Peru - Matucana Power Project : Loan 0511 - Loan Agreement - Conformed

LOAN NUMBER 511 PE Loan Agreement (Matucana Power Project) BETWEEN INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT AND EMPRESAS ELECTRICAS ASOCIADAS (Lima Light and Power Company) DATED SEPTEMBER 11, 1967 LOAN NUMBER 511 PE Loan Agreement (Matucana Power Project) BETWEEN INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT AND EMPRESAS ELECTRICAS ASOCIADAS (Lima Light and Power Company) DATED SEPTEMBER 11, 1967 Evan Agreement AGREEMENT, dated September 11, 1967, between INT ER- NATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT (hereinafter called the Bank) and EMPRESAS ELECTRICAS AsoCIADAS (Lirna Light and Power Company) (hereinafter called the Borrower). ARTICLE I Loan Regulations; Special Definitions SECTION 1.01. The parties to this Loan Agreement accept all the provisions of Loan Regulations No. 4 of the Bank dated February 15, 1961, as amended February 9, 1967, with the same force and effect as if they were fully set forth herein, subject, however, to the modifications thereof set forth in Schedule 3 to this Agreement (said Loan Regula- tions No. 4 as so modified being hereinafter called the Loan Regulations). SECTION 1.02. Except where the context otherwise re- quires, the following terms have the following meanings wherever used in this Loan Agreement or any Scheeule hereto: (a) The term "Indenture" means the indenture dated as of July 1, 1957, executed by the Borrower in favor of Schroder Trust Company, as Trustee, and in- cludes any indenture supplemental thereto which has been or shall be executed and delivered iii accordance with the provisions of the Indenture. (b) The term "Ninth Supplemental Indentur" means the supplemental indenture or supplemental inden- tures which shall be executed by the Borrower pur- suant to the provisions of Section 5.04 of this Agree- 44 ment providing for the issue, authentication and delivery of Debentures of the Series K. (c) The term "Debentures" shall mean debentures issued in accordance with the terms of the Indenture. (d) The term "Debentures of the Series K" shall mean Debentures of the various series issued pursuant to the Ninth Supplemental Indenture and this Agree- ment. (e) The term "subsidiary" shall mean any corporation, firm or association directly or indirectly controlled by the Borrower. (f) The term "Hidrandina" means Energia Hidro- electrica Andina S. A. (g) The term "Atelsa" means Atencion Electrica S. A. (h) The term "soles" and the symbol "8/.'" means cur- rency of the Guarantor. (i) The term "First Loan Agreement" means the Loan Agreement dated June 29, 1960 between the Bank and the Borrower. (j) The term "First Guarantee Agreement" means the Guarantee Agreement dated June 29, 1960 between the Guarantor and the Bank. (k) The term "Second Loan Agreement" means the Loan Agreement dated November 22, 1963 between the Bank and the Borrower. (1) The term "Second Guaiantee Agreement" means the Guarantee Agreement dated November 22, 1963 between the Guarantor and the Bank. (m) The term "Third Loan Agreement" means the Loan Agreement dated September 7,' 1966 between the Bank and the Borrower. 5 (n) The term "Third Guarantee Agreement" means the Guarantee Agreement dated September 7, 1966 be- tween the Guarantor and the Bank. ARTICLE II The Loan SECTION 2.01. The Bank agrees to lend to the Borrower an amount in various currencies equivalent to seventeen million five hundred thousand dollars ($17,500,000). SECTION 2.02. The Bank shall open a Loan Account on its books in the name of the Borrower and shall credit to such Account the amount of the Loan. The amount of the Loan may be withdrawn from the Loan Account as pro- vided in, and subject to the rights of cancellation and suspension set forth in, this Agreement and the Lotn Regulations. SECTION 2.03. The Borrower shall pay to the Bank a commitment charge at the rate of Hiree-eiglhtlis of one per cent (3/8 of 17o) per annum on the principal. amount of the Loan not so withdrawn from time to time. SECTION 2.04. The Borrower shall pay interest at the rate of six per cent (6/ ) per amiumn oii the principal amount of the Loan so withdrawn and