Morocco - Vegetable Production And Marketing : Loan 1757 - Loan Agreement - Conformed

~PICIAL . LOAN WNMER 1757 NOR Loan Agreement (Vegetable Production and Marketing Project) between KINGD( OF kOROCCO E and INTERNATIONAL BAK FOR RECONSTRUCTION MD DEVELOPHENT Dated 1979 9i 611 LOAN NUMBER 1757 NOR LOAN AGREEMENT AGREEMENT, dated N 6\A4 9, 1979, between KINGDOM OF MOROCCO (hereinafter called the Borrower or 4orocco) and INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT (hereinafter called the Bank). WHEREAS (A) the Borrower has requested the Bank to assist in the financing of the Project described in Schedule 2 to this Agreement by making the Loan as hereinafter provided; (B) parts of the Project will be carried out by Office de Commercialisation et d'Exportation (hereinafter called OCE) and Caisse Nationale de Cr6dit Agricole (hereinafter called CNCA) with the Borrower's assistance end, as part of such assistance, the Borrower will make available to OCE and CNCA portions of the proceeds of the Loan as hereinafter provided; and WHEREAS the Bank has agreed, on the basis inter alia of the foregoing, to make the Loan available to the Borrower upon the terms and conditions set forth hereinafter and. in project agreements of eveii date herewith between the Bank and OCE and between the Bank ard CNCA; NOW THEREFORE the arties 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 Agree- ments of the Bank being hereinafter called the General Condi- tions). Section 1.02. Wherever used in this Agreement, unless the context otherwise requires, the several terms defined in the General Conditions - and in the Preamble to this Agreement have the respective meanings therein set forth and the following additional terms have the following meanings: (a) "OCE Project Agreement" means the agreement between the Bank and OCE of even date herewith, as the same may be amended -2- from time to time, and such term includes all schedules to such Agreement and all agreements supplemental to such Agreement. (b) "CNCA Project Agreement" means the agreement between the Bank and CNCA of even date herewith, as the same may be amended from time to time, and such term includes all schedules to such Agreement and all agreements supplemental to such Agreement. (c) "CNCA Subsidiary Loan Agreement" and "OCE Subsidiary Loan Agreement" mean the agreements to be entered into between the Borrower and CNCA and the Borrower and OCE pursuant to Section 3.01 (c) of this Agreement, as the same may be amended from time to time, and such terms include all schedules to such Agreements. (d) "MARA" means the Borrower's ministry responsible for agriculture et rfforme agraire. (e) "MEPN" means the Borrower's ministry responsible for fguipement. (f) "SASMA" means Sociftg Agricole de Services au Maroc, a company affiliated with OCE. (g) "Project Area" means the horticultural zones for vegetables of the Borrower's provinces of Kenitra, Ben Slimane, El Jadida, Safi and Agadir and of the Borrower's prffectures of Rabat-Sal4 and Casablanca. (h) "Dirham" or the sign "DH" means the currency of the Borrower. (i) "CRCA" means any Caisse Rfgionale de Crfdit Agricole established pursuant to the Agricultural Credit Dahir and Dfcret and which operates as a regional branch of CNCA. (j) "CLCA" means any Caisse Locale de Cr6dit Agricole established under the laws of the Borrower and which operates as a local branch of CNCA. (k) "Coop6rative de la Rfforme Agraire" means any agrarian cooperative established pursuant to the Kingdom of Morocco's Dcret royal portant loi No. 267-66 of 15 Rebia I 1386 (July 4, 1966) and Dahir No. 1-72-277 of 22 Kaada 1392 (December 29, 1972). -3 (1) "farmers' association" means any association, groupement ou cooprative d'exploitants agricoles other than any Coopfra- tive de la Rfforme Agraire. (m) "Sub-borrower" means any individual farmer, Coopfra- tive de la Rfforme Agraire, farmers' association or other person, entity or group eligible to receive a Sub-loan under the Project. (n) "Sub-loan" means any short-, medium- or long-term loan made or proposed to be made by CNCA to a Sub-borrower for invest- ments and expenditures to be financed under the Project. (o) "Centre de Mise en Valeur" means any Centre de Travaux or Sous-Centre de Travaux established in the Project Area, pursuant to the Kingdom of Morocco's Dahir No. 1-56-322, dated January 31, 1957. (p) "1965 Loan Agreement". and "1965 Guarantee Agreement" mean, respectively, the Loan Agreement between the Bank and CNCA and the Guarantee Agreement between the Borrower and the Bank, both dated November 8, 1965. (q) "1972 Loan Agreement", "1972 Guarantee Agreement"', "1972 Credit Agreement" and "1972 Project Agreement" mean, respectively, the Loan Agreement between the Bank and CNCA, the Guarantee Agreement between the Borrower and the Bank, the Development Credit Agreement between the Borrower and the Association and the Project Agreement between the Association and CNCA, all dated October 10, 1972. (r) "1977 Loan Agreement" and "1977 Guarantee Agreement" mean, respectively, the Loan Agreement between CNCA and the Bank and the Guarantee Agreement between the Borrower and the