Colombia - Plan Vial I Project : Loan 0144 - Loan Agreement - Conformed

LOAN NUMBER 144 CO Loan Agreement (Plan Vial I Project) BETWEEN REPUBLIC OF COLOMBIA AND INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT DATED JUNE 6, 1956 uatt A~grmtru AGREEMENT, dated June 6, 1956, between REPUBLIC OF COLOMBIA (hereinafter called the Borrower) and INTER- NATIONAL BANK FOR RECONsTRuCTION AND DEVELOPMENT (hereinafter called the Bank). WHEREAS the Borrower is engaged in a program of con- struction, reconstruction and maintenance of major roads included in its national highway system; and WHEREAS by a loan agreement dated April 10, 1951, be- tween the Borrower and the Bank, the Bank agreed to lend to the Borrower for highway purposes the sum of $16,500,000 or the equivalent thereof in currencies other than dollars (said loan agreement as heretofore amended being hereinafter called the First Highway Loan Agree- ment); and WHEREAS by a loan agreement dated September 10, 1953, as amended by an agreement dated November 4, 1954, be- tween the Borrower and the Bank, the Bank agreed to lend to the Borrower for highway purposes an additional sum of $14,350,000 or the equivalent thereof in currencies other than dollars (said loan agreement as heretofore amended being hereinafter called the Second Highway Loan Agree- ment); and WHEREAS the Bank has agreed to make an additional loan for highway purposes; Now THEREFORE, the parties hereto agree as follows: ARTICLE I Loan Regulations SECTION 1.01. The parties to this Loan Agreement accept all the provisions of Loan Regulations No. 3 of the Bank dated February 15,'1955, as amended May 10, 1956 (said Loan Regulations No. 3 as so amended being hereinafter 4 called the Loan Regulations), with the same force and effect 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 referred to, an amount in various currencies equivalent to sixteen million five hundred thousands dollars ($16,500,000). SECTION 2.02. The Bank shall open a Loan Account on its books in the iame 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 The amount of the Loan may be withdrawn from the Loan Account as pro- vided in, and subject to the rights of cancellation and sus- pension set forth in, the Loan Regulations.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 (3/4 of 1%) per annum on the principal amount of the Loan not so withdrawn from time to time. SECTION 2.04. The Borrower shall pay interest at the rate of four and three-fourths per cent (434%) per annum on the principal amount of the Loan so withdrawn and out- standing from time to time. SECTION 2.05. Except as the Borrower and the Bank shall otherwise agree, the charge payable for special commit- ments 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 ('/2 of 1%) 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 semiannually on May 15 and November 15 in each year. 5 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 cause the proceeds of the Loan to be applied exclusively to financing the cost of goods required to carry out the Project described in Sched- ule 2 to this Agreement. The specific goods to be financed out of the proceeds of the Loan and the methods and pro- cedures for procurement of such goods shall be determined by agreement between the Borrower and the Bank, subject to modification by further agreement between them. SECTION 3.02. The Borrower shall cause all goods fi- nanced out of the proceeds of the Loan to be used in the territories of the Borrower exclusively in the carrying out of the Project. 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 Minister of Finance and Public Credit of the Borrower and such person or persons as he shall appoint in writing are designated as authorized representa- tives of the Borrower for the purposes of Section 6.12 of the Loan Regulations. ARTICLE V Particular Covenants SECTION 5.01. (a) The Borrower shall cause the Project to be carried out with due diligence and efficiency and in conformity with sound engineering and financial practices. 6 (b) Except as the Bank shall otherwise agree, all roads included in the Project shall be constructed or reconstructed by contractors satisfactory to the Bank under contracts satisfactory to the Bank. (c) The general design standards for roads included in the Project shall be as determined by agreement between the Borrower and the Bank. The Borrower shall cause to be furnished to the Bank, promptly upon their prepara- tion, 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. (d) The Borrower shall maintain or cause to be main- tained records adequate to identify the goods financed out of the proceeds of the Loan, to disclose the use thereof in the Project, and to record the progress of the Project (in- cluding the cost thereof) ; shall enable the Bank's represent- atives to inspect the Project, the goods and any relevant records and documents; and shall furnish to the Bank all such information as the Bank shall reasonably request concerning the expenditure of the proceeds of the Loan, the Project, and the goods. SECTION 5.02. The Borrower shall at all times make available, by appropriation or otherwise, for disbursement promptly as they are needed, all sums which shall be re- quired for the carrying out of the Project and for the proper maintenance of roads included in the Project. SECTION 5.03. (a) The Borrower shall cause all machin- ery and equipment purchased out of the proceeds of the Loan to be adequately maintained and repaired and shall cause suitable workshops to be maintained in suitable places for that purpose. (b) The Borrower shall at all times cause the roads in- cluded in the Project to be maintained fully and adequately. SECTION 5.04. The Borrower shall retain consultants satisfactory to the Bank to prepare the designs for, and to 7 supervise the construction of, the highway