Common use of Sub-projects Clause in Contracts

Sub-projects. 1. The Participating Bank shall make Sub-loans to Beneficiaries and appraise, review, approve, and supervise Sub-projects in accordance with the criteria, conditions and procedures set forth in the Operations Manual, including, inter alia, the following eligibility criteria: (a) (i) the proposed Sub-project is in compliance with the environmental standards set out in the Environmental Assessment Framework, and with all applicable laws and regulations of the Recipient relating to environmental protection; (ii) an environmental screening has been carried out for the proposed Sub-project in accordance with principles set forth in the Environmental Assessment Framework; and (iii) if said environmental screening concludes that an EMP is required, said EMP has been prepared by the Beneficiary and approved by the Recipient and the Association for implementing the proposed Sub-project; (b) the proposed Sub-project is technically feasible, and economically, financially and commercially viable; and (c) the proposed Sub-project is in support of energy efficiency investments in industrial enterprises with the objective of achieving energy savings and shall include, inter alia, the following categories of energy efficiency investments: (i) investments in energy systems related to boiler upgrading and fuel switching, use of co-generation facilities, electric driven systems, including compressed air systems, electric chillers, machinery and lighting; as well as heat piping (steam, water) and associated equipment; (ii) investments in process technology related to upgrading and replacement of equipment, machinery and facilities; and/or (iii) investments in waste heat and waste use related to the utilization of waste heat (of hot/warm gases, liquids and solids) and burning of combustible waste (gases, liquids, solids) when harmful pollution can be effectively controlled. 2. No Sub-project shall be eligible for financing under the Project if such Sub- project: (a) is qualified as per the Environmental Assessment Framework as a Category A; or (b) will include activities deemed ineligible in accordance with the exclusion list set forth and defined in the Operations Manual. 3. The Participating Bank shall make Sub-loans to Beneficiaries in accordance with eligibility criteria and procedures acceptable to the Association as set out in the Operations Manual, and shall only make the proceeds of the Sub-loan available to such Beneficiary after the Participating Bank has entered into a Sub-loan Agreement with the Beneficiary on terms and conditions acceptable to the Association, which shall include the following: (a) The Sub-loan shall be: (i) in an amount not exceeding three million US Dollars (US$3,000,000) equivalent to any individual Beneficiary or group of connected Beneficiaries, unless otherwise agreed by the Association; (ii) denominated and repayable in US Dollars, Soum linked to US Dollars or in Soum, depending on the assessment of the Beneficiaries’ capacity to repay in foreign currency and the need to purchase imported goods and services; (iii) repaid with a maturity and grace period as set forth in the Operations Manual for various types of Beneficiaries and Sub-projects; (iv) charged interest on the principal amount withdrawn and outstanding from time to time at a rate sufficient to cover the cost of borrowing of the Participating Bank concerned plus a reasonable risk-adjusted spread and profit margin; (v) co-financed by the Beneficiary in an amount equivalent to 20% of the cost of each Sub-project. (b) The Participating Bank shall obtain rights adequate to protect its interests and those of the Recipient and the Association through a Sub-loan Agreement between the Participating Bank and a Beneficiary, including the right to: (i) suspend or terminate the right of the Beneficiary to use the proceeds of the Sub-loan, or declare to be immediately due and payable, or obtain a refund of all or any part of the amount of the Sub-loan then withdrawn, upon the Beneficiary’s failure to perform any of its obligations under the Sub-loan Agreement; and (ii) require each Beneficiary to: (A) carry out its Sub-project with due diligence and efficiency and in accordance with sound technical, economic, financial, managerial, environmental standards and practices satisfactory to the Association and in accordance with the provisions of the Anti- Corruption Guidelines applicable to recipients of financing proceeds other than the Recipient as well as the requirements set out in the Environmental Assessment Framework; (B) contribute to the Sub-project an amount equivalent to at least 20% of the said Sub-project’s cost, and thereafter provide promptly as needed, the resources required for carrying out the Sub-project; (C) procure the goods, works and services to be financed out of the Sub-loan in accordance with the provisions of this Agreement and use such goods, works, and services exclusively for the Sub-project; (D) maintain policies and procedures adequate to enable it to monitor and evaluate in accordance with