outstanding from time to time. SECTION 2.05. Except as the Bank and the Borrower shall otherwise agree, the charge payable for special com- mnitments entered into by the Bank at the request of the Borrower pursuant to Section 4.02 of the Loan Regulations shall be at the rate of one-half of one per cent (/ of 1/o) per annum on the principal amount of any such special commitments outstanding from time to time. 6 SECTION 2.06. Interest and other charges shall be pay- able semi-annually on May 15 and November 15 in each year. SECTION 2.07. The Borrower shall repay the principal of the Loan in accordance with tli amortization schedule set forth in Schedule 1 to this Agxrment. ARTICLE III Use of Proceeds of the Loan SECTION 3.01. The Borrower shall a.)pIly the proceeds of the Loan in accordance with the provi8ions of this Agree- ment to expe-nditures on the Project described in Schedule 2 to this Agreement. The specific allocation of the proceeds of the Loan, and the methods and procedures for procure- ment of the goods to be financed out of such proceeds, shall be determined by agreement between the Bank and the Borrower, subject to modification by further agreement between them. SECTION 3.02. Except as the Bank and the Borrower shall otherwise agree, the Borrower shall cause all goods financed c,it of the proceeds of the Loan to be used ex- clusively in carrying out the Project. ARTICLE IV Debentures SECTION 4.01. The Borrower shall execute and deliver Debentures of the Series K representing the principal amount of the Loan of the form, tenor and purport pro- scribed in the Indenture as modified by the Ninth Supple- mental Indenture and as provided therein and in the Loan Regulations. SECTION 4.02. Except as the Bank wid the Borrower shall otherwise agree, the Borrower shall, against payment by 7 the Bank of any amount to be withdrawn from the Loan Account, deliver to or on the order of the Bank, Debentures of the Series K in the aggregate principal amount so paid. SECTION 4.03. The Borrower shall effect original issues of the Debentures of the Series K only as provided herein and in the Ninth Supplemental Indenture. SECTION 4.04. The Bank and the Borrower shall be at liberty to make such arrangements as they may from time to time mutually agree as to procedure for the issue, authentication' and delivery of the Debentures of the Series K and such arrangements may be in addition to or in sub- stitution for -any of the provisions of this Agreement or of the Loan Regulations. SECTION 4.05. (a) The Debentures of the Series K shall be bearer Debentures with coupons for semi-annual interest attached (hereinafter sometimes called Series K coupon Debentures). Debentures of tae Series K delivered to the Bank shall be Series K coupon Debentures in such tempo- rary or definitive form (authorized by the Ninth Supple- mental Indenture) as the Bank shall request. Series K coupon Debentures payable in dollars shall be substan- tially in the form set forth in the Ninth Supplemental Indenture. Series K coupon Debentures payable in any currency other than dollars shall be substantially in the form set forth in the Ninth Supplemental Indenture, ex- cept that they shall 'i) provide for payment of principal, interest and premium on redemption, if any, in such other currency, (ii) provide for such place of payment at such agency as the Bank shall specify, and (iii) contain such other modifications as the Bank shall reasonably request in order to conform to the laws or to the financial usage of the place where they are payable. (b) All Debentures of the Series K shall have the guar- antee of the Guarantor endorsed thereon substantially in the form set forth in Schedule 3 of the Loan Regulaticns. 