between Cienaga and Barranquilla which is to be constructed out of the pro- ceeds of the Loan. SECTION 5.05. To assure the diligent and efficient carry- ing out of the Project and the most economical and effective use of the resources available for that purpose the Bor- rower shall not, without the prior approval of the Bank, until construction of the roads included in the Project shall have been completed, permit any materials, machinery or equipment now used or heretofore or hereafter acquired for use in the Project and which has been financed out of the proceeds of the Loan to be used on roads not included in the Project. SECTION 5.06. The Borrower and the Bank are agreed that until the Project shall have been completed, the Bor- rower should exercise reasonable restraint in the construc- tion or reconstruction of roads not included in the Project. To this end, until the Project shall have been completed, the Borrower shall from time to time consult with the Bank as to roads to be constructed or reconstructed outside the Project and amounts to be expended therefor. SECTION 5.07. The Borrower shall satisfy the Bank that adequate arrangements have been made to insure the goods financed with the proceeds of the Loan against risks incident to their purchase and importation into the territories of the Borrower. SECTION 5.08. (a) The Borrower and the Bank 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 re- quest with regard to the general status of the Loan. On the part of the Borrower, such information shall include in- formation with respect to financial and economic conditions in the territories of the Borrower and the international balance of payments position of the Borrower. 8 (b) The Borrower and the Bank 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 inter- feres with, or threatens to interfere with, the accomplish- ment of the purposes of the Loan or the maintenance of the service thereof. (c) The Borrower shall afford all reasonable opportunity for accredited representatives of the Bank to visit any part of the territories of the Borrower for purposes related to the Loan. SECTION 5.09. It is the mutual intention of the Borrower and the Bank that no other external debt shall enjoy any priority over the Loan by way of a lien on governmental assets. To that end, 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 external debt, such lien will ipso facto equally and ratably secure the payment 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 security for the payment 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 origi- nally 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. As used in this Section (a) the term "assets of the Borrower " includes assets of the Borrower or of any of its political subdivisions or of any Agency including the Banco de la Republica, and (b) the term "Agency" means any 9 agency or instrumentality of the Borrower or of any politi- cal subdivision of the Borrower and shall include any in- stitution or organization which is owned or controlled directly or in;idirectly by the Borrower or by any political subdivision of the Borrower or the operations of which are conducted primarily in the interest of or for account of the Borrower or any political subdivision of the Borrower. SECTION 5.10. The principal of, and interest and other charges on, the Loan and the Bonds shall be paid without deduction for, and free from, any taxes or fees imposed under the laws of the Borrower or laws in effect in its territories; provided, however, that the provisions of this Section shall not apply to taxation of, or fees upon, pay- ments under any Bond to a holder thereof other than the Bank when such Bond is beneficially owned by an individual or corporate resident of the Borrower. SECTION 5.11. The Loan Agreement and the Bonds shall be free from any taxes or fees that shall be imposed under the laws of the Borrower or laws in effeot in its territories on or in connection with the execution, issue, delivery or registration therof and the Borrower shall pay all such taxes and fees, 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. SECTION 5.12. The principal of, and interest and other charges on, the Loan and the Bonds shall be paid free from all restrictions imposed under the laws of the Borrower or laws in effect in its territories. ARTICLE VI Remedies of the Bank SECTION 6.01. (i) If at the end of the state of siege whici is now in effect any Congressional authorization or ratifica- 10 tion shall be needed to enable the Borrower to fulfill its obligation to carry out the Project and such authorization or ratification shall not have been obtained; or (ii) if any event specified in paragraph (a) or paragraph (b) of Sec- tion 5.02 of the Loan Regulations shall occur and shall continue for a period of thirty days; or (iii) if any event specified in paragraph (c) or specified pursuant to para- graph (h) 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 durikg the continu- ance thereof, 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. SECTION 6.02. The following are specified as additional events for the purposes of paragraph (h) of Section 5.02 of the Loan Regulations: (a) Any event specified in paragraph (i) of Section 5.02 of Loan Regulations No. 3 of the Bank dated December 6, 1950, with reference to the First Highway Loan Agreement shall have occurred; (b) Any event specified in paragraph (c) of Section 5.02 of Loan Regulations No. 3 of the Bank dated October 15, 1952, with reference to the Second Highway Loan Agree- ment shall have occurred. ARTICLE VII Effective Date; Termination SECTION 7.01. The following is specified as an additional matter, within the meaning of Section 9.02 (c) of the Loan Regulations, to be included in the opinion or opinions to be furnished to the Bank: 11 that, except as otherwise indicated