Lenders' Agreement CONFORMED COPY LOAN NUMBER 1167 KE KREDITANSTALT FUR WIEDERAUFBAU INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT
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1 Public Disclosure Authorized LOAN NUMBER 1167 KE CONFORMED COPY Public Disclosure Authorized Lenders' Agreement (Mombasa and Coastal Water Supply Project) Public Disclosure Authorized BETWEEN KREDITANSTALT FUR WIEDERAUFBAU AND INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT Public Disclosure Authorized DATED JANUARY 22, 1976
2 CONFORMED COPY LOAN NUMBER 1167 KE Lenders' Agreement (Mombasa and Coastal Water Supply Project) BETWEEN KREDITANSTALT FUR WIEDERAUFBAU AND INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT DATED JANUARY 22, 1976
3 LENDERS' AGREEMENT AGREEMENT dated January 22, 1976 between KREDITANSTALT FUR WIEDERAUFBAU (hereinafter called KfW) and INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT (hereinafter called the Bank). WHEREAS (A) By the Loan Agreement dated October 15, 1975, between the Republic of Kenya (hereinafter called Kenya) and the Bank (hereinafter called the Bank Loan Agreement), the Bank has agreed to make to Kenya a loan in various currencies equivalent to thirty-five million United States dollars (US$35,000,000) to assist in the financing of a water supply project in Mombasa and along the coast near Mombasa, as more fully described in the Description of the Project comprising Schedule 2 to the Bank Loan Agreement (hereinafter called the Project); (B) By a loan agreement dated November 14, 1975, between Kenya and KfW (hereinafter called the KfW Loan Agreement) KfW has agreed to make a loan to Kenya in an amount of thirty-seven million German Mark (DM37,000,000), equivalent at current exchange rates to about fifteen million United States dollars (US$15,000,000) (hereinafter called the KfW Loan), to assist in the financing of the Project, under the terms and conditions set forth in the KfW Loan Agreement * and the separate agreements (hereinafter called the KfW Special Agreement) referred to in Articles I, II and VIII of the KfW Loan Agreement; (C) Kenya has established within the Water Department of its Ministry of Water Development a branch known as the Coast Water Province Branch (hereinafter called CPWB), having separate accounts, and has agreed to make available to CPWB, for purposes of the Project, the proceeds of the KfW Loan and the proceeds of the Bank Loan allocated to Parts A through F of the Project; (D) The proceeds of the KfW Loan are intended to be used to finance the foreign exchange costs of pipe and accessories (other than valves and flowmeters) required for the transmission and branch bulk supply mains included in the Project and approximately 15% of expenditures for related civil works, and the proceeds of the Bank Loan are intended to be used to finance approximately 50% of expenditures for such civil works, and other expenditures incurred or to be incurred for purposes of the Project; WHEREAS KfW and the Bank deem it to be in their mutual interest to coordinate the administration of their respective loans and to maintain effective cooperation between themselves on the basis of full partnership as hereinafter provided;
4 4 NOW THEREFORE the parties hereto hereby agree as follows: ARTICLE I Coordination, Exchange of Information; Consultation Section (a) Each party hereto, without assuming any liability therefor, shall (i) keep the other party currently informed of the progress of the Project. In particular, each party shall keep the other informed of each amount disbrsed under the KfW Loan and the Bank Loan, it being the intention that the proceeds of the Bank Loan allocated to Part C of the Project and the KfW Loan be disbursed as nearly as practicable according to the respective rates agreed upon pro rata and pai passu; (ii) exchange views with the other party from time to time with respect to the progress of the Project; and (iii) provide the other party with any information thereon that may appear useful. (b) Each party shall inform the other party beforehand of any supervision mission, afford the other party the opportunity to participate therein, and exchange views on the results of such mission. (c) Each party shall inform the other party of any event likely to interfere with the carrying out of the Project, or hinder or seriously impair its operation or financing. (d) Each party shall inform the other party of any notice by Kenya to prepay the whole or any part of the KfW Loan or the Bank Loan, as the case may be, and of any amount prepaid. Section Each party shall inform, and to all extent possible, consult the other party prior to: (a) (i) suspending in whole or in part the right of Kenya to make withdrawals under the KfW Loan or the Bank Loan, respectively; (ii) (iii) cancelling any amount of such loans; accelerating the maturity of such loans. (b) taking any action which would or might result in the termination of the KfW Loan Agreement or the Bank Loan Agreement;
5 5 (c) making substantial amendments to the agreements referred to in the foregoing sub-paragraph (b); (d) agreeing to any important changes: (i) (ii) in the specifications, cost and nature of the works of the Project; in the work schedules for the Project as compared with the original forecasts; and (e) modifying Schedule 1 to the Bank Loan Agreement or the corresponding provisions of the KfW Special Agreement. Section In addition, each party may at any time consult the other party on any matter of common interest. ARTICLE II Exchange of Consents Section Each party shall reach an agreement with the other party before: (a) giving its agreement to any request of Kenya under Section 2.02, or for a modification of Schedule 2, of the Bank Loan Agreement; (b) approving any modification to the choice of the consultants referred to in Section 3.02 of the Bank Loan Agreement and Article VIII, paragraph I of the KfW Loan Agreement or the terms and conditions of employment of such consultants; and (c) modifying the percentage set forth in respect of Category (2) of paragraph I of Schedule 1 to the Bank Loan Agreement or of the corresponding provisions of the KfW Special Agreement. ARTICLE III Effectiveness Section This Agreement, which shall take effect upon its signature by both parties, shall remain in force and effect between KfW and the Bank so long as neither the KfW Loan Agreement nor the Bank Loan Agreement has terminated.
6 6 ARTICLE IV Miscellaneous Section Any notice required under this Agreement and any agreement contemplated by this Agreement shall be in writing. Such notice shall be deemed to have been duly given when it shall be delivered by hand or by mail, telegram, cable or radiogram to the party to which it is required to be given at such party's address specified below, or at such other address as such party shall have designated by notice to the party giving such notice. For KfW: Kreditanstalt ffr Wiederaufbau Palmengartenstrasse Frankfurt/Main Federal Republic of Germany Cable address: Telex: KREDITANSTALT Frankfurtmain For the Bank: International Bank for Reconstruction and Development 1818 H Street, N.W. Washington, D.C United States of America Cable address: Telex: INTBAFRAD Washington, D.C (ITT) (RCA) or 64145(WUI)
7 7 Done in three copies in the German language and three copies in the English language each of which shall constitute an original and shall be equally authentic. KREDITANSTALT F UR WIEDERAUFBAU By /s/ R. Hopfen Authorized Representative By /s / R. Schr6der Authorized Representative INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT By /s / Syed Shahid Husain Regional Vice President Eastern Africa
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