8 ARTICLE V Particular Covenants SECTION 5.01. The Borrower shall carry out and complete the Project and operate and maintain its business and prop- erties, including the Project, with due diligence and Effi- ciency and in conformity with sound engineering, business, financial and electric utility practices. To that end, the Borrower shall employ engineering and other consultants mutually acceptable to the Borrower and the Bank on terms and conditions mutually satisfactory to the Bor- rower and the Bank. SECTION 5.02. (a) The Borrower shall furnish to the Bank, promptly upon their preparation, the plans and specifications (including construction schedules) for the Project and any material modifications subsequently made therein, in such detail as the Bank shall from time to time request. (b) The Borrower shall maintain records adequate to identify the goods financed out of the proceeds of the Loan, to disclose the use thereof in the Project, to record the progress of the Project (including the cost thereof) and to reflect in accordance with consistently maintained sound accounting practices the operations and financial condition of the Borrower and of its subsidiaries. (c) The Borrower shall enable the Bank's representa- tives to inspect the Project, the goods financed out of the proceeds of the Loan, the sites, works, construction and operations included in the Project aind all other plants, works, properties, equipment and operations of the Bor- rower and its subsidiaries, and to examine any relevant records and documents. (d) The Borrower shall furnish to the Bank all such information as the Bank shall reasonably request concerni- ing the expenditure of the proceeds of the Loan, the use of the goods purchased therewith, the progress of the 9 Project and the administration, operations and financial condition of the Borrower, its subsidiaries, and Hidrandina and Atelsa. SECTION 5.03. (a) The Bank and the Borrower shall co- operate fully to assure that the purposes of the Loan will be accomplished. To that end, the Bank and the Borrower shall from time to time, at the request of either party, exchange views through their representatives with regard to the performance by the Borrower of its obligations under the Loan Agreement, the adniinistration, operations and financial condition of the Borrower and other matters relating to the purposes of the Loan. (b) The Borrower shall promptly inform the Bank of any condition which interferes with, or threatens to inter- fere with, the accomplishment of the purposes of the Loan, the maintenance of the service thereof or the perforinance by the Borrower of its obligations under the Loan Agree- ment. SECTION 5.04. The Borrower shall execute and deliver a supplemental indenture, the form and substance of which shall be satisfactory to the Bank, providing for the issue, authentication and delivery of Debentures of the Series K; shall protocolize, record, file and register said supplemental indenture as provided in Section 7.09 of the Indenture as pronptly as shall be reasonably practicable; anl shall, upon the )rotocolization, recordation, fililg and registration thereof, furnish to the Bank an opinion or opinions satis- factory to the Bank of legal counsel acceptable to the Bank showing that said supplemental indentuire has been validly and effectively protocolized, recorded, filed an(I registered, and has created valid and effective liens, charges and priori- ties in accordance with its terms. SECTION 5.05. Except as the Bank and the Borrower shall otherwise agree, the Borrower will not, and will not permit any subsidiary to, create, incur, assume or suffer to exist any mortgage, pledge, lien or encuribrance, except the lien of the Indenture, upon any of its properties or assets, whether now owned or hereafter acquired, unless such mortgage, pledge or lien shall provide foi 'he security of the Debentures in priority to the debentures, notes or other obligations or liabilities of whatsoever character which are to be secured by such mortgage, pledge or lien; provided, however, that the foregoing provisions of this Section shall not apply to: (i) any lion created on property, at the time of purchase thereof, solely as security for the payment of the purchase price of such property; or (ii) any lien arising in the ordinary course of barking trans- actions and securing a debt maturing not more than one year after its date; or (iii) any "permitted lien" as de- fined in the Inde-ture on the date of this Agreement, excluding subsection (i) of said definition. SECTION 5.06. Subject to such exemptions as shall be conferred by the provisions of Section 3.03 and Section 3.04 