Bank, both dated February 7, 1977. (s) "1978 Loan Agreement" and "1978 Project Agreement" mean, respectively, the Loan Agreement between the Borrower and the Bank and the Project Agreement between CNCA and the Bank, both dated September 6, 1978. (t) "1979 Loan Agreement" and "1979 Guarantee Agreement" mean, respectively, the Loan Agreement between CNCA and the Bank and the Guarantee Agreement between the Borrower and the Bank, both dated May 23, 1979. -4- (u) "National Coordination Committee for Off-season Vege- tables" and "Regional Technical Committee for Off-season Vege- tables" mean the committees to be established pursuant to Section 3.02 hereof. (v) "Convention particuli4re" means the agreement to be entered into between the Borrower and CNCA pursuant to Section 3.01 (c) of this Agreement, as the same may be amended from time to time. (w) "Avance du Trfsor" means the funds made available to CNCA by the Borrower's Trfsor, within the framework of the Convention particuliare, for the purpose of enabling CNCA to make complementary loans available to the Sub-borrowers under Part A (1) of the Project, each such complementary loan being known as a "Pr8t complImentaire du Trfsor". ARTICLE II The Loan Section 2.01. The Bank agrees to lend to the Borrower, on the terms and conditions set forth or referred to herein an amount in various currencies equivalent to fifty-eight million dollars ($58,000,000). Section 2.02. The amount of the Loan may be withdrawn from the Loan Account in accordance with the provisions of Sched- ule 1 to this Agreement, as such Schedule may be amended from time to time by agreement between the Borrower and the Bank, for amounts disbursed under the Sub-loans and for expenditures made (or, if the Bank shall so agree, to be made) in respect of the reasonable cost of goods and services required for the Project and to be financed out of the proceeds of the Loan. It is furthermore specified that the first and the second Sub-loan applications for regrouped packing stations included in Part D (3) of the Project, together with the technical feasibility study pertaining thereto, shall be submitted by CNCA to the Bank for prior approval - before any withdrawal of proceeds of the Loan on account of either such Sub-loan shall be authorized. Section 2.03. Except as the Bank shall otherwise agree, procurement of the goods and civil works required for Parts C (1), C (3), C (5), D (4), E and F (2) of the Project and tc be -5- financed out of the proceeds of the Loan, shall be governed by the provisions of Schedule 4 to this Agreement. Section 2.04. The Closing Date shall be June 30, 1984 or such later date as the Bank shall establish. The Bank shall promptly notify the Borrower of such later date. Section 2.05. The Borrower shall pay to the Bank a commit- ment charge at the rate of three-fourths of one per cent (3/4 of 1%) per annum on the principal amount of the Loan not withdrawn from time to time. Section 2.06. The Borrower shall pay interest at the rate of seven and nine-tenths per cent (7.90%) per annum on the prin- cipal amount of the Loan withdrawn and outstanding from time to time. Section 2.07. Interest and other charges shall be payable semiannually on March 15 and September 15 in each year. Section 2.08. The Borrower shall repay the principal amount of the Loan in accordance with the amortization schedule set- forth in'Schedule 3 to this Agreement. Section 2.09. CNCA is designated as representat,e of the Borrower for the purposes of taking any action required or permitted to be taken under the provisions of Section 2.02 of this Agreement and Article V of the General Conditions with respect to withdrawals of proceeds of the Loan under Categories (6) and (7) of Schedule 1 hereto for expenditures required for Parts A, B and D (3) of the Project. ARTICLE III Execution of the Project Section 3.01. (a) The Borrower shall carry out Parts C (1), C (3), C (5), D (4) and E of the Project and the elements of Part F of the Project for which the Borrower shall be cesponsible with due diligence and efficiency and in conformity with appropriate financial, engineering, agricultural and construction practices, and shall provide, promptly as needed, the funds, facilities, services and other resources required for the purpose. -6- (b) Without any limitation or restriction upon any of its other obligations under the Loan Agreement, the Borrower shall cause OCE and CNCA to perform in accordance with the provisions of the OCE Project Agreement and the CNCA Project Agreement all the obligations therein set forth, shall take or cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable OCE and CNCA to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (c) For the purpose of enabling CNCA to carry out Parts A, B and D (3) and OCE to carry out Parts C (2), C (4), D (1) and D (2) of the Project and the elements of Part F (1) of the Project for which OCE shall be responsible, the Borrower shall relend to CNCA and OCE the equivalent in Dirhams of portions of the proceeds of the Loan under subsidiary loan agreements to be entered into not later than December 31, 1979 (or such other date as the Bank may