82525 INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT General Conditions Applicable to Loan and Guarantee Agreements DATED OCTOBER 27, 1980 INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT GENERAL CONDITIONS APPLICABLE TO LOAN AND GUARANTEE AGREEMENTS TABLE OF CONTENTS Article Number Title Page Article I Application to Loan and Guarantee Agreements Section 1.0 1 Application of General Conditions ........................ . Section 1.02 Inconsistency with Loan and Guarantee Agreements . . . . . . . . . . . . . . . . . . Article II Definitions; Headings Section 2.01 Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 Section 2.02 References . . . . . . . . .. . . . . . . . . . . . . . . . . . 3 Section 2.03 Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 Article III Loan Account; Interest and Other Charges; Repayment; Place of Payment ................................ 3 Section 3.01 Loan Account 3 Section 3.02 Commitment Charges ....................... . 3 Section 3.03 Interest .................................. . 4 Section 3.04 Repayment ............................... . 4 Section 3.05 Place of Payment .......................... . 4 Article IV Currency Provisions ......................... 4 Section 4.01 Currencies in which Withdrawals are to be Made . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 Section 4.02 Central Disbursement Account; Withdrawals ...... 5 Section 4.03 Principal Amount of the Loan . . . . . . . . . . . . . . . . . 5 Section 4.04 Currency in which Principal is Payable; Maturities ............................... 5 Section 4.05 Central Disbursement Account; Repayments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 Section 4.06 Currency in which Premium is Payable . . . . . . . . . . . 6 Section 4.07 Currency in which Interest and Other Charges are Payable ....................... 6 ii TABLE OF CONTENTS (Continued) Article Number Title Page ·Section 4.08 Purchase of Currencies . . . . . . . . . . . . . . . . . . . . . . . 6 Section 4.09 Valuation of Currencies . . . . . . . . . . . . . . . . . . . . . . 6 Section 4.10 Manner of Payment ......................... 6 Article V Withdrawal of Proceeds of Loans . . . . . . . . . . . . 7 Section 5.0 1 Withdrawal from the Loan Account . . . . . . . . . . . 7 Section 5.02 Special Commitment by the Bank . . . . . . . . . . . . 7 Section 5.03 Applications for Withdrawal or for Special Commitment . . . . . . . . . . . . . . . . . . . 7 Section 5.04 Evidence of Authority to Sign Applications-for Withdrawal . . . . . . . . . . . . . . 7 Section 5.05 Supporting·Evidence . . . . . . . . . . . . . . . . . 7 Section 5.06 Sufficiency of Applications and Documents . . . . . . . . . . . . . . . . . 8 Section 5.07 Payment by the Bank . . . . . . . . . . . . . . . . . . . . 8 Article VI Cancellation and Suspension . . . . . . . . . . . . . . . 8 Section 6.01 Cancellation by the Borrower . . . . . . . . . . . . . . . 8 Section 6.02 Suspension by the Bank . . . . . . . . . . . . .. . . . . . . 8 Section 6.03 Cancellation by the Bank . . . . . . . . . . . . . . . . . . 9 Section 6.04 Amounts Subject to Special Commitment Not Affected by Cancellation or Suspension by the Bank . . . . . . . . . . . . . . . . . 10 Section 6.05 Application of Cancellation to Maturities of the Loan . . . . . . . . . . . . . . . . . . 10 Section 6.06 Effectiveness of Provisions after Suspension or Cancellation . . . . . . . . . . . . . . 10 Section 6 .07 Cancellation of Guarantee . . . . . . . . . . . . . . . . 10 Article VII Acceleration of Maturity . . . . . . . . . . . . . . . . . 10 Section 7.0 1 Events of Acceleration . . . . . . . . . . . . . . . . . . 10 Article VIII Tax es . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 Section 8 .01 Taxes .............................. 12 iii TABLE OF CONTENTS (Continued) Article Number Title Page Article IX Cooperation and Information; Financial and Economic Data .... . . . . . . . . . 12 Section 9.01 Cooperation and Information 12 Section 9.02 Financial and Economic Data 13 Article X Enforceability of Loan Agreement and Guarantee Agreement; Failure to Exercise Rights; Arbitration . . . . . . . . . . . . . 13 Section 10.01 Enforceability . . . . . . . . . . . . . . .. . . . . . . . . . 13 Section 10.02 Obligations of the Guarantor . . . . . . . . . . . . . . 13 Section 10.03 Failure to Exercise Rights . . . . . . . . . . . . . . . . 13 Section 10.04 Arbitration . . . . . . . . . . . . . . . . . . . . . . . . 14 Article XI Miscellaneous Provisions 16 Section 11.01 Notices and Requests ................ . 16 Section 11.02 Evid ence of Authority . . . . . . . . . . . . . . . 16 Section 11.03 Action on Behalf of the Borrower or Guarantor . . . . . . . . . . . . . . . . . . 16 Section 11.04 Execution in Counterparts 17 Article XII Effective Date ; Termination . . . . . . 17 Section 12.01 Conditions Precedent to Effectiveness of Loan Agreement and Guarantee Agreeme nt . . . . . . . . . . . . . . . . . . . . . . . . 17 Section 12.02 Legal Opinions or Certificates . . . . . . . . . . . . . . 17 Section 12.03 Effective Date . . . . . . . . . . . . . . . . . . . . . . . . 18 Section 12.04 Termination of Loan Agreement and Guarantee Agreement for Failure to Become Effective . . . . . . . . . . . . . 18 Section 12.05 Termination of Loan Agreement and Guarantee Agreement on Full Payment . . . . . . . . . . . . . . . . . . . . . . . 18 General Conditions Applicable to Loan and Guarantee Agreements Dated October 27, 1980 ARTICLE I Application to Loan and Guarantee Agreements Section 1.0 1. Application of General Conditions. These General Conditions set forth certain terms and conditions generally applicable to loans made by the Bank. They shall apply to any loan agreement providing for any such loan and to any guarantee agreement with a member of the Bank providing for the guarantee of any such loan to such extent and subject to such modifications as shall be provided in such agreements; provided, however, that in the case of a loan agreement between the Bank and a member of the Bank, references in these General Conditions to the "Guarantor" and the "Guarantee Agreement" shall be disregarded. Section 1.02. Inconsistency with Loan and Guarantee Agreements. If any provision of a loan agreement or guarantee agreement is inconsistent with a provision of these General Conditions, the provision of the loan agreement or guarantee agreement, as the case may be, shall govern. ARTICLE II Definitions; Headings Section 2.0 1. Definitions. The following terms have the following meanings wherever used in these General Conditions : 1. The term Bank means International Bank for Reconstruction and Development. 