Conformed Copy - L4202 - Second Municipal Development Project - Guarantee Agreement

Page 1 CONFORMED COPY LOAN NUMBER 4202-TUN Guarantee Agreement (Second Municipal Development Project) between REPUBLIC OF TUNISIA and INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT Dated September 24, 1997 LOAN NUMBER 4202 TUN GUARANTEE AGREEMENT AGREEMENT, dated September 24, 1997, between the REPUBLIC OF TUNISIA (the Guarantor) and the INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT (the Bank). WHEREAS (A) the Guarantor and the CAISSE DES PRETS ET DE SOUTIEN DES COLLECTIVITES LOCALES (the Borrower), having been satisfied as to the feasibility and priority of the Project described in Schedule 2 to the Loan Agreement, have requested the Bank to assist in the financing of the Project; (B) by the Loan Agreement of even date herewith between the Bank and the Borrower, the Bank has agreed to extend to the Borrower a loan in an amount equal to four hundred fifty-two million eight hundred thousand French Francs (FRF452,800,000), on the terms and conditions set forth in the Loan Agreement, but only on condition that the Guarantor agree to guarantee the obligations of the Borrower in respect of such loan as provided in this Agreement and to undertake such obligations toward the Bank as are set forth in this Agreement; (C) by a subsidiary loan agreement to be entered into between the Guarantor and the Borrower, a portion of the proceeds of the Loan provided for under the Loan Agreement will be made available to the Guarantor on the terms and conditions set forth in said Subsidiary Loan Agreement; and WHEREAS the Guarantor, in consideration of the Bank