of the Guarantee Agreement or otherwise, the Bor- rower shall pay or cause to be paid all taxes, if any, im- posed under the laws of the Guarantor or laws in effect in the territories of the Guarantor on or in connection with the execution, issue, delivery or registration of the Loan Agreement, the Guarantee Agreement, the Indenture, the Ninth Supplemental Indenture or the Debentures of the Series K, or the payment of principal, interest or other charges thereunder; provided, however, that the provisions of this Section shall not apply to taxation of payments under any Debeuture of the Series K to a holder thereof other than the Bank when such Debenture of the Series K is beneficially owned by an individual or corporate resident of the Guarantor. SECTION 5.07. The Borrower shall pay or cause to be paid all taxes, if any, imposed under the laws of the coun- try or countries in whose currency the Loan and the De- beiitures of the Series K are payable or laws in effect 11 in the territories of such country or countries on or in connection with the execution, issue, delivery or registra- tion of the Loan Agreement, the Guarantec Agreemeit, the Indenture, the Ninth Supplemental Indenture or the IDe- bentures of the Series K. SECTION 5.08. (a) The Borrower shall take out a-nd maiu- tain with responsible inusurers or make other provision satisfactory to the Bank for insurance againist such risks and in such amouni as shall be consistent with sound practice. (b) With out limiting the generality of the foregoing, the Borrower undertakes to insure the im)or-ted goods to be financed out of the proceeds of the Loan agaiiist marine, transit and other hazards incident to acquisitioin, trais- portation and deliverv thereof to the placc of use or in- stallation and for such insurance any in nity shall be payable in a currency freely usable by the Borrower to replace or repair such goods. SEOTION 5.09. (a) The Borrower shall at all times maini- tain its existence. and right to carry on operations and shall, except as the Bank shall otherwise agree, take all steps necessary to maintain and renew all rights, powers, privileges and franchises which are necessary or useful in the conduct of its business. (b) The Borrower shall operate anid maintain its plants, equipment and property, and front time to time make all necessary renewals and repairs thereof, all i-n accor(lnce with sound engineering standards; and shall at all times operate its plants and equipment and imintain its financial position in accordance with sound business and electric utility practices. SECTION 5.10. The :Borrower shall not agree to any change in the contract between ii and Hidrandiua, dated January 4, 1967, unless the Borrower shall hve noti lied 12 the Bank in advance and obtained approval by the Bank of the change or a determination by the Bank that the change is not material. SECTION 5.11. (a) The Borrower shall transmit all ma- terial contraets between it and Hidrandina and between it and Atelsa to the Bank and sha l not agree to aiy new material contract with cither of them or to any material change in any such contraets iniless the Borrower shall have notified the Bank in advance and obtained approval by the Bank of the proposed contraet or the proposed change or a deternination by the Bank that such chaigc is not material. (b) The Borrower shall not purchase any assets of Hidrandina nor make any payments to lidrandina without the consent of the Bank. SECTION 5.12. The rrower shall have its financial sta.tements (balance sheet and related i-ncome and earned surplus stateienis) audited and certified annually by an independent accointing firm sati,sfactorv to the Bank and sh1all transmit to the Bank not la er than four imoiths after the end of the financiul vear, certified copies of such state- ments and a signed copy of the accountant's report. SEXTON 05.13. Iuless ii shall have obtained ihe prior approval of the Bank, the Borrower shalil not make any investnient in any corporation, fim or association i1n Cxcess of $1,000,000 or its equivaleit in other currencics. SECTION 5.14. Unless it shall have obtained the prior approval of the Bank, the Pr r will not redeeni or