2. The term Association means International Development Association. 3. The term Loan Agreement means the particular loan agreement to which these General Conditions shall have been made applicable, as such agreement may be amended from time to time: and such term includes these General Conditions as thus made applicable, all ll to the Loan Agreement and all schedules to agreements supplement:: the Loan Agreement. 4. The term Loan means the loan provided for in the Loan Agreement. 5. The term Guarantee Agreement means the agreement between a member of the Bank and the Bank providing for the guarantee of the Loan. as such agreement may be amended from time to time: and such term includes these General Conditions as thus made applicable, all agreements supplemental to the Guarantee Agreement ~md all schedules to the Guarantee Agreement. 6. The term Borrower means the party to the Loan Agreement to which the Loan is made. 7. The term Guarantor means the member of the Bank which is a party to the Guarantee Agreement. 8. The term currency of a country means such coin or currency as at the time referred to is legal t~nder for the payment of public and private debts in that c:o4ntry. The term currency includes the currency of a country; the Special Drawing Right of the International Monetary Fund; and any unit of account which represents the debt service obligation in respect of a borrowing by the Bank, to the ex- tent of the proceeds of such borrowing. 9. The term dollars and the sign $ mean dollars in currency of the United States of America. 10. The term Loan Account means the account opened by the Bank on its books in the name of the Borrower to which the amount of the Loan is credited. 1 1. The term Project means the project or program for which the Loan is granted, as described in the Loan Agreement and as the description thereof may b~ amended from time to time by agreement between the Bank and the Borrower. 12. The term Central Disbursement Account means the account main- tained by the Bank on its books to record the amounts in each currency outstanding and not yet repayable under the Loan and under such other loans as the B~nk shall determine from time to time. 13. The term external debt means any debt payable in any medium other than currency of the member of the Bank which is the Borrower or the Guarantor. whether such debt is or may become payable absolutely or at the option of the creditor in such other medium. 3 14. The term Effective D~te means the date on which the Loan Agreement and the Guarantee Agreement sh~ll come into force and effect as provided in Section I 2.03. 15. The term lien includes mortgages, pledges, charges, privileges and priorities of any kind. 16. The term assets includes property, revenues and claims of any kind. · 17. The term taxes includes imposts, levies, fees and duties of any nature, whether in effect at the date of the Loan Agreement or Guarantee Agreement or thereafter imposed. 18. The term incurring of debt includes the assumption and guarantee of debt and any renewaL extension, or modification of the terms of the debt or of the assumption or guarantee thereof. 19. The term Closing Date means the date specified in the Loan Agreement as of which the Bank may by notice to the Borrower terminate the right of the Borrower to withdraw from the Loan Account any amount theretofore unwithdrawn . Section 2.02 . References. References in these General Conditions to Articles or Sections are to Articles or Sections of these General Conditions. Section 2.03. lleadings. The headings of the Articles and Sections and the Table of Contents are inserted for convenience of reference only and are not a part of these General Conditions. ARTICLE III Loan Account: Interest and Other Charges: RepaymenC Place of Payment Section 3.0 1. Loan Account. The amount of the Loan shall be credited to the Loan Account and may be withdrawn therefrom by the Borrower as provided m the Loan Agreement and in these General Conditions. Section 3.02. Commitment Charges. The Borrower shall pay a commitment charge on the unwithdrawn amount of the Loan at the rate specified in the Loan Agreement. Such commitment charge shall accrue from a date sixty days after the date of the Loan Agreement to the respective dates on which amounts shall b ~ withdrawn by the Borrower from the Loan Account or shall be cancelled. The Borrower shall pay an additional commitment charge at the rate of one-half of one per cent ( 112 of 1r;n per annum on the principal amount of any special commitment entered into by the Bank pursuant to Section 5.02 and outstanding from time to time. 4 Section 3.03. Interest. The Borrower shall pay interest at the rate specified in the Loan Agreement on the amount of the Loan withdrawn from the Loan Account and outstanding from time to time. Interest shall accrue from the respective dates on which amounts shall be so withdrawn. Section 3.04. Repayment. (a) The Borrower shall repay the principal amount of the Loan withdrawn from the Loan Account in accordance with the amortization schedule to the Loan Agreement. The portion of the Loan to be repaid on each maturity date shall be determined by revaluing the principal amount of the matur- ity specified for that date by the Loan Agreement so as to reflect changes in the amounts in various currencies outstanding in the Central Disbursement Account or in the value of such amounts that occurred since the date or dates of withdrawal of the proceeds of the Loan then outstanding. (b) The Borrower shall have the right, upon payment