OFFICIAL
DOCUMENTS
CREDIT NUMBER 6098-NG (Portion A of the Credit)
CREDIT NUMBER 6099-NG (Portion B of the Credit)
Financing Agreement
(Kaduna State Economic Transformation Program)
between
FEDERAL REPUBLIC OF NIGERIA
and
INTERNATIONAL DEVELOPMENT ASSOCIATION
Dated5STHpl ,1? I-L. 2017


CREDIT NUMBER 6098-NG (Portion A of the Credit)
CREDIT NUMBER 6099-NG (Portion B of the Credit)
FINANCING AGREEMENT
AGREEMENT     dated      &,                    , 2017, entered into
between the FEDERAL REPUBLIC OF NIGERIA ("Recipient") and the
INTERNATIONAL DEVELOPMENT ASSOCIATION ("Association"). The Recipient
and the Association hereby agree as follows:
ARTICLE I - GENERAL CONDITIONS; DEFINITIONS
1.01. The General Conditions (as defined in the Appendix to this Agreement) constitute
an integral part of this Agreement.
1.02. Unless the context requires otherwise, the capitalized terms used in this Agreement
have the meanings ascribed to them in the General Conditions or in the Appendix
to this Agreement.
ARTICLE II - FINANCING
2.01. The Association agrees to extend to the Recipient, on the terms and conditions set
forth or referred to in this Agreement, a credit in two portions as follows:
(a)    an amount equivalent to ninety-seven million six hundred thousand
Special Drawing Rights (SDR 97,600,000) (Portion A of the Credit); and
(b)    an amount equivalent to one hundred fifty-seven million eight hundred
thousand Special Drawing Rights (SDR 157,800,000) (Portion B of the
Credit)
(Portion A of the Credit and Portion B of the Credit variously collectively referred
to as "Credit" and "Financing"), to assist in financing the program described in
Schedule 1 to this Agreement ("Program").
2.02.  The Recipient may withdraw the proceeds of the Financing in accordance with
Section IV of Schedule 2 to this Agreement. All withdrawals from the Financing
Account shall be deposited by the Association into an account specified by the
Recipient and acceptable to the Association. The Recipient's Representative for
purposes of taking any action required or permitted to be taken pursuant to this
Section is the director or deputy director, department of international economic
relations, Federal Ministry of Finance.
2.03. The Maximum Commitment Charge Rate payable by the Recipient on the
Unwithdrawn Financing Balance shall be one-half of one percent (1/2 of 1%) per
annum.


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2.04.  The Service Charge payable by the Recipient on the Withdrawn Credit Balance
shall be equal to three-fourths of one percent (3/4 of 1%) per annum.
2.05.  The Interest Charge payable by the Recipient on the Withdrawn Credit Balance
shall be equal to:
(a)    one point thirteen percent (1.13%) per annum on Portion A of the Credit;
and
(b)    one point twenty-five percent (1.25%) per annum on Portion B of the
Credit.
2.06.  The Payment Dates are February 1 and August I in each year.
2.07.  The principal amount of the Credit shall be repaid in accordance with the
repayment schedule set forth in Schedule 3 to this Agreement.
2.08.  The Payment Currency is Dollar.
ARTICLE III - PROGRAM
3.01.  The Recipient declares its commitment to the objectives of the Program. To this
end, the Recipient shall carry out the Program or cause the Program to be carried
out in accordance with the provisions of Article IV of the General Conditions.
3.02.  Without limitation upon the provisions of Section 3.01 of this Agreement, and
except as the Recipient and the Association shall otherwise agree, the Recipient
shall ensure that the Program is carried out in accordance with the provisions of
Schedules 2 to this Agreement.
ARTICLE IV - REMEDIES OF THE ASSOCIATION
4.01.  The Additional Event of Suspension consists of following, namely, that an action
has been taken or a policy has been adopted which results or may result in any
significant reversal of any part of the Program and /or any activity implemented
pursuant to the Program Action Plan; and
4.02.  The Additional Event of Acceleration consists of the following, namely, that any
of the events specified in Section 4.01 of this Agreement occurs and is continuing
for a period of sixty (60) days after notice of the event has been given by the
Association to the Recipient.


