Uruguay - Baygorria Project : Loan 0152 - Loan Agreement - Conformed

LOAN NUMBER 152 UR Loan Agreement (Baygorria Project) BETWEEN INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT AND ADMINISTRACION GENERAL DE LAS USINAS ELECTRICAS Y LOS TELEFONOS DEL ESTADO DATED OCTOBER 25, 1956 긔 Owe Ulan Apurntrut AGREEMENT, dated October 25, 1956, betweenINTER- NATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT (hereinafter called the Bank) and ADMINISTRACIONGENERAL DE LAS USINAs ELECTRICAS Y LOS TELEFONOS DEL ESTADO (hereinafter called the Borrower). ARTICLE I Loan Regulations SECTION 1.01. The parties to this Loan Agreement ac- cept all the provisions of Loan Regulations No. 4 of the Bank dated June 15, 1956 (said Loan Regulations No. 4 being hereinafter called the Loan Regulations), with the same I orce and effiect as if they were fully set forth herein. ARTICLE II The Loan SECTION 2.01. The Bank agrees to lend to the Borrower, on the terms and conditions in this Agreement set forth or refet red to, an amount in various currencies equivalent to twenty-five million five hundred thousand dollars ($25,5009000). SECTION 2.02. The Bank shall open a Loan Account on its books in the name of the Borrower and shall credit to such Account the amount of the Loan. The amount of the Loan may be withdrawn from the Loan Account as provided in, and subject to the rights of cancellation and suspension set forth in, the Loan Regulations. SECTION 2.03. The Borrower shall pay to the Bank a commitment charge at the rate of three-fourths of one per cent (% of 1%o) per annum on the principal amount of the Loan not so withdrawn from time to time. 4 SECTION 2.04. The Borrower shall pay interest at the rate of five per cent (50o) per annum on the principal amount of the Loan so withdrawn and outstanding from time to time. SECTION 2.05. Except as the Bank and the Borrower shall otherwise agree, the charge payable for special com- mitments entered into by the Bank at the request of the Borrower pursuant to Section 4.02 of the Loan Regulations shall be at the rate of one-half of one per cent (1/ of 1%o) per annum on the principal amount of any such special commitments outstanding from time to time. SECTION 2.06. Interest and other charges shall be pay- able semi-annually on April 15 and October 15 in each year. SECTION 2.07. The Borrower shall repay the principal of the Loan in accordance with the amortization schedule set forth in Schedule 1 to this Agreement. ARTICLE III Use of Proceeds of the Loan SECTION 3.01. The Borrower shall apply the proceeds of the Loan exclusively to financing the cost of goods required to carry out the Project described in Schedule 2 to this Agreement. The specific goods to be financed out of the proceeds of the Loan shall be determined by agreement between the Bank and the Borrower, subject to-modifica- tion by further agreement between them. SECTION 3.02. The Borrower shall cause all goods financed out of the proceeds of the Loan to be imported into the territories of the Guarantor and there to be used exclu- sively in the carrying out of the Project. 5 ARTICLE IV Bonds SECTION 4.01. The Borrower shall execute and deliver Bonds representing the principal amount of the Loan as provided in the Loan Regulations. SECTION 4.02. The Presidente and the Gerente de Ha- cienda of the Borrower and such person or persons as they shall appoint in writing are designated as authorized repre- sentatives of the Borrower for the purposes of Section 6.12 (a) of the Loan Regulations. ARTICLE V Particular Covenants SECTION 5.01. (a) The Borrower shall carry out the Project with due diligence and efficiency and in conformity with sound engineering and financial practices. (b) The Borrower shall furnish to the Bank, promptly upon their preparation, the plans and specifications for the Project and any material modifications subsequently made therein, in such detail as the Bank shall from time to time request. (c) The Borrower shall maintain records adequate to identify the goods financed out of the proceeds of the Loan, to disclose the use thereof in the Project, to record the progress of the Project (including the cost thereof) and to reflect in accordance with consistently maintained sound accounting practices the financial condition and operations of ,he Borrower; shall enable the Bank's representatives to inspect the Project, the goods and any relevant records and documents; and shall furnish to the Bank all such informa- tion as the Bank shall reasonably request concerning the expenditure of the proceeds of the Loan, the Project, the goods, and the financial condition and operations of the Borrower. 