of all accrued interest and of the premium specified in said amortization schedule, and upon not less than forty-five days' notice to the Bank, to repay, as of a date acceptable to the Bank, in advance of maturity (i) all of the principal amount of the Loan at the time outstand- ing, or (ii) all of the principal amount of any one or more maturities, provided that after such prepayment there shall not be outstanding any portion of the Loan maturing after the portion to be prepaid. (c) It is the policy of the Bank to encourage the repayment prior to maturity of portions of its loans retained by the Bank for its own account. Accordingly, the Bank will sympathetically consider, in the light of all circumstances then existing, any request of the Borrower that the Bank waive the payment of any premium payable under paragraph (b) of this Section on prepayment of any portion of the Loan which the Bank has not sold or agreed to sell. Section 3.05. Place of Payment. The principal (including premium, if any) of, and interest and other charges on, the Loan shall be paid at such places as the Bank shall reasonably request. ARTICLE IV Currency Provisions Section 4.0 1. Currencies in which Withdrawals are to be Made. Except as the Borrower and the Bank shall otherwise agree, withdrawals from the Loan Account shall be made in the respective currencies in which the expenditures to be financed out of the proceeds of the Loan have been paid or are payable; provided, however, that withdrawals in respect of expenditures in the currency of the member of the Bank which is the Borrower or the Guarantor shall be made in such currency or currencies as the Bank shall from time to time reasonably select. . . 5 Section 4.02. Central Disbursement Account; Withdrawals. Upon each with- drawal from the Loan Account, the amount withdrawn expressed in terms of the currency or currencies of withdrawal shall be entered into the Central Disbursement Account; provided , however, that , if withdrawal shall be made in any currency which the Bank shall have purchased with another currency for the purpose of such withdrawal, the amount in such other currency paid by the Bank on such purchase shall be entered into the Central Disbursement Account instead. Section 4.03. Principal A mount of the Loan. (a) The principal amount of the Loan withdrawn from the Loan Account and outstanding shall for any date consist of the sum of (i) the aggregate equivalent of the amounts in various currencies found by multiplying each of the several currency atnounts outstanding in the Central Dis- bursement Account as of that date by the Loan's share in the Central Disbursement Account, and (ii) any portion of the principal amount of the Loan which shall re- main due and payable after its scheduled maturity date. (b) The Loan's share in the Central Disbursement Account shall for any date be equivalent to: (i) the outstanding aggregate equivalent of the values of the amounts in various currencies withdrawn from the Loan Account expressed as of that date , or the respective dates, of withdrawal in terms of a single cur- rency selected by the Bank as a common denominator (or another com- mon denominator selected by the Bank) and revalued to reflect pro rata to the Loan's share in the Central Disbursement Account changes in the amounts in various currencies outstanding in the Central Disburse- ment Account or in the value of such amounts in terms of such com- mon denominator that occurred since such date or dates of withdrawal; divided by (ii) the aggregate equivalent of the values of the several currency amounts then outstanding in the Central Disbursement Account, expressed as. of the same date in terms of the same common denominator. Section 4 .04. Currency in which Principal is Payable ; Maturities. (a) The prin- cipal amount of the Loan shall be repayable from time to time in such currency as the Bank shall specify; provided , however, that , when so specified, the aggregate of all loan amounts repayable in such currency and still outstanding in the Central Dis- bursement Account shall not exceed the amount of such currency outstanding in the Central Disbursement Account. 'oil (b) The portion of the Loan to be repaid in any particular currency shall be the equivalent of such portion of the Loan expressed in terms of such currency as of the date on which such portion of the Loan becomes due and payable. Section 4.05. Central Disbursem ent Account; Repayments. (a) On each maturity date set forth in the Loan Agreement, the equivalent of the portion of the 6 Loan to be repaid as of such date expressed in terms of the currency specified by the Bank for repayment pursuant to Section 4.04 shall be deleted from the Central Dis- bursement Account. (h) If on or before any date acceptable to the Bank all or any portion of the Loan is prepaid in accordance with paragraph (b) of Section 3.04 and in the cur- rency specified by the Bank pursuant to Section 4.04, the amount so prepaid shall be deleted from the Central Disbursement Account on such date. (c) In the event of a notice given pursuant to Section 7.01, the principal amount of currency specified in such notice shall be deleted from the Central Dis- bursement Account on the date or the respective dates of its repayment. Section 4.06. Currency in which Premium is Payable. Any premium payable under Section 3.04 on prepayment of any portion of the Loan shall be payable in the currency in which the principal of such portion of the Loan is repayable. Section 4.07. Currency in which ln{erest and Other Charges are Payable. Interest and other charges on the Loan .shall be payable in such currency or curren- cies as the Bank shall from time to time specify. Section 4.08. Purchase of Currencies. The Bank will, at the request of the Borrower and on such terms and conditions as the Bank shall determine, use its best efforts to purchase any currency needed by the Borrower for payment of principal. interest and other charges required under the Loan Agreement upon payment by the Borrower of sufficient funds therefor in a currency or currencies to be specified