Common use of Payments Clause in Contracts

Payments. All the amounts due by the Borrower under this Agreement are payable in the Currency of each Tranche to the CEB’s account indicated in the applicable Disbursement Notice. Any payment under this Agreement shall be made on a Business Day subject to the Modified Following Business Day Convention. Any payment shall be deemed paid when the CEB has received the amount on its account. The Borrower or the bank instructed by the Borrower, as the case may be, shall send a written payment notice to the CEB at least five (5) Business Days before payment of any amounts due under this Agreement. All payments to be made by the Borrower under this Agreement shall be calculated and be made without (and free and clear of any deduction for) set-off or counterclaim. If the CEB receives a payment that is insufficient to discharge all the amounts then due and payable by the Borrower under this Agreement, the CEB shall apply that payment in or towards payment of: first, any fees, costs, charges or expenses due but unpaid under this Agreement; secondly, any accrued interest due but unpaid under this Agreement, thirdly, any principal due but unpaid under this Agreement; and fourthly, any other sum due but unpaid under this Agreement. PROJECT IMPLEMENTATION The Borrower shall implement the Project in accordance with the Agreement. The Borrower is the Republic of Serbia, acting through the Ministry of Finance (MoF). The Borrower designates the Ministry of Justice (MoJ) as the Project Implementing Entity (PIE). The entity in charge of the project’s implementation is the Project Implementation Unit (PIU), operating under the Administration for the Execution of Criminal Sanctions of the Ministry of Justice. The PIE shall ensure that the PIU is appropriately staffed and equipped throughout the Project implementation period, to the satisfaction of CEB. The Ministry of Justice has delegated the following competencies and tasks to the PIU: Coordination of activities with local governments and public utility companies, related to urban planning, construction of utility infrastructure, land acquisition, connection of facilities to infrastructure; Preparation of tender documentation and hiring of a designer and other services, goods and works; verification and evaluation of bids, reports and communication with the CEB and contracting; Preparation of project documentation for the new prison facility: project workshops, monitoring and approval; support for obtaining all necessary permits; Coordination between experts, firms, suppliers or contractors and the Ministry of Justice during implementation of the Project, as necessary; and Planning of financing from the state budget, loan and grants, execution of payments and financial monitoring and reporting. In any event, the Borrower remains solely liable to comply with its obligations under the Agreement. Failure to comply with the undertakings set forth hereby under Clause 5 would constitute, irrespective of any other applicable provision of the Loan Regulations, an event in the terms of Article 3.3 (h) of the Loan Regulations and may give rise to (i) the relevant Sub‑project expenditure declared ineligible for Allocation under the Project; and/or (ii) the early reimbursement, suspension or cancellation of the Loan, in whole or in part, under the terms of Articles 3.3 (Early reimbursement of disbursed loans), 3.5 (Suspension by the Bank of undisbursed loans) and 3.6 (Cancellation by the Bank of undisbursed loans) of the Loan Regulations. Duty of Care The Borrower through the PIE and PIU shall apply all care and diligence, and shall exercise all typically used means (including, but not limited to, legal, financial, managerial and technical) required for the proper implementation of the Project. Allocation Period The Borrower shall allocate each Tranche to the Project within twelve (12) months after the relevant Disbursement Date (hereinafter, the “Allocation Period”), unless otherwise agreed in writing by the Borrower and CEB. If a Tranche disbursed by the CEB is not allocated to the Project or is only partially allocated to it within the Allocation Period, the Borrower shall proceed with prepayment of the unallocated amounts on the next Interest Payment Date in the terms provided under Sub-clause 4.7 unless otherwise agreed between the Borrower and CEB. Project Costs The Tranches disbursed under the Loan shall not exceed seventy -one percent (71%) of the total eligible costs of the Project specified under Appendix 1 hereto. If the Tranches disbursed under the Loan exceed the above 71% (by reduction of the total eligible costs or otherwise), the Borrower shall proceed with prepayment of the surplus on the next Interest Payment Date in the terms provided under Sub-clause 4.7. Should the total eligible costs of the Project increase or be revised for whatever reason, the Borrower shall ensure that the additional financial resources for the completion of the Project are