agree) between the Borrower and CNCA and the Borrower and OCE, under terms and conditions which shall have been approved by the Bank and which shall include inter alia those set forth in Sched- ule 5 hereto, as such Schedule may be modified from time to time by agreement between the Borrower and the Bank. In addition, for the purpose of enabling CNCA to make complementary loans to the Sub-borrowers under Part A (1) of the Project, the Borrower shall, through its Trfsor, make available to CNCA funds under a Conven- tion particuli&re to be entered into not later than January 31, 1980 (or such other date as the Bank may agree), between the Borrower's Tresor and CNCA under terms and conditions satisfac- tory to the Bank. (d) The Borrower shall exercise its rights under the CNCA and OCE Subsidiary Loan Agreements land the Convention 2arti- culiire in such manner as to protect the interests of the Borrower and the Bank and to accomplish the purposes of the Loan, and except as the Bank shall otherwise agree, the Borrower shall not assign, nor amend, abrogate or waive the CNCA or OCE Subsid- iary Loan Agreements or the Convention particuli5re or any provision thereof. Section 3.02. The Borrower shall, not later than December 31, L979 (or such other date as the Bank may agree) establish and, thereafter, maintain a National Coordination Committee for Off- season Vegetables and, in each region of the Project Area, a Regional Technical Committee for Off-season Vegetables on terms *1 ---7'- and conditions satisfactory to the Bank, such terms and conditions to provide inter alia (i) that the composition of said committees shall include representatives of MARA, OCE, SASMA and CNCA, (ii) that the National Coordination Committee for Off-season Vegetables shall be entrusted with the overall coordination of the Project and each Regional Technical Committee for Off-season Vegetables with the coordination of the 11rject activities at the level of the region concerned, and (iii) that the National Coordination Committee for Off-season Vegetables shall meet at least every six months. Section 3.03. The Borrower shall, not later than Decem- ber 31, 1979 (or such other date as the Bank may agree), estab- lish, through MARA and in cooperation with OCE, the research, training and demonstration program for the 1979/80 season for off-season vegetables (including the ways and means to carry out such program). Thereafter, the National Coordination Committee for Off-season Vegetables shall be entrusted with the establishment of the annual research, training and demonstration programs for off-season vegetables. It is furthermore specified that all such programs shall be established on terms and conditions satisfactory to the Bank. Section 3.04. (a) The Borrower undertakes to insure, or make adequate provision for the insurance of, the imported goods to be financed out of the proceeds of the Loan Agreement against hazards incident to the acquisition, transportation and delivery thereof to the place of use or installation, and for such insurance any indemnity shall be payable in a currency freely usable by the Borrower to replace or repair such goods. (b) Except as the Bank shall otherwise agree, the Borrower shall cause all goods and services financed out of the proceeds of the Loan to be used exclusively for the Project. Section 3.05. (a) The Borrower shall furnish to the Bank, promptly upon their preparation, the plans, specifications, reports, contract documents and construction and procurement schedules for Parts C (1), C (3), C (5), D (4), E and F (2) of the Project, and any material modifications thereof or additions thereto, in such detail as the Bank shall reaoonably request. (b) The Borrower: (i) shall maintain records and procedures adequate to record and monitor the progress of Parts C (1), 414 -8- C (3), C (5), D (4) and E of the Project and the elements of Part F of the Project for which the Borrower shall be responsible, (including their cost and the benefits to be derived therefrom), to identify the goods and services financed out of the Proceeds of the Loan, and to disclose their use in the Project; (ii) shall enable the Bank's accredited representatives to visit the facilities and construction sites included in the Project and to examine the goods financed out of the proceeds of the Loan and all relevant records and documents; and (iii) shall, in coordination with OCE and CNCA, furnish to the Bank, at regular intervals, all such infor- mation (including the annual report and the minutes of the meetings of the National Coordinating Committee for Off-season Vegetables) as the Bank shall reasonably request concerning the Project, its cost and, where appropriate, the benefits to be derived from it, the expenditure of the proceeds of the Loan and the goods and services financed out of such proceeds. (c) Promptly after completion of the Project, but in any event not later than June 30, 1984 or such later date as may be agreed for the purpose between the Borrower and the Bank, the Borrower, through the National Coordination Committee for Off- season Vegetables, shall prepare and furnish to the Bank a report, of such scope