by the Bank from time to time. In purchasing the currencies required the Bank shall be acting as agent of the Borrower and the Borrower shall be deemed to have made any payment required under the Loan Agreement only when and to the extent that the Bank has received such payment in the currency or currencies required. Section 4.09. Valuation of Currencies. Whenever it shall be necessary for the purposes of the Loan Agreement or the Guarantee Agreement, or any other agreement to which these General Conditions shall be made applicable, to determine the value of one currency in terms of another, such value shall be as reasonably determined by the Bank. The Bank may value an amount of currency outstanding in the Central Disbursement Account which represents the proceeds of a borrowing by the Bank (the borrowed currency) in such manner as may be required to reflect the debt service obligation of the Bank in respect of such amount; and notwith- standing the provision of Sections 4.04 (a) and 4.05 the Bank may specify, for re- payment of the principal amount of the Loan, another currency needed by the Bank to repay the borrowing and, in such a case, an equivalent amount of the borrowed currency shall be deleted from the Central Disbursement Account. Section 4.1 0. Manner of Payment. (a) Any payment required under the Loan Agreement or the Guarantee Agreement to be made to the Bank in the currency 7 of any country shall be made in such manner, and in currency acquired in such manner, as shall be permitted under the law of such country for the purpose of making such payment and effecti ng the deposit of such currency to the account of the Bank with a dep ository of th e Bank in such country . (b) The principal (inc lud ing premium, if any) of, and interest and other charges on, the Loan shall be paid wi th out restrictions of any kind imposed by, or in the territory of, the member of the Bank which is the Borrower or the Guarantor. ARTICLE V Withdrawal of Proceeds of Loan Section 5.0 1. Withdrawa l from the L oan Account. The Borrower shall be entitled to withdraw from th e Loan Account amounts expended or, if the Bank shall so agree, amounts to be ex pend ed for the Project in accordance with the provisions of the Loan Agreement and of th ese General Conditions. Except as shall be othervv'ise agreed between the Bank and the Borrower, no withdrawals shall be made on account of expenditures in the territories of any country which is not a member of the Bank (other than Swit zerland) or for goods produced 111, or services supplied from , such krritories. * Section 5.02 . Special Commitment by the Bank. Upon the Borrower's request and upon such terms and conditions ~s shall b~ agreed upon between the Bank and the Borrower, the Bank may enter into special commitments in writing to pay amounts to the Borrower or others in respect of expenditures to be fi01nced under the Loan Agreement notwithst anding any subsequent suspension or cancellation by the Bank o r the Borrower. Section 5.03. Applicatin ns for Witlzdrmval or for Special Commitment. When the Borrower shall desire to withdraw any amount from the Loan Account or to request the Bank to enter int o a spcci:.ll commitment pursuant to Section 5.02, the Bo rrower shall deliv er to th~ Bank a written application in such form, and containing such statements and agreements, as the Bank shall reasonably request. Applications for withdrawal , with the necessary documentation as hereinafter in this Article provided, shall be made promptly in relation to expenditures for the Project. Section 5 .04. Evidence of Authority to Sign Applications for Withdrawal. The Borrower shall furnish to the Bank evidence of the authority of the person or persons authorized to sign applications for withd rawal and the authenticated specimen signature of any such person. Section 5.05. Supporting Evidence. The Borrower shall furnish to the Bank such documents and other evidence in support of the application as the Bank shall * Withdrawals may be made from the Loan Account on account of expenditures in, or for goods produced in or services supplied from, Taiwan. 8 reasonably request, whether before or after the Bank shall have permitted any withdrawal requested in the application. Section 5 .06. Sufficiency of Applications and Documents. Each application and the accompanying documents and other evidence must be sufficient in form and substance to satisfy the Bank that the Borrower is entitled to withdraw from the Loan Account the amount applied for and that the amount to b e withdrawn from the Loan Account is to be used only for the purposes specified in the Loan Agreement. Section 5.07. Payment by the Bank. The Bank shall pay the amounts withdrawn by the Borrower from the Loan Account only to or on the order of the Borrower. ARTICLE VI Cancellation and Suspension Section 6.0 1. Cancellation by the Borrower. The Borrower may by notice to the Bank cancel any amount of the hoan which the Borrower shall not have withdrawn prior to the giving of such notice, except that the Borrower may not so cancel any amount of the Loan in respect of which the Bank shall have entered into a special commitment pursuant to Section 5 .02. Section 6.02. Suspension by the Bank. If any of the following events of suspension shall have occurred and be continuing, the Bank may by notice to the Borrower and the Guarantor suspend in whole or in part the right of the Borrower to make withdrawals from the Loan Account: (a) The Borrower sha11 have failed to make payment (notwithstanding the fact that such payment may have been made by the Guarantor or a third party) of principal or interest or any other payment required under: (i) the Loan Agreement, or (ii) any other loan or guarantee agreement with the Bank or any bond or similar instrument delivered pursuant to any such agreement, or (iii) any development credit agreement with the Association. (b) The Guarantor shall have failed to make payment of principal or interest or any other payment required under: (i) the Guarantee Agreement, or (ii) any other loan or guarantee agreement with the Bank or