prepay, prior to the naturity thereof, any Debentures otherwise than: (i) upon a. refunding thereof by the issu- ance of Debentnres of the sanie or lter inaturity or maturiies ; or (ii) for the purpose from time to time of meeting the next semi-annual sinking fund or auialogous 13 SECTION 5.15. The Borrower shall not consent to any action taken at any meeting of Debenture holders pursuant to Section 13.06 of the Indenture or by written instrument pursuait to Section 13.09 of the Indenture, unless the Bank shall have given its approval of such action or consent. SECToN 5.16. The Boirrower may authorize the issue, execution and delivery of additional Debentures upon com- pliance with the preseiit provisions of Sections 4.02 an1(d 4.04 of the Indenture. SECTIo-N 5.17. Tli Borrower shall dulv perform all cove- nants, agreements and obligations to be perforied by it under the Indenture. SEOTIoN 5.18. Except. as the Bank and the Borrower shall otherwise agree, the Borrower shall, as promlptly as may be required, offer for subscription at a. price reason- ably relatc(1 to their market price suct additional capit1l shares as shall be slifficient to provide funlds, not otlher- wise aviilable, needed to carry out and coipliete tile Project and to provide adeginate working capital (ilring and at the completion thereof. ARTIOLE VI Remedies of the Bank SECTIOMN 6.01.. (i) If aiiy event specifeid in paragraph (a), paragraplh (e) or paragraph (f) of Section 5.02 of the Loan Regulations shall occur and sha.ll continue for a period of thirty days, or (ii) if a default sfiall occur in] the payment of principal or interest or anuy other paymient required under auy other loan agreemient between tbe Bank and the Borrower or under any bond or deleniture delivered pursuanit thereto or under auy eredit agreement between the Association and the Borrower and such deifault shall continue for a period of thirty days, or (iii) if a default shalt 14 occur in the payment of principal or interest or any other payment required under any loan agreement or under any guarantee agreement between the Guarantor and the Bank or under any bond or debenture delivered pursuant to any such agreement or under any credit agreement between the Association and the Guarantor under circumstances which would make it unlikely that the Guarantor would reet its obligations inder the Guarantee Agreement and such do- fault shall continue for a period of thirty days, or (iv) if any event specified in paragraph (a) of Section 6.02 of this Agreement shall occur, or (v) if any event specified in paragraph (c) of Section 5.02 of the Loan Regulations or in paragraph (b) of Section 6.02 of this Agreoment shall occur and shall continue for a period of sixty days after notice thereof shall have been given by the Bank to the Bcrrower, then at any subsequent time during the. con- tinuance thereof, the Bank, at its option, may delare the principal of the Loan and of all. the Debentures of the Series K then out,tanding to be due and payable immedi- ately, and upon any such declaration such principal shall become due and payable immediately, anything in this Agreement, or in the Indenture, or in the IDebentures of the Series K to the contrary notwithstanding. SECTION 6.02. Pursuant to p)aragra)h (1) of Section 5.02 of the Loan Reguiations, the following are specified as additional events for the purposes of said Section: (a.) one of the events specified in the Indenture as 'events of default". (b) any amendment or repeal of any of the provisions of the Electric Industry Law of July 1955 as anided at the (late of this Agreement, which mate- rially and. adversely affects the operations or finan- cial condition of the Borrower or the performance by the Borrower of its obligations uei. this Agree- ment, shall have bwon brought into force anid offeet. 