and in such detail as the Bank shall reason- ably request, on the execution and initial operation of the Project, its cost and the benefits derived and to be derived from it, the performance by the Borrower, OCE, CNCA and the Bank of their respective obligations under the Loan Agreement, the OCE and CNCA Project Agreements, the OCE and CNCA Subsidiary Loan Agreements and the Convention particuliAre and the accomplish- ment of the purposes of the Loan. Section 3.06. The Borrower shall take or cause to be taken all such action as shall be necessary to acquire, as and when needed, all such land and rights in respect of land as shall be required for the carrying out of the Project and shall furnish to the Bank, promptly after such acquisition, evidence satisfactory to the Bank that such land and rights in respect of land are available for purpose related to the Project. ............. -9- Section 3.07. In order to assist the Borrower in carrying out the elements of Part F (1) of the Project for which the Borrower shall be responsible, the Borrower shall, not later than December 31, 1980 (or such other date as the Bank and the Borrower may agree), employ c,onsultants whose qualifications, experience and terms and conditions of employment shall be satisfactory to the Borrower and the Bank. ARTICLE IV Other Covenants Section 4.01. (a) It is the policy of the Bank, in making loans to, Ur with the guarantee of, its members not to seek, in normal circumstances, special security from the member con- cerned but to ensure that no other external debt shall have priority over its loans in the allocation, realization or distri- bution of foreign exchange held under the control or for the benefit of such member. To that end, if any lien shall be created on any public assets (as hereinafter defined), 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, such lien shall, unless the Bank shall otherwise agree, ipso facto and at no cost to the Bank, equally and ratably secure the principal of, and interest and other charges on, the Loan, and the Borrower, in creating or permitting the creation of such lien, shall make express provision to that effect; p.rovided, however, that, if for any const tutional or other legal reason such provision cannot be made with respect to any lien created on assets of any of its political or administrative subdivisions, the Borrower shall promptly and at no cost to the Bank secure the principal of, and interest and other charges on, the Loan by an equivalent lien on other public assets satisfactory to the Bank. (b) The foregoing undertaking shall not apply to: (i) any lien created on property, at the time of purchase thereof, solely as security for payment of the purchase price of such property; and (ii) any lien arising in the ordinary course of banking transactions and securing a debt maturing not more than one year after its date. (c) As used in this Section, the term "public assets" means assets of the Borrower, of any political or administrative subdivision thereof and of any entity owned or controlled by, -10- or operating for the account or benefit of, the Borrower or any such subdivision, including gold and other foreign exchange assets held by Banque du Maroc or by any other institution per- forming the functions of a central bank or exchange stabilization fund, or similar functions, for the Borrower. Section 4.02. The Borrower shall maintain or cause to be maintained records adequate to reflect in accordance with consis- tently maintained appropriate accounting practices the operations, resources and expenditures of the departments or agencies of the Borrower responsible for carrying out Parts C (1), C (3), C (5), D (4) and E of the Project and the elements of Part F of the Project for which they shall be responsible or any part thereof. Section 4.03. The Borrower shall cause all facilities, equipment, roads and works included in the Project to be, at all times, staffed, operated and maintained in accordance with appro- priate agricultural, technical, training, road, water resource and environmental practices, shall cause all necessary repairs thereof to be made, and shall provide, promptly as needed, the funds, facilities, services and other resources required therefor. ARTICLE V Resedies(f the Bank Section 5.01. For the purposes of Section 6.02 of the General Conditions, the following additional events are specified pursuant to paragraph (k) thereof: (a) OCE or CNCA shall have failed to perform any covenant, agreement or obligation of OCE or CNCA under the OCE or CNCA Project Agreements or the Convention particuliAre, as the case may be. (b) An extraordinary situation shall have arisen which shall make it improbable that OCE or CNCA will be able to perform their respective obligations under the OCE or CNCA Project Agree- ments or the Convention particuliare, as the case may be. (c) The Borrower's Dahir No. 1-60-106 or the Borrower's Dfcret No. 2-61-607, both of 25 Joumada II 1381 (December 4, 1961), or the Borrower's Dahir No. 1192 of 20 Joumada I 1354 (August 21, 1935), or the Borrower's Dahir of July 9, 1965 (as amended and completed by the Borrower's Dahir No. 