available without recourse to the CEB. The plans to finance the increased costs shall be communicated to the CEB without delay. Project Specific Undertakings The Borrower acting through the PIU will provide the CEB with the final designs for review, to the Bank’s satisfaction, including revised project cost estimates, at his earliest convenience prior to launching work tenders. To anticipate such review, the Borrower acting through the PIU is invited to report to the CEB, at any point in time prior to the finalization of the project’s designs, any major discrepancies between feasibility study that was submitted to the CEB during appraisal, and final designs. During the project implementation and in all cases before commissioning of the prison facilities, details of measures taken to implement the provisions of the operational plans of the two facilities shall be shared with the CEB and be to the Bank’s satisfaction. The Borrower acting through the PIU shall set up a complaints system at project level to manage any complaints or queries from the public or other project-affected parties during the project construction phase. The Borrower acting through the PIU shall inform the CEB, as part of the periodic progress reporting, of the outcome of the expropriation process for the Kruševac prison and any additional land expropriation that may be required, including any issues related to the process if such arise. All assets and buildings under the Project must be permanently insured, maintained and operated in accordance with international best practices. All the land, real property rights and permits required for the implementation of the Project must be timely available.

Payments. All the amounts due by the Borrower under this Agreement are payable in the Currency of each Tranche to the CEB’s account indicated in the applicable Disbursement Notice. Any payment under this Agreement shall be made on a Business Day subject to the Modified Following Business Day Convention. Any payment shall be deemed paid when the CEB has received the amount on its account. The Borrower or the bank instructed by the Borrower, as the case may be, shall send a written payment notice to the CEB at least five (5) Business Days before payment of any amounts due under this Agreement. All payments to be made by the Borrower under this Agreement shall be calculated and be made without (and free and clear of any deduction for) set-off or counterclaim. If the CEB receives a payment that is insufficient to discharge all the amounts then due and payable by the Borrower under this Agreement, the CEB shall apply that payment in or towards payment of: first, any fees, costs, charges or expenses due but unpaid under this Agreement; secondly, any accrued interest due but unpaid under this Agreement, thirdly, any principal due but unpaid under this Agreement; and fourthly, any other sum due but unpaid under this Agreement. PROJECT IMPLEMENTATION The Borrower shall implement the Project in accordance with the Agreement. The Borrower is the Republic of Serbia, acting through the Ministry of Finance (MoF). The Borrower designates the Ministry of Justice Education, Science and Technological Development (MoJMoESTD) as the Project Implementing Entity (PIE). The entity in charge of ) and the project’s implementation Public Sector Project Implementations Unit Ltd. Belgrade is the Project Implementation Implementing Unit (PIU). The PIU is entrusted with specific implementation tasks, operating under the Administration for the Execution including but not limited to procurement, management of Criminal Sanctions of the Ministry of Justiceconsultants, financial management (accounting and payments), reporting, evaluation, monitoring and control. The PIE shall ensure that the PIU is appropriately staffed and equipped throughout the Project implementation period, to the satisfaction of CEB. The Ministry of Justice has delegated the following competencies and tasks to the PIU: Coordination of activities with local governments and public utility companies, related to urban planning, construction of utility infrastructure, land acquisition, connection of facilities to infrastructure; Preparation of tender documentation and hiring of a designer and other services, goods and works; verification and evaluation of bids, reports and communication with the CEB and contracting; Preparation of project documentation for the new prison facility: project workshops, monitoring and approval; support for obtaining all necessary permits; Coordination between experts, firms, suppliers or contractors and the Ministry of Justice during implementation of the Project, as necessary; and Planning of financing from the state budget, loan and grants, execution of payments and financial monitoring and reporting. In any event, the Borrower remains solely liable to comply with its obligations under the Agreement. Failure to comply with the undertakings set forth hereby under Clause 5 would constitute, irrespective of any