FINANCE CONTRACT

ROAD REHABILITATION AND SAFETY B BETWEEN THE REPUBLIC OF SERBIA AND THE EUROPEAN INVESTMENT BANK

("Off. Herald of RS - Treaties", No. 6/2023)

Contract Number (FI N°) 96.962
Operation Number (Serapis N°) 2012-0367

Belgrade, 5 October 2023

Luxembourg, 6 October 2023

THIS CONTRACT IS MADE BETWEEN:
the Republic of Serbia, represented by Mr. Siniša Mali, Deputy Prime Minister and Minister of Finance, on behalf of the Government as representative of the Republic of Serbia,		(the "Borrower")
of the first part, and

the European Investment Bank having its seat at 100 blvd Konrad Adenauer, Luxembourg, L-2950 Luxembourg, represented by Mr Matteo RIVELLINI, Head of Division and Ms Anne-France CATOIR, Legal Counsel,		(the "Bank")
of the second part.

WHEREAS:

(a) The Borrower has stated that, through the public company established and operating in the Republic of Serbia (Decision Establishing Public Enterprise for State Roads Management, No.023/8228/2005, dated December 22, 2005 and published in the Official Gazette of the Republic of Serbia No. 115/05) under the corporate title Public Enterprise "Roads of Serbia" (hereinafter called the "Promoter"), it is undertaking a project of the rehabilitation and safety improvement of approximately 1,000 kilometres of trunk roads throughout the Republic of Serbia as a part of a multi-year programme, as well as measures of institutional strengthening in respect of safety management, as per the technical description (the "Technical Description") set out in Schedule A (the "Project"). The Promoter will be responsible for Project implementation with all the necessary support from the Borrower.

(b) The total cost of the Project, as estimated by the Bank, is EUR 390,000,000 (three hundred ninety thousand million euros) and the Borrower has stated that it intends to finance the Project as follows:

Source	Amount (EUR m)
European Bank for Reconstruction and Development	100
World Bank Credit from the Bank in total Borrower	56.4 185 48.6
TOTAL	390

(c) In order to fulfil the financing plan set out in Recital (b), the Borrower has requested from the Bank a top-up credit of EUR 85,000,000.00 (eighty five million euros), in addition to EUR 100,000,000 (one hundred million euros) made available under the original finance contract signed between the Bank and the Borrower on 27 November 2013 (the "Original Contract"), to be made available from the Bank’s own resources and pursuant to the NDICI-GE Regulation.

(d) The financing under this Contract is provided pursuant to the European Fund for Sustainable Development Plus ("EFSD+"), an integrated financial package supplying financing capacity in the form of grants, budgetary guarantees and financial instruments worldwide; and in particular under the exclusive investment window for operations with sovereign counterparts and non-commercial sub-sovereign counterparts under article 36.1 of the NDICI-GE Regulation ("EFSD+ DIW1"). Pursuant to article 36.8 of the NDICI-GE Regulation, on 29 April 2022 the Bank and the European Union, represented by the European Commission, entered into an EFSD+ guarantee agreement (the "EFSD+ DIW1 Guarantee Agreement") whereby the European Union granted to the Bank a comprehensive guarantee for eligible financing operations of the Bank in respect of projects carried out in countries within the geographic areas referred to in article 4(2) of the NDICI-GE Regulation and in Annex I of the IPA III Regulation (the "EFSD+ DIW1 Guarantee"). The Republic of Serbia is an eligible country pursuant to the NDICI-GE Regulation and the IPA III Regulation.

(e) The Republic of Serbia and the Bank concluded on 11 May 2009 a framework agreement governing the Bank’s activities in the territory of the Republic of Serbia (the "Framework Agreement").

(f) As discussed on the various meetings during 2022 between the Republic of Serbia and the Bank, the Republic of Serbia requested the financing of the Project (as defined above), as such the present project falls within the scope of the Framework Agreement.

(g) The Bank, considering that the financing of the Project falls within the scope of its functions and having regard to the statements and facts cited in these Recitals, has decided to give effect to the Borrower’s request providing to it a credit in an amount of EUR 85,000,000.00 (eighty five million euros) under this finance contract (the "Contract"); provided that the total amount of the Bank’s financing of the Project, when aggregated with the amount of any other loan (including, but not limited to, under the Original Contract) which may be extended by the Bank for the purposes of the Project, shall not, in any case, exceed 50% (fifty per cent) of the total cost of the Project set out in Recital (b), nor, when aggregated with any EU grants available for the Project, 90% (ninety per cent) of the total cost of the Project set out in Recital (b).

(h) The Borrower has authorised the borrowing of the sum of EUR 85,000,000.00 (eighty five million euros) represented by this credit on the terms and conditions set out in this Contract.

(i) The Statute of the Bank provides that the Bank shall ensure that its funds are used as rationally as possible in the interests of the European Union; and, accordingly, the terms and conditions of the Bank’s loan operations must be consistent with relevant policies of the European Union.

(j) The Bank considers that access to information plays an essential role in the reduction of environmental and social risks, including human rights violations, linked to the projects it finances and has therefore established its transparency policy, the purpose of which is to enhance the accountability of the Bank’s group towards its stakeholders.

(k) The Bank supports the implementation of international and European Union standards in the field of anti-money laundering and countering the financing of terrorism and promotes tax good governance standards. It has established policies and procedures to avoid the risk of misuse of its funds for purposes which are illegal or abusive in relation to applicable laws. The Bank’s group statement on tax fraud, tax evasion, tax avoidance, aggressive tax planning, money laundering and financing of terrorism is available on the Bank’s website and offers further guidance to the Bank’s contracting counterparties.

(l) The Bank has established an overarching policy framework that allows the Bank’s Group to focus on sustainable and inclusive development, committing to a just and fair transition and supporting the transition to economies and communities that are climate and disaster resilient, low carbon, environmentally sound and more resource-efficient. The policy framework includes the EIB Group Environmental and Social Policy and the EIB Environmental and Social Standards. The EIB Group Environmental and Social Policy and the EIB Environmental and Social Standards are available on the Bank’s website and offers further guidance to the Bank’s contracting counterparties.

(m) By entering into this Contract the Borrower acknowledges that the Bank may be bound to comply with the Sanctions (as defined below) and that it cannot, therefore, amongst others, make funds available, directly or indirectly, to or for the benefit of a Sanctioned Person (as defined below).

NOW THEREFORE it is hereby agreed as follows:

INTERPRETATION AND DEFINITIONS

Interpretation

In this Contract:

(a) references to "Articles", "Recitals", "Schedules" and "Annexes" are, save if explicitly stipulated otherwise, references respectively to articles of, and recitals, schedules and annexes to this Contract;

(b) references to "law" or "laws" mean:

(i) any applicable law and any applicable treaty, constitution, statute, legislation, decree, normative act, rule, regulation, judgement, order, writ, injunction, determination, award or other legislative or administrative measure or judicial or arbitral decision in any jurisdiction which is binding or applicable case law; and

(ii) EU Law;

(i) a law or jurisdiction applicable to the Borrower, its rights and/or obligations (in each case arising out of or in connection with this Contract), its capacity and/or assets and/or the Project; and/or, as applicable

(ii) a law or jurisdiction (including in each case the Bank’s Statute) applicable to the Bank, its rights, obligations, capacity and/or assets;

(d) references to a provision of law or a treaty are references to that provision as amended or re-enacted;

(e) references to any other agreement or instrument are references to that other agreement or instrument as amended, novated, supplemented, extended or restated;

(f) words and expressions in plural shall include singular and vice versa; and

(g) references to "month" mean a period starting on one day in a calendar month and ending on the numerically corresponding day in the next calendar month, except that and subject to the definition of Payment Date, Article 5.1 and Schedule B and unless provided otherwise in this Contract:

(i) if the numerically corresponding day is not a Business Day, that period shall end on the next Business Day in that calendar month in which that period is to end if there is one, or if there is not, on the immediately preceding Business Day; and

(ii) if there is no numerically corresponding day in the calendar month in which that period is to end, that period shall end on the last Business Day in that calendar month; and

(h) a reference in this Contract to a page or screen of an information service displaying a rate shall include:

(i) any replacement page of that information service which displays that rate; and

(ii) the appropriate page of such other information service which displays that rate from time to time in place of that information service,

and, if such page or service ceases to be available, shall include any other page or service displaying that rate specified by the Bank.

Definitions

In this Contract:

"Accepted Tranche" means a Tranche in respect of which a Disbursement Offer has been duly accepted by the Borrower in accordance with its terms on or before the Disbursement Acceptance Deadline.

"Agreed Deferred Disbursement Date" has the meaning given to it in Article 1.5.A(2)(b).

"Authorisation" means an authorisation, permit, consent, approval, resolution, licence, exemption, filing, notarisation or registration.

"Authorised Signatory" means a person authorised to sign individually or jointly (as the case may be) Disbursement Acceptances on behalf of the Borrower and named in the most recent List of Authorised Signatories and Accounts received by the Bank prior to the receipt of the relevant Disbursement Acceptance.

"Business Day" means a day (other than a Saturday or Sunday) on which the Bank and commercial banks are open for general business in Luxembourg and in Belgrade.

"Cancelled Tranche" has the meaning given to it in Article 1.6.C(2).

"Change-of-Law Event" has the meaning given to it in Article 4.3.A(3).

"Compliance Certificate" means a certificate substantially in the form set out in Schedule E.2.

"Contract" has the meaning given to it in Recital (g).

"Contract Number" means the Bank generated number identifying this Contract and indicated on the cover page of this Contract after the letters "FI N°".

"Credit" has the meaning given to it in Article 1.1.

"Date of Effectiveness" has the meaning given in Article 12.3.

"Declaration on Honour" means the "Declaration on Honour" under EFSD+ signed by the Borrower on or about the date of this Contract.

"Deferment Fee" means a fee calculated on the amount of an Accepted Tranche deferred or suspended at the rate of the higher of:

(a) 0.125% (12.5 basis points), per annum; and

(b) the percentage rate by which:

(i) the interest rate that would have been applicable to such Tranche had it been disbursed to the Borrower on the Scheduled Disbursement Date, exceeds

(ii) EURIBOR (one month rate) less 0.125% (12.5 basis points), unless such rate is less than zero, in which case it shall be set at zero.

Such fee shall accrue from the Scheduled Disbursement Date to the Disbursement Date or, as the case may be, until the date of cancellation of the Accepted Tranche in accordance with this Contract.

"Disbursement Acceptance" means a copy of the Disbursement Offer duly countersigned by the Borrower in accordance with the List of Authorised Signatories and Accounts.

"Disbursement Acceptance Deadline" means the date and time of expiry of a Disbursement Offer as specified therein.

"Disbursement Account" means, in respect of each Tranche, the bank account to which disbursements may be made under this Contract, as set out in the most recent List of Authorised Signatories and Accounts.

"Disbursement Date" means the date on which disbursement of a Tranche is made by the Bank.

"Disbursement Offer" means a letter substantially in the form set out in Schedule C.

"Dispute" has the meaning given to it in Article 11.2.

"Disruption Event" means either or both of:

(a) a material disruption to those payment or communications systems or to those financial markets which are, in each case, required to operate in order for payments to be made in connection with this Contract; or

(b) the occurrence of any other event which results in a disruption (of a technical or systems-related nature) to the treasury or payments operations of either the Bank or the Borrower, preventing that Party from

(i) performing its payment obligations under this Contract; or

(ii) communicating with the other Party,

and which disruption (in either such case as per (a) or (b) above) is not caused by, and is beyond the control of, the Party whose operations are disrupted.

"EFSD+" has the meaning given in Recital (d).

"EFSD+ DIW1" has the meaning given in Recital (d).

"EFSD+ DIW1 Guarantee" has the meaning given in Recital (d).

"EFSD+ DIW1 Guarantee Agreement" has the meaning given in Recital (d).

"EIB Environmental and Social Standards" means the EIB Environmental and Social Standards which are published on the Bank’s website1 and which describe the environmental and social requirements that all EIB-financed projects must meet and the responsibilities of the various parties, including the Borrower and the Promoter.

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1https://www.eib.org/en/publications/eib-environmental-and-social-standards

"Eligible Expenditure" means expenditure (including costs of design and supervision, if relevant, and net of taxes and duties payable by the Borrower and/or the Promoter) incurred by the Borrower or the Promoter for the Project, in respect of works, goods and services relating to items specified in the Technical Description as eligible for financing under the Credit (for the avoidance of doubt excluding rights of way which shall be financed by the Borrower), which have been the object of contract or contracts executed on terms satisfactory to the Bank, having regard to the most recent edition of the Bank’s Guide to Procurement.

"Environment" means the following:

(a) fauna and flora, living organisms including the ecological systems;

(b) land, soil, water (including marine and coastal waters), air, climate and the landscape (natural or man-made structures, whether above or below ground);

(d) the built environment; and

(e) human health and wellbeing.

"Environmental and Social Impact Assessment Study" means a study or report as an outcome of the environmental and social impact assessment identifying and assessing the likely significant environmental and social impacts and/or risks associated with the proposed project and recommending measures to avoid, minimise and/or remedy any impacts and/or risks. This study is subject to public consultation with direct and indirect project stakeholders.

"Environmental and Social Documents" means (a) the Environmental and Social Impact Assessment Study; (b) each Non-Technical Summary and the Stakeholder Engagement Plan; (c) any other climate and/or social impact assessments, studies or action plans required to implement an allocated scheme.

"Environmental and Social Standards" means:

(a) Environmental Laws and Social Laws applicable to the Project or the Borrower;

(b) the EIB Environmental and Social Standards; and

"Environmental or Social Approval" means any Authorisation required by an Environmental Law or a Social Law in connection with the construction or operation of the Project.

"Environmental or Social Claim" means any claim, proceeding, formal notice or investigation by any person in respect of any breach or alleged breach of any Environmental and Social Standards.

"Environmental Law" means:

(a) EU law, including principles and standards save for any derogation accepted by the Bank for the purpose of this Contract based on any agreement between the Republic of Serbia and the EU;

(b) the Republic of Serbia laws and regulations; and

(c) international treaties and conventions signed and ratified by or otherwise applicable and binding on the Republic of Serbia,

in each case of which a principal objective is the preservation, protection or improvement of the Environment.

"EU Law" means the acquis communautaire of the European Union as expressed through the Treaties of the European Union, the regulations, directives, delegated acts, implementing acts, and the case law of the Court of Justice of the European Union.

"EUR" or "euro" means the lawful currency of the Member States of the European Union, which adopt or have adopted it as their currency in accordance with the relevant provisions of the Treaty on European Union and the Treaty on the Functioning of the European Union.

"EURIBOR" has the meaning given to it in Schedule B.

"Event of Default" means any of the circumstances, events or occurrences specified in Article 10.

"Final Availability Date" means the day falling 36 (thirty six) months after the Date of Effectiveness, which in any case shall not exceed 31 December 2026, or any other later date agreed between the parties in writing.

"Financing of Terrorism" means the provision or collection of funds, by any means, directly or indirectly, with the intention that they should be used or in the knowledge that they are to be used, in full or in part, in order to carry out any of the offences listed in the Directive (EU) 2017/541 of the European Parliament and of the Council of 15 March 2017 on combating terrorism and replacing Council Framework Decision 2002/475/JHA and amending Council Decision 2005/671/JHA (as amended, replaced or re-enacted from time to time).

"Financial Regulation" means Regulation (EU, Euratom) 2018/1046 of the European Parliament and of the Council of 18 July 2018 on the financial rules applicable to the general budget of the Union, amending Regulations (EU) No 1296/2013, (EU) No 1301/2013, (EU) No 1303/2013, (EU) No 1304/2013, (EU) No 1309/2013, (EU) No 1316/2013, (EU) No 223/2014, (EU) No 283/2014, and Decision No 541/2014/EU and repealing Regulation (EC, Euratom) No 966/2012 (OJ L 193, 30.7.2018, p. 1).

