LOAN NUMBER 3-
Guarantee Agreement
(Maria Cristina Project)
BETWEEN
REPUBLIC OF THE PHILIPPINES
AND
INTERNATIONAL BANK FOR RECONSTRUCTION
AND DEVELOPMENT
DATED NOVEMBER 7, 1962


LOAN NUMBER i? P?
Guarantee Agreement
(Maria Cristina Project)
BETWEEN
REPUBLIC OF THE PHILIPPINES
AND
INTERNATIONAL BANK FOR RECONSTRUCTION
AND DEVELOPMENT
DATED NOVEMBER 7, 1962


Marate Agreetrtt
AGREEMENT, dated November 7, 19612, bCtween REPUBL o
OF THE IHLIPPINRs (hereiafter called the Ouarantor) and
INTERNATIONAL iBANK FoR  ECONSTIU 'CTI> N A N1) D E?LOPM E NT
(hercinafter called 1the Bank).
IEKEAS by an agieeieiit of even (Li te h,-rewith between
the Bank aind National Power Corporation (hereinafter
called the BorAower) whilch agreemnent and the sclied-les
therein referred to arc, hereina fter called the Loan Agrec-
nicf, tie Bank has agreed to make to the iBorrower a loan
in various currencies equivalent to Ihree million seven
hundred thousand dollars ($3,700,000) on the terns and
coniditiois set forth in the Loan Agreement, but only on
condition that the Guariantor agrev to guarantee the obli-
gations of the Borrower in respect of sucli loan as here-
inafter provided; and
WirEREAs the Guarantor, in consideration of the Bank's
entering into 1ie Loan Agreenient with the Borrower, has
agreed so to guarantee such obligations of the Borrower;
INow TlERErt   10 e parties bereto hereby agrec as
follows:
ARTICLE I
Sicc'rou *N 1.01. T1 paftic s to 1his Guarantee Agreement
accept ai l th e provisionis of loni R,gulations No. 4 of tho
Bauk dated February 15, 1961 (said Lm-m Regulations No.
4 being hereinafter called tie Loan Regulations), with
the smne force and effect as if flhey were fully set forth
herein.
S )ers 1 .02. Wherev er used in this Agreement, uless
thie confflext. shal.Il othelrwise requ1irFe, tic several t11eri  de-
finet1 in the Lon  Agreement sial Iave tie respective
lmeanings therein set forth.


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ARTICLE II
8I«[',r)N  2.01.  W itilOlut lillitn  ion  r rest or 1sriciion   any
of the olher coveIanls oil its pii in this Agreemenlt con-
tained, fhe Guarannf t hre by ulncolnditionlly gurtees,
as primary obligor Ind not as sIrety meel, te due ald
Imun'tlal payment of the prineild of , and tHe i nh rest .1nd
er clarwges oil, tlLn, the priencipl of ail ind rest on
hlie Bous, thl prmiun, il anly, wn 1he prepaynyllt of 11he
Loan or the reeljulption o tlh  ods, Hwa fitæ ter 1gllar-
nte'es the ptIehual          ()Inof .1lhe11 c  ovenan   and
greemeOts  0f tl(, B rrow r i  tlle  territis  of o i, i  (H h -
n   I  llt, al  s  set  forfl  in  tH 2 A  \grIeie t  1111  ill Hw
l~li 1,.
M;«.1  rN >   ' 2.02.  Wi Juh i  t li ii 11 t il)]  r rest  iet ricion  uøn1   h
1)1r\ iSionIs of Setion (> l of1 ut Ihis A igremnt , the Guara tntour
spleiIi(elyt umlertks, w henever tre is reisona;bl r vnos
for erying 0ut th1le Proj(t. to make aagn  s, sutis-
fctory to the Banlk, promp,y to proid th e Borrower ur
ennse lte Borrower to.he pruvidd wil l seli fiuids s Iear
nleeded !o met suh expenditres.
ARTICLE III
Hra-ios  01. It is  theiý m1111n.-1  in1io  f  1e(um an
l the Bink that n uthr 'rnal debt shall Hwjo    an 1  1ly
w   li' I~   ~  1:1    I   ('11.il.111t i  11.4l  <i  .lii  v
absol~() 1.Ti  h t1l  ,  '   o ntI  j rni l,r  1g11 (1   al ldep
oth l  nr . h rg s  on1), tii   Illon and  th i   and  111t11  inl tihe,
cr1eltionof any sleli lin xres11 s prwvi-ion w ill , tio
t hat effti  ; provided, 110oweer, t11 hati t rgoing provisiols