indicators acceptable to the Association, the progress of the Sub- project and the achievement of its objectives; (1) maintain a financial management system and prepare financial statements in accordance with consistently applied accounting standards as set forth in the Operations Manual, both in a manner adequate to reflect the operations, resources and expenditures related to the Sub-project; and (2) have such financial statements audited by independent auditors as set forth in the Operations Manual, in accordance with consistently applied auditing standards as set forth in the Operations Manual, and promptly furnish the statements as so audited to the Recipient and the Participating Bank; (F) enable the Recipient, the Association and the Participating Bank to inspect the Sub-project, its operation and any relevant records and documents; and (G) prepare and furnish to the Recipient, the Association and the Participating Bank all such information as the Recipient or the Association or the Participating Bank shall reasonably request relating to the foregoing. 4. Unless the Association shall otherwise agree, each of the Participating Bank shall select and approve Beneficiaries in accordance with the criteria and procedures set forth in the Operations Manual, including that a Beneficiary may be selected only if: (a) said Beneficiary has been established and is operating pursuant to the Recipient’s relevant laws and regulations; (b) said Beneficiary: (i) owns less than 1% in the shares of the Participating Bank; and (ii) has none of its shares owned by the Participating Bank or any subsidiary or affiliate thereof; (c) said Beneficiary has a satisfactory financial structure and the organization, management, staff and financial and other resources required for the efficient carrying out of its operations, including the carrying out of the Sub-project, including without limitation: (A) a maximum debt-equity ratio of 75:25 (after receipt and for the first three years for each Sub-loan), unless otherwise agreed with the Association;

Sub-projects. 1. The Participating Bank shall make Sub-loans to Beneficiaries and appraise, review, approve, and supervise Sub-projects in accordance with the criteria, conditions and procedures set forth in the Operations Manual, including, inter alia, the following eligibility criteria: (a) (i) the proposed Sub-project is in compliance with the environmental standards set out in the Environmental Assessment FrameworkESMF, and with all applicable laws and regulations of the Recipient Borrower relating to environmental protection; (ii) an environmental screening has been carried out for the proposed Sub-project in accordance with principles set forth in the Environmental Assessment FrameworkESMF; and (iii) if said environmental screening concludes that an EMP is required, said EMP has been prepared by the Beneficiary and approved by the Recipient Borrower’s authorized entities and the Association Bank for implementing the proposed Sub-Sub- project; (b) the proposed Sub-project is technically feasible, and economically, financially and commercially viable; and (c) the proposed Sub-project is in support of energy efficiency investments in industrial enterprises with the objective of achieving energy savings and shall include, inter alia, the following categories of energy efficiency investments: (i) investments in energy systems related to boiler upgrading and fuel switching, use of co-generation facilities, electric driven systems, systems including compressed air systems, electric chillers, machinery and lighting; as well as heat piping (steam, water) and associated equipment; (ii) investments in process production technology related to upgrading and replacement of equipment, machinery and facilities; and/or (iii) investments in waste heat and waste use related to the utilization of waste heat (of hot/warm gases, liquids and solids) and burning of combustible waste (gases, liquids, solids) when harmful pollution can be effectively controlled. 2. No Sub-project shall be eligible for financing under the Project if such Sub- Sub-project: (a) is qualified as per the Environmental Assessment Framework ESMF as a Category A; or (b) will include activities deemed ineligible in accordance with the exclusion list set forth and defined in the Operations Manual. 3. The Participating Bank shall make Sub-loans to Beneficiaries in accordance with eligibility criteria and procedures acceptable to the Association Bank as set out in the Operations Manual, and shall only make the proceeds of the Sub-loan available to such Beneficiary after the Participating Bank has entered into a Sub-loan Agreement with the Beneficiary on terms and conditions acceptable to the AssociationBank, which shall include the following: (a) The Sub-loan shall be: (i) in an amount not exceeding three million US Dollars (exceeding, respectively, US$3,000,000) 10,000,000 equivalent to any individual Beneficiary or and US$30,000,000 equivalent to any group of connected Beneficiaries, unless otherwise agreed by the AssociationBank; (ii) denominated and repayable in US Dollars, Soum