"Fixed Rate" means an annual interest rate determined by the Bank in accordance with the applicable principles from time to time laid down by the governing bodies of the Bank for loans made at a fixed rate of interest, denominated in the currency of the Tranche and bearing equivalent terms for the repayment of capital and the payment of interest. Such rate shall not be of negative value.

"Fixed Rate Tranche" means a Tranche on which the Fixed Rate is applied.

"Floating Rate" means a fixed-spread floating annual interest rate, determined by the Bank for each successive Floating Rate Reference Period equal to EURIBOR plus the Spread. If the Floating Rate for any Floating Rate Reference Period is calculated to be below zero, it will be set at zero.

"Floating Rate Reference Period" means each period from one Payment Date to the next relevant Payment Date; the first Floating Rate Reference Period shall commence on the date of disbursement of the Tranche.

"Floating Rate Tranche" means a Tranche on which the Floating Rate is applied.

"Framework Agreement" has the meaning given in Recital (e).

"GAAP" means generally accepted accounting principles in the Republic of Serbia.

"Guide to Procurement" means the Guide to Procurement published on EIB’s website1 that informs the promoters of projects financed in whole or in part by the EIB of the arrangements to be made for procuring works, goods and services required for the Project.

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1https://www.eib.org/en/publications/guide-to-procurement.htm Please note that the reference is to the version of the Guide in force at the time of the relevant project procurement.

"Illegality Event" has the meaning given to it in Article 4.3.A(4).

"ILO" means the International Labour Organisation.

"ILO Standards" means any treaty, convention or covenant of the ILO signed and ratified by or otherwise applicable and binding on the Republic of Serbia and the Core Labour Standards (as defined in the ILO Declaration on Fundamental Principles and Rights at Work).

"Indemnifiable Prepayment Event" means a Prepayment Event other than the Non-EIB Financing Prepayment Event or Illegality Event.

"Interest Revision/Conversion" means the determination of new financial conditions relative to the interest rate, specifically the same interest rate basis ("revision") or a different interest rate basis ("conversion") which can be offered for the remaining term of a Tranche or until the next Interest Revision/Conversion Date, if any.

"Interest Revision/Conversion Date" means the date, which shall be a Payment Date, specified by the Bank pursuant to Article 1.2.B in the Disbursement Offer.

"Interest Revision/Conversion Proposal" means a proposal made by the Bank under Schedule D.

"Interest Revision/Conversion Request" means a written notice from the Borrower, delivered at least 75 (seventy five) days before an Interest Revision/Conversion Date, requesting the Bank to submit to it an Interest Revision/Conversion Proposal. The Interest Revision/Conversion Request shall also specify:

(a) the Payment Dates chosen in accordance with the provisions of Article 3.1;

(b) the amount of the Tranche for which the Interest Revision/Conversion shall apply; and

"IPA III Regulation" means Regulation (EU) 2021/1529 of the European Parliament and of the Council of 15 September 2021 establishing the Instrument for Pre-Accession assistance (IPA III).

"List of Authorised Signatories and Accounts" means a list, in form and substance satisfactory to the Bank, setting out:

(a) the Authorised Signatories, accompanied by evidence of signing authority of the persons named on the list and specifying if they have individual or joint signing authority;

(b) the specimen signatures of such persons;

(c) the bank account(s) to which disbursements may be made under this Contract (specified by IBAN code if the country is included in the IBAN Registry published by SWIFT, or in the appropriate ac count format in line with the local banking practice), BIC/SWIFT code of the bank and the name of the bank account(s) beneficiary, together with evidence that such account(s) have been opened in the name of the beneficiary; and

(d) the bank account(s) from which payments under this Contract will be made by the Borrower (specified by IBAN code if the country is included in the IBAN Registry published by SWIFT, or in the appropriate account format in line with the local banking practice), BIC/SWIFT code of the bank and the name of the bank account(s) beneficiary, together with evidence that such account(s) have been opened in the name of the beneficiary.

"Loan" means the aggregate of the amounts disbursed from time to time by the Bank under this Contract.

"Loan Outstanding" means the aggregate of the amounts disbursed from time to time by the Bank under this Contract that remains outstanding.

"Market Disruption Event" means any of the following circumstances:

(a) there are, in the reasonable opinion of the Bank, events or circumstances adversely affecting the Bank’s access to its sources of funding;

(b) in the opinion of the Bank, funds are not available from the Bank’s ordinary sources of funding in order to adequately fund a Tranche in the relevant currency and/or for the relevant maturity and/or in relation to the reimbursement profile of such Tranche; or

(i) the cost to the Bank of obtaining funds from its sources of funding, as determined by the Bank, for a period equal to the Floating Rate Reference Period of such Tranche (i.e. in the money market) would be in excess of EURIBOR; or

(ii) the Bank determines that adequate and fair means do not exist for ascertaining EURIBOR for the relevant currency of such Tranche.

"Material Adverse Change" means, in relation to the Borrower any event or change of condition affecting the Borrower, which, in the opinion of the Bank:

(a) materially impairs the ability of the Borrower to perform its obligations under this Contract; or

(b) materially impairs the financial condition or prospects of the Borrower.

"Maturity Date" means the last Repayment Date of a Tranche specified pursuant to Article 4.1.(b)(iv).

"Money Laundering" means:

(a) the conversion or transfer of property, knowing that such property is derived from criminal activity or from an act of participation in such activity, for the purpose of concealing or disguising the illicit origin of the property or of assisting any person who is involved in the commission of such activity to evade the legal consequences of his action;

(b) the concealment or disguise of the true nature, source, location, disposition, movement, rights with respect to, or ownership of property, knowing that such property is derived from criminal activity or from an act of participation in such activity;

(c) the acquisition, possession or use of property, knowing, at the time of receipt, that such property was derived from criminal activity or from an act of participation in such activity; or

(d) participation in, association to commit, attempts to commit and aiding, abetting, facilitating and counselling the commission of any of the actions mentioned in the foregoing points.

"NDICI-GE Regulation" means Regulation (EU) 2021/947 of the European Parliament and of the Council of 9 June 2021 establishing the Neighbourhood, Development and International Cooperation Instrument - Global Europe.

"Non-EIB Financing" has the meaning given to it in Article 4.3.A(2).

"Non-EIB Financing Prepayment Event" has the meaning given to it in 4.3.A(2).

"New Project Implementation Contract(s)" means any signed contract between Promoter and a contractor after June 2023 to implement the Project as described under the Technical Description (Schedule A.1).

"Ongoing Project Implementation Contract(s)" means any signed contract between Promoter and a contractor until June 2023 to implement the Project as described under the Technical Description (Schedule A.1).

"Payment Account" means the bank account from which payments under this Contract will be made by the Borrower, as set out in the most recent List of Authorised Signatories and Accounts.

"Payment Date" means the annual, semi-annual or quarterly dates specified in the Disbursement Offer until and including the Interest Revision/Conversion Date, if any, or the Maturity Date, save that, in case any such date is not a Relevant Business Day, it means:

(a) for a Fixed Rate Tranche either:

(i) the following Relevant Business Day, without adjustment to the interest due under Article 3.1; or

(ii) the preceding Relevant Business Day with adjustment (but only to the amount of interest due under Article 3.1 that accrued over the last interest period), in case repayment of principal is made in a single instalment in accordance with Schedule D point C; and

(b) for a Floating Rate Tranche, the following Relevant Business Day in that month, or, failing that, the nearest preceding Relevant Business Day, in all cases with corresponding adjustment to the interest due under Article 3.1.

"Prepayment Amount" means the amount of a Tranche to be prepaid by the Borrower in accordance with Article 4.2.A or Article 4.3.A, as applicable.

"Prepayment Date" means the date, as requested by the Borrower and agreed by the Bank or indicated by the Bank (as applicable) on which the Borrower shall effect prepayment of a Prepayment Amount.

"Prepayment Event" means any of the events described in Article 4.3.A.

"Prepayment Indemnity" means in respect of any principal amount to be prepaid, the amount communicated by the Bank to the Borrower as the present value (calculated as of the Prepayment Date) of the excess, if any, of:

(a) the interest that would accrue thereafter on the Prepayment Amount over the period from the Prepayment Date to the Interest Revision/Conversion Date, if any, or the Maturity Date, if it were not prepaid; over

(b) the interest that would so accrue over that period, if it were calculated at the Redeployment Rate, less 0.19% (nineteen basis points).

The said present value shall be calculated at a discount rate equal to the Redeployment Rate, applied as of each relevant Payment Date.

"Prepayment Notice" means a written notice from the Bank to the Borrower in accordance with Article 4.2.C.

"Prepayment Request" means a written request from the Borrower to the Bank to prepay all or part of the Loan Outstanding, in accordance with Article 4.2.A.

"Project Implementation Unit (PIU)" means all project implementation arrangements, which rely on a group of staff members designated officially to work together full-time or almost full-time, with separate accountability, to coordinate and manage project implementation.

"Prohibited Conduct" means any Financing of Terrorism, Money Laundering or Prohibited Practice.

"Prohibited Practice" means any:

(a) Coercive Practice, meaning the impairing or harming, or threatening to impair or harm, directly or indirectly, any party or the property of a party to influence improperly the actions of a party;

(b) Collusive Practice, meaning an arrangement between two or more parties designed to achieve an improper purpose, including to influence improperly the actions of another party;

(c) Corrupt Practice, meaning the offering, giving, receiving or soliciting, directly or indirectly, of anything of value by a party to influence improperly the actions of another party;

(d) Fraudulent Practice, meaning any act or omission, including a misrepresentation, that knowingly or recklessly misleads, or attempts to mislead, a party in order to obtain a financial (including, for the avoidance of taxation related) or other benefit or to avoid an obligation;

(e) Obstructive Practice, meaning in relation to an investigation into a Coercive, Collusive, Corrupt or Fraudulent Practice in connection with this Loan or the Project, (i) destroying, falsifying, altering or concealing of evidence material to the investigation or making false statements to investigators, with the intent to impede the investigation; (ii) threatening, harassing or intimidating any party to prevent it from disclosing its knowledge of matters relevant to the investigation or from pursuing the investigation, or (iii) acts intending to impede the exercise of the EIB Group’s contractual rights of audit or inspection or access to information;

(f) Tax Crime, meaning all offences, including tax crimes relating to direct taxes and indirect taxes and as defined in the national law of the Republic of Serbia, which are punishable by deprivation of liberty or a detention order for a maximum of more than one year;

(g) Misuse of EIB Group Resources and Assets, meaning any illegal activity committed in the use of the EIB Group’s resources or assets (including the funds lent under this Contract) knowingly or recklessly; or

(h) any other illegal activity that may affect the financial interests of the European Union, according to the applicable laws.

"Project" has the meaning given to it in Recital (a).

"Project Cost Reduction Event" has the meaning given to it in Article 4.3.A(1).

"Promoter" has the meaning given to it in Recital (a).

"Redeployment Rate" means the fixed annual rate determined by the Bank, being a rate which the Bank would apply on the day of the indemnity calculation to a loan that has the same currency, the same terms for the payment of interest and the same repayment profile to the Interest Revision/Conversion Date, if any, or the Maturity Date as the Tranche in respect of which a prepayment or cancellation is proposed or requested to be made. Such rate shall not be of negative value.

"Relevant Business Day" means a day on which real time gross settlement system operated by the Eurosystem (T2), or any successor system, is open for settlement of payments in EUR.

"Relevant Party" has the meaning given to it in Article 8.3.

"Relevant Person" means:

(a) with respect to the Borrower, any official or representative of any of its ministries, other central executive government bodies or other governmental sub-divisions, or any other person acting on its behalf or under its control, having, in accordance with applicable local laws, the right to manage and/or supervise the Loan or the Project; and

(b) with respect to the Promoter, any official or representative, or any other person acting on its behalf or under its control, having the power to give directions and exercise control with respect to the Loan or the Project.

"Repayment Date" shall mean each of the Payment Dates specified for the repayment of the principal of a Tranche in the Disbursement Offer, in accordance with Article 4.1.

"Requested Deferred Disbursement Date" has the meaning given to it in Article 1.5.A(1)(a)(ii).

"Road Safety Audits" means an independent, detailed, systematic, and technical safety check relating to the design characteristics of a road infrastructure project, covering all relevant Project stages from planning to early operation, and covering all relevant road users in line with the scope of the works.

"Road Safety Impact Assessments" means an analysis of the impact of a new road or modification to an existing road on the safety performance of the road.

"Safety Ratings" means the classification of parts of the existing road network in categories according to their objectively measured in-built safety.

"Sanctioned Person" means any individual or entity (for the avoidance of doubt, the term entity includes, but is not limited to, any government, group or terrorist organisation) who is a designated target of, or who is otherwise a subject of, Sanctions.

"Sanctions" means the economic or financial sanctions laws, regulations, trade embargoes or other restrictive measures (including, in particular, but not limited to, measures in relation to the financing of terrorism) enacted, administered, implemented and/or enforced from time to time by any of the following:

(a) the United Nations including, inter alia, the United Nations Security Council;

(b) the European Union including, inter alia, the Council of the European Union and the European Commission, and any other competent bodies/institutions or agencies of the European Union;

(c) the government of the United States of America, and any department, division, agency, or office thereof, including, inter alia, the Office of Foreign Asset Control (OFAC) of the United States Department of the Treasury, the United States Department of State and/or the United States Department of Commerce; and

(d) the government of the United Kingdom, and any department, division, agency, office or authority including, inter alia, the Office of Financial Sanctions Implementation of His Majesty’s Treasury and the Department for International Trade of the United Kingdom.

"Scheduled Disbursement Date" means the date on which a Tranche is scheduled to be disbursed in accordance with Article 1.2.B.

"Security" means any mortgage, pledge, lien, charge, assignment, hypothecation, or other security interest securing any obligation of any person or any other agreement or arrangement having a similar effect.

"Social Law" means:

(a) EU law, including principles and standards save for any derogation accepted by the Bank for the purpose of this Contract based on any agreement between the Republic of Serbia and the EU;

(b) the Republic of Serbia laws and regulations;

(c) international treaties and conventions signed and ratified by or otherwise applicable and binding on, the Republic of Serbia;

(d) any ILO Standards;

in each case of which a principal objective is the protection or improvement of Social Matters; and

(e) any United Nations treaty, convention or covenant on human rights signed and ratified by or otherwise applicable and binding on the Republic of Serbia.

"Social Matters" means all, or any of, the following:

(a) labour and working conditions;

(b) occupational health and safety;

(d) rights and interests of indigenous peoples;

(e) gender equality;

(f) public health, safety and security;

(g) avoidance of forced evictions and alleviation of hardship arising from involuntary resettlement; and

(h) stakeholder engagement.

"Spread" means the fixed spread (being of either positive or negative value) to EURIBOR as determined by the Bank and notified to the Borrower in the relevant Disbursement Offer or Interest Revision/Conversion Proposal.

"Stakeholder Engagement Plan" means the plan, with form and content to be agreed with the Bank, that specifies who, how and when project stakeholders are to be engaged by the Promoter, or others acting on behalf of the Promoter, in the interests of the implementation of the Project.

"Tax" means any tax, levy, impost, duty or other charge or withholding of a similar nature (including any penalty or interest payable in connection with any failure to pay or any delay in paying any of the same).

"Technical Description" has the meaning given to it in Recital (a).

"Tranche" means each disbursement made or to be made under this Contract. In case no Disbursement Acceptance has been received, Tranche shall mean a Tranche as offered under Article 1.2.B.