other applicable provision of the Loan Regulations, an event in the terms of Article 3.3 (h) of the Loan Regulations and may give rise to (i) the relevant Sub‑project expenditure declared ineligible for Allocation under the Project; and/or (ii) the early reimbursement, suspension or cancellation of the Loan, in whole or in part, under the terms of Articles 3.3 (Early reimbursement of disbursed loans), 3.5 (Suspension by the Bank of undisbursed loans) and 3.6 (Cancellation by the Bank of undisbursed loans) of the Loan Regulations. Duty of Care The Borrower through the PIE and PIU shall apply all care and diligence, and shall exercise all typically used means (including, but not limited to, legal, financial, managerial and technical) required for the proper implementation of the Project. Allocation Period The Borrower shall allocate each Tranche to the Project within twelve (12) months after the relevant Disbursement Date (hereinafter, the “Allocation Period”), unless otherwise agreed in writing by the Borrower and CEB. If a Tranche disbursed by the CEB is not allocated to the Project or is only partially allocated to it within the Allocation Period, the Borrower shall proceed with prepayment of the unallocated amounts on the next Interest Payment Date in the terms provided under Sub-clause 4.7 unless otherwise agreed between the Borrower and CEB. Project Costs The Tranches disbursed under the Loan shall not exceed seventy -one fifty five percent (7155%) of the total eligible costs of the Project specified under Appendix 1 hereto. If the Tranches disbursed under the Loan exceed the above 7155% (by reduction of the total eligible costs or otherwise), the Borrower shall proceed with prepayment of the surplus on the next Interest Payment Date in the terms provided under Sub-clause 4.7. Should the total eligible costs of the Project increase or be revised for whatever reason, the Borrower shall ensure that the additional financial resources for the completion of the Project are available without recourse to the CEB. The plans to finance the increased costs shall be communicated to the CEB without delay. Project Specific Undertakings The Borrower acting through the PIU will provide the CEB with the final designs for review, to the Bank’s satisfaction, including revised project cost estimates, at his earliest convenience prior to launching work tenders. To anticipate such review, the Borrower acting through the PIU is invited to report to the CEB, at any point in time prior to the finalization of the project’s designs, any major discrepancies between feasibility study that was submitted to the CEB during appraisal, PIE and final designs. During the project implementation and in all cases before commissioning of the prison facilities, details of measures taken to implement the provisions of the operational plans of the two facilities shall be shared with the CEB and be to the Bank’s satisfaction. The Borrower acting through the PIU shall set up a complaints system at project level to manage any complaints or queries from the public or other project-affected parties during the project construction phase. The Borrower acting through the PIU shall inform the CEB, CEB as part soon as possible about any significant (above 10%) revision in the project costs as set forth in appendix 5 table 1 ; The Borrower through the PIE and PIU shall inform the CEB in case subsidies are needed to ensure the long-term viability of the periodic progress reportinginvestment, e.g. to cover operations and maintenance costs; the Borrower through the PIE and PIU shall ensure the availability of funds for such purposes; The Borrower through the outcome of the expropriation process for the Kruševac prison PIE and any additional land expropriation PIU shall ensure that may be required, including any issues related further undertakings with regards to the process if such arise. environmental and social safeguards as stipulated in Sub-clause 5.6 hereunder are complied with; All assets and buildings plants under the Project must be are permanently insured, maintained and operated in accordance with international best practices. All ; and all the land, real property rights and permits required for the implementation of the Project must be are timely available.;