1-75-288 of - 11 - December 17, 1976) have been amended, suspended, abrogated, repealed or waived in such a way as to materially and adversely affect the ability of OCE or CNCA to carry out the covenants, agreements and obligations set forth in the OCE or CNCA Project or Subsidiary Loan Agreements or the Convention particuliare, as the case may be. (d) The Borrower or any other authority having jurisdiction shall have taken any action for the dissolution or disestablish- ment of OCE or CNCA or for the suspension of their respective operatigns. Section 5.02. For the purposes of Section 7.01 of the General Conditions, the following additional events are specified pursuant to paragraph (h) thereof: (a) Any event specified in paragraph (a) of Section 5.01 of this Agreement shall occur and shall continue for a period of sixty days after notice thereof shall have been given by the Bank to the Borrower, CNCA and OCE. (b) Any event specified in paragraphs (c) or (d) of Section 5.01 hereof shall occur. ARTICLE VI Effective Date; Termination Section 6.01. The following is" specified as an additional matter, within the meaning of Setion 12.02 (c) of the General Conditions, to be included in the opinion or opinions to be furnished to the Bank, namely, that the CNCA and OCE Project Agreements have been duly authorizkid or ratified by CNCA and OCE, respectively, and are legally binding upon CNCA and OCE, respec- tively, in accordance with their terms. Section 6.02. The date , is hereby specified for the purposes of Section 1 .04 of the General Condi- tions. ARTICLE VII Representatives of the Borrower; Addresses Section 7.01. The minister of the Borrower at the time responsible for finance is designated as representative of the * - 12- Borrower for the purposes of Section 11.03 of the General Condi- tions. Section 7.02. The following addresses are specified for the purposes of Section 11.01 of the General Conditions: For the Borrower: Minist&re des Finances Rabat Kingdom of Morocco Cable address: Telex: MINISTERE FINANCES 31936 . Rabat, Morocco For the Bank: International Bank for Reconstruction and Development 1818 R Streeti -N.W. Washington, D.C. 20433 United States of America Cable address: Telex: INTBAFRAD 440098 (ITT) Washington, D.C. 248423 (RCA) or 64145 (WUI) 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. KINGDOM OF MOROCCO By Authorized Representative INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT By /y /Regional Vice President Europe, Middle East and North Africa - 13 - SCHEDULE 1 Withdrawal of the Proceeds of the Loan 1. The table below sets forth the Categories of items to be financed out of the proceeds of the Loan, the allocation of the amounts of the Loan to each Category and the percentage of expenditures for items so to be financed in each Category: Amount of the Loan Allocated % of (Expressed in Expenditures Category Dollar Equivalent) to be Finadced (1) Civil works and 4,000,000 45% equipment for research and support services provided by MARA and for feeder roads (2) Civil works and 2,8009000 45% equipment for the quality control stations and packing stations of OCE, goods required for Part C(4) of the Project and technical assistance for the elements of Part F (1) of the Project for which OCE shall be responsible (3) Civil works for the 4509000 45% port storage facility at Agadir (4) Training and Technical 350,000 45% Assistance for the ele- ments of Part F (1) of the Project for which the Borrower shall be responsible -14- Amount of the Loan Allocated % of (Expressed in Expenditures Category Dollai Equivalent) to be Financed (5) Works for Part F (2) 400,000 50% of the Project (6) CNCA medium- and long- 37,400,000 75% of dis- term Sub-loans for on- bursements farm investments and actually made packing stations under the Sub- loans (7) CNCA short-term Sub- 12,600,000 50% of annual loans for incremental increments in production costs disbursements actually made under the Sub- loans TOTAL 58,000,000 2. The disbursement percentages have been calculated in compli- ance with the policy of the Bank that no proceeds of the Loan shall be disbursed on account of payments for taxes levied by, or in the territory of, the Borrower on goods or services, or on the importation, manufacture, procurement or supply thereof; to that end, if the amount of any such taxes levied on or in respect of any item to be financed out of the proceeds of the Loan decreases or ingreases, the Bank may, by notice to the Borrower, increase or decrease the disbursement percentage then applicable to such, item as required to be consistent with the aforementioned policy of the Bank. 3. Notwithstanding the provisions of paragraph I above, no withdrawals shall be made in respect of payments made for expendi- tures prior to the date of this Agreement. 