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ARTICLE V - EFFECTIVENESS; TERMINATION
5.01. The Additional Condition of Effectiveness consists of the following, namely, that
the Subsidiary Agreement has been executed on behalf of the Recipient and
Kaduna State.
5.02. The Additional Legal Matter consists of the following, namely, that the Subsidiary
Agreement has been duly authorized or ratified by the Recipient and Kaduna State
and is legally binding upon the Recipient and Kaduna State in accordance with its
terms.
5.03   The Effectiveness Deadline is the date one hundred eighty (180) days after the date
of this Agreement.
5.04. For purposes of Section 8.05(b) of the General Conditions, the date on which the
obligations of the Recipient under this Agreement (other than those providing for
payment obligations) shall terminate is twenty years after the date of this
Agreement.
ARTICLE VI- REPRESENTATIVE; ADDRESSES
6.01. The Recipient's Representative is its minister responsible for finance.
6.02. The Recipient's Address is:
Federal Ministry of Finance
Ahmadu Bello Way
Abuja, Federal Republic of Nigeria
Facsimile:
234-9-6273609
6.03. The Association's Address is:
International Development Association
1818 H Street, N.W.
Washington, D.C. 20433
United States of America
Telex:              Facsimile:
248423 (MCI)        1-202-477-6391


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AGREED at        <L      _   , _, as of the
day and year first above written.'
FEDERAL REPUBLIC OF NIGERIA
By:
Authorized Representative
Name: tVENi    (E4Su   1tM6)
Title: HnTURA&LE Mi09AE6- FAWt,
INTERNATIONAL DEVELOPMENT ASSOCIATION
By:
Authorized Representative
Name:   RQLo3A
Title: caulky   irpe,4%-


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SCHEDULE1
Program Description
The objective of the Program is to improve the business enabling environment and
strengthen fiscal management and accountability in Kaduna State.
The Program supports the Recipient's Kaduna State Development Plan ("KSDP"),
with a focus on the economic development and governance pillars and consists of the
following activities:
1 .    Promoting private investments through support for Kaduna State policy reforms to
improve the enabling environment and increase private investments, including
through support for: (a) transversal reforms to improve regulations affecting the
entry and operations of small and medium enterprises; (b) improved investment
policy and promotion, including the development of Public Private Partnerships;
(c) simplifying the registration of property, including through support for the
Systematic Property Registration Program implemented by the Kaduna
Geographical Information Services ("KADGIS"); and (d) the development and
implementation of a Framework for Responsible and Inclusive Land-Intensive
Agricultural Investments for Kaduna State.
2.     Strengthening fiscal management and accountability, including citizens'
engagement through: (a) improving revenue generation; (b) strengthening public
investment management; and (c) fostering fiscal accountability.


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SCHEDULE 2
Program Execution
Section I.   Implementation Arrangements
A.     Program Fiduciary, Environmental and Social Systems
Without limitation upon the provisions of Article IV of the General Conditions,
the Recipient shall carry out the Program, or cause the Program to be carried out, in
accordance with financial management, procurement and environmental and social
management systems acceptable to the Association, including those set forth in the ESSA
and the Program Action Plan ("Program Fiduciary, Environmental and Social Systems")
which are designed to ensure that:
1.     The Financing proceeds are used for their intended purposes, with due attention to
the principles of economy, efficiency, effectiveness, transparency, and
accountability.
2.     The actual and potential adverse environmental and social impacts of the Program
are identified, avoided, minimized, or mitigated, as the case may be, all through an
informed decision-making process.
B.     Anti-Corruption
Without limitation upon the provisions of Part A of this Section, the Recipient shall
carry out the Program, or cause the Program to be carried out, in accordance with
the provisions of the Anti-Corruption Guidelines.
C.     Other Program Institutional and Implementation Arrangements
1.     Program Institutions
Without limitation upon Part A of this Section, the Recipient shall maintain or
cause to be maintained at all times during Program implementation, adequate
institutional arrangements satisfactory to the Association as necessary, to achieve
the objectives of the Program as further detailed in the Program Implementation
Manual, including the following:
(a)    the Recipient shall maintain the Program Steering Committee until
completion of the Program with composition, mandate, and resources
satisfactory to the Association to ensure coordination with all relevant
MDAs under the Program; and


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(b)    the Kaduna State Ministry of Budget and Planning, in close coordination
with the Kaduna State Ministry of Finance shall be responsible for overall
implementation of the Program.
2.     Subsidiary Agreement
To facilitate the carrying out of the Program, the Recipient shall make the proceeds
of the Financing available to Kaduna State under a subsidiary agreement between
the Recipient and Kaduna State Ministry of Finance, under terms and conditions
approved by the Association ("Subsidiary Agreement"), which shall include the
following:
(a)    The principal amount of the Credit made available under the Subsidiary
Agreement ("Subsidiary Credit") shall be: (a) denominated and repayable
in Naira; (b) charged interest on the principal amount withdrawn and
outstanding from time to time at the rate of: (i) 1.13% per annum on
amounts withdrawn under Portion A of the Credit; and (ii) 1.25% per
annum on amounts withdrawn under Portion B of the Credit; and
(c) repayable over a period not exceeding twenty-five (25) years from the
date of the Subsidiary Agreement, inclusive of a grace period not
exceeding five (5) years.
(b)    The Subsidiary Agreement shall detail mutual responsibilities for the
implementation of the Program and other terms and conditions as may be
approved by the Association, such terms and conditions to include the
obligation of Kaduna State to: (i) carry out its activities under the Program
with due diligence and efficiency and in accordance with the Program
Fiduciary, Environmental and Social Systems, including those set forth in
the ESSA and the Program Action Plan, the Program Implementation
Manual, and the Anti-corruption Guidelines; (ii) maintain policies and
procedures adequate to enable it to monitor the progress of its activities
under the Program and the achievement of the Program's objectives;
(iii) enable the Recipient and the Association to inspect the Program
activities within the Kaduna State's jurisdiction, its operation and any
relevant records and documents; and (iv) prepare and furnish to the
Recipient and the Association all such information as the Recipient or the
Association may reasonably request relating to the foregoing.
(c)    The Recipient shall exercise its rights under the Subsidiary Agreement in
such manner as to protect the interests of the Recipient and the Association
and to accomplish the purposes of the Financing. Except as the
Association shall otherwise agree, the Recipient shall not assign, amend,
abrogate or waive the Subsidiary Agreement or any of its provisions.