ARTICLE 1

Credit and Disbursements

1.1 Amount of Credit

By this Contract the Bank establishes in favour of the Borrower, and the Borrower accepts, a credit in an amount of EUR 85,000,000.00 (eighty five million euros) for the financing of the Project (the "Credit").

1.2 Disbursement procedure

1.2.A Tranches

The Bank shall disburse the Credit in up to 17 (seventeen) Tranches. The amount of each Tranche shall be in a minimum amount of EUR 5,000,000.00 (five million euros) or (if less) the entire undrawn balance of the Credit.

1.2.B Disbursement Offer

Upon request by the Borrower and subject to Article 1.4.A, provided that no event mentioned in Article 1.6.B has occurred and is continuing, the Bank shall send to the Borrower within 5 (five) Business Days after the receipt of such request a Disbursement Offer for the disbursement of a Tranche. The latest time for receipt by the Bank of such Borrower’s request is 15 (fifteen) Business Days before the Final Availability Date. The Disbursement Offer shall specify:

(a) the amount of the Tranche in EUR;

(b) the Scheduled Disbursement Date, which shall be a Relevant Business Day, falling at least 10 (ten) days after the date of the Disbursement Offer and on or before the Final Availability Date;

(c) the interest rate basis of the Tranche, being: (i) a Fixed Rate Tranche; or (ii) a Floating Rate Tranche, in each case, pursuant to the relevant provisions of Article 3.1;

(d) the Payment Dates and the first interest Payment Date for the Tranche;

(e) the terms for repayment of principal for the Tranche, in accordance with the provisions of Article 4.1;

(f) the Repayment Dates and the first and the last Repayment Date for the Tranche;

(g) the Interest Revision/Conversion Date, if requested by the Borrower, for the Tranche;

(h) for a Fixed Rate Tranche, the Fixed Rate and for a Floating Rate Tranche the Spread, applicable to the Tranche until the Interest Revision/Conversion Date, if any, or until the Maturity Date; and

(i) the Disbursement Acceptance Deadline.

1.2.C Disbursement Acceptance

The Borrower may accept a Disbursement Offer by delivering a Disbursement Acceptance to the Bank no later than the Disbursement Acceptance Deadline. The Disbursement Acceptance shall be signed by an Authorised Signatory with individual representation right or two or more Authorised Signatories with joint representation right and shall specify the Disbursement Account to which the disbursement of the Tranche should be made in accordance with Article 1.2.D.

If a Disbursement Offer is duly accepted by the Borrower in accordance with its terms on or before the Disbursement Acceptance Deadline, the Bank shall make the Accepted Tranche available to the Borrower in accordance with the relevant Disbursement Offer and subject to the terms and conditions of this Contract.

The Borrower shall be deemed to have refused any Disbursement Offer which has not been duly accepted in accordance with its terms on or before the Disbursement Acceptance Deadline.

The Bank may rely on the information set out in the most recent List of Authorised Signatories and Accounts provided to the Bank by the Borrower. If a Disbursement Acceptance is signed by a person defined as Authorised Signatory under the most recent List of Authorised Signatories and Accounts provided to the Bank by the Borrower, the Bank may assume that such person has the power to sign and deliver in the name and on behalf of the Borrower such Disbursement Acceptance.

1.2.D Disbursement Account

Disbursement shall be made to the Disbursement Account specified in the relevant Disbursement Acceptance provided that such Disbursement Account is acceptable to the Bank.

Notwithstanding Article 5.2(e), the Borrower acknowledges that payments to a Disbursement Account notified by the Borrower shall constitute disbursements under this Contract as if they had been made to the Borrower’s own bank account.

Only one Disbursement Account may be specified for each Tranche.

1.3 Currency of disbursement

The Bank shall disburse each Tranche in EUR.

1.4 Conditions of disbursement

1.4.A Condition precedent to the first request for Disbursement Offer

The Bank shall have received from the Borrower in form and substance satisfactory to the Bank:

(a) evidence that the execution of this Contract by the Borrower has been duly authorised and that the person or persons signing this Contract on behalf of the Borrower is/are duly authorised to do so together with the specimen signature of each such person or persons;

(b) at least 2 (two) originals of this Contract duly executed by all Parties; and

prior to requesting a Disbursement Offer under Article 1.2.B by the Borrower. Any request for a Disbursement Offer made by the Borrower without the above documents having been received by the Bank and to its satisfaction shall be deemed not made.

1.4.B First Tranche

The disbursement of the first Tranche under Article 1.2, is conditional upon receipt by the Bank, in form and substance satisfactory to it, on or before the date falling 5 (five) Business Days before the Scheduled Disbursement Date (and, in the case of deferment under Article 1.5, the Requested Deferred Disbursement Date or the Agreed Deferred Disbursement Date, respectively), for the proposed Tranche, of the following documents or evidence:

(a) evidence that the Borrower has obtained all necessary Authorisations, required in connection with this Contract and the Project;

(b) a favourable legal opinion issued in English language by the Ministry of Justice of the Borrower confirming, inter alia, (i) the authority of persons signing this Contract on behalf of the Borrower; (ii) that this Contract has been duly executed by the Borrower and constitutes valid, binding and enforceable obligations of the Borrower according with its terms; (iii) the valid choice of laws of the Grand Duchy of Luxembourg law and the Court of Justice of the European Union under this Contract, and (iv) the recognition and enforcement of judgments of the Court of Justice of the European Union in any proceedings taken in the Republic of Serbia in relation to this Contract;

(c) the Borrower shall have taken all action necessary to exempt from taxation for all payments of principal, interest and other sums due hereunder and to permit the payment of all such sums gross without deduction of tax at source shall have been taken;

(d) any necessary exchange control consents shall have been obtained to permit receipt of disbursements hereunder, repayment of the same and payment of interest and all other amounts due hereunder; such consents must extend to the opening and maintenance of the accounts to which disbursement of the Credit is directed;

(e) that the PIU is in place with staff, resources and competencies acceptable to the Bank; and

(f) that the Cooperation Agreement for consultancy services to support Road Safety Impact Assessment has been signed and consultants selected, hired and in place, to the satisfaction of the Bank.

1.4.C All Tranches

The disbursement of each Tranche under Article 1.2, including the first, is subject to the following conditions:

(a) that the Bank has received, in form and substance satisfactory to it, on or before the date falling 5 (five) Business Days before the Scheduled Disbursement Date (and, in the case of deferment under Article 1.5, the Requested Deferred Disbursement Date or the Agreed Deferred Disbursement Date, respectively) for the proposed Tranche, of the following documents or evidence:

(i) a certificate from the Borrower in the form of Schedule E.1 signed by an authorised representative of the Borrower and dated no earlier than the date falling 15 (fifteen) Business Days before the Scheduled Disbursement Date (and, in the case of deferment under Article 1.5, the Requested Deferred Disbursement Date or the Agreed Deferred Disbursement Date, respectively);

(ii) confirmation that the project indicators specified in Article 6.6(iii) are achieved as applicable to the relevant tranche within the schedule, subject to acceptance by the Promoter and the Bank of the consultancy deliverables;

(iii) demonstrating that, following drawdown of the relevant Tranche, the aggregate amount of the Credit will not exceed the aggregate expenditure incurred or contractually committed by the Borrower in respect of the Project up to the date of the relevant Disbursement Offer;

(iv) evidence, satisfactory to the Bank, that the Promoter (i) has incurred in Eligible Expenditure on the items to be financed by the Bank in accordance with the Technical Description for an aggregate amount equal to 80% (eighty per cent.) of all previous Tranches disbursed by the Bank as well as all the amounts disbursed by the World Bank and the Borrower and (ii) will have incurred, by the 180th day falling after the preferred date for disbursement specified in the Disbursement Offer, Eligible Expenditure in an amount at least equal to the aggregate of 80% (eighty per cent) of the amount of the Tranche to be disbursed;

(v) in connection with the relevant section (as better specified under Schedule A.1) of the Project, the social screening according to the RPF and, if a resettlement action plan (RAP) is required, the RAP and evidence of its proper implementation;

(vi) in connection with the relevant section (as better specified under Schedule A.1) of the Project, copy of the Environmental or Social Approval(s), including the environmental screening decision by the competent authority and, if the environmental impact assessment (EIA) is required, the EIA and the non-technical summary (NTS);

(vii) in connection with the relevant section (as better specified under Schedule A.1) of the Project, written confirmation from the competent authority concerning the impacts on nature conservation (from A/B or equivalent); and

(viii) a copy of any other authorisation or other document, opinion or assurance which the Bank has notified the Borrower is necessary or desirable in connection with the entry into and performance of, and the transactions contemplated by, this Contract or the legality, validity, binding effect or enforceability of the same; and

(b) that on the Scheduled Disbursement Date (and, in the case of deferment under Article 1.5, on the Requested Deferred Disbursement Date or the Agreed Deferred Disbursement Date, respectively) for the proposed Tranche:

(i) the representations and warranties which are repeated pursuant to Article 6.11 are correct in all respects; and

(ii) no event or circumstance which constitutes or would with the passage of time or the giving of notice or the making of any determination under this Contract (or any combination of the foregoing) constitute:

(1) an Event of Default; or

(2) a Prepayment Event

has occurred and is continuing unremedied or unwaived or would result from the disbursement of the proposed Tranche.

1.5 Deferment of disbursement

1.5.A Grounds for deferment

1.5.A(1) Borrower’s request

(a) The Borrower may send a written request to the Bank requesting the deferral of the disbursement of an Accepted Tranche. The written request must be received by the Bank at least 5 (five) Business Days before the Scheduled Disbursement Date of the Accepted Tranche and specify:

(i) whether the Borrower would like to defer the disbursement in whole or in part and if in part, the amount to be deferred; and

(ii) the date until which the Borrower would like to defer a disbursement of the above amount (the "Requested Deferred Disbursement Date"), which must be a date falling not later than:

(1) 6 (six) months from its Scheduled Disbursement Date;

(2) 30 (thirty) days prior to the first Repayment Date; and

(3) the Final Availability Date.

(b) Upon receipt of such a written request, the Bank shall defer the disbursement of the relevant amount until the Requested Deferred Disbursement Date.

1.5.A(2) Failure to satisfy conditions to disbursement

(a) The disbursement of an Accepted Tranche shall be deferred if any condition for disbursement of such Accepted Tranche referred to in Article 1.4 is not fulfilled both:

(i) at the date specified for fulfilment of such condition in Article 1.4; and

(ii) at its Scheduled Disbursement Date (or, where the Scheduled Disbursement Date has been deferred previously, the date expected for disbursement).

(b) The Bank and the Borrower shall agree the date until which the disbursement of such an Accepted Tranche shall be deferred (the "Agreed Deferred Disbursement Date"), which must be a date falling:

(i) not earlier than 5 (five) Business Days following the fulfilment of all conditions of disbursement; and

(ii) not later than the Final Availability Date.

(c) Without prejudice to the Bank’s right to suspend and/or cancel the undisbursed portion of the Credit in whole or in part pursuant to Article 1.6.B, the Bank shall defer disbursement of such Accepted Tranche until the Agreed Deferred Disbursement Date.

1.5.A(3) Deferment FEE

If disbursement of an Accepted Tranche is deferred pursuant to paragraphs 1.5.A(1) or 1.5.A(2) above, the Borrower shall pay the Deferment Fee.

1.5.B Cancellation of a disbursement deferred by 6 (six) months

If a disbursement has been deferred by more than 6 (six) months in aggregate pursuant to Article 1.5.A, the Bank may notify the Borrower in writing that such disbursement shall be cancelled and such cancellation shall take effect on the date of such written notification. The amount of the disbursement which is cancelled by the Bank pursuant to this Article 1.5.B shall remain available for disbursement under Article 1.2.

1.6 Cancellation and suspension

1.6.A Borrower’s right to cancel

(a) The Borrower may send a written notice to the Bank requesting a cancellation of the undisbursed Credit or a portion thereof.

(b) In its written notice, the Borrower:

(i) must specify whether the Credit shall be cancelled in whole or in part and, if in part, the amount of the Credit to be cancelled; and

(ii) must not request any cancellation of an Accepted Tranche, which has a Scheduled Disbursement Date falling within 5 (five) Business Days of the date of such written notice.

(c) Upon receipt of such written notice, the Bank shall cancel the requested portion of the Credit with immediate effect.

1.6.B Bank’s right to suspend and cancel

(a) At any time upon the occurrence of the following events, the Bank may notify the Borrower in writing that the undisbursed portion of the Credit shall be suspended and/or (except upon the occurrence of a Market Disruption Event) cancelled in whole or in part:

(i) a Prepayment Event;

(ii) an Event of Default;

(iii) an event or circumstance which would with the passage of time or the giving of notice or the making of any determination under this Contract (or any combination of the foregoing) constitute a Prepayment Event or an Event of Default;

(iv) a Material Adverse Change; or

(v) a Market Disruption Event provided the Bank has not received a Disbursement Acceptance.

(b) On the date of such written notification from the Bank the relevant portion of the Credit shall be suspended and/or cancelled with immediate effect. Any suspension shall continue until the Bank ends the suspension or cancels the suspended amount.

1.6.C Indemnity for suspension and cancellation of a Tranche

1.6.C(1) Suspension

If the Bank suspends an Accepted Tranche upon the occurrence of an Indemnifiable Prepayment Event or an Event of Default or of an event or circumstance which would (with the passage of time or the giving of notice or the making of any determination under this Contract or any combination of the foregoing) constitute an Indemnifiable Prepayment Event or an Event of Default or upon the occurrence of a Material Adverse Change, the Borrower shall pay to the Bank the Deferment Fee calculated on the amount of such Accepted Tranche.

1.6.C(2) Cancellation

(a) If an Accepted Tranche which is a Fixed Rate Tranche (the "Cancelled Tranche") is cancelled:

(i) by the Borrower pursuant to Article 1.6.A; or

(ii) by the Bank upon an Indemnifiable Prepayment Event or an event or circumstance which would (with the passage of time or the giving of notice or the making of any determination under this Contract or any combination of the foregoing) constitute an Indemnifiable Prepayment Event or upon the occurrence of a Material Adverse Change or pursuant to Article 1.5.B,

the Borrower shall pay to the Bank an indemnity on such Cancelled Tranche.

(b) Such indemnity shall be:

(i) calculated assuming that the Cancelled Tranche had been disbursed and repaid on the same Scheduled Disbursement Date or, to the extent the disbursement of the Tranche is currently deferred or suspended, on the date of the cancellation notice; and

(ii) in the amount communicated by the Bank to the Borrower as the present value (calculated as of the date of cancellation) of the excess, if any, of:

(1) the interest that would accrue thereafter on the Cancelled Tranche over the period from the date of cancellation pursuant to this Article 1.6.C(2), to the Interest Revision/Conversion Date, if any, or the Maturity Date, if it were not cancelled; over

(2) the interest that would so accrue over that period, if it were calculated at the Redeployment Rate, less 0.19% (nineteen basis) points.

The said present value shall be calculated at a discount rate equal to the Redeployment Rate applied as of each relevant Payment Date of the applicable Tranche.

(c) If the Bank cancels an Accepted Tranche upon the occurrence of an Event of Default, the Borrower shall indemnify the Bank in accordance with Article 10.3.

1.7 Cancellation after expiry of the Credit

On the day following the Final Availability Date, unless otherwise specifically notified in writing by the Bank to the Borrower, any part of the Credit in respect of which no Disbursement Acceptance has been received in accordance with Article 1.2.C shall be automatically cancelled, without any further notice from the Bank to the Borrower and without any liability arising on the part of either Party.

1.8 Sums due under Article 1.5 and 1.6

Sums due under Articles 1.5 and 1.6 shall be payable:

(a) in EUR; and

(b) within 15 (fifteen) days of the Borrower’s receipt of the Bank’s demand or within any longer period specified in the Bank’s demand.