4. Notwithstanding the allocation of an amount of the Loan or the disbursement percentages set forth in the table in paragraph 1 above, if the Bank has reasonably estimated that the amount 44' - 15 - of the Loan then allocated to any Category will be insufficient to finance -the agreed percentage of all expenditures in that Category, the Bank may, by notice to the Borrower: (i) reallocate to such Category, to the extent required to meet the estimated shortfall, proceeds of the Loan which are then allocated to another Category and which in the opinion of the Bank are not needed to meet other expenditures, and (ii) if such reallocation cannot fully meet the estimated shortfall, reduce the disbursement percentage then applicable to such expenditures in order that further withdrawals under such Category may continue until all expenditures thereunder shall have been made. 5. If the Bank shall have reasonably determined that the procurement of any item in any Category is inconsistent wAth the procedures set forth or referred to in this Agreement, no expenditures for such item shall be financed out of the proceeds of the Loan and the Bank may, without in any way restricting or limiting any " other right, power or remedy of the Bank under the Loan Agreement, by notice to the Borrower, cancel such amount of the Loan as, in the Bank's reasonable opinion, represents the amount of such expenditures which would otherwise have been eligible for financing out of the proceeds of the Loan. - 16 - SCHEDULE 2 Description of the Project The Project aims at doubling the Brrower's exports of off-season vegetables by inter alia: (i) improving and expanding modern production techniques (including greenhouse technology and high-yielding hybrids) in Morocco; (ii) strengthening subsectoral production planning and monitoring in Morocco; and (iii) adapting the Moroccan marketing structure for off-season vegetables. The Project consists of the followiig Parts: Part A: On-Farm Investments (1) Provision of medium- and long-term credit to Sub- borrowers for the acquisition and equipping of produc- tion greenhouses containing about 1,000 hectares (in the aggregate), and of seedling greenhouses containing about 7 hectares (in the aggregate). (2) Provision of medium- and long-term credit to Sub- borrowers for the acquisition of agricultural equipment for use on about 8,000 hectares, for the financing of soil disinfection programs and for the improvement of irrigation systems on about 4,000 hectares. Part B: Incremental Production Costs Provision of short-term agricultural credit to Sub-borrowers to cover the incremental production costs of off-season vege- tables. Part C: Infrastructure and Agricultural Services (1) Strengthening of seven existing Centres de Mise en Valeur, construction and equipping of five new Centres de Mise en Valeur and recruitment of all personnel required therefor. (2) Strengthening of the technical extension services for off-season vegetable production, through the assignment of 55 additional technicians to the technical extension personnel of OCE/SASMA in order to bring the staffing level of such services in the Project Area to a total of about 95 technicians (including 10 supervisors). 71- (3) Construction works and equipping required for the research, demonstration and training to be carried out in the existing research stations and the demonstration and training centers to be established in Dar Bouazza, Oualidia and Melk Zhar, and provision of all personnel required therefor. (4) Acquisition and equipment for seedling greenhouses containing about 3 hectares and provision of all perconnel required for the operation thereof. (5) Regrouping of service cooperatives into ten inter- cooperative units and construction of inter alia office space, storage space for agricultural equipment, and milk collecting centers. Part D: Infrastructure for Packing, Quality Control and Storage (1) Construction and equipping of two packing stations of about 5,000 metric ton capacity each. (2) Construction and equipping of twelve quality control stations, and provision of all personnel required therefor. (3) Construction and equipping of ten packing stations and modernization of about thirty packing stations, each such station of about 2,500 metric ton capacity. (4) Construction of storage facility of about 6,000 m2 for fruits and vegetables in the port of Agadir. Part E: Feeder Roads Rehabilitation of about 125 km of feeder roads, construction of about 125 km of feeder roads, and provision of maintenance equipment. Part F: Training, Technical Assistance and Drillings (1) Applied research on production of seedlings under greenhouse and training of extension agents and farmers in new cropping techniques at the research stations, the demonstration and training centers and the seedling -18 - greenhouses referred to in Part C above, together with research on specific agricultural, marketing, monitoring and evaluation issues, through the provision of about 86 man-months of consultant and/or specialist services. (2) Carrying out of a program of drillings '(and related operations) to assess the hydraulic potential in the Project Area. * * * The Project is expected to be completed by December 31, 1983. * q m no e -a w s lilig gl 7' 19 SCUEDULE 3 A»ortization Schedule Payment of Principal Date Payment Due (expressed in dollars)* On each March 15 and September 15 beginning March 15, 1984 through Mrch 15, 1994 2,635,000 On September 15, 1994 2,665,000 * To the extent that any portion of the Loan