15 ARTICLE VII Modification of First, Second and Third Loar. Agreements SECTION 7.01. For the purposes of the First Loan Agree- ment, paragraph (c) of Section 5.02 of the Loan Regula- tions No. 4 of the Bank dated June 15, 1956, as amended in Schedule 3 of said First Loan Agredment, is further amended hereby to read as follows: " (c) A default shall have occurred in the performance of any other covenant or agreement on the part of the Borrower or the Guarantor under the Loan Agree- ment, or the Guarantee Agreement, or the loan agree- ment dated November 22, 1963, or the guarantee agree- ment of even date therewith, or the loan agreement date. September 7, 1966 or the guarantee agreement of even date therewith, or the loan agreement dated September 11, 1967, or the guarantee agreement of evoen date therewith, or the Indenture, the Supplemental In- denture (as defined in the Loan Agreement), the Fifth Supplemental Indenture (as defined in the loan agree- ment dated November 22, 1963), the Seventh Supple- mental Indenture (as defined in the loan agreement dated September 7, 1966), the Ninth Supplemental Indenture (as defined in the loan agreement dated September 11, 1967), the Debentures of the Series D, or the Debentures of the Series F (as defined in the loan agreement dated November 22, 1963) or the De- bentures of the Series H (as defined in the loan agree- ment dated September 7, 1966, or the Debentures of the Series K (as defined in the loan agreement dated September 11, 1967)." and the term "Loan Regulations" as used for the purposrses of the First Loan Agreement shall mean Loan Regulations No. 4 of the Bank, dated June 15, 1956, as modified by the First Loan Agreement, the Second Loan Agreement, the Third Loan Agreement and as further amended hereby. 16 SECTION 7.02. For the purposes of the Second Loan Agreement, paragraph (c) of Secfion 5.02 of the Loan Regulations No. 4 of the Bank dated February 15, 1961, as amended in Schedule 3 of said Second Loan Agreenent, is further aneided hereby to read as follows: (c) A default shall have occurred in the )erforma,ce of any other covenant or agreement on the part of the Borrower or the Guarantor under the Loan Agrec- ment, or the Guarante Agreement, or the loan agree- nient daled June 29, 1960, or the guarantee agreenient of even date kherewith, or the loan agreemen dated September 7, 1966, or the guarantee agreenient of even date therewith, or the loan agreemlent (lated September 11, 1967, or the guarantee agreemet of even date therewith, or the Indenture, the Supple- mental Indenture (as (lefined iii the loan agreement dated June 29, 1960), the Fifth Supplemental Iniden- ture, the Seventh Suppleiental Inden ture (as defined in the loan agreeIent dated September 7. 1966), the Ninth Supple.ntal ludenture (as defined in the loan agreement (lated Septembe 11, 1967), the ebetures of tie Series ) (as delineid in the loan agreement date(1 June 29, 1960), or the Debentures of the Series 11, or the Debentures of the Series II (as defined in the loan agreement (lated1 September 7, 1966), or the De- lentures of the Series K (as defined in the loan agrec- 1et dated September 11, 1967)." and the term "Loan Regulations'' as used for the purposes of the Second Loan Agreement shll men Joan Regula- tions No. 4 of the Bank, dated February 15, 1961, as modi- fied by the Second Loan Agreeient and the Third Loan Agreernent and as further amended hereby. Sic1o-r 7.03. For the purposes of the Third Loan Agreement, paragraph (c) of Section 5.02 of Loan Regu- lations No. 4 of the Bank dated February 15, 1961, as 」 18 (a) that the Borroxver lias c01111)lied Nväll SectiOn 5.04 of this Agi-eemeiit; aiid (b) that the Borrower läas sold an issuc of in aii aggretnate principal amount of Swiss fnancs 25,000,000. SEXTION 8.04.4. Tlic follom-iiig is specifiled as au additional Inatter, N\-,itliill ffic of Sectiou 9.02(c) of tlic ljoan R(,,gul,ltioiis, to bc iiielti(le(1 iii the opinion or opin:oils to be fin-iiislied to tliv P),-,tiik; unniely, Illat, tile requir villellts of Section 5.04 oF this 11,1v0 becli satisfled. SECTION 8.03. 11 IlliS LM111 S11,111 UOt LIVC cona, into forcu and e-typet b-v Jalninry 21, 1968, 111c L(UCITI Agrecillent alld al, obligatioms of t110 partics livrekillder sluall 11111('SS the Bank, after of the rcaso])-; for tilv delay, ustablislies a, jater fol- tbv piuposvs of 111i,ý Svetion. The BJank sliall Imtify the BorroNs-er a-nd the of sucli. datc- ARTICLE IX Miseellaneous SECTIO,ý 9.01. Tliv Closino- Date sliall bv ý\ýov(ýi,iil)er 1. or suell olli,(,i- dato as 17ý sliall bc ay-recd 1) ]g-t 2ý tli Balik aud ffic BorroAver as the Clos*11 Da 9.02. Tlic 1'ollowiiio- , 1 (1 (11 - c ss cs arv Specified for the, ptil-poses of Svetion 8.01 of 111c Loan For tlie BorroNver: Eiuprcs<ns Asociadas Casilki. 