ARTICLE 2

The Loan

2.1 Amount of Loan

The Loan shall comprise the aggregate amount of Tranches disbursed by the Bank under the Credit, as confirmed by the Bank pursuant to Article 2.3.

2.2 Currency of payments

The Borrower shall pay interest, principal and other charges payable in respect of each Tranche in the currency in which such Tranche was disbursed.

Other payments, if any, shall be made in the currency specified by the Bank having regard to the currency of the expenditure to be reimbursed by means of that payment.

2.3 Confirmation by the Bank

The Bank shall deliver to the Borrower the amortisation table referred to in Article 4.1, if any, showing the Disbursement Date, the currency, the amount disbursed, the repayment terms and the interest rate for each Tranche, not later than 10 (ten) calendar days after the Scheduled Disbursement Date for such Tranche.

ARTICLE 3

Interest

3.1 Rate of interest

3.1.A Fixed Rate Tranches

The Borrower shall pay interest on the outstanding balance of each Fixed Rate Tranche at the Fixed Rate quarterly, semi-annually or annually in arrear on the relevant Payment Dates as specified in the Disbursement Offer, commencing on the first such Payment Date following the Disbursement Date of the Tranche. If the period from the Disbursement Date to the first Payment Date is 15 (fifteen) days or less then the payment of interest accrued during such period shall be postponed to the following Payment Date.

Interest shall be calculated on the basis of Article 5.1 (a).

3.1.B Floating Rate Tranches

The Borrower shall pay interest on the outstanding balance of each Floating Rate Tranche at the Floating Rate quarterly or semi-annually in arrear on the relevant Payment Dates, as specified in the Disbursement Offer commencing on the first such Payment Date following the Disbursement Date of the Tranche. If the period from the Disbursement Date to the first Payment Date is 15 (fifteen) days or less then the payment of interest accrued during such period shall be postponed to the following Payment Date.

The Bank shall notify the Borrower of the Floating Rate within 10 (ten) days following the commencement of each Floating Rate Reference Period.

If pursuant to Articles 1.5 and 1.6 disbursement of any Floating Rate Tranche takes place after the Scheduled Disbursement Date, EURIBOR applicable to the first Floating Rate Reference Period shall be determined in accordance with Schedule B, for the Floating Rate Reference Period commencing on the Disbursement Date and not the Scheduled Disbursement Date.

Interest shall be calculated in respect of each Floating Rate Reference Period on the basis of Article 5.1(b).

3.1.C Revision or Conversion of Tranches

Where the Borrower exercises an option to revise or convert the interest rate basis of a Tranche, it shall, from the effective Interest Revision/Conversion Date (in accordance with the procedure set out in Schedule D) pay interest at a rate determined in accordance with the provisions of Schedule D.

3.2 Interest on overdue sums

Without prejudice to Article 10 and by way of exception to Article 3.1, if the Borrower fails to pay any amount payable by it under this Contract on its due date, interest shall accrue on any overdue amount payable under the terms of this Contract from the due date to the date of actual payment at an annual rate equal to:

(a) for overdue sums related to Floating Rate Tranches, the applicable Floating Rate plus 2% (200 basis points);

(b) for overdue sums related to Fixed Rate Tranches, the higher of

(i) the applicable Fixed Rate plus 2% (200 basis points); or

(ii) EURIBOR (one month) plus 2% (200 basis points); and

and shall be payable in accordance with the demand of the Bank. For the purpose of determining EURIBOR in relation to this Article 3.2, the relevant periods within the meaning of Schedule B shall be successive periods of one (1) month commencing on the due date. Any unpaid but due interest may be capitalised in conformity with article 1154 of the Luxembourg Civil Code. For the avoidance of doubt, capitalisation of interest shall occur only for interest due but unpaid for a period of more than one year. The Borrower hereby agrees in advance to have the unpaid interest due for a period of more than one year compounded and that as of the capitalisation, such unpaid interest will in turn produce interest at the interest rate set out in this Article 3.2.

Notwithstanding Article 3.2 (c) above, if the overdue sum is in a currency for which no relevant interbank rate is specified in this Contract, the relevant interbank rate, or as determined by the Bank, the relevant risk-free rate that is generally retained by the Bank for transactions in that currency shall apply plus 2% (200 basis points), calculated in accordance with the market practice for such rate.

3.3 Market Disruption Event

If at any time:

(a) from the receipt by the Bank of a Disbursement Acceptance in respect of a Tranche; and

(b) until the date falling 30 (thirty) calendar days prior to the Scheduled Disbursement Date,

a Market Disruption Event occurs, the Bank may notify the Borrower that this Article 3.3 has come into effect.

The rate of interest applicable to such Accepted Tranche until the Maturity Date or the Interest Revision/Conversion Date if any, shall be the rate (expressed as a percentage rate per annum) which is determined by the Bank to be the all-inclusive cost to the Bank for the funding of the relevant Tranche based upon the then applicable internally generated Bank reference rate or an alternative rate determination method reasonably determined by the Bank.

The Borrower shall have the right to refuse in writing such disbursement within the deadline specified in the notice and shall bear charges incurred as a result, if any, in which case the Bank shall not effect the disbursement and the corresponding portion of the Credit shall remain available for disbursement under Article 1.2. If the Borrower does not refuse the disbursement in time, the Parties agree that the disbursement in EUR and the conditions thereof shall be fully binding for both Parties.

The Spread or the Fixed Rate previously accepted by the Borrower shall no longer be applicable.

ARTICLE 4

Repayment

4.1 Normal repayment - Repayment by instalments

(a) The Borrower shall repay each Tranche by instalments on the Repayment Dates specified in the relevant Disbursement Offer in accordance with the terms of the amortisation table delivered pursuant to Article 2.3.

(b) Each amortisation table shall be drawn up on the basis that:

(i) in the case of a Fixed Rate Tranche without an Interest Revision/Conversion Date, repayment shall be made quarterly, semi-annually or annually by equal instalments of principal or constant instalments of principal and interest;

(ii) in the case of a Fixed Rate Tranche with an Interest Revision/Conversion Date or a Floating Rate Tranche, repayment shall be made by equal quarterly, semi-annual or annual instalments of principal;

(iii) the first Repayment Date of each Tranche shall fall not earlier than 30 (thirty) days from the Scheduled Disbursement Date and not later than the Repayment Date immediately following the 4th (fourth) anniversary of the Scheduled Disbursement Date of the Tranche; and

(iv) the last Repayment Date of each Tranche shall fall not earlier than 4 (four) years and not later than 15 (fifteen) years from the Scheduled Disbursement Date.

4.2 Voluntary prepayment

4.2.A Prepayment option

Subject to Articles 4.2.B, 4.2.C and 4.4, the Borrower may prepay all or part of any Tranche, together with accrued interest and indemnities if any, upon giving a Prepayment Request with at least 30 (thirty) calendar days’ prior notice specifying:

(a) the Prepayment Amount;

(b) the Prepayment Date, which shall be a Payment Date;

(d) the Contract Number.

The Prepayment Request shall be irrevocable.

4.2.B Prepayment indemnity

4.2.B(1) FIXED RATE TRANCHE

Subject to Article 4.2.B(3) below, if the Borrower prepays a Fixed Rate Tranche, the Borrower shall pay to the Bank on the Prepayment Date the Prepayment Indemnity in respect of the Fixed Rate Tranche which is being prepaid.

4.2.B(2) FLOATING RATE TRANCHE

Subject to Article 4.2.B(3) below, the Borrower may prepay a Floating Rate Tranche without indemnity.

4.2.B(3) REVISION/CONVERSION

Prepayment of a Tranche on its Interest Revision/Conversion Date may be effected without indemnity except if the Borrower has accepted pursuant to Schedule D a Fixed Rate under an Interest Revision/Conversion Proposal.

4.2.C Prepayment mechanics

Upon presentation by the Borrower to the Bank of a Prepayment Request, the Bank shall issue a Prepayment Notice to the Borrower, not later than 15 (fifteen) days prior to the Prepayment Date. The Prepayment Notice shall specify the Prepayment Amount, the accrued interest due thereon, the Prepayment Indemnity payable under Article 4.2.B or, as the case may be, that no indemnity is due, the method of application of the Prepayment Amount and, if a Prepayment Indemnity is applicable, the deadline by which the Borrower may accept the Prepayment Notice.

If the Borrower accepts the Prepayment Notice no later than by the deadline (if any) specified in the Prepayment Notice, the Borrower shall effect the prepayment. In any other case, the Borrower may not effect the prepayment.

The Borrower shall accompany the payment of the Prepayment Amount by the payment of accrued interest, the Prepayment Indemnity, due on the Prepayment Amount, as specified in the Prepayment Notice, and the fee under Article 4.2.D, if any.

4.2.D Administrative Fee

If the Borrower prepays a Tranche on a date other than a relevant Payment Date, or if the Bank exceptionally accepts, solely upon the Bank’s discretion, a Prepayment Request with prior notice of less than 30 (thirty) calendar days, the Borrower shall pay to the Bank an administrative fee in such amount as the Bank shall notify to the Borrower.

4.3 Compulsory prepayment and cancellation

4.3.A Prepayment Events

4.3.A(1) PROJECT COST REDUCTION EVENT

(a) The Borrower shall promptly inform the Bank if a Project Cost Reduction Event has occurred or is likely to occur. At any time after the occurrence of a Project Cost Reduction Event the Bank may, by notice to the Borrower, cancel the undisbursed portion of the Credit and/or demand prepayment of the Loan Outstanding up to the amount by which the Credit exceeds the limits referred to in paragraph (c) below together with accrued interest and all other amounts accrued and outstanding under this Contract in relation to the proportion of the Loan Outstanding to be prepaid.

(b) The Borrower shall effect payment of the amount demanded on the date specified by the Bank, such date falling not less than 30 (thirty) days from the date of the demand.

(c) For the purpose of this Article, "Project Cost Reduction Event" means that the total cost of the Project falls below the figure stated in Recital (b) so that the amount of the Credit (together with any other credits or loans provided by the Bank for this Project) exceeds:

(i) 50% (fifty percent per cent); and/or

(ii) when aggregated with the amount of any other funds from the European Union made available for the Project, 90% (ninety per cent), of such total cost of the Project.

4.3.A(2) NON-EIB FINANCING PREPAYMENT EVENT

(a) The Borrower shall promptly inform the Bank if a Non-EIB Financing Prepayment Event has occurred or is likely to occur. At any time after the occurrence of a Non-EIB Financing Prepayment Event the Bank may, by notice to the Borrower, cancel the undisbursed portion of the Credit and demand prepayment of the Loan Outstanding, together with accrued interest and all other amounts accrued and outstanding under this Contract in relation to the proportion of the Loan Outstanding to be prepaid.

(b) The proportion of the Credit that the Bank may cancel and the proportion of the Loan Outstanding that the Bank may require to be prepaid shall be the same as the proportion that the prepaid amount of the Non-EIB Financing bears to the aggregate outstanding amount of all Non-EIB Financing.

(c) The Borrower shall effect payment of the amount demanded on the date specified by the Bank, such date being a date falling not less than 30 (thirty) days from the date of the demand.

(d) Paragraph (a) does not apply to any voluntary prepayment (or repurchase or cancellation, as the case may be) of a Non-EIB Financing:

(i) made with a prior written consent of the Bank;

(ii) made within a revolving credit facility; or

(iii) made out of the proceeds of any financial indebtedness having a term at least equal to the unexpired term of such Non-EIB Financing prepaid.

(e) For the purposes of this Article:

(i) "Non-EIB Financing Prepayment Event" means any case where the Borrower voluntarily prepays (for the avoidance of doubt, such prepayment shall include a voluntary repurchase or cancellation of any creditor’s commitment, as the case may be) a part or the whole of any Non-EIB Financing; and

(ii) "Non-EIB Financing" means any financial indebtedness (save for the Loan and any other direct financial indebtedness from the Bank to the Borrower), or any other obligation for the payment or repayment of money originally made available to the Borrower for a term of more than 3 (three) years.

4.3.A(3) CHANGE OF LAW EVENT

The Borrower shall promptly inform the Bank if a Change-of-Law Event has occurred or is likely to occur. In such case, or if the Bank has reasonable cause to believe that a Change-of-Law Event has occurred or is about to occur, the Bank may request that the Borrower consult with it. Such consultation shall take place within 30 (thirty) days from the date of the Bank’s request. If, after the lapse of 30 (thirty) days from the date of such request for consultation, the Bank is of the opinion that:

(a) such Change-of-Law Event would materially impair the Borrower’s ability to perform its obligations under this Contract, and

(b) the effects of the Change-of-Law Event cannot be mitigated to its satisfaction,

the Bank may by notice to the Borrower, cancel the undisbursed portion of the Credit and/or demand prepayment of the Loan Outstanding, together with accrued interest and all other amounts accrued and outstanding under this Contract.

The Borrower shall effect payment of the amount demanded on the date specified by the Bank, such date being a date falling not less than 30 (thirty) days from the date of the demand.

For the purposes of this Article "Change-of-Law Event" means the enactment, promulgation, execution or ratification of or any change in or amendment to any law, rule or regulation (or in the application or official interpretation of any law, rule or regulation), or the imposition of any Sanctions, that occurs after the date of this Contract and which could impair the Borrower’s ability to perform its obligations under this Contract.

4.3.A(4) ILLEGALITY EVENT

(a) Upon becoming aware of an Illegality Event:

(i) the Bank shall promptly notify the Borrower, and

(ii) the Bank may immediately (A) suspend or cancel the undisbursed portion of the Credit, and/or (B) demand prepayment of the Loan Outstanding, together with accrued interest and all other amounts accrued and outstanding under this Contract on the date indicated by the Bank in its notice to the Borrower.

(b) For the purposes of this Article, "Illegality Event" means that:

(i) it becomes unlawful in any applicable jurisdiction, or it becomes or is likely to become contrary to any Sanctions, for the Bank to:

(1) perform any of its obligations as contemplated in this Contract; or

(2) fund or maintain the Loan; or

(ii) the Framework Agreement is or is likely to be:

(1) repudiated by the Republic of Serbia or not binding on the Republic of Serbia in any respect;

(2) not effective in accordance with its terms or is alleged by the Borrower to be ineffective in accordance with its terms;

(3) breached by the Republic of Serbia, in that any obligation assumed by the Republic of Serbia under the Framework Agreement ceases to be fulfilled as regards any financing made to any borrower in the territory of the Republic of Serbia from the resources of the Bank, or the EU; or

(4) not applicable to the Project or the rights of the Bank under the Framework Agreement cannot be enforced in respect of the Project.

(1) it is no longer valid or in full force and effect;

(2) the conditions for cover thereunder are not fulfilled;

(3) it is not effective in accordance with its terms or is alleged to be ineffective in accordance with its terms; or

(4) the Republic of Serbia ceases to be an eligible country pursuant to the NDICI-GE Regulation, the IPA III Regulation, or any other applicable law or instrument governing EFSD+.

4.3.B Prepayment mechanics

Any sum demanded by the Bank pursuant to Article 4.3.A, together with any interest or other amounts accrued or outstanding under this Contract including, without limitation, any indemnity due under Article 4.3.C, shall be paid on the Prepayment Date indicated by the Bank in its notice of demand.

4.3.C Prepayment indemnity

4.3.C(5) FIXED RATE TRANCHE

If the Borrower prepays a Fixed Rate Tranche in case of an Indemnifiable Prepayment Event, the Borrower shall pay to the Bank on the Prepayment Date the Prepayment Indemnity in respect of the Fixed Rate Tranche that is being prepaid.

4.3.C(6) FLOATING RATE TRANCHE

The Borrower may prepay the Floating Rate Tranches without the Prepayment Indemnity.