is repayable in a currency other than dollars (see General Conditions, Section 4.02), the figures in this column represent dollar equiva- lents determined as for purposes of withdrawal. - 20 - Premiums on Prepayment The following percentages are specified as the premiums payable on repayment in advance of maturity of any portion of the principal amount of the Laan pursuant to Section 3.05 (b) of the General Conditions: Time of Prepayment Premium Not more than three years before maturity 1.60% More than three years but not more than six years before maturity 3.15% More than six years but not more than eleven years before maturity 5.80% More than eleven years but not more than thirteen years before maturity 6.85% More than thirteen years before maturity 7.90% 4 - 21 - SCHEDULE 4 Procurement A. International Competitive Bidding 1. Except as provided in Part C hereof, goods and civil works for Parts C (1), C (3), C (5), D (4), E and F (2) of the Project shall be procured under contracts awarded in accordance with procedures consistent with those set forth in the "Guidelines for Procurement under World Bank Loans and IDA Credits" published by the Bank in March 1977 (hereinafter called the Guidelines), on the basis of international competitive bidding as described in Part A of the Guidelines. 2. For goods and works to be procured on the basis of inter- national competitive bidding, in addition to the requirements of paragraph 1.2 of the Guidelines, the Borrower shall prepare and forward to the Bank as soon as possible, and in any event not later than 60 days prior to the date of availability to the public of the first tender, a general procurement notice, in such form and detail and containing such information as the Bank shall reasonably request; the Bank will arrange for the publication of such notice in order to provide timely notification to prospective bidders of the opportunity to bid for the goods and works in question. The Borrower shall provide the necessary information to update such notice annually so long as any goods or works remain to be procured on the basis of international competitive bidding. 3. The Borrower shall take all appropriate measures, for the procurement of equipment and civil works, to enable manufacturers or contractors, as the case may be, to bid for individual con- tracts or for a group of similar contracts, at their option. 4. For the purpose of evaluation and comparison of bids for the supply of goods to be procured on the basis of international competitive bidding: (i) bidders shall be required to state in their bid the c.i.f. (port of entry) price for imported goods, or the ex-factory price for domestically manufactured goods; (ii) customs duties and other import taxes on goods evaluated on c.i.f.. basis, and sales and similar taxes (applicable to finished domestic products) on goods evaluated on an ex-factory basis, shall be excluded; and (iii) the cost to the Borrower of inland freight and other expenditures incidental to the delivery of goods to the place of their use or installation shall be included. - 22 - B. Preference for Domestic Manufacturers In the procurament of goods in accordance with the procedures described in Part A of this Schedule, goods manufactured in Morocco may be granted a margin of preference in accordance with, and subject to, the following provisions: 1. All bidding documents for the procurement of goods shall clearly indicate any preference which will be granted, the information required to establish the elgibility of a bid for such preference and the following methods and stages that will be followed in the evaluation and comparison of bids. 2. After evaluation, responsive bids will be classified in one of the following three groups: (1) Group A: bids offering goods manufactured in Morocco if the bidder shall have established to the satisfaction of the Borrower and the Bank that the manufacturing cost of such goods includes a value added in Morocco equal to at least 20% of the ex-factory bid price of such goods. (2) Group B: all other domestic bids. (3) Group C: bids offering any other goods. 3. All evaluated bids in each group shall be first compared among themselves, excluding any customs duties and other import taxes on goods to be imported and any sales or similar taxes or goods to be supplied domestically, to determine the lowest 41aluated bid of each group. Such lowest evaluated bids shall then be compared with each other, and if, as a result of this comparison, a bid from group A or group B is the lowest, it shall be selected for the award. 