Payments. All the amounts due by the Borrower under this Agreement are payable in the Currency of each Tranche to the CEB’s account indicated in the applicable Disbursement Notice. Any payment under this Agreement shall be made on a Business Day subject to the Modified Following Business Day Convention. Any payment shall be deemed paid when the CEB has received the amount on its account. The Borrower or the bank instructed by the Borrower, as the case may be, shall send a written payment notice to the CEB at least five (5) Business Days before payment of any amounts due under this Agreement. All payments to be made by the Borrower under this Agreement shall be calculated and be made without (and free and clear of any deduction for) set-off or counterclaim. If the CEB receives a payment that is insufficient to discharge all the amounts then due and payable by the Borrower under this Agreement, the CEB shall apply that payment in or towards payment of: : (i) first, any fees, costs, charges or expenses due but unpaid under this Agreement; ; (ii) secondly, any accrued interest due but unpaid under this Agreement, , (iii) thirdly, any principal due but unpaid under this Agreement; and and (iv) fourthly, any other sum due but unpaid under this Agreement. PROJECT IMPLEMENTATION The Borrower shall implement the Project in accordance with the Agreement. The Borrower is the Republic of Serbia, acting through the designates Ministry of Finance Education, Science and Technological Development (MoF). The Borrower designates the Ministry of Justice (MoJMoE) as the Project Implementing Entity (PIE). The entity in charge of ) and the project’s implementation Public Investment Management Office (PIMO) is the Project Implementation Implementing Unit (PIU). PIMO is entrusted with specific implementation tasks, operating under the Administration for the Execution including but not limited to procurement, management of Criminal Sanctions of the Ministry of Justiceconsultants, financial management (accounting and payments), reporting, evaluation, monitoring and control. The PIE Project coordination interlocutor from PIMO shall be the Project Coordinator, who shall coordinate Project activities among all Serbia’s stakeholders, and report to CEB. The Borrower shall ensure that the PIU appointed by the PIE is appropriately staffed and equipped throughout the Project implementation period, to the satisfaction of CEB. The Ministry of Justice has delegated the following competencies and tasks to the PIU: Coordination of activities with local governments and public utility companies, related to urban planning, construction of utility infrastructure, land acquisition, connection of facilities to infrastructure; Preparation of tender documentation and hiring of a designer and other services, goods and works; verification and evaluation of bids, reports and communication with the CEB and contracting; Preparation of project documentation for the new prison facility: project workshops, monitoring and approval; support for obtaining all necessary permits; Coordination between experts, firms, suppliers or contractors and the Ministry of Justice during implementation of the Project, as necessary; and Planning of financing from the state budget, loan and grants, execution of payments and financial monitoring and reporting. In any event, the Borrower remains solely liable to comply with its obligations under the Agreement. Failure to comply with the undertakings set forth hereby under Clause 5 would constitute, irrespective of any other applicable provision of the Loan Regulations, an event in the terms of Article 3.3 (h) of the Loan Regulations and may give rise to (i) the relevant Sub‑project Sub-project expenditure declared ineligible for Allocation under the Project; and/or (ii) the early reimbursement, suspension or cancellation of the Loan, in whole or in part, under the terms of Articles 3.3 (Early reimbursement of disbursed loans), 3.5 (Suspension by the Bank of undisbursed loans) and 3.6 (Cancellation by the Bank of undisbursed loans) of the Loan Regulations. . 5.1 Duty of Care The Borrower through the PIE and PIU shall apply all care and diligence, and shall exercise all typically used means (including, but not limited to, legal, financial, managerial and technical) required for the proper implementation of the Project. Allocation Period The Borrower shall allocate each Tranche to the Project within twelve (12) months after the relevant Disbursement Date (hereinafter, the “Allocation Period”), unless otherwise agreed in writing by the Borrower and CEB. If a Tranche disbursed by the CEB is not allocated to the Project or is only partially allocated to it within the Allocation Period, the Borrower shall proceed with prepayment of the unallocated amounts on the next Interest Payment Date in the terms provided under Sub-clause 4.7 unless otherwise agreed between the Borrower and CEB. Project Costs The Tranches disbursed under the Loan shall not exceed seventy -one percent (71%) of the total eligible costs of the Project specified under Appendix 1 hereto. If the Tranches disbursed under the Loan exceed the above 71% (by reduction of the total eligible costs or otherwise), the Borrower shall proceed with prepayment of the surplus on the next Interest Payment Date in the terms provided under Sub-clause 4.7. Should the total eligible costs of the Project increase or be revised for whatever reason, the Borrower shall ensure that the additional financial resources for the completion of the Project are available without recourse to the CEB. The plans to finance the increased costs shall be communicated to the CEB without delay. Project Specific Undertakings The Borrower acting through