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CONFORMED COPY
LOAN NUMBER 3248 BOT
(Tuli Block Roads Project)
between
REPUBLIC OF BOTSWANA
and
INTERNATIONAL BANK FOR RECONSTRUCTION
AND DEVELOPMENT
Dated September 12, 1990
LOAN NUMBER 3248 BOT
LOAN AGREEMENT
AGREEMENT, dated September 12, 1990, between REPUBLIC OF BOTSWANA (the Borrower) 
and INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT (the Bank).
WHEREAS the Borrower, having satisfied itself as to the feasibility and priority 
of the Project described in Schedule 2 to this Agreement, has requested the Bank to 
assist in the financing of the Project; and
WHEREAS the Bank has agreed, on the basis, inter alia, of the foregoing, to 
extend the Loan to the Borrower upon the terms and conditions set forth in this 
Agreement;
NOW THEREFORE the parties hereto hereby agree as follows:
ARTICLE I
General Conditions; Definitions
Section 1.01. The "General Conditions Applicable to Loan and Guarantee 
Agreements" of the Bank, dated January 1, 1985, with the last sentence of Section 3.02 
deleted (the General Conditions) constitute an integral part of this Agreement.
Section 1.02. Unless the context otherwise requires, the several terms defined 
in the General Conditions and in the Preamble to this Agreement have the respective 
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meanings therein set forth and the following additional term has the following 
meaning, namely "RD" means the Roads Department of the Borrower's Ministry of Works, 
Transport and Communications.
ARTICLE II
The Loan
Section 2.01. The Bank agrees to lend to the Borrower, on the terms and 
conditions set forth or referred to in the Loan Agreement, various currencies that 
shall have an aggregate value equivalent to the amount of fourteen million nine 
hundred thousand dollars ($14,900,000), being the sum of withdrawals of the proceeds 
of the Loan, with each withdrawal valued by the Bank as of the date of such 
withdrawal.
Section 2.02. The amount of the Loan may be withdrawn from the Loan Account in 
accordance with the provisions of Schedule 1 to this Agreement for expenditures made 
(or, if the Bank shall so agree, to be made) in respect of the reasonable cost of 
goods and services required for the Project described in Schedule 2 to this Agreement 
and to be financed out of the proceeds of the Loan.
Section 2.03. The Closing Date shall be June 30, 1997, or such later date as the 
Bank shall establish. The Bank shall promptly notify the Borrower of such later date.
Section 2.04. The Borrower shall pay to the Bank a commitment charge at the rate 
of three-fourths of one percent (3/4 of 1%) per annum on the principal amount of the 
Loan not withdrawn from time to time.
Section 2.05. (a) The Borrower shall pay interest on the principal amount of the 
Loan withdrawn and outstanding from time to time, at a rate for each Interest Period 
equal to the Cost of Qualified Borrowings determined in respect of the preceding 
Semester, plus one-half of one percent (1/2 of 1%). On each of the dates specified in 
Section 2.06 of this Agreement, the Borrower shall pay interest accrued on the 
principal amount outstanding during the preceding Interest Period, calculated at the 
rate applicable during such Interest Period.
(b)
As soon as practicable after the end of each Semester, the Bank shall 
notify the Borrower of the Cost of Qualified Borrowings determined in respect of such 
Semester.
(c)
For the purposes of this Section:
 