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E.     Program Implementation Manual
1.     No later than three (3) months after the Effective Date, the Recipient shall prepare
a Program implementation manual in form and substance satisfactory to the
Association, containing detailed arrangements and procedures for implementation
of the Program including inter alia: (a) disbursement and flow of funds
arrangements; (b) institutional arrangements; (c) financial management, and
governance arrangements; (d) environmental and social management systems
including  the  ESSA    and   Program   grievance  redress  mechanism;
(e) monitoring and evaluation, reporting and communication, including Program
indicators; (f) Program Action Plan; (g) detailed arrangements for verification of
achievement of DLRs (including the Verification Protocol); and (h) such other
administrative, financial, technical and organizational arrangements and
procedures as shall be required for the Program.
2.     The Recipient shall: (a) furnish to and exchange views with the Association on
such manual promptly upon its preparation; and (b) thereafter adopt such manual
as shall have been approved by the Association ("Program Implementation
Manual").
3.     The Recipient shall ensure, and shall cause Kaduna State to ensure, that the
Program is carried out in accordance with the arrangements and procedures set out
in the PIM (provided, however, that in case of any conflict between the
arrangements and procedures set out in the PIM and the provisions of this
Agreement, the provisions of this Agreement shall prevail), and shall not amend,
abrogate or waive, or permit to be amended, abrogated or waived, the PIM or any
of its provisions without the prior approval in writing by the Association.
F.     Program Action Plan
Without limitation to the provisions of Section I.A of this Schedule, the Recipient
shall carry out the Program Action Plan, or cause the Program Action Plan to be
carried out in a manner satisfactory to the Association.
G.     DLR Verification Protocol
1 .    No later than ninety (90) days after the Effective Date, the Recipient, through
Kaduna State, shall recruit one or more organizations with experience,
independence, and capacity and under terms of reference acceptable to the
Association ("Independent Verification Agent(s)" or "IVA") to verify the data and
other evidence supporting the achievement of one or more Disbursement Linked
Results ("DLRs") as set forth in the DLI Verification Protocol and recommend
corresponding payments to be made.


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2.     The Recipient shall: (a) ensure that the Independent Verification Agent(s) carries/
carry out verification process(es) in accordance with the DLI Verification
Protocol; and (b) submit to the Association the corresponding verification reports
in a timely manner and in form and substance satisfactory to the Association.
3.     In the event there is a need for verification services prior to the recruitment of the
firm in accordance with sub-paragraph I above, the Recipient shall put in place
adequate interim arrangements satisfactory to the Association and approved in
writing by the Association for verification of the DLRs.
Section II.   Excluded Activities
The Recipient shall ensure that the Program excludes any activities which:
(a)    in the opinion of the Association, are likely to have significant adverse
impacts that are sensitive, diverse, or unprecedented on the environment
and/or affected people; or
(b)    involve the procurement of: (i) works, estimated to cost fifty million
Dollars ($50,000,000) equivalent or more per contract; (ii) goods,
estimated to cost thirty million Dollars ($30,000,000) equivalent or more
per contract; (iii) non-consulting services, estimated to cost twenty million
Dollars ($20,000,000) equivalent or more per contract; or (iv) consulting
services, estimated to cost fifteen million Dollars ($15,000,000)
equivalent or more per contract.
Section III.  Program Monitoring, Reporting and Evaluation, Audits
A.     Program Reports
The Recipient shall monitor and evaluate the progress of the Program and prepare
Program Reports in accordance with the provisions of Section 4.08 of the General
Conditions. Each Program Report shall cover the period of one calendar semester,
and shall be furnished to the Association not later than one month after the end of
the period covered by such report.
B.     Program Financial Audits
Without limitation upon the generality of Section L.A of this Schedule 2 and
Section 4.09 of the General Conditions, the Recipient shall have the Financial
Statements audited in accordance with the provisions of Section 4.09(b) of the
General Conditions. Unless otherwise agreed by the Association, each audit of the
Financial Statements shall cover the period of one fiscal year of the Recipient. The
audited Financial Statements for each such period shall be furnished to the
Association not later than nine (9) months after the end of such period.