6 SECTION 5.02. (a) The Bank and the Borrower shall cooperate fully to assure that the purposes of the Loan will be accomplished. To that end, each of them shall furnish to the other all such information as it shall reasonably request with regard to the general status of the Loan. (b) The Bank and the Borrower shall from time to time exchange views through their representatives with regard to matters relating to the purposes of the Loan and the maintenance of the service thereof. The Borrower shall promptly inform the Bank of any condition which interferes with, or threatens to interfere with, the accomplishment of the purposes of the Loan or the maintenance of the service thereof. SECTION 5.03. If the Borrower shall propose to incur any debt, the Borrower shall inform the Bank of such proposal and, before the proposed action is taken, shall afford the Barik all opportunity which is reasonably practicable in the circumstances to exchange views with the Borrower with respect thereto; provided, however, that the foregoing provisions shall not apply to: (a) the incurring of addi- tional debt through utilization, in accordance with the terms of any credit established prior to the date of this Agree- ment, of any unused amounts available under such credit; or (b) the incurring of debt maturing not more than eight- een months after the date on which it is originally incurred. SECTION 5.04. The Borrower undertakes that, except as the Bank shall otherwise agree, if any lien shall be created on any assets of the Borrower as security for any debt, such lien will ipso facto equally and ratably secure the pay- ment of the principal of, and interest and other charges on, the Loan and the Bonds, and that in the creation of any such lien express provision will be made to that effect; provided, however, that the foregoing provisions of this Section shall not apply to: (i) any lien created on property, at the time of purchase thereof, solely as s'curity for the payment 7 of the purchase price of such property; (ii) any lien on commercial goods to secure a debt maturing not more than one year after the date on which it is originally incurred and to be paid out of the proceeds of sale of such commercial goods; or (iii) any lien arising in the ordinary course of banking transactions and securing a debt maturing not more than one year after its date. For purposes of this Section, the term "assets of the Borrower" shall not be deemed to include bonds of the Guarantor owned by the Borrower and for the service of which the Borrower is liable. SECTION 5.05. The Borrower shall pay or cause to be paid all taxes, fees and other fiscal charges, if any, imposed under the laws of the Guarantor or laws in effect in the territories of the Guarantor on or in connection with the execution, issue, delivery or registration of this Agreement, the Guarantee Agreement or the Bonds, or the payment of principal, interest or other charges thereunder; provided, however, that the provisions of this Section shall not apply to taxation of, or fees or other fiscal charges upon, pay- ments under any Bond to a holder thereof other than the Bank when such Bond is beneficially owned by an indi- vidual or corporate resident of the Guarantor. SECTION 5.06. The Borrower shall pay or cause to be paid all taxes, fees and other fiscal charges, if any, imposed under the laws of the country or countries in whose currency the Loan and the Bonds are payable or laws in effect in the territories of such country or countries on or in connection with the execution, issue, delivery or registration of this Agreement, the Guarantee Agreement or the Bonds. SECTION 5.07. Except as shall be otherwise agreed be- tween the Bank and the Borrower, the Borrower shall insure or cause to be insured the goods financed with the proceeds of the Loan against risks incident to their purchase and importation into the territories of the Guarantor. Such 8 insurance shall be consistent with sound commercial prac- tice and shall be payable in dollars or in the currency in which the cost of the goods insured thereunder shall be payable. SECTION 5.08. (a) The Borrower shall at all times main- tain its existence and right to carry on operations and shall, except as the Bank shall otherwise agree, take all steps necessary to maintain and renew all rights, powers, priv- ileges and franchises which are necessary or useful in the conduct of its business. (b) The Borrower shall operate and maintain its plants, equipment and