1,384 Lirria, Peru .LXI,terii,,ttýx-c address for cables: Asociadas Peru 19 For the Bank: International Bank for Reconstruction and Development 1818 H Street, N.W. Washington, D. C. 20433 United States of America Alternative address for cables: Intbafrad Washington, D. C. IN WITNESS WIIEREOF, the parties hereto, acting through their representatives thereunto duly authorized, have caused this Loan Agreement to be signed in their respective names and delivered in the District of Columbia, United States of America, as of the day and year first above written. INTERNATIONAL BANK FOR RECONSTRU CTION AN) DEVELOPMENT By /s/ J. BURKE KNAPP Vice Presidevt EMPRESAs ELECTRICAS ASOCIADAS (Lima Light and Power Company) By /s/ CARLoS MARIOTTI Authorized Representative 20 SCHEDULE 1 Amortization Schedule Payment, of Principal Date Payment Due (expressed in dollars)* November 15, 1972 $220,000 May 15, 1973 230,000 November 15, 1973 235,00C May 15, 1974 245,000 November 15, 1974 250,000 May 15, 1975 260,000 November 15, 1975 265,000 May 15, 1976 275,000 November 15, 1976 280,000 May 15, 1977 290,000 November 15, 1977 300,000 May 15, 1978 310,000 November 15, 1978 315,000 May 15, 1979 325,000 November 15, 1979 335,000 May 15, 1980 345,000 Noverr ber 15, 1980 355,000 May 15, 1981 370,000 November 15, 1981 380,000 May 15, 1982 390,000 November 15, 1982 400,000 May 15, 1983 415,000 November 15, 1983 425,000 May 15, 1984 440,000 November 15, 1984 450,000 May 15, 1985 465,000 November 15, 1985 480,000 May 15, 1986 495,000 November 15, 1986 510,000 May 15, 1987 525,000 November 15, 1987 540,000 May 15, 1988 555,000 November 15, 1988 575,000 May 15, 1989 590,000 November 15, 1989 610,000 May 15, 1990 625,000 November 15, 1990 645,000 May 15, 1991 665,000 November 15, 1991 685,000 May 15, 1992 705,000 November 15, 1992 725,000 * To the extent that any part of the Loan is repayable in a eurrency other Lhan dollars (see Loan Regulations, Section 3.03), the figures in this colunu represent dollar equivalents determined as for purposes of withdrawal. 21 Preniums on Prepayment and Redemption The following percntages are specifled as tae premlius payable on repaymen t in advance of maturity of any part of the principal anount of the Loan pursuant to Section 2.05(b) of the Loan Regulations or on the redemption of any Bond prior to its naturity pursuant to Section 6.16 of the Loan Regulations. Ti>ne of Prepayment or Redemption Premim Not more than three years before maturity. /%6 More than three years but not more than six years before maturity ...... ...... 17% More than six years but not more than eleven years before maturity 2% More than eleven years but not more than sixteen years before maturity . . . 3% More than sixteen years but not iore tlian twenty-one years before inaturity 4% More than twenity-one years bit not more than twenty-three yeari s before maturity 5% lore than twenty-three years before ma- turity 6% 22 SCHEDULE 2 Description of Project The Project is the construction of generating and trans- mission facilities for the 120 MW Matucana hydroelectric power station. The Project includes: (a) an intake and sand trap on the Rimac River at Tamboraque, (b) a, free flow lunnel about 20 km long and 3 nieters in diameter from the intake to the forebay, (c) a steel penstock about 1700 meters long to convey the water from the forebay to the power station, (d) a power station in which two 60 MW turbine-gen- erator units operating under a head of 960 meters are installed, (e) a 220 k double circuit steel tower transimissioi line about 80 km long from the power station to Lima, and associated substations, (f) (list ribution system expansion. It is expected that the Project will be conpleted about December 31, 1971. 