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Section IV.   Withdrawal of Program Financing Proceeds
A.     General
1.     The Recipient may withdraw the proceeds of the Financing in accordance with the
provisions of Article II of the General Conditions applicable to the Program, this
Section, and such additional instructions as the Association may specify from time
to time by notice to the Recipient to: (a) finance the results ("DLRs") achieved by
the Recipient, as measured against specific indicators ("Disbursement Linked
Indicators" or "DLIs"); all as set forth in the table in paragraph 2 of this Part A.
2.     The following table specifies each category of withdrawal of the proceeds of the
Financing (including the Disbursement Linked Indicators as applicable)
("Category"), the Disbursement Linked Results for each Category (as applicable),
and the allocation of the amounts of the Financing to each Category:


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Portion A     Portion B                                   Disbursement Linked Result (as applicable)
Category      Amount ofthe   Amount of                                     (Indicative timeline or DLI achievement)
(including        Credit      the Credit
Disbursement      Allocated     Allocated
Linked Indicator  (expressed in  (expressed     DLI
as applicable       SDR)        in SDR)      Baseline    Prior results  FY2017       FY2018       FY2019      FY2020
(1) DLI l:          25,540,000                  248 days   Approval of       217          186          155         123
Simplified                                   (2014)    Ease of Doing
business                                               Business
processes:                                             Charter
reduction in the
time required to
start a business,
deal with
construction
permit and
register
property
Allocated amount:                                              7.33         4.52         4.52         4.52        4.68
Scalability formula:
SDR 145,877 per
reduced day
(capped to SDR
18,230,000)
(2) DLI 2:          25,540,000                     0       3,000 new        7,000        10,000      10,000       10,000
Implementation                            (Jan. 2017)  CofOs issued
of systematic                                          by June 30,
property                                               2017
registration
program: # of


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new CofOs,                                          Approval of
issued                                              KADGIS
regulations
Allocated amount:                                          9.12         3.07        4.45        4.45        4.45
Scalability formula:
SDR 443,544 per
1,000 new CofOs
(capped to SDR
16,410,000)
(3) DLI 3:         25,540,000                   10     Organization       8           8           8           8
Strengthening                            (Jan. 2017)  of
investment                                          KADINVEST
promotion:                                          2.0
number of                                           (April 5-6,
Memoranda of                                        2017)
Understanding
signed between
investors and
KADIPA
Allocated amount:                                          3.66         5.47        5.47        5.47        5.47
Scalability formula:
SDR 683,797 for
every new
Memorandum of
Understanding
signed (capped to
SDR 21,880,000)
(4) DLI 4:         20,980,000   4,560,000  Incomplete                Enactment   Project     FCCL from   One PPP
Development of                          legal and                 of legal and  Facilitation  existing  transaction
the legal and                                                    institutional  Fund Rules, projects  with low


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institutional                            institutional              framework    Governance   measured    environment
framework for                            framework                  for PPP      and          and         and social
PPP                                                                              Operational  disclosed;  risks reaches
Manual      PPP          commercial
prepared;   disclosure   closure
develop-    framework
ment of PPP  adopted;
pipeline,   web portal
pre-        established
feasibility  and project
study for 3  information
priority    available;
transactions; detailed
PPP Fiscal  feasibility
Commit-     studies for 1
ment and    transaction
Contingent  with low
Liability   environmen-
Manage-     tal and
ment        social risks
Framework   completed;
(FCCL)      Project
adopted;    Facilitation
Fund
established
and seed of
N. 60
million
Naira
________________________________________________________provided


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Allocated amount:                                              -       6.38 (under  6.38 (under  6.38 (under  1.84 (under
Portion A of Portion A of  Portion A of  Portion A of
the Credit)  the Credit)  the Credit)  the Credit)
4.56 (under
Portion B of
the Credit)
Scalability formula:
Not scalable.
(5) DLI 5:                       25,540,000  No FRILIA   FRILIA                     FRILIA in   Enactment   Social audit
Development                                           principles                line with    of FRILIA   confirms
and                                                   approved by               approved                 satisfactory
implementation                                        Kaduna State              principles               implementa-
of a Framework                                        governor                  developed                tion of
for Responsible                                                                 through a                FRILIA
and Inclusive                                                                   consultative
Land-Intensive                                                                  process
Agricultural
Investments
(FRILIA)
Allocated amount                                             3.67                      7.29        7.29        7.29
Scalability formula:
Not scalable.
(6) DLI 6:                       25,540,000     42%      BATMIS fully      50%         55%         60%          66%
Increasing IGR                              (2016)    operational for
outturn                                               revenues and
expenditure
chain
Allocated amount:                                            3.67         7.29         4.56        4.56        5.46
Scalability formula:


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SDR 911,730 per
point rounded to
the closest point
(capped to SDR
21,880,000)
(7) DLI 7:                       25,540,000     6,000     # registered    50,000      100,000      150,000     200,000
Improvement of                              (2015)    tax payers
tax collection:                                       (TIN) by June
increase in                                           2017: 30,000
number of
registered tax
payers (TIN)
filing returns
Allocated amount:                                             7.29         2.05         5.40        5.40         5.40
Scalability formula:
SDR 107,262 per
1,000 new
registered tax
payers filing
returns (capped to
SDR 18,230,000)
(8) DLI 8:                       25,540,000      50%      Establishment    55%          60%         65%          70%
Increasing                                            of Planning
capital                                                Commission;
expenditure                                           draft Kaduna
execution rate                                        Infrastructure
Master Plan
released for
public
consultations;


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compliance
with budget
circular on
capital project
appraisal and
prioritization
in 2017
approved
budget;
reduction of
arrears of
payment to
contractors
from 3% to
1% of
appropriations
Allocated amount:                                               10.86         3.67         3.67         3.67         3.67
Scalability formula:
SDR 729,384 per
point rounded to
the closest point
(capped to SDR
14,590,000)
(9) DLI 9:                         25,540,000  Low level of Approval of    Implementat Implementat Implementat Implementat
Increasing                                 transparency  Procurement   ion of e-    ion of e-    ion of e-    ion of e-
procurement                                and          Guidelines (as  procurement procurement procurement procurement
effectiveness                              competitive  per            , disclosure  , disclosure  , disclosure  , disclosure
ness in      Procurement    of contract  of contract  of contract  of contract
procurement Law);           awards,      awards,      awards,      awards,
process      adoption of e-  procurement procurement procurement procurement


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procurement   for three (3)  audit in five  audit in ten  audit in
strategy;     main         (5) main     (10) main   fifteen (15)
disclosure of  procuring   procuring    procuring    main
contracts     MDAs;        MDAs         MDAs        procuring
above N. 50   audit in one                           MDAs
million since  (1) main
Jan. 2017     procuring
MDA
Allocated amount:                                              7.29         3.67         2.44         6.07        6.07
Scalability formula:
SDR 1,210,000 per
main procuring
MDA (capped to
SDR 18,230,000)
(10) DLI 10:                      25,540,000  Absence of  Approval of    5% of           10%          15%         20%
Improved                                   citizen     Audit Law by   capital
government                                 engagement  Executive      projects
responsiveness                             on budget   Council,      improved in
to citizens'                               execution   Approval of    response to
feedback on                                            Freedom of     citizens'
fiscal                                                 Information   feedback
performance                                            Law by
Executive
Council;
disclosure of
State and LG
budgets for
2017;
disclosure of
State budget


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execution
audit report
for 2015 and
2016; launch
of citizen's
module in
Eyes and Ears
for capital
projects
Allocated amount:                                        10.86         3.67        3.67         3.67        3.67
Scalability formula:
SDR 729,384 per
percentage point
(capped at SDR
14,590,0004)
TOTAL               97,600,000  157,800,000
AMOUNT:


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B.     Withdrawal Conditions; Withdrawal Period
1. Notwithstanding the provisions of Part A of this Section, no withdrawal shall be
made:
(a)    for purposes of Section 2.03 of the General Conditions (renumbered as
such pursuant to paragraph 6 of Section II of the Appendix to this
Agreement and relating to Program Expenditures), for DLRs achieved
prior to the date of this Agreement, except that withdrawals up to an
aggregate amount not to exceed SDR 63,750,000, may be made for such
DLRs achieved prior to this date but on or after November 8, 2016 (prior
results);
(b)    for any DLR unless and until the Recipient has furnished evidence
satisfactory to the Association that said DLR has been achieved and
verified, all in accordance with the DLI Verification Protocol; and
(c)    for a DLR related to a DLI for a FY under Categories 1, 2, 3, 4, 5, 6, 7, 8,
9, 10, unless the Recipient has furnished evidence satisfactory to the
Association that: (i) an aggregate amount equivalent to the amount of
Financing withdrawn in respect of the DLR under said Category for the
previous FY was, as applicable, transferred to Kaduna State, in a timely
manner in accordance with the provisions of this Agreement; and (ii) for
said FY Kaduna State has received the amount of the Financing allocated
to it based on the DLR(s) achieved by said State as verified by the DLI
Verification Protocol.
2.     Notwithstanding the provisions of Part B.1(c) of this Section, the Recipient shall
transfer to Kaduna State in a timely manner the proceeds of the Program Financing
allocated to the respective State on the basis of the DLR(s) achieved by said State
as verified by the DLI Verification Protocol, all in accordance with the provisions
of this Agreement.
3.     Notwithstanding the provisions of Part B. 1(b) of this Section, the Recipient may
withdraw an amount not to exceed twenty-five percent (25%) of the amount of the
Financing as an advance; provided, however, that if the DLR(s) in the opinion of
the Association, are not achieved (or only partially achieved) by the Closing Date,
the Recipient shall refund such advance (or portion of such advance as determined
by the Association to the Association promptly upon notice thereof by the
Association. Except as otherwise agreed with the Recipient, the Association shall
cancel the amount so refunded. Any further withdrawals requested as an advance
under any Category for the Program shall be permitted only on such terms and
conditions as the Association shall specify by notice to the Recipient.


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4.     Notwithstanding the provisions of Part B.1(b) of this Section, if any of the DLRs
under Categories 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, has not been achieved by the date by
which the said DLR is set to be achieved, the Association may, by notice to the
Recipient: (a) authorize the withdrawal of such lesser amount of the unwithdrawn
proceeds of the Financing then allocated to said Category which, in the opinion of
the Association, corresponds to the extent of achievement of said DLR, said lesser
amount to be calculated in accordance with the table of paragraph IV.A.2 of this
Part B; (b) reallocate all or a portion of the proceeds of the Financing then allocated
to said DLR(s) to any other DLR(s); and/or (c) cancel all or a portion of the
proceeds of the Financing then allocated to said DLR.
5.     The Closing Date is March 31, 2021.
6.     Notwithstanding the foregoing provisions of this Section IV, if at any time after
the Closing Date the Recipient has failed to provide evidence satisfactory to the
Association that the Withdrawn Financing Balance does not exceed the total
amount of Program Expenditures, the Recipient shall, promptly upon notice from
the Association, refund to the Association such excess amount of the Withdrawn
Financing Balance. The Association shall cancel the refunded amount of the
Withdrawn Financing Balance.


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SCHEDULE3
Repayment Schedule
Principal Amount of the Credit
repayable
Date Payment Due                 (expressed as a percentage)*
On each February I and August 1:
commencing August 1, 2022 to and including            1.65%
February 1, 2032
commencing August 1, 2032 to and including            3.35%
February 1, 2042
* The percentages represent the percentage of the principal amount of the Credit to be
repaid, except as the Association may otherwise specify pursuant to Section 3.03(b) of the
General Conditions.


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APPENDIX
Section I.    Definitions
1.     "Anti-Corruption Guidelines" means the Association's "Guidelines on Preventing
and Combating Fraud and Corruption in Program-for-Results Financing", dated
February 1, 2012, and revised July 10, 2015.
2.     "Audit Law" means Kaduna State Audit Law No. 5 of 2010.
3.     "BATMIS" means Budget and Treasury Management Information System.
4.     "Category" means a category set forth in the table in Section IV.A.2 of Schedule
2 to this Agreement.
5.     "CofOs" means Certificate of Occupancy.
6.     "Disbursement Linked Indicator" or "DLI" each means in respect of a given
Category, the indicator related to said Category as set forth in the table in Section
IV.A.2 of Schedule 2 to this Agreement.
7.     "DLI Baseline" means the initial collection of data which serves as a basis for
comparison with the subsequently acquired data.
8.     "Disbursement Linked Result" or "DLR" each means in respect of a given
Category, the result under said Category as set forth in the table in Section IV.A.2
of Schedule 2 to this Agreement, on the basis of the achievement of which, the
amount of the Financing allocated to said result may be withdrawn in accordance
with the provisions of said Section IV.
9.     "DLI Verification Protocol" means the protocol agreed by the Association and the
Recipient to verify the data and other evidence supporting the achievement of one
or more DLRs, as such protocol may be modified from time to time with the
agreement of the Association.
10.    "Ease of Doing Business Charter" means the commitment by Kaduna State MDAs
to reduce the time of selected business services officially announced on April 5,
2017.
11.    "ESSA" means the Environmental and Social System Assessment dated May 16,
2017, and applicable to the Program which assesses the Recipient's environmental
and social management systems, detailing the Program's environmental and social
benefits, risks and impacts and recommending remedial measures to strengthen the
social and environmental systems performance.


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12.    "Eyes and Ears for Capital Projects" means the phone-based application which
allows monitoring of capital projects implementation in Kaduna State and which
includes a citizen's feedback module.
13.    "Fiscal Year" or "FY" each means the Recipient's fiscal year commencing January
I and ending December 31 in each year.
14.    "Framework for Responsible and   Inclusive Land-Intensive Agricultural
Investments" or "FRILIA" each means a policy document describing the processes
governing land-intensive agricultural investments in Kaduna State to ensure
socially and environmentally sustainable investments.
15.    "Freedom of Information Law" means the Bill for a Law to Make Public Records
and Information Available and to Protect Records, Information, Personal Privacy
and Serving Public Officers in Kaduna State.
16.    "General Conditions" means the "International Development Association General
Conditions for Credits and Grants", dated July 31, 2010, with the modifications set
forth in Section II of this Appendix.
17.    "IGR" means internally generated revenues.
18.    "Independent Verification Agent(s)" or "IVA" each means any agent referred to
in Section I.G. I of Schedule 2 of this Agreement.
19.    "KADIPA" means Kaduna Investment Promotion Agency, as established by the
Law to Establish the Kaduna Investment Promotion Agency and Other Matters
Connected Therewith (enacted on December 23rd, 2015).
20.    "KADINVEST 2.0" means Kaduna Economic and Investment Summit held on
April 5-6, 2017.
21.    "Kaduna Geographical Information Services" or "KADGIS" each means the
agency established through the Law to Establish the Kaduna Geographic
Information Service and Matters Connected Therewith enacted on December 23rd,
2015.
22.    "Kaduna Infrastructure Master Plan" means the Kaduna Infrastructure Master Plan
(2018-2050), Providing the Infrastructure to Accelerate our Development, Draft
for Public Consultation, published by Kaduna State Government.
23.    "Kaduna State Development Plan" or "KSDP" each means the Kaduna State
Development Plan (2016-2020), Delivering on Jobs, Social Justice and Prosperity
published by Kaduna State Government.


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24.    "Kaduna State" or "State" means the Kaduna state of the Recipient as defined in
Articles 2 and 3 of the Constitution of the Federal Republic of Nigeria 1999.
25.    "Kaduna State Ministry of Finance" means the Kaduna State ministry responsible
for finance or any successor thereto.
26.    "LG" means Local Government as defined in Article 3 of the Constitution of the
Federal Republic of Nigeria 1999.
27.    "MDAs" means the ministries, departments and agencies of Kaduna State.
28.    "Memorandum of Understanding" means the memorandum of understanding to be
signed between an investor and KADIPA and "Memoranda of Understanding"
means any number of such Memoranda.
29.    "Ministry of Budget and Planning" means Kaduna State's ministry responsible for
budget and planning or any successor thereto.
30.    "Ministry of Finance" means Kaduna State's ministry responsible for finance or
any successor thereto.
31.    "Naira" means the Recipient's currency.
32.    "Planning Commission" means the successor of the Kaduna State Ministry of
Budget and Planning to be formally established no later than June 30, 2017, or any
successor thereto.
33.    "PPP" means private public partnership.
34.    "PPP Fiscal Commitment and Contingent Liability Management Framework" or
"FCCL" means the Framework to provide guidance to Kaduna State on managing
fiscal risks from PPPs during approval and implementation, focusing on:
(i) identifying and assessing fiscal commitments arising from PPPs during project
preparation and implementation; (ii) incorporating these into the project approval
process, including budgeting for these appropriately; and (iii) strengthening the
monitoring and reporting of fiscal commitments over the lifetime of the project.
35.    "Procurement Guidelines" means the Guidelines on Public Procurement to be
issued by Kaduna State Public Procurement Authority as per the Procurement Law.
36.    "Procurement Law" means the Law to Establish a Public Procurement Authority
for Kaduna Sate and for Connected Purposes, enacted on June 1, 2016.
37.    "Program Implementation Manual" or "PIM" each means the manual for the
implementation of the Program acceptable to the Association to be prepared and
adopted by the Recipient in accordance with the provisions of Section I.E of


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Schedule 2 to this Agreement, as the same may be amended in accordance with the
provisions of said Section.
38.    "Program" means the activities described in Schedule 1 to this Agreement.
39.    "Program Action Plan" means the set of priority actions agreed by the Association
and the Recipient for the strengthening of the Recipient's sectoral and institutional
framework referred to in Section I.F of Schedule 2 to this Agreement, as the same
may be amended from time to time with the prior written approval of the
Association.
40.    "Program  Fiduciary and Environmental and Social Systems" means the
Recipient's systems for the Program referred to in Section I.A of Schedule 2 to this
Agreement."
41.    "Program Steering Committee" means the committee referred to in Section
I.C. 1(a) of Schedule 2 to this Agreement.
42.    "Project Facilitation Fund" means a Fund established to support the development
of PPP in Kaduna State in any of the following ways: support contracting
authorities in preparation, appraisal and tendering of PPP project; extend viability
gap finance to PPP projects; meet any contingent liabilities arising from a PPP
project; support activities of the PPP Unit in the delivery of its mandate.
43.    "Rules, Governance and Operational Manual" means the manual governing the
establishment and operations of the Project Facilitation Fund for PPP.
44.    "Subsidiary Agreement" means the agreement referred to in Section I.C.2 of
Schedule 2 to this Agreement pursuant to which the Recipient shall make the
proceeds of the Financing available to Kaduna State.
45.    "Systematic Property Registration Program" means the pro-poor, low cost, mass
property registration program to issue Certificates of Occupancy implemented by
KADGIS.
46.    "TIN" means Tax Identification Number under the Federal Joint Tax Board,
established by section 86 (1) of the Personal Income Tax Act, Law of the
Federation of Nigeria, 2004.
Section II.   Modifications to the General Conditions
The General Conditions are hereby modified as follows:
1.     Wherever used throughout the General Conditions, the term "the Project" is
modified to read "the Program", the term "the Project Agreement" is modified to
read "the Program Agreement", the term "Project Implementing Entity" is


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modified to read "the Program Implementing Entity", the term "Project Report" is
modified to read "Program Report"; and the term "Eligible Expenditures" is
modified to read "Program Expenditures".
2.    In the Table of Contents, the references to Sections, Section names and Section
numbers are modified to reflect the modifications set forth in the paragraphs below.
3.     Section 2.02, Special Commitment by the Association, is deleted in its entirety, and
the subsequent Sections in Article II are renumbered accordingly.
4.    In Section 2.02 (originally numbered as Section 2.03), the heading "Applications
for Withdrawal or for Special Commitment" is replaced with "Applications for
Withdrawal", and the phrase "or to request the Association to enter into a Special
Commitment" is deleted.
5.     The section originally numbered as Section 2.04, Designated Accounts, is deleted
in its entirety, and the subsequent Sections in Article II are renumbered
accordingly.
6.     Paragraph (a) of Section 2.03 (originally numbered as Section 2.05), Eligible
Expenditures (renamed "Program Expenditures" in accordance with paragraph I
of this Section II), is modified to read: "(a) the payment is for the financing of the
reasonable cost of expenditures required for the Program and to be financed out of
the proceeds of the Financing in accordance with the provisions of the Legal
Agreements;".
7.     The last sentence of Section 2.04 (originally numbered as Section 2.06), Financing
Taxes, is modified to read: "To that end, if the Association at any time determines
that the amount of any such Tax is excessive, or that such Tax is discriminatory or
otherwise unreasonable, the Association may, by notice to the Recipient, exclude
such amount or such Tax from the Program Expenditures to be financed out of the
proceeds of the Financing, as required to ensure consistency with such policy of
the Association."
8.     Section 2.06 (originally numbered as Section 2.08), Reallocation, is modified to
read: "Notwithstanding any allocation of an amount of the Financing to a
withdrawal category under the Financing Agreement, the Association may, by
notice to the Recipient, reallocate any other amount of the Financing to such
category if the Association reasonably determines at any time that such
reallocation is appropriate for the purposes of the Program."
9.     Section 3.02 is modified to read as follows:
"Section 3.02. Service Charge and Interest Charge
(a)    Service Charge. The Recipient shall pay the Association a service charge on


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the Withdrawn Credit Balance at the rate specified in the Financing
Agreement. The Service Charge shall accrue from the respective dates
on which amounts of the Credit are withdrawn and shall be payable semi-
annually in arrears on each Payment Date. Service Charges shall be
computed on the basis of a 360-day year of twelve 30-day months.
(b)    Interest Charge. The Recipient shall pay the Association interest on the
Withdrawn Credit Balance at the rate specified in the Financing
Agreement. Interest shall accrue from the respective dates on which
amounts of the Credit are withdrawn and shall be payable semi-annually
in arrears on each Payment Date. Interest shall be computed on the basis
of a 360-day year of twelve 30-day months."
10.    Section 6.01, Cancellation by the Recipient, is modified to read: "The Recipient
may, by notice to the Association, cancel any amount of the Unwithdrawn
Financing Balance."
11.    Paragraph (d) of Section 6.03, Cancellation by the Association, entitled
"Misprocurement", is deleted, and subsequent paragraphs are re-lettered
accordingly.
12.    Section 6.04, Amounts Subject to Special Commitment not Affected by
Cancellation or Suspension by the Association, is deleted in its entirety, and
subsequent Sections in Article VI and references to such Sections are renumbered
accordingly.
13.   In the Appendix, Definitions, all references to Section numbers are modified, as
necessary, to reflect the modifications set forth above. In addition, the definition
of the term "Special Commitment" set forth in paragraph 50 is deleted in its
entirety, and all subsequent paragraphs are renumbered accordingly.
14.    Paragraph 28 of the Appendix ("Financing Payment") is modified by inserting the
words "the Interest Charge" between the words "the Service Charge" and "the
Commitment Charge".
15.    The Appendix is modified by inserting a new paragraph 32 with the following
definition of "Interest Charge", and renumbering the remaining paragraphs
accordingly:
"32. "Interest Charge" means the interest charge specified in the Financing
Agreement for the purpose of Section 3.02(b)."
16.    Renumbered paragraph 37 (originally paragraph 36) of the Appendix ("Payment
Date") is modified by inserting the words "Interest Charges" between the words
"Service Charges" and "Commitment Charges".


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17.    Renumbered paragraph 50 (originally paragraph 49) of the Appendix ("Service
Charge") is modified by replacing the reference to Section 3.02 with Section
3.02(a).