1. 1 January 2005 Introduction to Phase 2 and General Update Lesotho CCM

2. Performance-based funding across the chronology of a Global Fund proposal Y1Y2Y3Y4Y5 Proposal Initial Grant AgreementExtension of Grant Agreement Phase 1 Phase 2  Funding beyond Phase 1 is based on: –Performance during Phase 1; –Availability of resources  Proposals are approved for up to a 5 year term  However, Global Fund initially commits funds only for years 1 and 2 – “Phase 1”  Performance assessment builds on periodic reviews throughout Phase 1 (quarterly/semi-annual Disbursement Requests/ Progress Updates), complemented by Annual Review and Audit Report

3. Key dates in Phase 1 lifecycle 1. Board approves Proposals 2. Global Fund and PR(s) sign Grant Agreement 3. PR receives first disbursement; Program start date (1 January 2004) 0 9. Negotiate and sign Grant Agreement extension by month 22 21-22 7. Phase 2 Secretariat recommendation 20 18 6. CCM submits Request for Continued Funding 10. First phase 2 disbursement 22 5. CCM invited to submit a Request for Continued Funding (1 May 2005) 16 24 Program month 4. PR implementation and reporting; CCM oversight; LFA verifications; Global Fund performance- based disbursements; partner support 8. Board approval during month 21 21 Phase 2 Renewal Process * End of months

4. Phase 2 documentation Invitations sent to CCM CCM Submit Request for Continued Funding Month 16Month 18Month 20Month 22 Phase 2 Renewal Process Submitted Documents (by the CCM) CCM Request for Continued Funding Minutes of the CCM meetings (on Phase 2 Request) Detailed Budget and Workplan for Y3 List of Health Products for Y3 Indicative Budget and Workplan for Y4-5 Proposed Attachments 3 Latest Progress Report Revised Program Implementation strategy (if necessary) CCM Request for Continued Funding Minutes of the CCM meetings (on Phase 2 Request) Detailed Budget and Workplan for Y3 List of Health Products for Y3 Indicative Budget and Workplan for Y4-5 Proposed Attachments 3 Latest Progress Report Revised Program Implementation strategy (if necessary) Sent Documents (to the CCM) Invitation letter to CCM to submit a Request for Continued Funding Grant Performance Reports CCM Request for Continued Funding Form and Instructions Attachment 3 Form Attachment 3 Form Instructions Invitation letter to CCM to submit a Request for Continued Funding Grant Performance Reports CCM Request for Continued Funding Form and Instructions Attachment 3 Form Attachment 3 Form Instructions Documents to be submitted later by PRs Annual Reviews Audit Reports Annual Reviews Audit Reports

5. CCM Request for Continued Funding Country contextual information Partnerships Linkages with related national/regional/ international initiatives Overall national financial resources CCM assessment of Phase 1 Feedback on Global Fund processes Phase 2 budget –Maximum amount available –Phase 2 request

6. Phase 2 timing in Lesotho Invitations sent to CCM CCM Submit Request for Continued Funding Month 16Month 18Month 20Month 22 Phase 2 Renewal Process Board decision 1 May 2005 1 July 2005 Deadline September - October 2005

7. Maximum amounts available for TB in Phase 2 Original proposal, total Original proposal, years 3-5 Phase 1 agreements, years 1-2 Disbursements to date Maximum available for Phase 2 (total minus actual and projected Phase 1 disbursements) US$5,000,000 US$3,000,000 US$2,000,000 US$946,329 US$4,053,671 (minus Phase 1 disbursements in 2005)

8. CCM Guidelines – Updated by the Board Board adopted the following requirements for CCMs: –All CCMs are required to show evidence of membership of people living with or affected by the diseases –CCM members representing the non-government sectors must be selected by their own sector(s) based on a documented, transparent process, developed within each sector –CCMs are required to put in place and maintain a transparent, documented process to: Solicit and review submissions for possible integration into the proposal Nominate the Principal Recipients and oversee program implementation Ensure the input of a broad range of stakeholders, including CCM members and non-members, in the proposal development and grant oversight process This decision will be effective from Round 5 onwards and for Phase 2 renewals starting from June 2005 (this applies to the Lesotho CCM)