property, and from time to time make all necessary renewals and repairs thereof, all in accordance with sound engineering standards; and shall at all times operate its plants and equipment and maintain its financial position in accordance with sound business and public util- ity practices. SECTION 5.09. The Borrower shall not, without the prior consent of the Bank (i) sell or otherwise dispose of all or substantially all of its property and assets unless the Bor- rower shall first redeem and pay or make adequate provi- sion satisfactory to the Bank for redemption and payment of all of the Loan which shall be outstanding and unpaid; or (ii) sell or otherwise dispose of all or substantially all of the property included in the Project or any plant included therein unless the Borrower shall first redeem and pay or make adequate provision satisfactory to the Bank for redemption and payment of a proportionate part of the Loan which shall then be outstanding and unpaid equal to the proportionate part of the Project so sold or disposed of. The Borrower may, however, without consent of the Bank, sell or otherwise dispose of any property which shall have become old, worn-out, obsolete or unnecessary for use in its operations. 9 SECTION 5.10. The Borrower shall, whenever funds are needed to enable it to carry out the Project or to enable it to meet its other obligations, defer payment of principal, interest and other charges due to the Guarantor on loans made by the Guarantor to the Borrower or required to service indebtedness incurred on account of borrowing by the Guarantor for the Borrower. The Borrower shall from time to time make arrangements with the Guarantor where- by amounts due on account of any deferred payments shall be funded on a long-term basis or shall be capitalized. ARTICLE VI Remedies of the Bank SECTION 6.01. (i) If any event specified in paragraph (a), paragraph (b), paragraph (e) or paragraph (f) of Section 5.02 of the Loan Regulations shall occur and shall continue for a period of thirty days, or (ii) if any event specified in paragraph (c) of Section 5.02 of the Loan Regulations shall occur and shall continue for a period of sixty days after notice thereof shall have been given by the Bank to the Borrower, then at any subsequent time during the continuance thereG., the Bank, at its option, may declare the principal of the Loan and of all the Bonds then outstanding to be due and payable immediately, and upon any such declaration such principal shall become due and payable immediately, anything in this Agreement or in the Bonds to the contrary notwithstanding. ARTICLE VII Miscellaneous SECTION 7.01. The Closing Date shall be September 30, 1961. SECTION 7.02. A date 90 days after the date of this Agree- ment is hereby specified for the purposes of Section 9.04 of the Loan Regulations. 10 SECTION 7.03. The following addresses are specified for the purposes of Section 8.01 of the Loan Regulations: For the Borrower: Administracion General de las Usinas Electricas y los Telefonos del Estado Palacio de la Luz-Paraguay 2431 Montevideo, Uruguay Alternative cable address: Lux Montevideo Uruguay For the Bank: International Bank for Reconstruction and Development 1818 H Street, N.W. Washington 25, D. C. United States of America Alternative cable address: Intbafrad Washington, D.C. IN WITNESS WHEREOF, the parties hereto, acting through their representatives thereunto duly authorized, have caused this Loan Agreement to be signed in their respective names and delivered in the District of Columbia, United 11 States of America, as of the day and year first above written. INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT By W. A. B. ILIFF Vice President ADMINISTRACION GENERAL DE LAS USINAS ELECTRICAS Y LOS TELEFONOS DEL ESTADO By ORESTES L. LANZA Authorized Representative 12 SCHEDULE 1 Amortization Schedule Principal Payment of Amount Outstanding Principal After Each Payment Date (expressed in (expressed in Payment Due dollars) * dollars) * April 15, 1961 - $25,500,000 October 15, 1961 $364,000 25,136,000 April 15, 1962 373,000 24,763,000 October 15, 1962 382,000 24,381,000 April 15, 1963 392,000 23,989,000 October 15, 1963 402,000 23,587,000 April 15, 1964 412,000 23,175,000 October 15, 1964 422,000 22,753,000 April 15, 1965 432,000 22,31 000 October 15, 1965 443,000 21,878,000 April 15, 1966 454,000 21,424,000 October 15, 1966 466,000 20,958,000 April 15, 1967 477,000 20,481,000 October l5, 1967 489,000 19,992,000 April 15, 1968 502,000 19,490,000 October 15, 1968 514,000 18,976,000 April 15, 1969 527,000 