4.4 General

4.4.A No prejudice to Article 10

This Article 4 shall not prejudice Article 10.

4.4.B No reborrowing

A repaid or prepaid amount may not be reborrowed.

ARTICLE 5

Payments

5.1 Day count convention

Any amount due by way of interest, indemnity or the Deferment Fee from the Borrower under this Contract, and calculated in respect of a fraction of a year, shall be determined on the following respective conventions:

(a) under a Fixed Rate Tranche, a year of 360 (three hundred and sixty) days and a month of 30 (thirty) days; and

(b) under a Floating Rate Tranche, a year of 360 (three hundred and sixty) days and the number of days elapsed.

5.2 Time and place of payment

(a) Unless otherwise specified in this Contract or in the Bank’s demand, all sums other than sums of interest, indemnity and principal are payable within 15 (fifteen) days of the Borrower’s receipt of the Bank’s demand.

(b) Each sum payable by the Borrower under this Contract shall be paid to the relevant account notified by the Bank to the Borrower. The Bank shall notify the account not less than 15 (fifteen) days before the due date for the first payment by the Borrower and shall notify any change of account not less than 15 (fifteen) days before the date of the first payment to which the change applies. This period of notice does not apply in the case of payment under Article 10.

(d) A sum due from the Borrower shall be deemed paid when the Bank receives it.

(e) Any disbursements by and payments to the Bank under this Contract shall be made using the Disbursement Account (for disbursements by the Bank) and the Payment Account (for payments to the Bank).

5.3 No set-off by the Borrower

All payments to be made by the Borrower under this Contract shall be calculated and be made without (and free and clear of any deduction for) set-off or counterclaim.

5.4 Disruption to Payment Systems

If either the Bank determines (in its discretion) that a Disruption Event has occurred or the Bank is notified by the Borrower that a Disruption Event has occurred:

(a) the Bank may, and shall if requested to do so by the Borrower, consult with the Borrower with a view to agreeing with the Borrower such changes to the operation or administration of this Contract as the Bank may deem necessary in the circumstances;

(b) the Bank shall not be obliged to consult with the Borrower in relation to any changes mentioned in paragraph (a) if, in its opinion, it is not practicable to do so in the circumstances and, in any event, shall have no obligation to agree to such changes; and

(c) the Bank shall not be liable for any damages, costs or losses whatsoever arising as a result of a Disruption Event or for taking or not taking any action pursuant to or in connection with this Article 5.4.

5.5 Application of sums received

5.5.A General

Sums received from the Borrower shall only discharge its payment obligations if received in accordance with the terms of this Contract.

5.5.B Partial payments

If the Bank receives a payment that is insufficient to discharge all the amounts then due and payable by the Borrower under this Contract, the Bank shall apply that payment, in the order set out below, in or towards:

(a) pro rata to each of any unpaid fees, costs, indemnities and expenses due under this Contract;

(b) any accrued interest due but unpaid under this Contract;

(d) any other sum due but unpaid under this Contract.

5.5.C Allocation of sums related to Tranches

(a) In case of:

(i) a partial voluntary prepayment of a Tranche that is subject to a repayment in several instalments, the Prepayment Amount shall be applied pro rata to each outstanding instalment, or, at the request of the Borrower, in inverse order of maturity; or

(ii) a partial compulsory prepayment of a Tranche that is subject to a repayment in several instalments, the Prepayment Amount shall be applied in reduction of the outstanding instalments in inverse order of maturity.

(b) Sums received by the Bank following a demand under Article 10.1 and applied to a Tranche, shall reduce the outstanding instalments in inverse order of maturity. The Bank may apply sums received between Tranches at its discretion.

(c) In case of receipt of sums which cannot be identified as applicable to a specific Tranche, and on which there is no agreement between the Bank and the Borrower on their application, the Bank may apply these between Tranches at its discretion.

ARTICLE 6

Borrower undertakings and representations

The undertakings in this Article 6 remain in force from the date of this Contract for so long as any amount is outstanding under this Contract or the Credit is in force.

A. PROJECT UNDERTAKINGS

6.1 Use of Loan and availability of other funds

The Borrower shall use all amounts borrowed by it under this Contract for the execution of the Project.

The Borrower shall ensure that it has available to it the other funds listed in Recital (b) and that such funds are expended, to the extent required, on the financing of the Project.

The Loan proceeds shall not be used for the payment of value added tax on sales of goods and services and import of goods and services, costs of customs duties and other import duties, taxes and other impositions occurring in the execution of implementation of the Project.

6.2 Completion of Project

The Borrower shall, and shall ensure that the Promoter will, carry out the Project in accordance with the Technical Description as may be modified from time to time with the approval of the Bank, and complete it by the final date specified therein.

6.3 Increased cost of Project

If the total cost of the Project exceeds the estimated figure set out in Recital (a), the Borrower shall obtain the finance to fund the excess cost without recourse to the Bank, so as to enable the Project to be completed in accordance with the Technical Description. The plans for funding the excess cost shall be communicated to the Bank without delay.

6.4 Procurement procedure

The Borrower shall, and shall ensure that the Promoter:

(i) purchase equipment, secure services and order works for the Project by acceptable procurement procedures complying, to the Bank’s satisfaction, with the Bank’s Guide to Procurement. In particular, tender currencies will be the European Economic and Monetary Union Euro (EURO) and/or United States Dollar (USD) and/or Serbian Dinar (RSD). Payments under the contract shall be made to the account of the selected contractor in the currency or currencies in which their tender is expressed. Contractors who are residents of the Republic of Serbia and have bid in EUR or USD shall be paid in RSD - to the extent mandatory under local law - and according to the middle exchange rate of the National Bank of Serbia on the date of issuing the relevant invoice/proforma invoice;

(ii) ensure that all procurement documents are compliant with the Guide to Procurement, including by making any necessary adaptations to templates;

(iii) submit the detailed procurement plan for the whole operation before first disbursement and inform the Bank of any changes to the initial procurement plan;

(iv) consult with the Bank regarding the amendment of the contracts financed by the Bank and shall seek the Banks non-objection prior to entering into any material amendments to contracts financed by the Bank;

(v) ensure that review procedures for remedies, as provided for in Serbian law, shall be available to any party having had an interest in obtaining a particular contract and who has been or risk being harmed by an alleged infringement; and

(vi) ensure that no requirements of domestic preference or local content not aligned with the Guide to Procurement are included in the contracts envisaged for the financing by the Bank.

6.5 Continuing Project Undertakings

The Borrower shall, and ensure that the Promoter shall (as applicable):

(a) Maintenance: maintain, repair, overhaul and renew all property forming part of the Project as required to keep it in good working order;

(b) Project assets: unless the Bank shall have given its prior consent in writing retain title to and possession of all or substantially all the assets comprising the Project or, as appropriate, replace and renew such assets and maintain the Project in substantially continuous operation in accordance with its original purpose; the Bank may withhold its consent only where the proposed action would prejudice the Bank’s interests as lender to the Borrower or would render the Project ineligible for financing by the Bank under its Statute or under article 309 of the Treaty on the Functioning of the European Union;

(c) Insurance: insure all works and property forming part of the Project with first class insurance companies in accordance with the most comprehensive relevant industry practice;

(d) Rights and Permits: maintain in force all rights of way or use and all Authorisations necessary for the execution and operation of the Project;

(e) Environment and Social:

(i) implement and operate the Project in compliance with the Environmental and Social Standards; and

(ii) obtain, maintain and comply with requisite Environmental or Social Approvals for the Project;

(f) EU law: execute and operate the Project in accordance with the relevant laws of the Republic of Serbia and the relevant standards of EU law, save for any general derogation made by the European Union; and

(g) Accounts: ensure that the Promoter requests any disbursements from the Borrower, and the Borrower makes any payments to the Promoter in relation with the Project to a bank account in the name of the Promoter held with a duly authorised financial institution in the jurisdiction where the Promoter is located or where the Project is undertaken by the Promoter.

6.6 Additional Undertakings

The Borrower, directly or by means of the Promoter, shall:

(i) ensure that the Promoter implements the Project in accordance with the respective resettlement policy framework ("RPF") and environmental management framework (EMF);

(ii) ensure that upon signature of each work or service contract relating to the Project, in line with the most recent edition of the Bank’s Guide to Procurement, as published on its website, promptly submit to the Bank copies of the relevant contract and the signed covenant of integrity;

(iii) ensure that the actions are taken to achieve the Project indicators as specified below:

Indicator	Due date	End of 2023	End of 2024	End of 2025	End of 2026

Perform road safety audits at all relevant stages					100% of project roads
Road safety impact assessments inputs provided for road sections covered by the New Project Implementation Contracts			90%	100%
Provide decisions on recommendations made from road safety audits on road sections covered by the New Project Implementation Contracts				50%	100%
Conduct safety ratings surveys on road sections covered by the New Project Implementation Contracts				100%

(iv) ensure that, for Ongoing Project Implementation Contract(s), the recommendations of independent Road Safety Audits (RSA) have been included in the final design and will be checked at completion/during early operation, as appropriate, documented with RSA Summary Tables listing all identified problems, proposed recommendations, and decisions made by the responsible authority;

(v) ensure that, for New Project Implementation Contract(s) a Road Safety Impact Assessment (RSIA) is prepared, confirming that the improvements will result in an expected net reduction in road fatalities and serious injuries;

(vi) ensure that, for New Project Implementation Contract(s) Road Safety Audits (RSA) are carried out on the final design, documented with RSA \ Feedback Form Tables listing all identified problems, proposed recommendations, and decisions made by the responsible authority; and

(vii) ensure that, for New Project Implementation Contract(s) an assessment of the Safety Ratings on the final design for all relevant road users, including non-motorised road users, based on the EU methodology for network wide road safety assessment, or similar methodology, is prepared.

6.7 Books and records

The Borrower shall:

(a) ensure that it has, and that the Promoter has, kept and will continue to keep proper books and records of account, in which full and correct entries shall be made of all financial transactions and the assets and business of the Borrower and the Promoter, including expenditures in connection with the Project, in accordance with GAAP as in effect from time to time; and,

(b) keep records of contracts financed with the proceeds of the Loan for at least 6 (six) years from substantial performance of the contract.

B. GENERAL UNDERTAKINGS

6.8 Compliance with laws

The Borrower shall comply in all respects with all laws and regulations to which it or the Project is subject.

6.9 Integrity

(a) Prohibited Conduct:

(i) The Borrower shall not and shall procure that the Promoter shall not engage in (and shall not authorise or permit any other person acting on its behalf to engage in) any Prohibited Conduct in connection with the Project, any tendering procedure for the Project, or any transaction contemplated by the Contract.

(ii) The Borrower undertakes and shall procure that the Promoter undertakes to take such action as the Bank shall reasonably request to investigate or terminate any alleged or suspected occurrence of any Prohibited Conduct in connection with the Project.

(iii) The Borrower undertakes and shall procure that the Promoter undertakes to ensure that contracts financed by this Loan include the necessary provisions to enable the Borrower or the Promoter to investigate or terminate any alleged or suspected occurrence of any Prohibited Conduct in connection with the Project.

(b) Sanctions: The Borrower shall not and shall procure that the Promoter shall not directly or indirectly:

(i) maintain or enter into a business relationship with, and/or make any funds and/or economic resources available to, or for the benefit of, any Sanctioned Person in connection with the Project,

(ii) use all or part of the proceeds of the Loan or lend, contribute or otherwise make available such proceeds to any person in any manner that would result in a breach by itself and/or by the Bank of any Sanctions; or

(iii) fund all or part of any payment under this Contract out of proceeds derived from activities or businesses with a Sanctioned Person, a person in breach of the Sanctions or in any manner that would result in a breach by itself and/or by the Bank of any Sanctions.

It is acknowledged and agreed that the undertakings set out in this Article 6.9(b) are only sought by and given to the Bank to the extent that to do so would be permissible pursuant to any applicable anti-boycott rule of the EU such as Regulation (EC) 2271/96.

The Borrower undertakes and shall procure that the Promoter undertakes to take within a reasonable timeframe appropriate measures in respect of any Relevant Person who:

(i) becomes a Sanctioned Person; or

(ii) is the subject of a final and irrevocable court ruling in connection with Prohibited Conduct perpetrated in the course of the exercise of their professional duties,

in order to ensure that such member is excluded from any of the activities in relation to the Loan and to the Project.

6.10 Data Protection

(a) When disclosing information (other than mere contact information relating to the Borrower’s personnel involved in the management of this Contract ("Contact Details")) to the Bank in connection with this Contract, the Borrower shall redact or otherwise amend that information (as necessary) so that it does not contain any information relating to identified or identifiable individuals ("Personal Information"), except where this Contract specifically requires, or the Bank specifically requests in writing, to disclose such information in the form of Personal Information.

(b) Before disclosing any Personal Information (other than Contact Details) to the Bank in connection with this Contract, the Borrower shall ensure that each individual to whom such Personal Information relates:

(i) has been informed of the disclosure to the Bank (including the categories of Personal Information to be disclosed); and

(ii) has been advised on the information contained in (or has been provided with an appropriate link to) the Bank’s privacy statement in relation to its lending and investment activities as set out from time to time at https://www.eib.org/en/privacy/lending (or such other address as the Bank may notify to the Borrower in writing from time to time).

6.11 General Representations and Warranties

The Borrower represents and warrants to the Bank that:

(a) it has the power to execute, deliver and perform its obligations under this Contract and all necessary governmental and other action have been taken to authorise the execution, delivery and performance of the same by it;

(b) this Contract constitutes its legally valid, binding and enforceable obligations;

(c) the execution and delivery of, the performance of its obligations under and compliance with the provisions of this Contract do not and will not contravene or conflict with:

(i) any applicable law, statute, rule or regulation, or any judgement, decree or permit to which it is subject; and

(ii) any agreement or other instrument binding upon it which might reasonably be expected to have a material adverse effect on its ability to perform its obligations under this Contract;

(d) there has been no Material Adverse Change since 15 June 2023 on which the Bank’s Management Committee approved this loan operation as documented under this Contract;

(e) no event or circumstance which constitutes a Prepayment Event or an Event of Default has occurred and is continuing unremedied or unwaived;

(f) no litigation, arbitration, administrative proceedings or investigation is current or to its knowledge is threatened or pending before any court, arbitral body or agency which has resulted or if adversely determined is reasonably likely to result in a Material Adverse Change, nor is there subsisting against it any unsatisfied judgement or award;

(g) it has obtained all necessary Authorisations in connection with this Contract and in order to lawfully comply with its obligations hereunder, and the Project and all such Authorisations are in full force and effect and admissible in evidence;

(h) its payment obligations under this Contract rank not less than pari passu in right of payment with all other present and future unsecured and unsubordinated obligations under any of its debt instruments except for obligations mandatorily preferred by law;

(i) it is in compliance with Article 6.5 (e) and to the best of its knowledge and belief (having made due and careful enquiry) no Environmental or Social Claim has been commenced or is threatened against it in relation to the Project;

(j) it is in compliance with all undertakings under this Article 6;

(k) to the best of its knowledge, no funds invested in the Project by the Borrower are of illicit origin, including products of Money Laundering or linked to the Financing of Terrorism;

(l) neither the Borrower, its officers and directors nor any other person acting on its or their behalf or under its or their control has committed nor will commit:

(i) any Prohibited Conduct in connection with the Project or any transaction contemplated by the Contract; or

(ii) any illegal activity related to the Financing of Terrorism or Money Laundering;

(m) the Project (including without limitation, the negotiation, award and performance of contracts financed or to be financed by the Loan) has not involved or given rise to any Prohibited Conduct;

(n) none of the Borrower, the Promoter and/or any Relevant Person is a Sanctioned Person, or is in breach of any Sanctions; and

(o) the Declaration of Honour is true in all respects.