the PIU will provide the CEB with the final designs for review, to the Bank’s satisfaction, including revised project cost estimates, at his earliest convenience prior to launching work tenders. To anticipate such review, the Borrower acting through the PIU is invited to report to the CEB, at any point in time prior to the finalization of the project’s designs, any major discrepancies between feasibility study that was submitted to the CEB during appraisal, and final designs. During the project implementation and in all cases before commissioning of the prison facilities, details of measures taken to implement the provisions of the operational plans of the two facilities shall be shared with the CEB and be to the Bank’s satisfaction. The Borrower acting through the PIU shall set up a complaints system at project level to manage any complaints or queries from the public or other project-affected parties during the project construction phase. The Borrower acting through the PIU shall inform the CEB, as part of the periodic progress reporting, of the outcome of the expropriation process for the Kruševac prison and any additional land expropriation that may be required, including any issues related to the process if such arise. All assets and buildings under the Project must be permanently insured, maintained and operated in accordance with international best practices. All the land, real property rights and permits required for the implementation of the Project must be timely available.Care

Payments. All the amounts due by the Borrower under this Agreement are payable in the Currency of each Tranche to the CEB’s account indicated in the applicable Disbursement Notice. Any payment under this Agreement shall be made on a Business Day subject to the Modified Following Business Day Convention. Any payment shall be deemed paid when the CEB has received the amount on its account. The Borrower or the bank instructed by the Borrower, as the case may be, shall send a written payment notice to the CEB at least five (5) Business Days before payment of any amounts due under this Agreement. All payments to be made by the Borrower under this Agreement shall be calculated and be made without (and free and clear of any deduction for) set-off or counterclaim. If the CEB receives a payment that is insufficient to discharge all the amounts then due and payable by the Borrower under this Agreement, the CEB shall apply that payment in or towards payment of: : (i) first, any fees, costs, charges or expenses due but unpaid under this Agreement; ; (ii) secondly, any accrued interest due but unpaid under this Agreement, , (iii) thirdly, any principal due but unpaid under this Agreement; and and (iv) fourthly, any other sum due but unpaid under this Agreement. PROJECT IMPLEMENTATION The Borrower shall implement the Project in accordance with the Agreement. The Borrower is the Republic of Serbia, acting through the designates Ministry of Finance (MoF)Education, Science and Technological Development as the PIE. The Borrower designates the Ministry of Justice (MoJ) as the Project Implementing Entity (PIE). The entity in charge of the project’s implementation is the Project Implementation Unit (PIU), operating under the Administration for the Execution of Criminal Sanctions of the Ministry of Justice. The PIE shall ensure that the PIE appoints a PIU is appropriately staffed and equipped throughout the Project implementation period, to the satisfaction of CEB. The Ministry of Justice has delegated the following competencies and tasks to the PIU: Coordination of activities with local governments and public utility companies, related to urban planning, construction of utility infrastructure, land acquisition, connection of facilities to infrastructure; Preparation of tender documentation and hiring of a designer and other services, goods and works; verification and evaluation of bids, reports and communication with the CEB and contracting; Preparation of project documentation for the new prison facility: project workshops, monitoring and approval; support for obtaining all necessary permits; Coordination between experts, firms, suppliers or contractors and the Ministry of Justice during implementation of the Project, as necessary; and Planning of financing from the state budget, loan and grants, execution of payments and financial monitoring and reporting. In any event, the Borrower remains solely liable to comply with its obligations under the Agreement. Failure to comply with the undertakings set forth hereby under Clause 5 would constitute, irrespective of any other applicable provision of the Loan Regulations, an event in the terms of Article 3.3 (h) of the Loan Regulations and may give rise to (i) the relevant Sub‑project expenditure declared ineligible for Allocation under the Project; and/or (ii) the early reimbursement, suspension or cancellation of the Loan, in whole or in part, under the terms of Articles 3.3 (Early reimbursement of disbursed loans), 3.5 (Suspension by the Bank of undisbursed loans) and 3.6 (Cancellation by the Bank of undisbursed loans) of the Loan Regulations. . 