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of this ecton slhall not apply to: (i) any lien created on
prop)rt y, at Ihe time of purehase thereof, solely as; s,curity
for the payment of Ith ireh-se pric of sih property;
(ii) anien on commericial goods to secure a debt maturing
not more than ome year aller the date oi which il is origi-
n1ally nure and lo bc pa.id1 outf of 1'11( proce'eds of salc
of sluil lonneial ,oods; or (iii)  n lien arising ill the
on'(hilm inr course ol b-anikiiig I ralsatl ions aind seuing a lebt
matulrinig not nore fihan oie v,r after its date.
Tli er   "r 'sset s  ftl Gi arantr'' as uised in this
Section ineludes assets of lite( Guaranir or of auny of its
polienI subdi\isin or of any' 'geny of th'e GIuarantor
or of any such politicI saiivision, iincIudiing Cenfr al Bank
of th1e Philippins or any other insliltution performing tIhe
functions of a central banik.
3EenJs 3.02. (n Th eli Gmarantor aud tihe Bank shall co-
operfe fully to assure thnt th Imr   of th1 Lian will
be accomplished. To tihat end, eahel of then shall furnish
to 111 other' all shei informnintion as it shall reasonably re-
qunest with regnrd to thle geieral status of Ilhe Loan, On
Ite part of Ith,' (harantor, suh11 ilf('mltion shall inude
ifor   ioN0 with !espect lo financial and econiomic condi-
ions in t he ierrito ries of the  uarnor' and the interna-
tional balanec of payments position of he f   Garantor.
(b) TIe Glaranlor and thle llnnk sl fron fiime to tiime
exchaniige view's thoh rutimIheir' representatli ves w i tegnard
lo  m l ers  relaling  to  time  pulrpo(",;ses  1df  tihe  [,()n1 .an1md  thIe
minlmmee Iofhe service tereof. Thwn, e øaranor' shl
promlptiy infomf rite    of any colnitiol wi'l inl'rfrees
with, or threatens to interfere Villi, I1he aéecomlplisihmeint of
tIhe puirposes of' 1the i Loan or llte maiiølnnce u the se rvie
t hereof.
(e) Thle Guarantor slall  fford all r-e'a.lsonable opportuni ty
for acrediled rmepIesentatives of tie Bank to visit any
part of Ihle terriories uf ihe Ghrantor lor purposes reled
to the Loan.


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(c) to leave a sUrphis, for fmancing a reasonable portion of
future expansion of its power fapilities.
ARTICLE IV
SECTION 4.01. The Guarantor shall endorse, in accord-
ance with the provisions of the. Loan Ytegulations, its g'-uar-
antee oil the Bonds to be executed - ' ind delivered by the
Borrower. The Secretary of Finance of the Guarantor ' , and
such person or persons as he tiliall designate in writing are
designated as the authorized representatives of the Guar-
antor for the purposes of Section 6.12 (b) of the Loan
Regulations.
ARTICLE V
SECTION 5.01. The folloN -ing addresses are specified for
the purposes of Section 8.01 of the Loan Regulations:
For the Guarantor:
Central Bank of the Philippines
Manila
Philippines
Alternative address for cablegrams and radiograms:
Philcenbank
Manila
For the Bank:
Intematimial Bajik for
Recoil's fril Cti oil and Development
ISIS H Street, N.W.
Washington 25, D. C.
United Stcates of Anierica,
Alternative address for cablegrams and radiograms:
Intbafrad
Washington, D. C.


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