Romania - Flood Recovery Project : Loan 1169 - Guarantee Agreement - Conformed

CONFORMED COPY LOAN NUMBER 1169 RO LOAN NUMBER 1170 RO Guarantee Agreement (Flood Recovery Project) BETWEEN THE SOCIALIST REPUBLIC OF ROMANIA AND INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT DATED NOVEMBER 12, 1975 CONFORMED COPY LOAN NUMBER 1169 RO LOAN NUMBER 1170 RO Guarantee Agreement (Flood Recovery Project) BETWEEN THE SOCIALIST REPUBLIC OF ROMANIA AND INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT DATED NOVEMBER 12, 1975 GUARANTEE AGREEMENT AGREEMENT, dated November 12, 1975, between THE SOCIALIST REPUBLIC OF ROMANIA (hereinafter called the Guarantor) and INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT (hereinafter called the Bank). WHEREAS by Loan Agreement of even date herewith between the Bank and Banca pentru Agricultura si Industrie Alimentara (hereinafter called BAFI) the Bank has agreed to make to BAFI a loan in various currencies equivalent to forty million dollars ($40,000,000), on the terms and conditions set forth in that Loan Agreement, on the condition that the Guarantor agree to guarantee the obligations of BAFI in respect of such loan as hereinafter provided; and WHEREAS by Loan Agreemunt of even date herewith between the Bank and Banca de Investitii (hereinafter called BI) the Bank has agreed to make to BI a loan in various currencies equivalent to twenty million dollars ($20,000,000), on the terms and conditions set forth in that Loan Agreement, on the condition that the Guarantor agree to guarantee the obligations of BI in respect of such loan as hereinafter provided; NOW THEREFORE the parties hereto hereby agree as follows: ARTICLE I General Conditions; Definitions Section 1.01. The parties to this Agreement accept all the provisions of the General Conditions Applicable to Loan and Guarantee Agreements of the Bank dated March 15, 1974, with the same force and effect as if they were fully set forth herein (said General Conditions Applicable to Loan and Guarantee Agreements being hereinafter called the General Conditions); provided, however, that: (a) the term "Borrower" shall be read to refer to either BAFI or BI, as the case may be; (b) the term "Loan Agreement" shall be read to refer to either the before-mentioned Loan Agreement concluded with BAFI or the before-mentioned Loan Agreement concluded with BI, as the case may be; 4 (c) the term "Loan" shall be read to refer to the Loan made under either Loan Agreement, as the case may be; (d) the term "Loan Account" shall be read to refer to the Loan Account to which the amount of either Loan is credited, as the case may be; and (e) the term "Project" shall be read to refer to the Project described in either Loan Agreement, as the case may be. ARTICLE II Guarantee; Provision of Funds Section 2.01. Without limitation or restriction upon any of its other obligations under the Guarantee Agreement, the Guarantor hereby unconditionally guarantees, as primary obligor and not as surety merely, the due and punctual payment of the principal of, and interest and other charges on, each Loan, and the premium, if any, on the prepayment of each Loan and the punctual performance of the other obligations of BAFI and BI, pursuant to the provisions of the Loan Agreement concerned. Section 2.02. Without limitation or restriction upon the provisions of Section 2.01 of this Agreement, the Guarantor specifically undertakes to provide, as and when needed, the funds, facilities, services and other resources required for each Project, and to cause its departments and agencies responsible for carrying out each Project or any part thereof to cooperate effectively with each other. Section 2.03. The Guarantor and the Bank agree that, in order to realize the purposes of each Project, it shall be necessary that the requirements set forth in Section 4.01 of the Loan Agreement for such Project will be met, and, to that end, the Guarantor shall cause its departments and agencies concerned to comply with such requirements and shall provide to its departments and agencies concerned, as and when needed, the funds required for the purpose. ARTICLE III Other Covenants Section 3.01. It is not the practice of the Guarantor to create liens on its assets as security for external debt. It is the policy of the Bank, in making loans to, or with the guarantee of, its members not to seek, in normal circumstances, special security from the member concerned but to ensure that no other external 5 debt shall have priority over its loans in the allocation, realization or distribution of foreign exchange held under the control or for the benefit of such member. In the event that the Guarantor shall create a lien on assets of the Guarantor, as security for any external debt, which will or might result in a priority for the benefit of the creditor of such external debt in the allocation, realization or distribution of foreign exchange, and unless the Guarantor and the Bank shall otherwise agree, the Guarantor shall simultaneously, at no cost to the Bank, equally and ratably secure the principal of, and interest and other charges on, each Loan by an equivalent lien on gold or other freely convertible foreign exchange assets of the Guarantor. Upon the creation of any such lien, the Guarantor shall notify the Bank thereof. ARTICLE IV Representative of the Guarantor; Addresses Section 4.01. The Minister of Finance of the Guarantor is designated as representative of the Guarantor for the purposes of Section 11.03 of the General Conditions. Section 4.02. The following addresses are specified for the purposes of Section 11.01 of the General Conditions: For the Guarantor: Ministerul Finantelor Str. Doamnei No. 8 Bucharest, Romania Telex No.: 011239 IGFSMFR Bucharest For the Bank: International Bank for Reconstruction and Development 1818 H Street, N.W. Washington, D.C. 20433 United States of America 6 Cable address: INTBAFRAD Washington, D.C. IN WITNESS WHEREOF, the parties hereto, acting through their representatives thereunto duly authorized, have caused this Agreement to be signed in their respective names in the District of Columbia, United States of America, as of the day and year first above written. THE SOCIALIST REPUBLIC OF ROMANIA By /s / Corneliu Bogdan Authorized Representative INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT By /s / Willi A. Wapenhans Regional Vice President Europe, Middle East and North Africa