5.1 Duty of Care The Borrower through the PIE and PIU shall apply all care and diligence, and shall exercise all typically used means (including, but not limited to, legal, financial, managerial and technical) required for the proper implementation of the Project. Allocation Period The Borrower shall allocate each Tranche to the Project within twelve (12) months after the relevant Disbursement Date (hereinafter, the “Allocation Period”), unless otherwise agreed in writing by the Borrower and CEB. If a Tranche disbursed by the CEB is not allocated to the Project or is only partially allocated to it within the Allocation Period, the Borrower shall proceed with prepayment of the unallocated amounts on the next Interest Payment Date in the terms provided under Sub-clause 4.7 unless otherwise agreed between the Borrower and CEB. Project Costs The Tranches disbursed under the Loan shall not exceed seventy -one percent (71%) of the total eligible costs of the Project specified under Appendix 1 hereto. If the Tranches disbursed under the Loan exceed the above 71% (by reduction of the total eligible costs or otherwise), the Borrower shall proceed with prepayment of the surplus on the next Interest Payment Date in the terms provided under Sub-clause 4.7. Should the total eligible costs of the Project increase or be revised for whatever reason, the Borrower shall ensure that the additional financial resources for the completion of the Project are available without recourse to the CEB. The plans to finance the increased costs shall be communicated to the CEB without delay. Project Specific Undertakings The Borrower acting through the PIU will provide the CEB with the final designs for review, to the Bank’s satisfaction, including revised project cost estimates, at his earliest convenience prior to launching work tenders. To anticipate such review, the Borrower acting through the PIU is invited to report to the CEB, at any point in time prior to the finalization of the project’s designs, any major discrepancies between feasibility study that was submitted to the CEB during appraisal, and final designs. During the project implementation and in all cases before commissioning of the prison facilities, details of measures taken to implement the provisions of the operational plans of the two facilities shall be shared with the CEB and be to the Bank’s satisfaction. The Borrower acting through the PIU shall set up a complaints system at project level to manage any complaints or queries from the public or other project-affected parties during the project construction phase. The Borrower acting through the PIU shall inform the CEB, as part of the periodic progress reporting, of the outcome of the expropriation process for the Kruševac prison and any additional land expropriation that may be required, including any issues related to the process if such arise. All assets and buildings under the Project must be permanently insured, maintained and operated in accordance with international best practices. All the land, real property rights and permits required for the implementation of the Project must be timely available.Care

Payments. All the amounts due by the Borrower under this Agreement are payable in the Currency of each Tranche to the CEB’s account indicated in the applicable Disbursement Notice. Any payment under this Agreement shall be made on a Business Day subject to the Modified Following Business Day Convention. Any payment shall be deemed paid when the CEB has received the amount on its account. The Borrower or the bank instructed by the Borrower, as the case may be, shall send a written payment notice to the CEB at least five (5) Business Days before payment of any amounts due under this Agreement. All payments to be made by the Borrower under this Agreement shall be calculated and be made without (and free and clear of any deduction for) set-off or counterclaim. If the CEB receives a payment that is insufficient to discharge all the amounts then due and payable by the Borrower under this Agreement, the CEB shall apply that payment in or towards payment of: : (i) first, any fees, costs, charges or expenses due but unpaid under this Agreement; ; (ii) secondly, any accrued interest due but unpaid under this Agreement, , (iii) thirdly, any principal due but unpaid under this Agreement; and and (iv) fourthly, any other sum due but unpaid under this Agreement. PROJECT IMPLEMENTATION The Borrower shall implement the Project in accordance with the Agreement. The Borrower is the Republic of Serbia, acting through the Ministry of Finance (MoF). The Borrower designates the Ministry of Justice (MoJ) as the Project Implementing Entity (PIE). The entity in charge of the project’s implementation is the Project Implementation Unit (PIU), operating under the Administration for the Execution of Criminal Sanctions of the Ministry