18,449,000 October 15, 1969 540,000 17,909,000 April 15, 1970 554,000 17,355,000 October 15, 1970 568,000 16,787,000 April 15, 1971 582,000 16,205,000 October 15, 1971 596,000 15,609,000 April 15, 1972 611,000 14,998,000 October 15, 1972 626,000 14,372,000 April 15, 1973 642,000 13,730,000 October 15, 1973 658,000 13,072,000 April 15, 1974 675,000 12,397,000 October 15, 1974 691,000 11,706,000 April 15, 1975 709,000 10,997,000 October 15, 1975 726,000 10,271,000 April 15, 1976 745,000 9,526,000 October 15, 1976 763,000 8,763,000 April 15, 1977 782,000 7,981,000 October 15, 1977 802,000 7,179,000 April 15, 1978 822,000 6,357,000 October 15, 1978 842,000 5,515,000 April 15, 1979 863,000 4,652,000 October 15, 1979 885,000 3,767,000 April 15, 1980 907,000 2,860,000 October 15, 1980 930,000 1,930,000 April 15, 1981 953,000 977,000 October 15, 1981 977,000 - * To the extent that any part of the Loan is repayable in a currency other than dollars (see Loan Regulations, Section 3.02), the figures in these columns represent dollar equivalents determined as for purposes of withdrawal. 13 Premiums on Prepayment and Redemption The following percentages are specified as the premiums payable on repayment in advance of maturity of any part of the principal amount of the Loan pursuant to Section 2.05 (b) of the Loan Regulations or on the redemption of any Bond prior to its maturity pursuant to Section 6.16 of the Loan Regulations: Time of Prepayment or Redemption Premium Not more than 3 years before maturity. . 1/4 of 1% More than 3 years but not more than 6 years before maturity ............1 of 1% More than 6 years but not more than 11 years before maturity ............ 1% More than 11 years but not more than 16 years before maturity ............ 2% More than 16 years but not more than 21 years before maturity ........... 3% More than 21 years but not more than 23 years before maturity ........ 4% More than 23 years before maturity ..... .5% 14 SCHEDULE 2 Description of the Project A. On the Rio Negro at a place known as Rincon de Baygorria, about 88 km downstream from the existing Rincon del Bonete dam and powerhouse, a hydroelectric power plant with a total generating capacity of about 103,000 kw will be constructed. The works will include a concrete gravity dam with lateral earth dikes on each bank, steel gates on the crest of the dam to control the level of the reservoir and cranes with capacity sufficient to handle the crest gates and the heaviest items of machinery to be installed at the powerhouse. Three generating units equipped with Kaplan turbines will be installed in the powerhouse. Each turbine will have a capacity of 47,000 hp at a head of 14.7 meters and a flow of 270 cubic meters per second. Three 3-phase, 50-cycle, air-cooled generators each having a capacity of 36,000 kva (34,200 kw at a .95 power factor) will be provided. Three 36,000 kva trans- formers will be connected to the generators to step up the generating voltage to 161 kv, and adequate control equip- ment and switch gear will be supplied. B. A 161 kv single-circuit transmission line about 39 kilometers long strung on steel towers connecting the exist- ing power station at Rincon del Bonete to the power station at Rincon de Baygorria will be constructed, and substation equipment will be added at Rincon del Bonete. A 161 kv double-circuit transmission line about 270 kilometers long strung on steel towers will be constructed to extend from Rincon de Baygorria via Paso del Puerto to the substation known as B in Montevideo. C. A 150 kv collector system will be constructed in and around Montevideo consisting of three substations and a double-circuit transmission line extending from the substa- tion known as E near the existing Batlle thermal station on the waterfront, thence through the suburbs of Monte- video to the substation known as A on the northern out- w 15 skirts of the city. For the first five kilometers from sub- station E the circuits will consist of underground cables and for the remaining 28 kilometers the circuits will consist of an overhead double-circuit transmission line strung on steel towers. The collector system will interconnect the existing thermal stations in Montevideo, the existing 110 kv transmission lines extending eastward and westward from Montevideo, the existing 161 kv transmission line from the Rincon del Bonete hydro station and the new 161 kv transmission line from the Baygorria hydro station to Montevideo. D. Mechanized equipment for modernization of the Bor- rower's accounting system will be acquired and put into operation.