(i)
"Interest Period" means a six-month period ending on the date 
immediately preceding each date specified in Section 2.06 of this 
Agreement, beginning with the Interest Period in which this 
Agreement is signed.
(ii)
"Cost of Qualified Borrowings" means the cost, as reasonably 
determined by the Bank and expressed as a percentage per annum, of 
the outstanding borrowings of the Bank drawn down after June 30, 
1982, excluding such borrowings or portions thereof as the Bank 
has allocated to fund: (A) the Bank's investments; and (B) loans 
which may be made by the Bank after July 1, 1989, bearing interest 
rates determined otherwise than as provided in paragraph (a) of 
this Section.
(iii)
"Semester" means the first six months or the second six months of 
a calendar year.
(d)
On such date as the Bank may specify by no less than six months' notice 
to the Borrower, paragraphs (a), (b) and (c) (iii) of this Section shall be amended to 
read as follows:
"(a)  The Borrower shall pay interest on the principal amount of 
the Loan withdrawn and outstanding from time to time, at a 
rate for each Quarter equal to the Cost of Qualified 
Borrowings determined in respect of the preceding Quarter, 
plus one-half of one percent (1/2 of 1%). On each of the 
dates specified in Section 2.06 of this Agreement, the 
Borrower shall pay interest accrued on the principal amount 
outstanding during the preceding Interest Period, calculated 
at the rates applicable during such Interest Period."
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"(b)  As soon as practicable after the end of each Quarter, the 
Bank shall notify the Borrower of the Cost of Qualified 
Borrowings determined in respect of such Quarter."
"(c)  (iii) `Quarter' means a three-month period commencing on 
January 1, April 1, July 1 or October 1 in a calendar year."
Section 2.06. Interest and other charges shall be payable semiannually on 
January 15 and July 15 in each year.
Section 2.07. The Borrower shall repay the principal amount of the Loan in 
accordance with the Amortization Schedule set forth in Schedule 3 to this Agreement.
ARTICLE III
Execution of the Project
Section 3.01. The Borrower declares its commitment to the objectives of the 
Project as set forth in Schedule 2 to this Agreement and, to this end, shall carry out 
the Project through RD with due diligence and efficiency and in conformity with 
appropriate administrative, financial and engineering practices, and shall provide, 
promptly as needed, the funds, facilities, services and other resources required for 
the Project.
Section 3.02. Except as the Bank shall otherwise agree, procurement of the works 
and consultants' services required for Part A of the Project and to be financed out of 
the proceeds of the Loan shall be governed by the provisions of Schedule 4 to this 
Agreement.
Section 3.03. The Borrower shall continue to implement its plan for a 
comprehensive restructuring of road user fees designed to achieve the full recovery of 
road maintenance costs and to make a contribution to the replacement costs from road 
users in accordance with the Borrower's implementation schedule acceptable to the 
Bank.
ARTICLE IV
Financial Covenants
Section 4.01. (a) The Borrower shall maintain or cause to be maintained records 
and accounts adequate to reflect in accordance with sound accounting practices the 
operations, resources and expenditures in respect of the Project of the departments or 
agencies of the Borrower responsible for carrying out Part A of the Project.
(b)
The Borrower shall:
 
(i)
have the records and accounts referred to in paragraph (a) of this 
Section for each fiscal year audited, in accordance with 
appropriate auditing principles consistently applied, by 
independent auditors acceptable to the Bank;
(ii)
furnish to the Bank as soon as available, but in any case not 
later than six months after the end of each such year, the report 
of such audit by said auditors, of such scope and in such detail 
as the Bank shall have reasonably requested; and
(iii)
furnish to the Bank such other information concerning said records 
and accounts and the audit thereof as the Bank shall from time to 
time reasonably request.
(c)
For all expenditures with respect to which withdrawals from the Loan 
Account were made on the basis of statements of expenditure, the Borrower shall:
(i)
maintain or cause to be maintained, in accordance with paragraph 
(a) of this Section, records and accounts reflecting such 
expenditures;
(ii)
retain, until at least one year after the Bank has received the 
audit report for the fiscal year in which the last withdrawal from 
the Loan Account was made, all records (contracts, orders, 
invoices, bills, receipts and other documents) evidencing such 
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expenditures;
(iii)
enable the Bank's representatives to examine such records; and
 
(iv)
ensure that such records and accounts are included in the annual 
audit referred to in paragraph (b) of this Section and that the 
report of such audit contains a separate opinion by said auditors 
as to whether the statements of expenditure submitted during such 
fiscal year, together with the procedures and internal controls 
involved in their preparation, can be relied upon to support the 
related withdrawals.
ARTICLE V
Other Covenants
Section 5.01. The Borrower undertakes:
(a)
to maintain its gazetted road system adequately in accordance with sound 
engineering practices; and 
(b)
to provide adequate funds, facilities, services and other resources for 
that purpose.
Section 5.02. The Borrower shall take all actions necessary:
(a)
to cause the dimensions, axle-loads and weight limits of the vehicles 
using the gazetted roads to be kept within the limits provided by law; and
(b)
to ensure consistent and effective enforcement of its Road Traffic Act.
 
Section 5.03. The Borrower undertakes to prepare and furnish to the Bank, not 
later than September 1, 1991, an integrated agricultural development plan for the 
Selebi-Phikwe area, including the improvement of horticultural marketing, and to take 
steps to facilitate its implementation.
ARTICLE VI
Termination
Section 6.01. The date ninety (90) days after the date of this Agreement is 
hereby specified for the purposes of Section 12.04 of the General Conditions.
ARTICLE VII
Representative of the Borrower; Addresses
Section 7.01. The Minister of Finance and Development Planning of the Borrower 
is designated as representative of the Borrower for the purposes of Section 11.03 of 
the General Conditions.
Section 7.02. The following addresses are specified for the purposes of Section 
11.01 of the General Conditions:
For the Borrower:
Ministry of Finance and Development Planning
Private Bag 008
Gaborone
Botswana
Cable address:
Telex:
 
FINANCE
2401 FIN BD
Gaborone
For the Bank:
International Bank for
   Reconstruction and Development
1818 H Street, N.W.
Washington, D.C. 20433
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United States of America
Cable address:
Telex:
 
INTBAFRAD
197688 (TRT)
Washington, D.C.
248423 (RCA)
 64145 (WUI) or
 82987 (FTCC)
IN WITNESS WHEREOF, the parties hereto, acting through their duly authorized 
representatives, have caused this Agreement to be signed in their respective names in 
the District of Columbia, United States of America, as of the day and year first above 
written.
REPUBLIC OF BOTSWANA
By /s/ B. K. Sebele
Authorized Representative
INTERNATIONAL BANK FOR
   RECONSTRUCTION AND DEVELOPMENT
By /s/ Edwin Lim
Acting Regional Vice President
Africa
SCHEDULE 1
Withdrawal of the Proceeds of the Loan
1.
The table below sets forth the Categories of items to be financed out of the 
proceeds of the Loan, the allocation of the amounts of the Loan to each Category and 
the percentage of expenditures for items so to be financed in each Category:
                           Amount of the
                          Loan Allocated           % of
                           (Expressed in        Expenditures
      Category          Dollar Equivalent)      to be Financed
(1)   Civil works             11,800,000        55%
      under Part A
      of the Project
(2)   Consultants'               900,000        55%
      services under
      Part A of the
      Project
(3)   Unallocated              2,200,000
            TOTAL             14,900,000
2.
Notwithstanding the provisions of paragraph 1 above, no withdrawals shall be 
made in respect of payments made for expenditures prior to the date of this Agreement, 
except that withdrawals, in an aggregate amount not exceeding the equivalent of 
$200,000 may be made on account of payments made for expenditures before that date but 
after June 1, 1990.
SCHEDULE 2
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Description of the Project
The objectives of the Project are to assist the Borrower in: (i) providing road 
links for the development of the Selebi-Phikwe area; and (ii) strengthening its road 
planning and maintenance capabilities.
The Project consists of the following parts, subject to such modifications 
thereof as the Borrower and the Bank may agree upon from time to time to achieve such 
objectives:
Part A:
Construction of the road between Sefophe and Martin's Drift, a distance of about 
134 km, including a spur road to Kgagodi, and village access roads.
Part B:
Construction of the road between Bobonong and Lekkerpoet, a distance of about 66 
km, including access roads to Molalatau and Mathathane.
Part C:
A road investment and maintenance study designed to reclassify existing roads, 
identify viable road projects, reorganize maintenance arrangements and optimize the 
use of manpower and financial resources for those activities.
*                 *                 *
The Project is expected to be completed not later than December 31, 1996.
SCHEDULE 3
Amortization Schedule
                                           Payment of Principal
Date Payment Due                          (expressed in dollars)*
On each January 15 and July 15
     beginning January 15, 1996
     through   January 15, 2007                 620,000
On July 15, 2007                                640,000