in such opinion, no authorizations or ratifications by the Congress of the Borrower at or before the end of the state of siege now in effect will be required to enable the Borrower to con- tinue to carry out the Project or to enable the Borrower to carry out its other obligations under this Agreement. SECTION 7.02. A date 60 days after the date of this Agreement is hereby specified for the purposes of Section 9.04 of the Loan Regulations. ARTICLE VIII Miscellaneous SECTION 8.01. The Closing Date shall be December 31, 1958. SECTION 8.02. The following addresses are specified for the purposes of Section 8.01 of the Loan Regulations: For the Borrower: Ministro de Hacienda y Credito Publico Bogota, Colombia For the Bank: International Bank for Reconstruction and Development 1818 H Street, N. W. Washington 25, D. C. United States of America SECTION 8.03. The Minister of Finance and Public Credit or the Minister of Public Works of the Borrower is desig- nated for the purposes of Section 8.03 of the Loan Regula- tions. IN WITNESS WHEREOF, the parties hereto, acting through their representatives thereunto duly authorized, have caused this Loan Agreement to be signed in their respective 12 names and delivered in the District of Columbia, United States of America, as of the day and year first above written. REPUBLIC OF COLOMBIA By FRANCISCO URRUTIA Authorized Representative INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT By R. L. GARNER Vice President 13 SCHEDULE 1 Amortization Schedule Principal Payment of Amount Outstanding Principal After Each Payment Date (expressed in (expressed in Payment Due dollars) * dollars) * November 15, 1958 $16,500,000 May 15, 1959 $491,000 16,009,000 November 15, 1959 502,000 15,507,000 May 15, 1960 515,000 14,992,000 November 15, 1960 527,000 14,465,000 May 15, 1961 539,000 13,926,000 November 15, 1961 552,000 13,374,000 May 15, 1962 565,000 12,809,000 November 15, 1962 578,000 12,231,000 May 15, 1963 592,000 11,639,000 November 15, 1963 606,000 11,033,000 May 15, 1964 621,000 10,412,000 November 15, 1964 636,000 9,776,000 May 15, 1965 651,000 9,125,000 November 15, 1965 666,000 8,459,000 May 15, 1966 682,000 7,777,000 November 15, 1966 698,000 7,079,000 May 15, 1967 715,000 6,364,000 November 15, 1967 732,000 5,632,000 May 15, 1968 749,000 4,883,000 November 15, 1968 767,000 4,116,000 May 15, 1969 785,000 3,331,000 November 15, 1969 804,000 2,527,000 May 15, 1970 823,000 1,704,000 November 15, 1970 842,000 862,000 May 15, 1971 862,000 *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. 14 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 5 years before maturity ........................ 1/2 of 1/o More than 5 years but not more than 10 years before maturity ............ 1%0 More than 10 years before maturity ............................. 2%o 15 SCHEDULE 2 Description of the Project The Project is the construction, reconstruction and main- tenance (during the period of construction or reconstruc- tion of specific roads) of approximately 3,000 kilometers of roads included in the national highway system of Colom- bia. The list of specific roads to be constructed or recon- structed is as follows: A. Roads to be Constructed or Reconstructed and Paved Approximate Length From To Kms. Tunja Barbosa ---------------------75 Barbosa Rio Suarez ------------------16 Oiba Socorro ---------------------30 Socorro San Gil ---------------------22 San Gi Piedecuesta ------------------80 Piedecuesta Bucaramanga --------18 Bucaramanga Pamplona ------------------125 Pamplona Cucuta ----------------------74 Cucuta Frontera --------------------16 Cucuta bypass 6 Bucaramanga Rio Negro -------------------19 Ibague Gualanday -------------------31 Gualanday Melgar ---------------------67 Melgar Fusagasuga ------------------45 Fusagasuga Chusaca ---------------------42 Chusaca Bogota ----------------------18 Facatativa Los Alpes --------------------9 Los Alpes Km55 -----------------------6 Km 55 Km84 ----------------------29 Km 84 Villeta -----------------------8 Villeta Honda ----------------------73 Honda La Dorada -------------------31 Murillo Calarca ---------------------90 Armenia Ibague ----------------------92 Cartago Pereira ---------------------30 Pereira Manizales (Km 4) -------------50 Manizales Km 8 Km 38 ----------------------30 Km 80 Honda ----------------------63 Taraza Sincelejo -------------------256 Sincelejo Ovejas---------------44 Ovejas Sincerin --------------------100 Sincerin Cartagena -------------------53 16 Approximate Length From To Kms. Cartagena Barranquilla ----------------133 Barranquilla Cienaga ---------------------60 Loboguerrero Km 18 ----------------------35 Km 18 Km 4 -----------------------14 Cali Palmira ---------------------28 Palmira Amaime ---------------------10 Amaime Tulua -----------------------64 Tulua Cartago--------------------- 92 Cerritos La Virginia ------------------13 La Virginia Cauya ----------------------45 Cauya Supia -----------------------51 Supia Boca Rio Supia ----------------8 Boca Rio Supia La Pintada ------------------48 La Pintada Caldas ----------------------58 Caldas Medellin------- -------------22 Medellin Hatillo ----------------------33 Hatillo Yarumal -------------------106 Yarumal Taraza ---------------------110 Arauca Manizales (Km 10) ---------------- 28 B. Roads to be Constructed or Reconstructed.But Not Paved Km 38 (Manizales) Km 80 (Fresno) ---------------42 Rio Suarez Oiba------------------------------------ 51 Rio Negro Aguachica --------------------------- 146 Loboguerrero Buenaventura (Km 11) ---------52 Gamarra Ocana --------------------------------- 82 Cauy Arauca ---------------------29 The type, width and thickness of surfacing of each such road shall be as agreed between the Borrower and the Bank, subject to modification by further agreement between them. La Virinia 1