any bond or similar instruments delivered pursuant to any such agreement, or (iii) any development credit agreement with the Association. (c) The Borrower or the Guarantor shall have failed to perform any other obligation under the Loan Agreement or the Guarantee Agreement. • l 9 (d) The Bank or the Association shall have suspended in whole or in part the right of the Borrower or the Guarantor to make withdrawals under any loan agreement with the Bank or any development credit agreement with the Association because of a failure by the Borrower or the Guarantor to perform any of its obligations under such agreement or any guarantee agreement with the Bank. (e) As a result of events which have occurred after the date of the Loan Agreement, an extraordinary situation shall have arisen which shall make it improbable that the Project can be carried out or that the Borrower or the Guarantor will be able to perform its obligations under the Loan Agreement or the Guarantee Agreement. (f) The member of the Bank which is the Borrower or the Guarantor: (i) shall have been suspended from membership in or ceased to be a member of the Bank, or (ii) shall have ceased to be a member of the International Monetary Fund. (g) After the date of the Loan Agreement and prior to the Effective Date any event shall have occurred which would have entitled the Bank to suspend the Borrower's right to make withdrawals from the Loan Account if the Loan Agreement had been effective on the date such event occurred. (h) Any material adverse change in the condition of the Borrower (other than a member of the Bank) , as represented by the Borrower, shall have occurred prior to the Effective Date. (i) A representation made by the Borrower or the Guarantor in or pursuant to the Loan Agreement or the Guarantee Agreement, or any statement furnished in connection therewith, and intended to be relied upon by the Bank in making the Loan, shall have been incorrect in any rna terial respect. U) Any event specified in paragraph (f) or (g) of Section 7.01 shall have occurred. (k) Any other event specified in the Loan Agreement for the purposes of this Section shall have occurred. The right of the Borrower to make withdrawals from the Loan Account shall continue to be suspended in whole or in part, as the case may be, until the event or events which gave rise to suspension shall have ceased to exist, unless the Bank shall have notified the Borrower that the right to make withdrawals has been restored; provided, however, that such notice of restoration may limit the right to make withdrawals. Section 6.03. Cancellation by the Bank. If (a) the right of the Borrower to make withdrawals from the Loan Account shall have been suspended with respect . . 10 to any amount of the Loan for a continuous period of thirty days, or (b) at any time the Bank determines, after consultation with the Borrower, that an amount of the Loan will not be required to finance the Project's costs to be financed out of the proceeds of 'the Loan, or (c) after the Closing Date an amount of the Loan shall remain unwithdrawn from the Loan Account, or (d) the Bank shall have received notice from the Guarantor pursuant to Section 6.07 with respect to an amount of the Loan, the Bank may by notice to the Borrower and the Guarantor terminate the right of the Borrower to make withdrawals with respect to such amount. Upon the giving of such notice such amount of the Loan shall be cancelled. Section 6.04. Amounts Subject to Special Commitment Not Affected by Cancellation or Suspension by the Bank. No cancellation or suspension by the Bank shall apply to amounts subject to any special commitment entered into by the Bank pursuant to Section 5.02 except as expressly provided in such commitment. Section 6.05. Application of Cancellation to Maturities of the Loan. Except as otherwise agreed between the Bank and the Borrower, any cancellation shall be applied pro rata to the several maturities of the principal amount of the Loan which shall mature after the date of such cancellation and shall not have been theretofore sold or agreed to be sold by the Bank. Section 6.06. Effectiveness of Provisions after Suspension or Cancellation. Notwithstanding any cancellation or suspension, all the provisions of the Loan Agreement and the Guarantee Agreement shall continue in full force and effect except as in this Article specifically provided. Section 6.07. Cancellation of Guarantee. If the Borrower shall have failed to make payment of principal or interest or any other payment required under the Loan Agreement (otherwise than as a result of any act or omission to act of the Guarantor) and such payment shall have been made by the Guarantor, the Guarantor may, after consultation with the Bank, by notice to the Bank and the Borrower terminate its obligations under the Guarantee Agreement with respect to any amount of the Loan unwithdrawn from the Loan Account on the date of receipt of such notice by the Bank and not subject to any special commitment entered into by the Bank pursuant to Section 5.02. Upon receipt of such notice by the Bank, such obligations in respect of such amount shall terminate. ARTICLE VII Accelerati()n of Maturity Section 7.0 1. Events of Acceleration. If any of the following events shall occur and shall continue for the period specified below, if any, then at any 11 subsequent time during the continuance thereof, the Bank, at its option, may by notice to the Borrower and the Guarantor declare the principal of the Loan then outstanding to be due and payable immediately together with the interest and other charges thereon and upon any such declaration such principal, together with the interest and other charges thereon, shall become due and payable immediately: (a) A default shall occur in the payment of principal or interest or any other payment required under the Loan Agreement and such default shall continue for a period of thirty days. (b) A default shall occur in the payment of principal or interest or any other payment required under the Guarantee Agreement and such default shall continue for a period of