of Justice. The PIE shall ensure that the PIU is appropriately staffed and equipped throughout the Project implementation period, to the satisfaction of CEB. The Ministry of Justice has delegated the following competencies and tasks to the PIU: : (i) Coordination of activities with local governments and public utility companies, related to urban planning, construction of utility infrastructure, land acquisition, connection of facilities to infrastructure; ; (ii) Preparation of tender documentation and hiring of a designer and other services, goods and works; verification and evaluation of bids, reports and communication with the CEB and contracting; ; (iii) Preparation of project documentation for the new prison facility: project workshops, monitoring and approval; support for obtaining all necessary permits; ; (iv) Coordination between experts, firms, suppliers or contractors and the Ministry of Justice during implementation of the Project, as necessary; and and (v) Planning of financing from the state budget, loan and grants, execution of payments and financial monitoring and reporting. In any event, the Borrower remains solely liable to comply with its obligations under the Agreement. Failure to comply with the undertakings set forth hereby under Clause 5 would constitute, irrespective of any other applicable provision of the Loan Regulations, an event in the terms of Article 3.3 (h) of the Loan Regulations and may give rise to (i) the relevant Sub‑project Sub-project expenditure declared ineligible for Allocation under the Project; and/or (ii) the early reimbursement, suspension or cancellation of the Loan, in whole or in part, under the terms of Articles 3.3 (Early reimbursement of disbursed loans), 3.5 (Suspension by the Bank of undisbursed loans) and 3.6 (Cancellation by the Bank of undisbursed loans) of the Loan Regulations. . 5.1 Duty of Care The Borrower through the PIE and PIU shall apply all care and diligence, and shall exercise all typically used means (including, but not limited to, legal, financial, managerial and technical) required for the proper implementation of the Project. Allocation Period The Borrower shall allocate each Tranche to the Project within twelve (12) months after the relevant Disbursement Date (hereinafter, the “Allocation Period”), unless otherwise agreed in writing by the Borrower and CEB. If a Tranche disbursed by the CEB is not allocated to the Project or is only partially allocated to it within the Allocation Period, the Borrower shall proceed with prepayment of the unallocated amounts on the next Interest Payment Date in the terms provided under Sub-clause 4.7 unless otherwise agreed between the Borrower and CEB. Project Costs The Tranches disbursed under the Loan shall not exceed seventy -one percent (71%) of the total eligible costs of the Project specified under Appendix 1 hereto. If the Tranches disbursed under the Loan exceed the above 71% (by reduction of the total eligible costs or otherwise), the Borrower shall proceed with prepayment of the surplus on the next Interest Payment Date in the terms provided under Sub-clause 4.7. Should the total eligible costs of the Project increase or be revised for whatever reason, the Borrower shall ensure that the additional financial resources for the completion of the Project are available without recourse to the CEB. The plans to finance the increased costs shall be communicated to the CEB without delay. Project Specific Undertakings The Borrower acting through the PIU will provide the CEB with the final designs for review, to the Bank’s satisfaction, including revised project cost estimates, at his earliest convenience prior to launching work tenders. To anticipate such review, the Borrower acting through the PIU is invited to report to the CEB, at any point in time prior to the finalization of the project’s designs, any major discrepancies between feasibility study that was submitted to the CEB during appraisal, and final designs. During the project implementation and in all cases before commissioning of the prison facilities, details of measures taken to implement the provisions of the operational plans of the two facilities shall be shared with the CEB and be to the Bank’s satisfaction. The Borrower acting through the PIU shall set up a complaints system at project level to manage any complaints or queries from the public or other project-affected parties during the project construction phase. The Borrower acting through the PIU shall inform the CEB, as part of the periodic progress reporting, of the outcome of the expropriation process for the Kruševac prison and any additional land expropriation that may be required, including any issues related to the process if such arise. All assets and buildings under the Project must be permanently insured, maintained and operated in accordance with international best practices. All the land, real property rights and permits required for the implementation of the Project must be timely available.Care