2:3 SCHEDULE 3 Modifications of Loan Regulations No. 4 For the purposes of this Agreeient the provisions of Loan Regulations No. 4 of the Bank, dated February 15, 1961, as amended Februai.y 9, 1967, are modified as follows: (a) Wherever the ternis "Bond'' or "Bonds'' are used in the Loan Regulations, the terms "Debenture of the Series K' or "Debentures of the Series K'' shall be sub- stituted therefor. (b) The following sentence is added at the end of Section 3.07. "Whenever it shall be necessary to value soles in terns of dollars or another curreney, such value shall be as reasonably deterinined by the Bank.'' (c) By the deletion of subparagraph (c) of Section 5.02 and the sul)stitution thereof of the following subparagraph: "(c) A default shall have occured in the perforn- ance of any other covenant or agreement on the part of the Borrower or the Guarantor under the First, Second or Third Loan Agreement, the First, Second or Third Guaraiitee Agreement, the Lioan Agrec- ment, the Giuarantee Agreement, the Indenture, the Suppleiental Indenture (as defined in the First Loan Agreement), the Fifti Spplemental lnden- ture (as defined in the Second Loan Agreenent), the Seventh Supplemental Indenture (as deffned in the Third Loai Agreement), the Ninth Stipplemenutal Indenture, the Dehenures of the Series 1) (as de- filled in the First loan Agreement) or tie )ebenl- tures of the Series F (as denfled in the Second Loan Agreement), the lDebentnres of the Series Hi (as defimed in the Third Loan Agreement), or the De- bentures of the Series K.'' (d) Section 6.01 is deleted. 24 (e) The words "under Section 6.03 or " are deleted from Sections 6.05 and 6.10. (f) Section 6.07 is deleted. (g) The first two sentences of Section 6.09 are deleted. (h) By the deletion of subparagraphs (c) and (d) of Section 6.11 and the substitution for subparagraph (d) of the following re-lettered subparagraph: " (c) The Bank shall reimburse the Borrower for the reasonable cost of any exchange made pursuant to paragraph (a)." (i) SubpEragraph (a) of the Section 6.12 is deleted, and subparagraph (b) is re-lettered " (a)". (j) Section 6.13 is deleted. (k) Section 6.18 is deleted. (1) By the addition in Section 7.01, after the words "Guarantee Agreement" where those words occur, of the words "the Indenture, the Ninth Supplemental Indenture". (m) By the deletion of the second sentence of Section 7.02 and the substitution therefor of the following sen- tence: ''Such obligations shall not be subject to any prior notice to, demand upon or action against the Bor- rower or to any prior notice to or demand upon the Guarantor with regard to any default by the. Bor- rower, and shall not be impaired by any of the following : any extension of tim)e, forbearanev or con- cession given to the Borrower; any assertion of, or failure to assert, or delay in asserting, any right, power or remedy against the Borrower or in respect of any security for the Loan; any modification or amplification of the provisions of the Loan Agree- ment contemplated by the terms thereof; any modi- fication or amplification of any other document re- 25 lated to the Loan or related to any security therefor; any failure of the Borrower to comply with any re- quirement of ainy law, regulation or order of the Guarantor or of any political subdivision or agency of the Guaraiitor.'' (ii) By the deletion of sub)paragraph (j) of Sectioin 7.04 and the substitution therefor of the following: (j) The provisiois for arbitration set forth in this Section shall be in licu of any other procedure for the (letermination of controversies between the parties to the loan Agreeiment and Guarantec Agree- ment or any claim by any such party against any other such party arising thereunder; provided, how- ever, that nothing herein shall be deemed to preclude any of the said parties from exercising, or institut- ing any legal or equitalfle action to venforce, any right or claim arising out of or pursuant to the Indenture, the Ninth Supplem ental Indenture or the Debentures of the Series K, and subinssion to arbitration here- under shall not be deemed to be a condition prece- de-t or in any way to prejudice such exercise or other enforcement of any such riglit or claiin.' (o) Subparagraph (a) (ii) of Section 9.02 is deleted. (p) Section 9.04 is deleted. (q) Paiaeragaph 9 of Section 10.01 is deleted. (r) By the deletion of Schiedules 1 and 2.