The representations and warranties set out above are made on the date of this Contract and are, with the exception of the representations set out in paragraph (d) and (o) above, deemed repeated with reference to the facts and circumstances then existing on the date of each Disbursement Acceptance, each Disbursement Date and on each Payment Date.

It is acknowledged and agreed that the representations set out in paragraph (n) above are only sought by and given to the Bank to the extent that to do so would be permissible pursuant to any applicable anti-boycott rule of the EU such as Regulation (EC) 2271/96.

6.12 Conflict of Interest

Pursuant to the general duty under the Guide to Procurement for the Promoter to effectively prevent, identify and remedy conflicts of interest, the Borrower shall and shall procure that the Promoter shall ensure that prior to the award of any contract financed under the Project:

(i) the Beneficial Owners of the successful bidder (including joint venture partners and subcontractors) who are Close Associates or Family Members of the representative(s), member(s) of the management bodies or senior officer(s) of the Borrower or the Promoter are identified and promptly communicated to the Bank; and

(ii) adequate measures are adopted to address any potential conflicts of interest such as a financial, economic or other personal interest between the identified Beneficial Owner(s) and any member(s) of the Borrower’s or the Promoter’s management bodies, representative(s) or senior officer(s).

For the purposes of this Article:

"AML Directives" means the 4th AML Directive and the 5th AML Directive.

"4th AML Directive" means Directive 2015/849 of the European Parliament and of the Council of 20 May 2015 on the prevention of the use of the financial system for the purposes of money laundering or terrorist financing as amended, supplemented or restated.

"5th AML Directive" means Directive 2018/843 of the European Parliament and of the Council of 19 June 2018 on anti-money laundering and terrorist financing as amended, supplemented or restated.

"Beneficial Owner(s)" has the meaning given to such term in the AML Directives.

"Close Associate(s)" means "persons known to be close associates" as defined in the AML Directives.

"Family Member(s)" has the meaning given to such term in the AML Directives.

ARTICLE 7

Security

The undertakings in this Article 7 remain in force from the date of this Contract for so long as any amount is outstanding under this Contract or the Credit is in force.

7.1 Pari passu ranking

The Borrower shall ensure that its payment obligations under this Contract rank, and will rank, not less than pari passu in right of payment with all other present and future unsecured and unsubordinated obligations under any of its debt instruments except for obligations mandatorily preferred by law.

In particular, if the Bank makes a demand under Article 10.1 or if an event or potential event of default under any unsecured and unsubordinated External Debt Instrument of the Borrower or of any of its agencies or instrumentalities has occurred and is continuing, the Borrower shall not make (or authorise) any payment in respect of any other such External Debt Instrument (whether regularly scheduled or otherwise) without simultaneously paying, or setting aside in a designated account for payment on the next Payment Date a sum equal to, the same proportion of the debt outstanding under this Contract as the proportion that the payment under such External Debt Instrument bears to the total debt outstanding under that External Debt Instrument. For this purpose, any payment of an External Debt Instrument that is made out of the proceeds of the issue of another instrument, to which substantially the same persons as hold claims under the External Debt Instrument have subscribed, shall be disregarded.

In this Contract, "External Debt Instrument" means:

(a) an instrument, including any receipt or statement of account, evidencing or constituting an obligation to repay a loan, deposit, advance or similar extension of credit (including without limitation any extension of credit under a refinancing or rescheduling agreement);

(b) an obligation evidenced by a bond, debenture or similar written evidence of indebtedness; or

(c) a guarantee granted by the Borrower for an obligation of a third party; provided in each case that such obligation is:

(i) governed by a system of law other than the law of the Borrower;

(ii) payable in a currency other than the currency of the Borrower’s country; or

(iii) payable to a person incorporated, domiciled, resident or with its head office or principal place of business outside the Borrower’s country.

7.2 Additional Security

If the Borrower grant to a third party any security for the performance of any External Debt Instrument or any preference or priority in respect thereof, the Borrower shall, if so required by the Bank, provide to the Bank equivalent security for the performance of its obligations under this Contract or grant to the Bank equivalent preference or priority.

7.3 Clauses by inclusion

If the Borrower concludes with any other financial creditor a financing agreement that includes a loss-of-rating clause or a covenant or other provision regarding its financial ratios, if applicable, that is not provided for in this Contract or is more favourable to the relevant financial creditor than any equivalent provision of this Contract is to the Bank, the Borrower shall promptly inform the Bank and shall provide a copy of the more favourable provision to the Bank. The Bank may request that the Borrower promptly executes an agreement to amend this Contract so as to provide for an equivalent provision in favour of the Bank.

ARTICLE 8

Information and Visits

8.1 Information concerning the Project

The Borrower shall, and shall procure that the Promoter shall (as applicable):

(a) deliver to the Bank:

(i) the information in content and in form, and at the times, specified in Schedule A.2 or otherwise as agreed from time to time by the Parties; and

(ii) any such information or further document concerning the financing, procurement, implementation, operation and matters relating to Environment or Social Matters of or for the Project, or any information or further document required by the Bank to comply with its obligations under the NDICI-GE Regulation or the Financial Regulation, as the Bank may reasonably require within a reasonable time,

provided always that if such information or document is not delivered to the Bank on time, and the Borrower does not rectify the omission within a reasonable time set by the Bank in writing, the Bank may remedy the deficiency, to the extent feasible, by employing its own staff or a consultant or any other third party, at the Borrower’s expense, as applicable (within the limit of reasonable and duly documented expenses) and the Borrower, as applicable, shall provide such persons with all assistance necessary for the purpose;

(b) submit for the approval of the Bank without delay any material change to the Project, also taking into account the disclosures made to the Bank in connection with the Project prior to the signing of this Contract, in respect of, inter alia, the price, design, plans, timetable or to the expenditure programme or financing plan for the Project;

(i) the suspension or cancellation of the Project;

(ii) any material alteration to any laws, constitutional documents or shareholding structure relating to the Promoter with a material effect on the Project after the date of this Contract; and

(iii) any disposal by the Promoter of any material assets forming part of the Project; and

(d) promptly inform the Bank of:

(i) any action or protest initiated or any objection raised by any third party or any genuine complaint received by the Borrower or the Promoter (as applicable) which is material with regard to environmental, social or other matters affecting the Project;

(ii) true copies of contracts financed with the proceeds of the Loan and evidence of expenditures relating to disbursements;

(iii) any fact or event known to the Borrower or the Promoter, which may substantially prejudice or affect the conditions of execution or operation of the Project;

(iv) any non-compliance by it with any Environmental and Social Standards;

(v) any suspension, revocation or material modification of any Environmental or Social Approval,

(vi) a genuine allegation or complaint with regard to any Prohibited Conduct or any Sanction related to the Project;

(vii) any changes to the initial procurement plan(s);

(viii) provide to the Bank, if so requested:

(a) a certificate of its insurers showing fulfilment of the requirements of Article 6.5(c);

(b) annually, a list of policies in force covering the insured property forming part of the Project, together with confirmation of payment of the current premiums; and

(ix) should it become aware of any fact or information confirming or reasonably suggesting that (a) any Prohibited Conduct or any violation of any Sanction has occurred in connection with the Project, or (b) any of the funds invested in the Project was derived from an illicit origin;

and set out the action to be taken with respect to such matters.

8.2 Information concerning the Borrower

The Borrower shall, and shall procure that the Promoter shall (as applicable):

(a) deliver to the Bank:

(i) from time to time, such further information on its general financial situation as the Bank may reasonably require or such certificates of compliance with the undertakings of Article 6 as the Bank may deem necessary; and

(ii) any such information, evidence or further document concerning the compliance with the due diligence requirements of the Bank for the Borrower and the Promoter, including, but not limited to "know your customer" (KYC) or similar identification and verification procedures, as the Bank may reasonably require within a reasonable time;

as the Bank may deem necessary or may reasonably require to be provided within a reasonable time, and

(b) inform the Bank immediately of:

(i) any fact which obliges it to prepay any financial indebtedness or any European Union funding;

(ii) any event or decision that constitutes or may result in a Prepayment Event;

(iii) any intention on its part to relinquish ownership of any material component of the Project;

(iv) any fact or event that is reasonably likely to prevent the substantial fulfilment of any obligation of the Borrower under this Contract;

(v) any Event of Default having occurred or being threatened or anticipated;

(vi) any fact or event which results in the Borrower or the Promoter, or any Relevant Person in respect of the Borrower or the Promoter, or their controlling entities being a Sanctioned Person;

(vii) unless prohibited by law, any material litigation, arbitration, administrative proceedings or investigation carried out by a court, administration or similar public authority, which, to the best of its knowledge and belief, is current, imminent or pending against the Borrower, the Promoter or its controlling entities or members of the Borrower’s or Promoter’s management bodies in connection with Prohibited Conduct related to the Credit, the Loan or the Project;

(viii) any measure taken by the Borrower pursuant to Article 6.9 (Integrity) of this Contract;

(ix) any litigation, arbitration or administrative proceedings or investigation which is current, threatened or pending and which might if adversely determined result in a Material Adverse Change; and

(x) any material development in relation to any pending litigation, arbitration or administrative proceedings or investigation with respect to tax avoidance.

8.3 Visits, Right of Access and Investigation

(a) The Borrower shall allow the Bank, and when either required by the relevant mandatory provisions of EU law or pursuant to the NDICI-GE Regulation or the Financial Regulation, as applicable, the European Court of Auditors, the European Commission, the European Anti-Fraud Office and the European Public Prosecutor’s Office, as well as persons designated by the foregoing (each a "Relevant Party"), to:

(i) visit the sites, installations and works comprising the Project,

(ii) interview representatives of the Borrower and/or the Promoter, and not obstruct contacts with any other person involved in or affected by the Project; and

(iii) conduct such investigations, inspections, on-the-spot audits and checks as they may wish and review the Borrower’s and/or Promoter’s books and records in relation to the Loan, the Contract, and the execution of the Project, and to be able to take copies of related documents to the extent permitted by the law.

(b) The Borrower shall provide the Bank and any Relevant Party, or ensure that the Bank and the Relevant Parties are provided, with access to information, facilities and documentation, as well as with all necessary assistance, for the purposes described in this Article.

(c) Additionally, the Borrower shall allow the European Commission and the EU Delegation of the Republic of Serbia to participate in any monitoring missions organised by the Bank related to this Contract, the Loan or the Project.

(d) In the case of a genuine allegation, complaint or information with regard to a Prohibited Conduct related to the Loan and/or the Project, the Borrower shall consult with the Bank in good faith regarding appropriate actions. In particular, if it is proven that a third party committed a Prohibited Conduct in connection with the Loan and/or the Project with the result that the Loan was misapplied, the Bank may, without prejudice to the other provisions of this Contract, inform the Borrower if, in its view, the Borrower should take appropriate recovery measures against such third party. In any such case, the Borrower shall in good faith consider the Bank’s views and keep the Bank informed.

8.4 Disclosure and Publication

(a) The Borrower acknowledges and agrees, and shall ensure that the Promoter will acknowledge and agree, that:

(i) the Bank may be obliged to communicate information and materials relating to the Borrower, the Loan, the Contract and/or the Project to any institution or body of the European Union, including the European Court of Auditors, the European Commission, any relevant EU Delegation, the European Anti-Fraud Office and the European Public Prosecutor’s Office, as may be necessary for the performance of their tasks in accordance with EU Law (including the NDICI Regulation and the Financial Regulation); and

(ii) the Bank may publish on its website and/or on social media, and/or produce press releases, containing information related to the financing provided pursuant to this Contract with the support of the EFSD+ DIW1 Guarantee, including the name, address and country of establishment of the Borrower, the purpose of the financing, and the type and amount of financial support received under this Contract.

(b) The Borrower:

(i) acknowledges, and shall ensure that the Promoter will acknowledge, the origin of the EU financial support under the EFSD+;

(ii) shall ensure, and shall ensure that the Promoter will ensure that, the visibility of the EU financial support under the European Fund for Sustainable Development Plus, in particular when promoting or reporting on the Borrower, this Contract, the Loan or the Project, and their results, in a visible manner on communication material related to the Borrower, this Contract, the Loan or the Project, and by providing coherent, effective and proportionate targeted information to multiple audiences, including the media and the public, provided that the content of the communication material has been previously agreed with the Bank; and

(iii) shall consult with, and shall ensure that the Promoter will consult with, the Bank, the Commission and the EU Delegation of the Republic of Serbia on communication about the signature of this Finance Contract.

ARTICLE 9

Charges and expenses

9.1 Taxes, duties and fees

(a) The Borrower shall pay all Taxes, duties, fees and other impositions of whatsoever nature, including stamp duty and registration fees, arising out of the execution or implementation of this Contract or any related document and in the creation, perfection, registration or enforcement of any Security for the Loan to the extent applicable.

(b) The Borrower shall pay all principal, interest, indemnities and other amounts due under this Contract gross without any withholding or deduction of any national or local impositions whatsoever required by law or under an agreement with a governmental authority or otherwise. If the Borrower is obliged to make any such withholding or deduction, it shall gross up the payment to the Bank so that after withholding or deduction, the net amount received by the Bank is equivalent to the sum due.

(c) In such cases, the Borrower shall ensure that the proceeds of the Loan shall not be used for financing of customs duties and Taxes levied by, or in the territory of, the Borrower in respect of all goods, works and services procured by the Promoter for the purposes of the Project.

9.2 Other charges

The Borrower shall bear all charges and expenses, including professional, banking or exchange charges incurred in connection with the preparation, execution, implementation, enforcement and termination of this Contract or any related document, any amendment, supplement or waiver in respect of this Contract or any related document, and in the amendment, creation, management, enforcement and realisation of any security for the Loan.

9.3 Increased costs, indemnity and set-off

(a) The Borrower shall pay to the Bank any costs or expenses incurred or suffered by the Bank as a consequence of the introduction of or any change in (or in the interpretation, administration or application of) any law or regulation or compliance with any law or regulation which occurs after the date of signature of this Contract, in accordance with or as a result of which:

(i) the Bank is obliged to incur additional costs in order to fund or perform its obligations under this Contract, or

(ii) any amount owed to the Bank under this Contract or the financial income resulting from the granting of the Credit or the Loan by the Bank to the Borrower is reduced or eliminated.

(b) Without prejudice to any other rights of the Bank under this Contract or under any applicable law, the Borrower shall indemnify and hold the Bank harmless from and against any loss incurred as a result of any full or partial discharge that takes place in a manner other than as expressly set out in this Contract.

(c) The Bank may set off any matured obligation due from the Borrower under this Contract (to the extent beneficially owned by the Bank) against any obligation (whether or not matured) owed by the Bank to the Borrower regardless of the place of payment, booking branch or currency of either obligation. If the obligations are in different currencies, the Bank may convert either obligation at a market rate of exchange in its usual course of business for the purpose of the set-off. If either obligation is unliquidated or unascertained, the Bank may set off in an amount estimated by it in good faith to be the amount of that obligation.

ARTICLE 10

Events of Default

10.1 Right to demand repayment

The Borrower shall repay all or part of the Loan Outstanding (as requested by the Bank) forthwith, together with accrued interest and all other accrued or outstanding amounts under this Contract, upon written demand being made by the Bank in accordance with the following provisions.