4. If, as a result of the comparison under paragraph 3 above, the lowest bid is a bid from group C, all group C bids shall be further compared with the lowest evaluated bid from group A after adding to the evaluated bid price of the imported goods offered in each group C bid, for the purpose of this further comparison only, an amount equal to: (i) the amount of customs duties and other import taxes which a non-exempt importer would have to pay for the importation of the goods offered in such -23- group C bid; or (ii) 15% of the c.i.f. bid price of such goods if said customs duties and taxes exceed 15% of such price. If the group A bid in such further comparison is the lowest, it shall be selected for the award; if not, the bid from group C which as a result of the comparison under paragraph 3 is the lowest evaluated bid shall be selected. C. Other Procurement Procedures 1. Each individual contract for civil works at the storage facility at Agadir estimated to cost less than $300,000 equivalent (including taxes), and each individual contract for equipment at the said storage facility estimated to cost less than $1501000 equivalent (including taxes), may be awarded through local cmnpe- titive bidding procedures acceptable to the Bank; provided, however, that the aggregate amount of all contracts to be so awarded shall not exceed the equivalent of $1,200,000 (including taxes). 2. Contracts for civil works, vehicles and equipment for agri- cultural support services, contracts for construction and rehabi- litation of feeder roads and contracts for works under Part F (2) of the Project may be awarded through local competitive bidding procedures acceptable to the Bank. D. Review of Procurement Decisions by the Bank 1. Review of invitations to bid and of proposed awards and final contracts: With respect to all contracts for civil works at the storage facility at Agadir estimated to cost the equivalent of $300,000 or more and for all contracts for equipment at the said storage facility estimated to cost the equivalent of $150,000 or more: (a) Before bids are invited, the Borrower shall furnish to the Bank, for its comments, the text of the invitations to bid and the specifications and other bidding documents, together with a description of the advertising procedures to be followed for the bidding, and shall make such modifications in the said documents or. procedures as the Bank shall reasonably request. Any further modification to the bidding documents shall require the Bank's concurrence before it is issued to the prospective bidders. -24- (b) After bids have been received and evaluated, the Bor- rower shall, before a final decision on the award is made, inform the Bank of the name of the bidder to which it intends to award the contract and shall furnish to the Bank, in sufficient time for its review, a detailed report on the evaluation and comparison of the bids received, and such other information as the Bank shall reasonably request. The Bank shall, if it determines that the intended award would be inconsistent Vith the Guidelines or this Schedule, promptly inform the Borrower and state the reasons for such determination. (c) The terms and conditions of the contract shall not, without the Bank's concurrence, materially differ from those on which bids were asked. (d) Two conformed copies of the contract shall be furnished to the Bank promptly after its execution and prior to the submis- sion to the Bank of the first application for withdrawal of funds from the Loan Account in respect of such contract. 2. With respect to each contract not governed by the preceding paragraph, the Borrower shall furnish to the Bank, promptly after its execution and prior to the submission to the Bank of the first application for withdrawal of funds from the Loan Account in respect of such contract, two conformed copies of such con- tract, together with the analysis of the respective bids, recom- mendations for award and such other information as the Bank shall reasonably request. The Bank shall, if it determines that the award of the contract was not consistent with the Guidelines or this Schedule, promptly inform the Borrower and state the reasons for such determination. 3. Before agreeing to any material modification or waiver of the terms and conditions of a contract, or granting an exten- sion of the stipulated time for performance of such contract, or issuing any change order under such contract (except in cases of extreme urgency) which would increase the cost o' the contract by more than 30% of the original price, the Borrower shall inform the Bank of the proposed modification, waiver, extension or change order and the reasons therefor. The Bank, if it determines that: the proposal would be inconsistent with the provisions of this Agreement, shall promptly in-frm the Borrower and state the reasons for its determination. - 25 - SCÖLDULE 5 Suary of Terms and Conditions for the CNCA and OCE Subsidiary Loan Agreements (A) The Borrower shall, out of the proteeds of the Loan, relend to CNCA $50.0 million equivalent, at the same interest rate as that of the Loan from the Bank to the Borrower for a period of 14 years (including 2 years of grace). (B) The Borrower shall, out of the proceeds of the Loan, relend to OCE, $2.8 million equivalent, at an interest rate of nine per cent (9%) per annum, for a period of 14 years (including 2 years of grace). 21 INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT CERTIFICATE I hereby certify that the foregoing is a true copy of the original in the archives of the Interna- -tional Bang for Reconstruction and Develop- ment. In witness whereof I have signed this Certifi- cate and affixed the Seal of the Bank thereunto this day of kl., 197-5. FOR SECRETARY 1 1R 1r