereof, all in accordance with sound engineering, financial and management practices. Section 3.03. CFC shall take out and maintain with responsible insurers, or make other provision satisfactory to the Bank for, insurance against such risks and in such amounts as shall be consistent with appropriate practice. Section 3.04. Except as the Bank may otherwise agree, CFC shall at all times take all steps necessary to maintain its right to carry on its operations, and to acquire and to retain such interest in land and properties, and to acquire, maintain and renew such concessions, licenses, consents, franchises or other rights, as may be necessary or useful for the execution and operation of the Parts of the Project for which it is responsible. ARTICLE IV Financial Covenants Section 4.01. (a) CFC shall maintain records and accounts adequate to reflect in accordance with sound accounting practices its operations and financial condition. (b) CFC shall: (i) Have its records, 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 Bank; (ii) furnish to the Bank 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 Bank shall have reasonably requested; and (iii) furnish to the Bank such other information concerning said records, accounts and financial statements as well as the audit thereof, as the Bank shall from time to time reasonably request. Section 4.02. CFC shall: (a) plan its housing credit operations until completion of Parts B.1 (d)(iii) and B.1 (e)(iii) of the Project on the basis of a program agreed upon between the Borrower, the Bank and CFC and reflecting the amount of financial resources known to be or to become available to CFC during such period for the financing of housing credit; (b) continuously monitor its financial resource position, the availability of the resources required for the carrying out of such program and the prospects for mobilizing additional resources for housing credit lending; and (c) inform the Bank of its expansion forecasts and programs. Section 4.03. Except as the Bank may otherwise agree, CFC shall use the proceeds of the Loan relent to MAETUR under the MAETUR Financing Agreement and to urban communes and communities under Part A.4 of the Project, as and when they are repaid by MAETUR and under the Subsidiary Financings, respectively, and to the extent the amounts so repaid are not yet required to meet CFC's repayment obligations to the Borrower under the CFC Financing Agreement, for making further loans to MAETUR and to urban communes and communities for projects similar to the Project. ARTICLE V Effective Date; Termination; Cancellation and Suspension Page 4 Section 5.01. This Agreement shall come into force and effect on the date upon which the Loan Agreement becomes effective. Section 5.O2. This Agreement and all obligations of the Bank and of CFC thereunder shall terminate on the date on which the Loan Agreement shall terminate in accordance with its terms, and the Bank shall promptly notify CFC thereof. 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 hereinafter specified or at such other address as such party shall have designated by notice to the party giving such notice or making such request. The addresses so specified are: For the Bank: International Bank for Reconstruction and Development 1818 H Street, N.W. Washington, D.C. 20433 United States of America Cable address: Telex: INTBAFRAD 440098 (ITT) Washington, D.C. 248423 (RCA) or 64145 (WUI) For CFC: Credit Foncier du Cameroun (CFC) Bo