thirty days. (c) A default shall occur in the payment of principal or interest or any other payment required under any other loan or guarantee agreement between the Bank and the Borrower or under any bond or similar instrument delivered pursuant to any such agreement or under any development credit agreement between the Association and the Borrower and such default shall continue for a period of thirty days. (d) A default shall occur in the payment of principal or interest or any other payment required under any loan or guarantee agreement between the Guarantor and the Bank or under any bond or similar instrument delivered pursuant to any such agreement or under any development credit agreement between the Association and the Guarantor under circumstances which would make it unlikely that the Guarantor would meet its obligations under the Guarantee Agreement and such default shall continue for a period of thirty days. (e) A default shall occur in the performance of any other obligation on the part of the Borrower or the Guarantor under the Loan Agreement or the Guarantee Agreement, and such default shall continue ~or a period of sixty days after notice thereof shall have been given by the Bank to the Borrower and the Guarantor. (f) The Borrower (other than a member of the Bank) shall have become unable to pay its debts as they mature or any action or proceeding shall have been taken by the Borrower or by others whereby any of the assets of the Borrower shall or may be distributed among its creditors. (g) The Guarantor or any other authority having jurisdiction shall have taken any action for the dissolution or disestablishment of the Borrower (other than a member of the Bank) or for the suspension of its operations. 12 (h) Any other event specified in the Loan Agreement for the purposes of this Section shall have occurred and shall continue for the period, if any, specified in the Loan Agreement. ARTICLE VIII Taxes Section 8.0 1. Taxes. (a) The principal of, and interest and other charges on, the Loan shall be paid without deduction for, and free from, any taxes levied by, or in the territory of, the member of the Bank which is the Borrower or the Guarantor. (b) The Loan Agreement and the Guarantee Agreement, and any other agreement to which these General Conditions shall be made applicable, shall be free from any taxes levied by, or in the territory of, the member of the Bank which is the Borrower or the Guarantor on or in connection with the execution, delivery or registration thereof. ARTICLE IX Cooperation and Information; Financial and Economic Data Section 9.0 1. Cooperation and Information. (a) The Bank, the Borrower and the Guarantor shall cooperate fully to assure that the purposes of the Loan will be accomplished. To that end, the Bank, the Borrower and the Guarantor shall from time to time, at the request of any one of them: (i) exchange views through their representatives with regard to the progress of the Project, the benefits derived therefrom and the performance of their respective obligations under the Loan Agreement and the Guarantee Agreement and other matters relating to the purposes of the Loan; and (ii) furnish to the other party all such information as it shall reasonably request with regard to the progress of the Project, the benefits derived therefrom and the general status of the Loan. (b) The Bank, the Borrower and the Guarantor shall promptly inform each other of any condition which interferes with, or threatens to interfere with, the progress of the Project, the accomplishment of the purposes of the Loan, the maintenance of the service thereof or the performance by any one of them of its obligations under the Loan Agreement and the Guarantee Agreement. 13 (c) The member of the Bank which is the Borrower or the Guarantor shall afford all reasonable opportunity for accredited representatives of the Bank to visit any part of its territory for purposes related to the Loan. Section 9.02. Financial and Economic Data. The member of the Bank which is the Borrower or the Guarantor shall furnish to the Bank all such information as the Bank shall reasonably request with respect to financial and economic conditions in its territory, including its balance of payments and its external debt as ~ell as that of its political or administrative subdivisions and of any entity owned or controlled by, or operating for the account or benefit of, such member or any such subdivision, and of any institution performing the functions of a central bank or exchange stabilization fund, or similar functions, for such member. ARTICLE X Enforceability of Loan Agreement a_!ld Guarantee Agreement; Failure to Exercise Rights; Arbitration Section 10.0 1. Enforceability. The rights and obligations of the Bank, the Borrower and the Guarantor under the Loan Agreement and the Guarantee Agreement shall be valid and enforceable in accordance with their terms notwithstanding the law of any State or political subdivision thereof, to the contrary. Neither the Bank nor the Borrower nor the Guarantor shall be entitled in any proceeding under this Article to assert any claim that any provision of these General Conditions or of the Loan Agreement or the Guarantee Agreement is invalid or unenforceable because of any provision of the Articles of Agreement of the Bank. Section 10.02. Obligations of the Guarantor. The obligations of the Guarantor under the Guarantee Agreement shall not be discharged except by performance and then only to the extent of such performance. Such obligations shall not be subject to any prior notice to, demand upon or action against the Borrower or to any prior notice to or demand upon the Guarantor with regard to any default by the Borrower, and shall not be impaired by any of the following: any extension of time , forebearance or concession 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 Agreement contemplated by the terms thereof; any failure of the Borrower to comply with any requirement of any law of the Guarantor. Section 10.03. Failure to Exercise Rights. No delay in exercising, or omission to exercise, any right , power or remedy accruing to any party under the Loan 14 Agreement or Guarantee Agreement upon any default shall impair any such right, power or remedy or be construed ~o be a waiver thereof or an acquiescence in such default; nor shall any action of such party in respect of any default, or any acquiescence by it in any default, affect or impair any right, power or remedy of such party in respect of any other or subsequent default. Section I 0.04 . Arbitration. (a) Any controversy between the pa rties to the Loan Agreement or the parties to the Guarantee Agreement, and any claim by any such party against any other such party arising under the Loan Agreement or the Guarantee Agreement which shall not be settled by agreement of the parties shall be submitted to arbitration by an Arbitral Tribunal as hereinafter provided. (b) The parties to such arbitration shall be the Bank on the one side and the Borrower and the Guarantor on the other side. (c) The Arbitral Tribunal shall consist of three arbitrators appointed as follows: one arbitrator shall be appointed by the Bank; a second arbitrator shall be appointed by the Borrower and the Guarantor or, if they shall not agree, by the Guarantor; and the third arbitrator (hereinafter sometimes called the Umpire) shall be appointed by agreement of the parties or, if they shall not agree, by the President of the International Court of Justice or, failing appointment by him, by the Secretary-General of the United Nations. If either side shall fail to appoint an arbitrator, such ·arbitrator shall be appointed by the Umpire. In case any arbitrator appointed in accordance with this Section shall resign, die or become unable to act, a successor arbitrator shall be appointed in the same manner as herein prescribed for the appointment of the original arbitrator and such successor shall have all the powers and duties of such original arbitrator. (d) An arbitration proceeding may be instituted under this Section upon notice by the party instituting such proceeding to the other party. Such notice shall contain a statement setting forth the nature of the controversy or claim to be submitted to arbitration and the nature of the relief sought and the name of the arbitrator appointed by the party instituting such proceeding. Within thirty days after such notice, the other party shall notify to the party instituting the proceeding the name of the arbitrator appointed by such other party. (e) If within sixty days after the notice instituting the arbitration proceeding the parties shall not have agreed upon an Umpire, any party may request the appointment of an Umpire as provided in paragraph .(c) of this Section. (f) The Arbitral Tribunal shall convene at such time and place as shall be fixed by the Umpire. Thereafter, the Arbitral Tribunal shall determine where and when it shall sit. • J 15 (g) The Arbitral Tribunal shall decide all questions relating to its competence and shall, subject to the provisions of this Section and except as the parties shall otherwise agree, determine its procedure. All decisions of the Arbitral l Tribunal shall be by majority vote. I (' (h) The Arbitral Tribunal shall afford to all parties a fair hearing and shall render its award in writing. Such award may be rendered by default. An award signed by a majority of the Arbitral Tribunal shall constitute the award of such Tribunal. A signed counterpart of the award shall be transmitted to each party. Any such award rendered in accordance with the provisions of this Section shall be final and binding upon the parties to the Loan Agreement and the Guarantee Agreement. Each party shall abide by and comply with any such award rendered by the Arbitral Tribunal in accordance with the provisions of this Section. (i) The parties shall fix the amount of the remuneration of the arbitrators and such other persons as shall be required for the conduct of the arbitration proceedings. If the parties shall not agree on such amount before the Arbitral Tribunal shall convene, the Arbitral Tribunal shall fix such amount as shall be reasonable under the circumstances. The Bank, the Borrower and the Guarantor shall each defray its own expenses in the arbitration proceedings. The costs of the Arbitral Tribunal shall be divided between and borne equally by the Bank on the one side and the Borrower and the Guarantor on the other. Any question concerning the division of the costs of the Arbitral Tribunal or the procedure for payment of such costs shall be determined by the Arbitral Tribunal. U) The provisions for arbitration set forth in this Section shall be in lieu of any other procedure for the settlement of controversies between the parties to the Loan Agreement and Guarantee Agreement or any claim by any such party against any other such party arising thereunder. (k) If within thirty days after counterparts of the award shall be delivered to the parties the award shall not be complied with, any party may enter judgment upon, or institute a proceeding to enforce, the award in any court of competent jurisdiction against any other party, may enforce such judgment by execution or may pursue any other appropriate remedy against such other party for the enforcement of the award and the provisions of the Loan Agreement or the Guarantee Agreement. Notwithstanding the foregoing, this Section shall not authorize any entry of judgment or enforcement of the award against any party that is a member of the Bank except as such procedure may be available otherwise than by reason of the provisions of this Section. (1) Service of any notice or process in connection with any proceeding under this Section or in connection with any proceeding to enforce any award 16 rendered pursuant to this Section may be made in the manner provided in Section 11.01. The parties to the Loan Agreement and the Guarantee Agreement waive any and all other requirements for the service of any such notice or process. ARTICLE XI Miscellaneous Provisions Section 11.01. Notices and R equ ests. Any notice or request required or permitted to be given or made under the Loan Agreement or Guarantee