linked to US Dollars or in Soum, depending on the assessment of the Beneficiaries’ capacity to repay in foreign currency and the need to purchase imported goods and services; (iii) repaid with a maturity and grace period as set forth in the Operations Manual for various types of Beneficiaries and Sub-projects; (iv) charged interest on the principal amount withdrawn and outstanding from time to time at a rate sufficient to cover the cost of borrowing of the Participating Bank concerned plus a reasonable risk-adjusted spread and profit margin; (v) co-co- financed by the Beneficiary in an amount equivalent to 20% of the cost of each Sub-project. (b) The Participating Bank shall obtain rights adequate to protect its interests and those of the Recipient Borrower and the Association Bank through a Sub-loan Agreement between the Participating Bank and a Beneficiary, including the right to: (i) suspend or terminate the right of the Beneficiary to use the proceeds of the Sub-loan, or declare to be immediately due and payable, or obtain a refund of all or any part of the amount of the Sub-loan then withdrawn, upon the Beneficiary’s failure to perform any of its obligations under the Sub-loan Agreement; and (ii) require each Beneficiary to: (A) carry out its Sub-project with due diligence and efficiency and in accordance with sound technical, economic, financial, managerial, environmental and social standards and practices (including any applicable laws and regulations on child and/or forced labor and any other applicable national labor laws and regulations) satisfactory to the Association Bank and in accordance with the provisions of the Anti- Anti-Corruption Guidelines applicable to recipients Borrowers of financing proceeds other than the Recipient Borrower as well as the requirements set out in the Environmental Assessment Framework; (B) contribute to the Sub-project an amount equivalent to at least 20% of the said Sub-project’s cost, and thereafter provide promptly as needed, the resources required for carrying out the Sub-project; (C) procure the goods, works and services to be financed out of the Sub-loan in accordance with the provisions of this Agreement Agreement, the Operations Manual and use such goods, works, and services exclusively for the Sub-project; (D) maintain policies and procedures adequate to enable it to monitor and evaluate in accordance with indicators acceptable to the AssociationBank, the progress of the Sub- Sub-project and the achievement of its objectives; (1) maintain a financial management system and prepare financial statements in accordance with consistently applied accounting standards as set forth in the Operations Manual, both in a manner adequate to reflect the operations, resources and expenditures related to the Sub-Sub- project; and (2) ), have such financial statements audited by independent auditors as set forth in the Operations Manual, in accordance with consistently applied auditing standards as set forth in the Operations Manual, and promptly furnish the statements as so audited to the Recipient Borrower and the Participating Bank; (F) enable the RecipientBorrower, the Association Bank and the Participating Bank to inspect the Sub-project, its operation and any relevant records and documents; and (G) prepare and furnish to the RecipientBorrower, the Association Bank and the Participating Bank all such information as the Recipient Borrower or the Association Bank or the Participating Bank shall reasonably request relating to the foregoing. 4. Unless the Association Bank shall otherwise agree, each of the Participating Bank shall select and approve Beneficiaries in accordance with the criteria and procedures set forth in the Operations Manual, including that a Beneficiary may be selected only if: (a) said Beneficiary has been established and is operating pursuant to the RecipientBorrower’s relevant laws and regulationsregulations and is in compliance with the laws and regulations referred to in paragraph 3 (b) (ii) (A) of this section; (b) said Beneficiary: (i) owns less than 110% in the shares of the Participating Bank; and (ii) has none less than 10% of its equity shares owned by the Participating Bank or any subsidiary or affiliate thereof; (c) said Beneficiary has a satisfactory financial structure and the organization, management, staff and financial and other resources required for the efficient carrying out of its operations, including the carrying out of the Sub-projectprojects, including without limitation: (Ai) a maximum debt-equity ratio of 75:25 (after receipt and for the first three years for each the Sub-loan portfolio); and (ii) after receipt of the Sub-loan, it generates enough cash during the pay-back period of the Sub-loan to maintain a minimum debt service coverage ratio of at least 1.1:1 (after receipt), unless otherwise agreed with the AssociationBank; (d) said Xxxxxxxxxxx has a demonstrated record of profitability in the preceding two business years; and (e) said Beneficiary has demonstrated that the annual energy efficiency savings of the proposed Sub-project shall be at least equal to 20%. 5. For the purpose of Section 4(c) above:

Sub-projects. 1. The Participating Bank shall make Sub-loans to Beneficiaries and appraise, review, approve, and supervise Sub-projects in accordance with the criteria, conditions and procedures set forth in the Operations Manual, including, inter alia, the following eligibility criteria: (a) (i) the proposed Sub-project is in compliance with the environmental standards set out in the Environmental Assessment Framework, and with all applicable laws and regulations of the Recipient relating to environmental protection; (ii) an environmental screening has been carried out for the proposed Sub-project in accordance with principles set forth in the Environmental Assessment Framework; and (iii) if said environmental screening concludes that an EMP is required, said EMP has been prepared by the Beneficiary and approved by the Recipient and the Association for implementing the proposed Sub-project; (b) the proposed Sub-project is technically feasible, and economically, financially and commercially viable; and (c) the proposed Sub-project is in support of energy efficiency investments in industrial enterprises with the objective of achieving energy savings and shall include, inter alia, the following categories of energy efficiency investments: (i) investments in energy systems related to boiler upgrading and fuel switching, use of co-generation facilities, electric driven systems, including compressed air systems, electric chillers, machinery and lighting; as well as heat piping (steam, water) and associated equipment; (ii) investments in process technology related to upgrading and replacement of equipment, machinery and facilities; and/or (iii) investments in waste heat and waste use related to the utilization of waste heat (of hot/warm gases, liquids and solids) and burning of combustible waste (gases, liquids, solids) when harmful pollution can be effectively controlled. 2. No Sub-project shall be eligible for financing under the Project if such Sub- Sub-project: (a) is qualified as per the Environmental Assessment Framework as a Category A; or (b) will include activities deemed ineligible in accordance with the exclusion list set forth and defined in the Operations Manual. 3. The Participating Bank shall make Sub-loans to Beneficiaries in accordance with eligibility criteria and procedures acceptable to the Association as set out in the Operations Manual, and shall only make the proceeds of the Sub-loan available to such Beneficiary after the Participating Bank has entered into a Sub-loan Agreement with the Beneficiary on terms and conditions acceptable to the Association, which shall include the following: (a) The Sub-loan shall be: (i) in an amount not exceeding three million US Dollars (US$3,000,000) equivalent to any individual Beneficiary or group of connected Beneficiaries, unless otherwise agreed by the Association; (ii) denominated and repayable in US Dollars, Soum linked to US Dollars or in Soum, depending on the assessment of the Beneficiaries’ capacity to repay in foreign currency and the need to purchase imported goods and services; (iii) repaid with a maturity and grace period as set forth in the Operations Manual for various types of Beneficiaries and Sub-projects; (iv) charged interest on the principal amount withdrawn and outstanding from time to time at a rate sufficient to cover the cost of borrowing of the Participating Bank concerned plus a reasonable risk-adjusted spread and profit margin; (v) co-financed by the Beneficiary in an amount equivalent to 20% of the cost of each Sub-project. (b) The Participating Bank shall obtain rights adequate to protect its interests and those of the Recipient and the Association through a Sub-loan Agreement between the Participating Bank and a Beneficiary, including the right to: (i) suspend or terminate the right of the Beneficiary to use the proceeds of the Sub-loan, or declare to be immediately due and payable, or obtain a refund of all or any part of the amount of the Sub-loan then withdrawn, upon the Beneficiary’s failure to perform any of its obligations under the Sub-loan Agreement; and (ii) require each Beneficiary to: (A) carry out its Sub-project with due diligence and efficiency and in accordance with sound technical, economic, financial, managerial, environmental standards and practices satisfactory to the Association and in accordance with the provisions of the Anti- Anti-Corruption Guidelines applicable to recipients of financing proceeds other than the Recipient as well as the requirements set out in the Environmental Assessment Framework; (B) contribute to the Sub-project an amount equivalent to at least 20% of the said Sub-project’s cost, and thereafter provide promptly as needed, the resources required for carrying out the Sub-project; (C) procure the goods, works and services to be financed out of the Sub-loan in accordance with the provisions of this Agreement and use such goods, works, and services exclusively for the Sub-project; (D) maintain policies and procedures adequate to enable it to monitor and evaluate in accordance