~DOCUML. The World Bank rw 1Wgtreet N.W. (202) 473-1000 INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT Washington, D.C. 20433 Cable Address: INTBAFRAD INTERNATIONAL DEVELOPMENT ASSOCIATION U.S.A. Cable Address: INDEVAS March 29, 2013 Lic. Pavel Centeno Ministro de Finanzas PAblicas Ministerio de Finanzas PAblicas 8 Av. 20-87, Zona I Ciudad de Guatemala, Guatemala Re: Guatemala: Loan No. 7374-GU (Rural Economic Development Project) Third Amendment to Loan Agreement Dear Sir, We refer to the Loan Agreement between International Bank for Reconstruction and Development (the "Bank") and the Republic of Guatemala (the "Borrower") dated October 22, 2007, restated on April 14, 2009, and amended on June 30, 2011, with respect to the above- captioned Project ("Loan Agreement"). Please note that capitalized terms used in this letter ("Amendment Letter") and not defined herein have the meaning ascribed to them in the Loan Agreement. Pursuant to your letter dated August 20, 2012, wherein a request is made to amend the Loan Agreement, we are pleased to inform you that the Bank proposes to amend the Loan Agreement as follows: (1) Part 1.3 of Schedule I to the Loan Agreement is hereby amended to read as follows: "the carrying out by FONAPAZ of public rural infrastructure investments" (2) Section 1.1.(a)(iv)(iii) of Schedule 2 to the Loan Agreement is hereby amended to read as follows: "(iii) the Investment Subprojects under Part 1.1;" (3) Section I.4.(b) of Schedule 2 to the Loan Agreement is hereby amended to read as follows: "MINECO enter into agreements with the Beneficiaries wherein the modalities for the implementation of the Investment Subprojects shall be specified, all in accordance with the provisions set forth in the OM; and" (4) Section I.5.(a) of Schedule 2 to the Loan Agreement is hereby amended to read as follows: "(a) ensure that the Investment Subprojects carried out under MINECO are identified, appraised, approved, implemented, managed and evaluated in accordance with the procedures set forth or referred to in the OM;" (5) The table in Paragraph A.2 in Section IV of Schedule 2 to the Loan Agreement is hereby amended to read as follows. Amount of the Loan Percentage of Allocated Expenditures Cate2ory (expressed in USD) to be financed (1) Goods, works, consultants' services and Training (including for 14,396,406.25 100% Investment Subprojects) in respect of Part 1.1 of the Project (2) Goods, works, consultants' 7,350,000 100% services and Training (including for Goods, works, consultants' services Investment Sub-projects) in respect of and Training (including for Investment Part 1.3 of the Project Sub-projects approved on before the Third Amendment Effective Date) (3) Goods, works, consultants' 82,593.75 100% services and Training (including for Investment Subprojects) in respect of Part 1.4 of the Project (4) Goods, consultants' services and 4,246,000 100% Training in respect of Part 2 of the Project (5) Goods, consultants' services and 960,563 100% Training in respect of Part 3 of the Project (6) Operating Costs under: With respect to Subcategory (6): (a) Part 1.1 of the Project 611,000 100% (b) Part 1.3 of the Project 1,650,000 100% (c) Part 1.4 of the Project 0 100% (d) Part 2 of the Project 354,000 100% (e) Part 3 of the Project 274,437 100% (7) Front-end Fee 75,000 Amount payable pursuant to Section 2.03 of this Agreement in accordance with Section 2.07 (b) of the General Conditions (8) Unallocated 0 TOTAL AMOUNT 30,000,000 2 100% (6) Section IV.B.2. of Schedule 2 to the Loan Agreement is hereby amended to read as follows: "2. The Closing Date is July 31 2014." (7) The following definitions on Section I of the Appendix to the Loan Agreement are hereby amended to read in their entirety as follows: (a) ""Beneficiary" means either: (i) a municipality, for Investment Subprojects under Part 1.1 of the project exclusively; or (ii) a cooperative, producer organization, trade intermediary, association or private firm, which all meet the selection criteria, set forth in the OM." (b) ""FONAPAZ" means Fondo Nacional para la Paz, the Borrower's Acuerdo Gubernativo No. 408-91 dated June 28, 1991, and Acuerdo Gubernativo No. 244-92 dated April 13, 1992, as such accords have been amended as of the date to this Agreement, or any successor thereto, acceptable to the Bank." (c) ""Investment Subproject" means: (i) either a specific investment in collective or local public productive infrastructure; and/or (ii) any technical assistance in relation to a Subproject, including the costs associated with legal incorporation of the Beneficiary, and prepared pursuant to Part 1.1 of the Project." (d) "Operating Costs" means expenditures which would not have been incurred absent the Project (other than for Consultant Services) which, subject to the no-objection of the Bank, are incurred by SEGEPLAN and the Co-Executing Agencies in connection with the carrying out of their functions and responsibilities under the Project, including: transportation costs, utilities, office supplies and rent, travel and per diem, communications, public announcements, management and technical meeting costs and attendance fees, small maintenance works and vehicle insurance. Operating costs under Part 1.1 also include costs of works' design, and supervision, monitoring, operation and management of Investment Subprojects under Part 1.1 of the Project. Please indicate your agreement with the foregoing by countersigning and dating the form of confirmation on the two original copies of this letter provided to you and returning one countersigned original to us. Thereafter, all the provisions of the Loan Agreement, except as amended through this Amendment Letter, shall remain in full force and effect. The provisions of this Amendment Letter will become effective as of the date of this letter upon receipt by the Bank of one fully executed original of this Amendment Letter (Third Amendment Effective Date). Please also note that the restructuring paper dated March 29, 2013 will be disclosed on the Bank's external website. 3 Very truly yours, INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT Byy C. Felipe Jaramillo Director Central America Latin America a the Caribbean Region AGREED: REPUBLIC OF GUATtMALA Byy_ Aut6orized-Reprisentative Name: Pavel V. Centeno Title: Ministro de Finanzas P6blicas Date: 17 de mayo de 2013 4