Agreement and any other agreement between any of the parties contemplated by the Loan Agreement or the Guarantee Agreement shall be in writing. Except as otherwise provided in Section 12.03, 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 specified in the Loan Agreement or Guarantee Agreement or at such other address as such party shall have designated by notice to the party giving such notice or making such request. Section 11.02. Evidence of Authority. The Borrower and the Guarantor shall furnish to the Bank sufficient evidence of the authority of the person or persons who will, on behalf of the Borrower or the Guarantor, take any action or execute any documents required or permitted to be taken or executed by the Borrower under the Loan Agreement or by the Guarantor under the Guarantee Agreement, and the authenticated specimen signature of each such person. Section 11.03. Action on Behalf of the Borrower or Guarantor. Any action required or permitted to be taken, and any documents required or permitted to be executed, pursuant to the Loan Agreement or the Guarantee Agreement, on behalf of the Borrower or the Guarantor, may be taken or executed by the representative of the Borrower or the Guarantor designated in the Loan Agreement or the Guarantee Agreement for the purposes of this Section or any person thereunto authorized in writing by him. Any modification or amplification of the provisions of the Loan Agreement or the Guarantee Agreement may be agreed to on behalf of the Borrower or the Guarantor by written instrument executed on behalf of the Borrower or the Guarantor by the representative so designated or any person thereunto authorized in writing by him; provided that, in the opinion of such representative, su ch modification or amplification is reasonable in the circumstances and will not substantially increase the obligations of the Borrower under the Loan Agreement or of the Guarantor under the Guarantee Agreement. The Bank may accept the execution by such representative or other person of any such . instrument as conclusive evidence that in the opinion of such representative any modification or amplification of the provisions of the Loan . . 17 Agreement or the Guarantee Agreement effected by such instrument is reasonable in the circumstances and will not substantially increase the obligations of the Borrower or of the Guarantor thereunder. Section 11.04. Execution in Counterparts. The Loan Agreement and the Guarantee Agreement may each be executed in several counterparts, each of which shall be an original. ARTICLE XII Effective Date; Termination Section 12.0 1. Conditions Precedent to Effectiveness of Loan Agreement and Guarantee Agreement. The Loan Agreement and the Guarantee Agreement shall not become effective until evidence satisfactory to the Bank shall have been furnished to the Bank: (a) that the execution and delivery of the Loan Agreement and the Guarantee Agreement on behalf of the Borrower and the Guarantor have been duly authorized or ratified by all necessary governmental and corporate action; (b) if the Bank shall so request, that the condition of the Borrower (other than a member of the Bank), as represented or warranted to the Bank at the date of the Loan Agreement, has undergone no material adverse change after such date; and (c) that all other events specified in the Loan Agreement as conditions to effectiveness have occurred. Section 12.02. Legal Opinions or Certificates. As part of the evidence to be furnished pursuant to Section 12.01, there shall be furnished to the Bank an opinion or opinions satisfactory to the Bank of counsel acceptable to the Bank or, if the Bank shall so request, a certificate satisfactory to the Bank of a competent official of the member of the Bank which is the Borrower or the Guarantor, showing: (a) on behalf of the Borrower, that the Loan Agreement has been duly authorized or ratified by, and executed and delivered on behalf of, the Borrower and is legally binding upon the Borrower in accordance with its terms; (b) on behalf of the Guarantor, that the Guarantee Agreement has been duly authorized or ratified by, and executed and delivered on behalf of, the Guarantor and is legally binding upon the Guarantor in accordance with its terms; and • l 18 (c) such other matters as shall be specified in the Loan Agreement or as shall be reasonably requested by the Bank in connection therewith. Section 12.03. Effective Date. (a) Except as shall be otherwise agreed by the Bank and the Borrower, the Loan Agreement and the Guarantee Agreement shall come into force and effect on the date upon which the Bank dispatches to the Borrower and to the Guarantor notice of its acceptance of the evidence required by Section 12.01. (b) If, before the Effective Date, any event shall have occurred which would have entitled the Bank to suspend the right of the Borrower to make withdrawals from the Loan Account if the Loan Agreement had been effective, the Bank may postpone the dispatch of the notice referred to in paragraph (a) of this Section until such event or events shall have ceased to exist. Section 12.04. Termination of Loan Agreement and Gua~antee Agreement for Failure to Become Effective. If the .Loan Agreement shall not have come into force and effect by the date specified in the Loan Agreement for the purposes of this Section, the Loan Agreement and the Guarantee Agreement and all obligations of the parties thereunder shall terminate, unless the Bank, after consideration of the reasons for the delay, shall establish a later date for the purposes of this Section. The Bank shall promptly notify the Borrower and the Guarantor of such later date. Section 12.05. Termination of Loan Agreement and Guarantee Agreement on Full Payment. If and when the entire principal amount of the Loan withdrawn from the Loan Account and the premium, if any, on the prepayment of the Loan and all interest and other charges which shall have accrued on the Loan shall have been paid, the Loan Agreement and the Guarantee Agreement and all obligations of the parties thereunder shall forthwith terminate.