10.1.A Immediate demand

The Bank may make such demand immediately without prior notice (mise en demeure préalable) or any judicial or extra judicial step:

(a) if the Borrower does not pay on the due date any amount payable pursuant to this Contract at the place and in the currency in which it is expressed to be payable, unless:

(i) its failure to pay is caused by an administrative or technical error or a Disruption Event and

(ii) payment is made within 3 (three) Business Days of its due date;

(b) if any information or document given to the Bank by or on behalf of the Borrower or any representation, warranty or statement made or deemed to be made by the Borrower in pursuant to or for the purposes of entering into this Contract or in connection with the negotiation or performance of this Contract is or proves to have been incorrect, incomplete or misleading in any material respect;

(c) if, following any default of the Borrower in relation to any loan, or any obligation arising out of any financial transaction, other than the Loan:

(i) the Borrower is required or is capable of being required or will, following expiry of any applicable contractual grace period, be required or be capable of being required to prepay, discharge, close out or terminate ahead of maturity such other loan or obligation; or

(ii) any financial commitment for such other loan or obligation is cancelled or suspended;

(d) if the Borrower is unable to pay its debts as they fall due, or suspends its debts, or makes or seeks to make a composition with its creditors;

(e) if an encumbrancer takes possession of, or a receiver, liquidator, administrator, administrative receiver or similar officer is appointed, whether by a court of competent jurisdiction or by any competent administrative authority any property forming part of the Project;

(f) if the Borrower defaults in the performance of any obligation in respect of any other loan granted by the Bank (including, but not limited to, under the Original Contract) or financial instrument entered into with the Bank, or of any other loan or financial instrument made to it from the resources of the Bank or the European Union;

(g) if any expropriation, attachment, arrestment, distress, execution, sequestration or other process is levied or enforced upon the property of the Borrower or any property forming part of the Project and is not discharged or stayed within 14 (fourteen) days;

(h) if a Material Adverse Change occurs, as compared with the Borrower’s condition at the date of this Contract; or

(i) if it is or becomes unlawful for the Borrower to perform any of its obligations under this Contract or this Contract is not effective in accordance with its terms or is alleged by the Borrower to be ineffective in accordance with its terms.

10.1.B Demand after notice to remedy

The Bank may also make such demand without prior notice (mise en demeure préalable) or any judicial or extra judicial step (without prejudice to any notice referred to below):

(a) if the Borrower fails to comply with any provision of this Contract other than those referred to in Article 10.1.A; or

(b) if any fact related to the Borrower or the Project stated in the Recitals materially alters and is not materially restored and if the alteration either prejudices the interests of the Bank as lender to the Borrower or adversely affects the implementation or operation of the Project,

unless the non-compliance or circumstance giving rise to the non-compliance is capable of remedy and is remedied within a reasonable period of time specified in a notice served by the Bank on the Borrower.

10.2 Other rights at law

Article 10.1 shall not restrict any other right of the Bank at law to require prepayment of the Loan Outstanding.

10.3 Indemnity

10.3.A Fixed Rate Tranches

In case of demand under Article 10.1 in respect of any Fixed Rate Tranche, the Borrower shall pay to the Bank the amount demanded together with the indemnity on any amount of principal due to be prepaid. Such indemnity shall (i) accrue from the due date for payment specified in the Bank’s notice of demand and be calculated on the basis that prepayment is effected on the date so specified, and (ii) be for the amount communicated by the Bank to the Borrower as the present value (calculated as of the date of the prepayment) of the excess, if any, of:

(a) the interest that would accrue thereafter on the amount prepaid over the period from the date of prepayment to the Interest Revision/Conversion Date, if any, or the Maturity Date, if it were not prepaid; over

(b) the interest that would so accrue over that period, if it were calculated at the Redeployment Rate, less 0.19% (nineteen basis points).

The said present value shall be calculated at a discount rate equal to the Redeployment Rate, applied as of each relevant Payment Date of the applicable Tranche.

10.3.B Floating Rate Tranches

In case of demand under Article 10.1 in respect of any Floating Rate Tranche, the Borrower shall pay to the Bank the amount demanded together with a sum equal to the present value of 0.19% (nineteen basis points) per annum calculated and accruing on the amount of principal due to be prepaid in the same manner as interest would have been calculated and would have accrued, if that amount had remained outstanding according to the applicable amortisation schedule of the Tranche, until the Interest Revision/Conversion Date, if any, or the Maturity Date.

The value shall be calculated at a discount rate equal to the Redeployment Rate applied as of each relevant Payment Date.

10.3.C General

Amounts due by the Borrower pursuant to this Article 10.3 shall be payable on the date specified in the Bank’s demand.

10.4 Non-Waiver

No failure or delay or single or partial exercise by the Bank in exercising any of its rights or remedies under this Contract shall be construed as a waiver of such right or remedy. The rights and remedies provided in this Contract are cumulative and not exclusive of any rights or remedies provided by law.

Article 11

Law and jurisdiction, miscellaneous

11.1 Governing Law

This Contract and any non-contractual obligations arising out of or in connection with it shall be governed by the laws of Luxembourg.

11.2 Jurisdiction

(a) The Court of Justice of the European Union has exclusive jurisdiction to settle any dispute (a "Dispute") arising out of or in connection with this Contract (including a dispute regarding the existence, validity or termination of this Contract or the consequences of its nullity) or any non-contractual obligation arising out of or in connection with this Contract.

(b) The Parties agree that the Court of Justice of the European Union is the most appropriate and convenient court to settle Disputes between them and, accordingly, that they will not argue to the contrary.

(c) The parties to this Contract hereby waive any immunity from or right to object to the jurisdiction of the Court of Justice of the European Union. A decision of the Court of Justice of the European Union given pursuant to this Article shall be conclusive and binding on each party without restriction or reservation.

11.3 Place of performance

Unless otherwise specifically agreed by the Bank in writing, the place of performance under this Contract, shall be the seat of the Bank.

11.4 Evidence of sums due

In any legal action arising out of this Contract the certificate of the Bank as to any amount or rate due to the Bank under this Contract shall, in the absence of manifest error, be prima facie evidence of such amount or rate.

11.5 Entire Agreement

This Contract constitutes the entire agreement between the Bank and the Borrower in relation to the provision of the Credit hereunder, and supersedes any previous agreement, whether express or implied, on the same matter.

11.6 Invalidity

If at any time any term of this Contract is or becomes illegal, invalid or unenforceable in any respect, or this Contract is or becomes ineffective in any respect, under the laws of any jurisdiction, such illegality, invalidity, unenforceability or ineffectiveness shall not affect:

(a) the legality, validity or enforceability in that jurisdiction of any other term of this Contract or the effectiveness in any other respect of this Contract in that jurisdiction; or

(b) the legality, validity or enforceability in other jurisdictions of that or any other term of this Contract or the effectiveness of this Contract under the laws of such other jurisdictions.

11.7 Amendments

Any amendment to this Contract shall be made in writing and shall be signed by the Parties.

11.8 Counterparts

This Contract may be executed in any number of counterparts, all of which taken together shall constitute one and the same instrument. Each counterpart is an original, but all counterparts shall together constitute one and the same instrument.

Article 12

Final clauses

12.1 Notices

12.1.A Form of Notice

(a) Any notice or other communication given under this Contract must be in writing and, unless otherwise stated, may be made by letter or electronic mail.

(b) Notices and other communications for which fixed periods are laid down in this Contract or which themselves fix periods binding on the addressee, may be made by hand delivery, registered letter or by electronic mail. Such notices and communications shall be deemed to have been received by the other Party:

(i) on the date of delivery in relation to a hand-delivered or registered letter; and

(ii) in the case of any electronic mail only when such electronic mail is actually received in readable form and only if it is addressed in such a manner as the other Party shall specify for this purpose.

(i) mention the Contract Number in the subject line; and

(ii) be in the form of a non-editable electronic image (pdf, tif or other common non editable file format agreed between the Parties) of the notice signed by an Authorised Signatory with individual representation right or by two or more Authorised Signatories with joint representation right of the Borrower as appropriate, attached to the electronic mail.

(d) Notices issued by the Borrower pursuant to any provision of this Contract shall, where required by the Bank, be delivered to the Bank together with satisfactory evidence of the authority of the person or persons authorised to sign such notice on behalf of the Borrower and the authenticated specimen signature of such person or persons.

(e) Without affecting the validity of electronic mail notices or communication made in accordance with this Article 12.1, the following notices, communications and documents shall also be sent by registered letter to the relevant Party at the latest on the immediately following Business Day:

(i) Disbursement Acceptance

(ii) any notices and communication in respect of the deferment, cancellation and suspension of a disbursement of any Tranche, interest revision or conversion of any Tranche, Market Disruption Event, Prepayment Request, Prepayment Notice, Event of Default, any demand for prepayment, and

(iii) any other notice, communication or document required by the Bank.

(f) The Parties agree that any above communication (including via electronic mail) is an accepted form of communication, shall constitute admissible evidence in court and shall have the same evidential value as an agreement under hand (sous seing privé).

12.1.B Addresses

The address and electronic mail address (and the department for whose attention the communication is to be made) of each Party for any communication to be made or document to be delivered under or in connection with this Contract is:

For the Bank	Attention: GLO/ENL 98-100 boulevard Konrad Adenauer L-2950 Luxembourg E-mail address: contactline-96962@eib.org
For the Borrower	Attention: Ministry of Finance 20 Kneza Milosa Street 11000 Belgrade Republic of Serbia E-mail address: kabinet@mfin.gov.rs Copy: uprava@javnidug.gov.rs

12.1.C Notification of communication details

The Bank and the Borrower shall promptly notify the other Party in writing of any change in their respective communication details.

12.2 English language

(a) Any notice or communication given under or in connection with this Contract must be in English.

(b) All other documents provided under or in connection with this Contract must be:

(i) in English; or

(ii) if not in English, and if so required by the Bank, accompanied by a certified English translation and, in this case, the English translation will prevail.

12.3 Effectiveness of this Contract

Other than this Article 12.3, which will become legally effective and enter into full force and effect upon the date of signature of this Contract, this Contract shall become effective on the date (the "Date of Effectiveness") specified in a letter from the Bank to the Borrower confirming that the Bank has received a copy of the Official Gazette of the Republic of Serbia publishing the law on ratification of this Contract by the Parliament of the Republic of Serbia.

If the Date of Effectiveness does not occur on or prior to the date falling 12 (twelve) months after the date of this Contract, this Contract shall not enter into force and no further action shall be necessary or required (unless agreed otherwise between the Bank and the Borrower).

12.4 Recitals, Schedules and Annexes

The Recitals and following Schedules form part of this Contract:

Schedule A	Project Specification and Reporting
Schedule B	Definition of EURIBOR
Schedule C	Forms for Borrower
Schedule D	Interest Rate Revision and Conversion
Schedule E	Certificates to be provided by the Borrower

The parties hereto have caused this Contract to be executed in 6 (six) originals in the English language.

At Belgrade, this 5 October 2023	At Luxembourg, this 6 October 2023
Signed for and on behalf of THE REPUBLIC OF SERBIA	Signed for and on behalf of EUROPEAN INVESTMENT BANK
_______________________ Name: Mr. Siniša Mali Title: Deputy Prime Minister and Minister of Finance	______________________ Name: Matteo RIVELLINI Title: Head of Division	_______________________ Name: Anne-France CATOIR Title: Legal Counsel

Schedule A

PROJECT SPECIFICATION AND REPORTING

A.1 TECHNICAL DESCRIPTION

1. Purpose, Location

The Project covers a multi-year rehabilitation programme of several trunk road sections throughout Serbia, with a great emphasis on the incorporation of road safety measures, as recommended by road safety audits.

2. Description

The Project comprises design supervision and civil works concerning pavement strengthening to 11.6t/axle, pavement widening, structures renewal, traffic signalisation and management improvements on the following sections:

Road No	Section	Length (km)
IB 27	Lazarevac 4 - Arandelovac 1	17.826
IB 27	Arandelovac 4 - Krcevac	8.713
IB 23	Loznica - Valjevo (Zavlaka 2 - Pricevici)	27.008
IB 28	Mali Zvornik - Graçanica	25.420
IB26/28	Banja Koviljaca - Mali Zvornik - Ljubovija 1	27.676
IB 27	Loznica - Zavlaka 2 (Krst - Zavlaka 2)	20.279
IB 39	Vlasotince - Svode	12.514
IB 21	Irig 2 - Ruma 1	15.580
IB 23	Pakovrace (Markovica) - Uzice (new contract)	37.101
IB 21	Pozega-Ivanjica	13.335
IB 35	Kladovo - Brza Palanka	23.259
IB 23/28	Knezevici - Bela Zemlja - Uzice	15.234
IB 29	Prijepolje - Sjenica (Medare)	13.800
E-75	Novi Sad - Belgrade	5.500
IB 39	Leskovac South (connection with A1) - Leskovac (Bratmilovce)	6.499
IB 29	Sjenica (Karajukica Bunar) - Susica	9.015
IB 35	Merosina - Prokuplje (Orljane) & Beloljin - Kursumlija - Rudare	35.759
IIA160	Svilajnac (Crkvenac) - Medvedja (Glogovac)	14.803
IB 15	Vrbas (Zmajevo) - Srbobran (Feketic)	9.492
IB 27	Interchange Markovac - Svilajnac	6.208
IB 10	Border of APV (Pančevo) - Pančevo (Kovin) & Pančevo (Kovin) - Border of APV (Pančevo)	5.712
IB 21	Kosjeric (Varda) - Pozega	22.135
IB 39	Babusnica - Svodje	19.534
IB 21	Ivanjica - Sjenica	20.915
IIA186	Cuprija (Despotovac) - Despotovac	21.44
IB 33	Negotin (Radujevac) - SRB/BUG Border (Mokranje)	12.919
IB 13	Zrenjanin (Ecka) - Ecka	8.690
IB 22	Raska (K. Mitrovica) - Novi Pazar (Banja)	17.890
IB 21	Pozega-Ivanjica	25.603
IB 21	Valjevo (bypass) - Kaona - Kosjeric	21.100
IB 14&33	Border of APV (Kovin) - Ralja - Pozarevac (Orljevo)	33.136
IB 22	Usce - Raska (Kosovska Mitrovica)	32.127
IB 21	Ivanjica - Sjenica	38.148
IB 33	Pozarevac (Orljevo) - Ljesnica	35.057
IB 22	Novi Pazar (Brdjani) - Ribarice	24.36
IB 15	Sombor (Industrial zone) - Kula	39.535
IA 1	Brestovac (interchange) - Doljevac (interchange)	6.022
IB 29	Susica - Dojevice	26.700
IB 12	Kac - Zrenjanin 1	24.211
IA 3	Border CRO/SER (Batrovci) - Kuzmin 1 (highway)	43.307
IB 31	Raska 2 - APKM Border (Jarinje)	10.550
IA 1	Paracin Interchange - Razanj Interchange	24.818
IA 1	Razanj Interchange - Aleksinac Interchange	23.711
IA 3	Sremska Mitrovica Interchange - Ruma Interchange - Pecinci Interchange	26.848
IB 19	Kula (Backa Topola) - Vrbas (Savino Selo)	10.156
IB 22	Mrcajevci - Kraljevo 1	18.480
IIA 152	Topola 1 - Bucin Grob	26.980
IIA 170	Rogacica 2 - Bajina Basta 1 (Perucac)	9.590
	TOTAL	974.695

The exact scope of the Project (number and precise length of sections) will be confirmed during implementation as designs are being prepared. If sections will be substantially modified, replaced or added, the Bank may appraise modified and/or added components in line with its procedures.The Project will also include an institutional support component concerning road safety.

Calendar

The project will be completed by end of 2026.

A.2 Information Duties under Article 8.01(a)

1. Dispatch of information: designation of the person responsible

The information below has to be sent to the Bank under the responsibility of:

Company	Roads of Serbia
Contact person	Mr Aleksandar Kostadinovic
Title	Executive Director for Investments and Project Coordinator
Function / Department
Address	Vlajkoviceva 19A, 11000 Belgrade
Phone	+ 381 11 30 34 744
Fax	+ 381 11 30 34 663
Email	aleksandar.kostadinovic@putevi-srbije.rs

The above-mentioned contact person(s) is (are) the responsible contact(s) for the time being.

The Borrower shall inform the EIB immediately in case of any change.

2. Information on specific subjects

The Borrower shall deliver to the Bank the following information at the latest by the deadline indicated below.

Document / information	Deadline
Base line data for measurement/calculation of the result indicators for each section - Improved access- traffic flows served (AADT) - Baseline and expected reduction in no. road fatalities and serious injuries (Nrs p.a.).	As the design is completed for each section

3. Information on the project’s implementation

The Borrower shall deliver to the Bank the following information on project progress during implementation at the latest by the deadline indicated below.

Document / information	Deadline	Frequency of reporting
Project Progress Report - A brief update on the technical description, explaining the reasons for significant changes vs. initial scope; - Update on the date of completion of each of the main project’s components, explaining reasons for any possible delay; -Update on the cost of the project, explaining reasons for any possible cost increases vs. initial budgeted cost; - A description of any major issue with impact on the environment; - An update on reported road fatalities and serious injuries on the sub-project sections and description of any major road safety issues encountered and mitigation measures applied; - Update on procurement procedures (outside EU); - Update on the project’s demand or usage and comments; - Any significant issue that has occurred and any significant risk that may affect the project’s operation; - Any legal action concerning the project that may be on-going.		quarterly
Performance Audit report		Yearly

4. Information on the end of works and first year of operation

The Borrower shall deliver to the Bank the following information on project completion and initial operation at the latest by the deadline indicated below.

Document / information

Date of delivery
to the Bank

Project Completion Report, including:
- A brief description of the technical characteristics of the project as completed, explaining the reasons for any significant change;
- The date of completion of each of the main project’s components, explaining reasons for any possible delay;
- The final cost of the project, explaining reasons for any possible cost increases vs. initial budgeted cost;
- The number of new jobs created by the project: both jobs during implementation and permanent new jobs created;
- A description of any major issue with impact on the environment;
- Update on procurement procedures;
- A preliminary before/after evaluation of the development in road fatalities and serious injuries on the sub-project sections;
- Update on the project’s demand or usage and comments;
- Any significant issue that has occurred and any significant risk that may affect the project’s operation;
- Any legal action concerning the project that may be on-going.
- Update of the actual values for the indicators of the project, for inclusion in the Bank´s Results Measurement (REM)
○Improved access- traffic flows served (AADT)
○Reduction in road fatalities and serious injuries (Nr p.a)

15 months after completion

5. Information required 3 years after the Project Completion Report (outside EU only)

The Borrower shall deliver to the Bank the following information 3 years after the project completion report at the latest by the deadline indicated below.

Document / information

Date of delivery to the Bank

Project Completion Report, including:
- Update of the actual values for the indicators of the project, for inclusion in the Bank´s Results Measurement (REM) sheet)
○Improved access- traffic flows served (AADT)
○Final before/after evaluation on the development in road fatalities and serious injuries on all sub-project sections and final estimate of nr. fatalities and serious injuries saved (Nr p.a.)

51 months after completion

Language of reports

English

Schedule B

DEFINITION OF EURIBOR

A. EURIBOR

"EURIBOR" means:

(a) in respect of a relevant period of less than one month, the Screen Rate (as defined below) for a term of one month;

(b) in respect of a relevant period of one or more months for which a Screen Rate is available, the applicable Screen Rate for a term for the corresponding number of months; and

(c) in respect of a relevant period of more than one month for which a Screen Rate is not available, the rate resulting from a linear interpolation by reference to two Screen Rates, one of which is applicable for a period next shorter and the other for a period next longer than the length of the relevant period,

(the period for which the rate is taken or from which the rates are interpolated being the "Representative Period").

For the purposes of paragraphs (a) to (c) above:

(i) "available" means the rates, for given maturities, that are calculated and published by Global Rate Set Systems Ltd (GRSS), or such other service provider selected by the European Money Markets Institute (EMMI), or any successor to that function of EMMI, as determined by the Bank; and

(ii) "Screen Rate" means the rate of interest for deposits in EUR for the relevant period as published at 11:00 a.m., Brussels time, or at a later time acceptable to the Bank on the day (the "Reset Date") which falls 2 (two) Relevant Business Days prior to the first day of the relevant period, on Reuters page EURIBOR 01 or its successor page or, failing which, by any other means of publication chosen for this purpose by the Bank.

If such Screen Rate is not so published, the Bank shall request the principal offices of four major banks in the euro-zone, selected by the Bank, to quote the rate at which EUR deposits in a comparable amount are offered by each of them, as at approximately 11:00 a.m., Brussels time on the Reset Date to prime banks in the euro-zone interbank market for a period equal to the Representative Period. If at least 2 (two) quotations are provided, the rate for that Reset Date will be the arithmetic mean of the quotations. If no sufficient quotations are provided as requested, the rate for that Reset Date will be the arithmetic mean of the rates quoted by major banks in the euro-zone, selected by the Bank, at approximately 11:00 a.m., Brussels time, on the day which falls 2 (two) Relevant Business Days after the Reset Date, for loans in EUR in a comparable amount to leading European banks for a period equal to the Representative Period. The Bank shall inform the Borrower without delay of the quotations received by the Bank.

All percentages resulting from any calculations referred to in this Schedule will be rounded, if necessary, to the nearest one thousandth of a percentage point, with halves being rounded up.

If any of the foregoing provisions becomes inconsistent with provisions adopted under the aegis of EMMI (or any successor to that function of EMMI as determined by the Bank) in respect of EURIBOR, the Bank may by notice to the Borrower amend the provision to bring it into line with such other provisions.

If the Screen Rate becomes permanently unavailable, the EURIBOR replacement rate will be the rate (inclusive of any spreads or adjustments) formally recommended by (i) the working group on euro risk-free rates established by the European Central Bank (ECB), the Financial Services and Markets Authority (FSMA), the European Securities and Markets Authority (ESMA) and the European Commission, or (ii) the European Money Market Institute, as the administrator of EURIBOR, or (iii) the competent authority responsible under Regulation (EU) 2016/1011 for supervising the European Money Market Institute, as the administrator of the EURIBOR, or (iv) the national competent authorities designated under Regulation (EU) 2016/1011, or (v) the European Central Bank.

If the Screen Rate becomes permanently unavailable and no EURIBOR replacement rate is formally recommended as provided above, EURIBOR shall be the rate (expressed as a percentage rate per annum) which is determined by the Bank to be the all-inclusive cost to the Bank for the funding of the relevant Tranche based upon the then applicable internally generated Bank reference rate or an alternative rate determination method reasonably determined by the Bank.

Schedule C

FORMS FOR BORROWER

C.1 Form of Disbursement Offer/Acceptance (Articles 1.2.B and 1.2.C.)

To:	the Republic of Serbia
From:	European Investment Bank
Date:	______________________
Subject:	Disbursement Offer/Acceptance for the Finance Contract between European Investment Bank and the Republic of Serbia dated _____________
	(the "Finance Contract")
	Serapis number 2012-0367	FI number 96.962

Dear Sirs,

We refer to the Finance Contract. Terms defined in the Finance Contract have the same meaning when used in this letter.

Following your request for a Disbursement Offer from the Bank, in accordance with Article 1.2.B of the Finance Contract, we hereby offer to make available to you the following Tranche:

(a) Amount to be disbursed in EUR:

(b) Scheduled Disbursement Date:

(d) Interest payment periodicity:

(e) Payment Dates:

(f) Terms for repayment of principal:

(g) The Repayment Dates and the first and the last Repayment Date for the Tranche:

(h) The Interest Revision/Conversion Date:

(i) The Fixed Rate or Spread, applicable until the Interest Revision/Conversion Date if any, or until the Maturity Date.

To make the Tranche available subject to the terms and conditions of the Finance Contract, the Bank must receive a Disbursement Acceptance in the form of a copy of this Disbursement Offer duly signed on your behalf, to the following e-mail contactline-[FI number}@eib.org, no later than the Disbursement Acceptance Deadline of [time] Luxembourg time on [date].

The Disbursement Acceptance below must be signed by an Authorised Signatory and must be fully completed as indicated, to include the details of the Disbursement Account.

If not duly accepted by the above stated time, the offer contained in this document shall be deemed to have been refused and shall automatically lapse.

If you do accept the Tranche as described in this Disbursement Offer, all the related terms and conditions of the Finance Contract shall apply, in particular, the provisions of Article 1.4.

Yours faithfully,

EUROPEAN INVESTMENT BANK

We hereby accept the above Disbursement Offer for and on behalf of the Borrower:

_________________________________________
for and on behalf of the Republic of Serbia
Date:

IMPORTANT NOTICE TO THE BORROWER:

BY SIGNING BELOW YOU CONFIRM THAT THE LIST OF AUTHORISED SIGNATORIES AND ACCOUNTS PROVIDED TO THE BANK WAS DULY UPDATED PRIOR TO THE PRESENTATION OF THE ABOVE DISBURSEMENT OFFER BY THE BANK.

IN THE EVENT THAT ANY SIGNATORIES OR ACCOUNTS APPEARING IN THIS DISBURSEMENT ACCEPTANCE ARE NOT INCLUDED IN THE LATEST LIST OF AUTHORISED SIGNATORIES AND ACCOUNTS (AS DISBURSEMENT ACCOUNT) RECEIVED BY THE BANK, THE ABOVE DISBURSEMENT OFFER SHALL BE DEEMED AS NOT HAVING BEEN MADE.

Disbursement Account (as defined in the Finance Contract) to be credited1:

Disbursement Account N°:.....................................................................

Disbursement Account Holder/Beneficiary:...........................................

(please, provide IBAN format if the country is included in IBAN Registry published by SWIFT, otherwise an appropriate format in line with the local banking practice should be provided)

Bank name and address:..........................................................................

Bank identification code (BIC):..............................................................

Payment details to be provided:..............................................................

Please transmit information relevant to:

Name(s) of the Borrower’s Authorised Signatory(ies) (as defined in the Finance Contract):

.................................................................................................................
Signature(s) of the Borrower’s Authorised Signatory(ies) (as defined in the Finance Contract):

_____________
1The details concerning banking intermediary are also to be provided if such intermediary has to be used to make the transfer to the Beneficiary’s Account.

Schedule D

INTEREST RATE REVISION AND CONVERSION

If an Interest Revision/Conversion Date has been included in the Disbursement Offer for a Tranche, the following provisions shall apply.

A. Mechanics of Interest Revision/Conversion

Upon receiving an Interest Revision/Conversion Request the Bank shall, during the period commencing 60 (sixty) days and ending 30 (thirty) days before the Interest Revision/Conversion Date, deliver to the Borrower an Interest Revision/Conversion Proposal stating:

(a) the Fixed Rate and/or Spread that would apply to the Tranche, or of its part indicated in the Interest Revision/Conversion Request pursuant to Article 3.1; and

(b) that such rate shall apply until the Maturity Date or until a new Interest Revision/Conversion Date, if any, and that interest is payable quarterly, semi-annually or annually in accordance with Article 3.1, in arrear on designated Payment Dates.

The Borrower may accept in writing an Interest Revision/Conversion Proposal by the deadline specified therein.

Any amendment to this Contract requested by the Bank in this connection shall be effected by an agreement to be concluded not later than 15 (fifteen) days prior to the relevant Interest Revision/Conversion Date.

Fixed Rates and Spreads are available for periods of not less than 4 (four) years or, in the absence of a repayment of principal during that period, not less than 3 (three) years.

B. Effects of Interest Revision/Conversion

If the Borrower duly accepts in writing a Fixed Rate or a Spread in respect of an Interest Revision/Conversion Proposal, the Borrower shall pay accrued interest on the Interest Revision/Conversion Date and thereafter on the designated Payment Dates.

Prior to the Interest Revision/Conversion Date, the relevant provisions of this Contract and Disbursement Offer and Disbursement Acceptance shall apply to the Tranche in its entirety. From and including the Interest Revision/Conversion Date onwards, the provisions contained in the Interest Revision/Conversion Proposal relating to the new Fixed Rate or Spread shall apply to the Tranche (or any part thereof, as indicated in the Interest Revision/Conversion Request) until the new Interest Revision/Conversion Date, if any, or until the Maturity Date.

C. Partial or no Interest Revision/Conversion

In case of a partial Interest Revision/Conversion, the Borrower will repay, without indemnity, on the Interest Revision/Conversion Date the part of the Tranche that is not covered by the Interest Revision/Conversion Request and which is therefore not subject to the Interest Revision/Conversion.

If the Borrower does not submit an Interest Revision/Conversion Request or does not accept in writing the Interest Revision/Conversion Proposal for the Tranche or if the Parties fail to effect an amendment requested by the Bank pursuant to paragraph A above, the Borrower shall repay the Tranche in full on the Interest Revision/Conversion Date, without indemnity.

Schedule E

CERTIFICATES TO BE PROVIDED BY THE BORROWER

E.1 Form of Certificate from Borrower (Article 1.4.C)

To:	European Investment Bank
From:	The Republic of Serbia
Date:	__________________
Subject:	Certificate for the Finance Contract between Republic of Serbia and European Investment Bank dated _____________ (the "Finance Contract")
	Contract Number 96.962	Operation Number 2012-0367

Dear Sirs,

Terms defined in the Finance Contract have the same meaning when used in this letter.

For the purposes of Article 1.4 of the Finance Contract we hereby certify to you as follows:

(a) no Security of the type prohibited under Article 7.1 has been created or is in existence;

(b) there has been no material change to any aspect of the Project or in respect of which we are obliged to report under Article 8.1, save as previously communicated by us;

(c) we have sufficient funds available to ensure the timely completion and implementation of the Project in accordance with the Technical Description;

(d) no event or circumstance which constitutes or would with the passage of time or the giving of notice or the making of any determination under the Finance Contract (or any combination of the foregoing) constitute a Prepayment Event or an Event of Default has occurred and is continuing unremedied or unwaived;

(e) no litigation, arbitration administrative proceedings or investigation is current or to our knowledge is threatened or pending before any court, arbitral body or agency which has resulted or if adversely determined is reasonably likely to result in a Material Adverse Change, nor is there subsisting against us any unsatisfied judgement or award;

(f) the representations and warranties to be made or repeated by us under Article 6.11 are true in all respects;

(g) no Material Adverse Change has occurred, as compared with the situation at the date of the Finance Contract;

(h) the most recent List of Authorised Signatories and Accounts provided to the Bank by the Borrower is up-to-date and the Bank may rely on the information set out therein; and

(i) undertake to immediately notify the Bank if any the above fails to be true or correct as of the Disbursement Date for the proposed Tranche.

Yours faithfully,

For and on behalf of the Republic of Serbia
Date:

E.2 Form of Compliance Certificate

From:	Borrower
To:	European Investment Bank
Date:
Subject:	Finance Contract between Republic of Serbia and European Investment Bank dated [l] (the "Finance Contract")
	Contract Number FI N° 96.962	Operation Number Serapis N°2012-0367

Dear Sirs,

We refer to the Finance Contract. This is a Compliance Certificate. Terms defined in the Finance Contract have the same meaning when used in this Compliance Certificate.

We hereby confirm:

(a) no Security of the type prohibited under Article 7.2 has been created or is in existence;

(b) no event or circumstance which constitutes or would with the passage of time or the giving of notice or the making of any determination under the Finance Contract (or any combination of the foregoing) constitute a Prepayment Event or an Event of Default has occurred and is continuing unremedied or unwaived. [If this statement cannot be made, this certificate should identify any potential prepayment event or event of default that is continuing and the steps, if any, being taken to remedy it].

Yours faithfully,

For and on behalf of Borrower

[name and signature]