with indicators acceptable to the Association, the progress of the Sub- Sub-project and the achievement of its objectives; (1) maintain a financial management system and prepare financial statements in accordance with consistently applied accounting standards as set forth in the Operations Manual, both in a manner adequate to reflect the operations, resources and expenditures related to the Sub-project; and (2) ), have such financial statements audited by independent auditors as set forth in the Operations Manual, in accordance with consistently applied auditing standards as set forth in the Operations Manual, and promptly furnish the statements as so audited to the Recipient and the Participating Bank; (F) enable the Recipient, the Association and the Participating Bank to inspect the Sub-project, its operation and any relevant records and documents; and (G) prepare and furnish to the Recipient, the Association and the Participating Bank all such information as the Recipient or the Association or the Participating Bank shall reasonably request relating to the foregoing. 4. Unless the Association shall otherwise agree, each of the Participating Bank shall select and approve Beneficiaries in accordance with the criteria and procedures set forth in the Operations Manual, including that a Beneficiary may be selected only if: (a) said Beneficiary has been established and is operating pursuant to the Recipient’s relevant laws and regulations; (b) said Beneficiary: (i) owns less than 1% in the shares of the Participating Bank; and (ii) has none of its shares owned by the Participating Bank or any subsidiary or affiliate thereof; (c) said Beneficiary has a satisfactory financial structure and the organization, management, staff and financial and other resources required for the efficient carrying out of its operations, including the carrying out of the Sub-project, including without limitation: (A) a maximum debt-equity ratio of 75:25 (after receipt and for the first three years for each Sub-loan), unless otherwise agreed with the Association; (B) after receipt of the sub-loan, it generates enough cash during the pay-back period of the Sub-loan to maintain a minimum debt service coverage ratio of at least 1.1:1 (after receipt), unless otherwise agreed with the Association; (d) said Beneficiary has a demonstrated record of profitability in the preceding two business years; and (e) said Beneficiary has demonstrated that the annual energy efficiency savings of the proposed Sub-project shall be at least equal to 20%. 5. For the purpose of Section 4(c) above:

Sub-projects. 1. The Participating Bank shall make Sub-loans to Beneficiaries and appraise, review, approve, and supervise Sub-projects in accordance with the criteria, conditions and procedures set forth in the Operations Manual, including, inter alia, the following eligibility criteria: (a) (i) the proposed Sub-project is in compliance with the environmental standards set out in the Environmental Assessment Framework, and with all applicable laws and regulations of the Recipient relating to environmental protection; (ii) an environmental screening has been carried out for the proposed Sub-project in accordance with principles set forth in the Environmental Assessment Framework; and (iii) if said environmental screening concludes that an EMP is required, said EMP has been prepared by the Beneficiary and approved by the Recipient and the Association for implementing the proposed Sub-project; (b) the proposed Sub-project is technically feasible, and economically, financially and commercially viable; and (c) the proposed Sub-project is in support of energy efficiency investments in industrial enterprises with the objective of achieving energy savings and shall include, inter alia, the following categories of energy efficiency investments: (i) investments in energy systems related to boiler upgrading and fuel switching, use of co-generation facilities, electric driven systems, including compressed air systems, electric chillers, machinery and lighting; as well as heat piping (steam, water) and associated equipment; (ii) investments in process technology related to upgrading and replacement of equipment, machinery and facilities; and/or (iii) investments in waste heat and waste use related to the utilization of waste heat (of hot/warm gases, liquids and solids) and burning of combustible waste (gases, liquids, solids) when harmful pollution can be effectively controlled. 2. No Sub-project shall be eligible for financing under the Project if such Sub- Sub-project: (a) is qualified as per the Environmental Assessment Framework as a Category A; or (b) will include activities deemed ineligible in accordance with the exclusion list set forth and defined in the Operations Manual. 3. The Participating Bank shall make Sub-loans to Beneficiaries in accordance with eligibility criteria and procedures acceptable to the Association as set out in the Operations Manual, and shall only make the proceeds of the Sub-loan available to such Beneficiary after the Participating Bank has entered into a Sub-loan Agreement with the Beneficiary on terms and conditions acceptable to the Association, which shall include the following: (a) The Sub-loan shall be: (i) in an amount not exceeding three million US Dollars (US$3,000,000) equivalent to any individual Beneficiary or group of connected Beneficiaries, unless otherwise agreed by the Association; (ii) denominated and repayable in US Dollars, Soum linked to US Dollars or in Soum, depending on the assessment of the Beneficiaries’ capacity to repay in foreign currency and the need to purchase imported goods and services; (iii) repaid with a maturity and grace period as set forth in the Operations Manual for various types of Beneficiaries and Sub-projects; (iv) charged interest on the principal amount withdrawn and outstanding from time to time at a rate sufficient to cover the cost of borrowing of the Participating Bank concerned plus a reasonable risk-adjusted spread and profit margin; (v) co-financed by the Beneficiary in an amount equivalent to 20% of the cost of each Sub-project. (b) The Participating Bank shall obtain rights adequate to protect its interests and those of the Recipient and the Association through a Sub-loan Agreement between the Participating Bank and a Beneficiary, including the right to: (i) suspend or terminate the right of the Beneficiary to use the proceeds of the Sub-loan, or declare to be immediately due and payable, or obtain a refund of all or any part of the amount of the Sub-loan then withdrawn, upon the Beneficiary’s failure to perform any of its obligations under the Sub-loan Agreement; and (ii) require each Beneficiary to: (A) carry out its Sub-project with due diligence and efficiency and in accordance with sound technical, economic, financial, managerial, environmental standards and practices satisfactory to the Association and in accordance with the provisions of the Anti- Anti-Corruption Guidelines applicable to recipients of financing proceeds other than the Recipient as well as the requirements set out in the Environmental Assessment Framework; (B) contribute to the Sub-project an amount equivalent to at least 20% of the said Sub-project’s cost, and thereafter provide promptly as needed, the resources required for carrying out the Sub-project; (C) procure the goods, works and services to be financed out of the Sub-loan in accordance with the provisions of this Agreement and use such goods, works, and services exclusively for the Sub-project; (D) maintain policies and procedures adequate to enable it to monitor and evaluate in accordance with indicators acceptable to the Association, the progress of the Sub- Sub-project and the achievement of its objectives; (1) maintain a financial management system and prepare financial statements in accordance with consistently applied accounting standards as set forth in the Operations Manual, both in a manner adequate to reflect the operations, resources and expenditures related to the Sub-project; and (2) have such financial statements audited by independent auditors as set forth in the Operations Manual, in accordance with consistently applied auditing standards as set forth in the Operations Manual, and promptly furnish the statements as so audited to the Recipient and the Participating Bank; (F) enable the Recipient, the Association and the Participating Bank to inspect the Sub-project, its operation and any relevant records and documents; and (G) prepare and furnish to the Recipient, the Association and the Participating Bank all such information as the Recipient or the Association or the Participating Bank shall reasonably request relating to the foregoing. 4. Unless the Association shall otherwise agree, each of the Participating Bank shall select and approve Beneficiaries in accordance with the criteria and procedures set forth in the Operations Manual, including that a Beneficiary may be selected only if: (a) said Beneficiary has been established and is operating pursuant to the Recipient’s relevant laws and regulations; (b) said Beneficiary: (i) owns less than 1% in the shares of the Participating Bank; and (ii) has none of its shares owned by the Participating Bank or any subsidiary or affiliate thereof; (c) said Beneficiary has a satisfactory financial structure and the organization, management, staff and financial and other resources required for the efficient carrying out of its operations, including the carrying out of the Sub-project, including without limitation: (A) a maximum debt-equity ratio of 75:25 (after receipt and for the first three years for each Sub-loan), unless otherwise agreed with the Association; (B) after receipt of the sub-loan, it generates enough cash during the pay-back period of the Sub-loan to maintain a minimum debt service coverage ratio of at least 1.1:1 (after receipt), unless otherwise agreed with the Association; (d) said Beneficiary has a demonstrated record of profitability in the preceding two business years; and (e) said Beneficiary has demonstrated that the annual energy efficiency savings of the proposed Sub-project shall be at least equal to 20%. 5. For the purpose of Section 4(c) above: