India - Calcutta Port Project : Loan 0198 - Loan Agreement - Conformed

LOAN NUMBER 198 IN Loan Agreement (Calcutta Port Project) BETWEEN INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT AND THE COMMISSIONERS FOR THE PORT OF CALCUTTA DATED JUNE 25, 1958 LOAN NUMBER 198 IN Loan Agreement (Calcutta Port Project) BETWEEN INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT AND THE COMMISSIONERS JOR THE PORT OF CALCUTTA DATED JUNE 25, 1958 AGREEMENT, dated June 25, 1958, between INTER- NATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT (hereinafter called the Bank) and THE COMMISSIONERS FOR THE PORT OF CALCUTTA (hereinafter called the Borrower). ARTICLE I Loan Regulations SECTION 1.01. The parties to this Loan Agreement accept all the provisions of Loan Regulations No. 4 of the Bank dated June 15, 1956, subject, however, to the modifications thereof set forth in Schedule 3 to this Agreement (said Loan Regulations No. 4 as so modified being hereinafter 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 twenty-nine million dollars ($29,000,000). 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 The amount of the Loan may be withdrawn from the Loan Account as pro- vided in, and subject to the rights of cancellation and suspension set forth in, the Loan Regulations.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charge at the rate of three-fourths of one per cent (% of 17) per annum on the principal amount of the Loan not so withdrawn from time to time. Such commit- 4 ment charge shall accrue from a date sixty days after the date of this Agreement to the respective dates on which amounts shall be withdrawn by the Borrower from the Loan Account as provided in Article IV of the Loan Regulations or shall be cancelled pursuant to Article V of the Loan Regulations. SECTION 2.04. The Borrower shall pay interest at the rate of five and one-half per cent (51/2%) per annum on the principal amount of the Loan so withdrawn and outstanding from time to time.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- mitnents 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 10/%) 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 payable 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 and the methods and procedures for procurement of such goods shall be determined by agreement between the Bank and the Borrower, subject to modification by further agreement between them. 5 SECTION 3.02. Except as shall be otherwise agreed between the Bank and the Borrower, 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 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 Chairman and two other Commis- sioners of the Borrower 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, and conduct its operations with due diligence and efficiency and in conformity with sound engineeing, finan- cial and business practices. (b) The Borrower shall furnish to the Bank, promptly upon their preparation, the plans and specifications and the construction schedule for the Project and any material modifications subsequently made therein, in such detail as the Bank shall from time to time reasonably 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 operations and financial condition of the Borrower; shall enable the Bank's representatives to inspect its properties and operations including the sites, works and construction included in the Project, the goods 6 and any relevant records and documents; and shall furnish to the Bank all such information as the Bank shall reason- ably request concerning the expenditure of the proceeds of the Loan, the Project, the goods, and the operations and financial condition of the Borrower. 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 inter- feres with, or threatens to interfere with, the accomplish- ment of the purposes of the Loan or the maintenance of the service thereof. SECTION 5.03. (a) The Loan and the Bonds shall be a first charge on the property now vested, or which hereafter may become vested, in the Borrower and on the tolls, dues, rates, rents and charges leviable by the Borrower under the Calcutta Port Act, 1890 (Bengal Act III of 1890) to the same extent as, but not to any greater extent than, if the Loan and the Bonds were debentures issued or to be issued pursuant to said Act and without preference, prior,ty or distinction of any part of the Loan or any Bond or any such debenture over any other part of the Loan or any Bond or any other such debenture by reason of maturity, date of issue or otherwise; (b) the Bank and the holders of the Bonds other than the Bank shall be deemed to be debenture- holders for the purposes of sections 26 and 27 of such Act; and (c) no debenture-holder of the Borrower and no holder of any other obligation of the Borrower shall have or be deemed to have any prior or greater right, preference or distinction than the charge hereby created by reason of 7 priority in #he date, issue, sale or negotiation of the Bor- rower's debentures or obligations or otherwise. 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 payment of the principal of, and interest and other charges on, the Loan and the Bonds, and that, except to the extent that such equal and ratable security shall be validly constituted by operation of law, 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 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. SECTION 5.05. The Borrower shall pay or cause to be paid all taxes or fees, if any, imposed under the laws of the Guarantor or laws in effect in the territories of the Guar- antor 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 upon, payments 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 Guarantor. SECTION 5.06. The Borrower shall pay or cause to be paid all taxes and fees, if any, imposed under the laws of the country or countries in whose currency the Loan and the 8 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. 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 Reg- ulations 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 thereof, the Bank, at its option, may declare the principal of the Loan and of all the Bonds then out- standing to be due and payable immediately, and upon any such declaration such principal shall become due and pay- able immediately, anything in this Agreement or in the Bonds to the contrary notwithstanding. ARTICLE VII Effective Date; Termination SECTION 7.01. The following is specified as an additional matter, within the meaning of Section 9.02 (e) of the Loan Regulations, to be included in the opinion or opinions to be furnished to the Bank: that the Borrower has full power and authority to construct and operate the Project and that, except as stated in such opinion, all acts, consents, sanctions and approvals necessary therefor, have been duly and validly performed or given. SECTION 7.02. A date ninety days after the date of this Agreement is hereby specified for the purposes of Section 9.04 of the Loan Regulations. 9 ARTICLE VIII Miscellaneous SECTION 8.01. The Closing Date shall be September 30, 1962. SECTION 8.02. The following addresses are specified for the purposes of Section 8.01 of the Loan Regulations: For the Borrower: The Commissioners for the Port of Calcutta Calcutta India Alternative address for cablegrams and radiograms: Port Commissioners Calcutta For the Bank: International Bank for Reconstruction and Development 1818 H Street, N.W. Washington 25, D. C. United States of America Alternative address for cablegrams and radiograms: Intbafrad Washington, D. C. IN WITNESS WHEREOF, the parties hereto, acting through their representatives thereunto duly authorized, have caused this Loan Agreement to be executed in their respec- tive names, and to be delivered in the District of Columbia, 10 United States of America, as of the day and year first above written. INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT By DAVIDSON SOMMERS Vice President THE COMMISSIONERS FOR THE PORT OF CALCUTTA By R. K. MITRA Chairman G. D. LONGHURST Commissioner A. MITRA Commissioner Seal 11 SCHEDULE 1 Amortization Schedule Payment of Principal Date Payment Due (expressed in dollars)* April 15, 1963 $605,000 October 15, 1963 621,000 April 15, 1964 639,000 October 15, 1964 656,000 April 15, 1965 674,000 October 15, 1965 693,000 April 15, 1966 712,000 October 15, 1966 731,000 April 15, 1967 751,000 October 15, 1967 772,000 April 15, 1968 793,000 October 15, 1968 815,000 April 15, 1969 837,000 October 15, 1969 861,000 April 15, 1970 884,000 October 15, 1970 909,000 April 15, 1971 933,000 October 15, 1971 959,000 April 15, 1972 986,000 October 15, 1972 1,013,000 April 15, 1973 1,040,000 October 15, 1973 1,069,000 April 15, 1974 1,098,000 October 15, 1974 1,129,000 April 15, 1975 1,160,000 October 15, 1975 1,192,000 April 15, 1976 1,224,000 October 15, 1976 1,258,000 April 15, 1977 1,293,000 October 15, 1977 1,328,000 April 15, 1978 1,365,000 * 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 this column represent dollar equivalents determined as for purposes of withdrawal. 12 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.. of 1% More than 3 years but not more than 6 years before maturity......... 1/2 % More than 6 years but not more than 11 years before maturity.............2 % More than 11 years but not more than 16 years before maturity ..............32 % More than 16 years but not more than 18 years before maturity .............42 % More than 18 years before maturity .... 51/2% 13 SCHEDULE 2 Description e, Project The Project consists of a program of rehabilitation and improvement of the Port of Calcutta, as part of India's Second Five Year Plan. It is estimated to involve expendi- tures in Indian currency and foreign exchange, after April 1, 1957, amounting to the equivalent of about $59 million and comprises the following main items: 1. Improvement of harbor facilities In King George's Dock three berths will be provided with transit sheds and devcloped as general cargo berths, one as an oil berth and one as a laying-up berth. In Kidderpore Docks, berths Nos. 22, 23, 24, 25 and 26 will be improved and the quay walls in No. 1 dock will be reconditioned and strengthened. Electric cranes and lifts, mechanical cargo- handling equipment, one 30-ton and one 60-ton floating crane and other miscellaneous minor equipment will be purchased. The water and electricity supply in certain areas will be improved. Three new moorings will be pro- vided and laid at Diamond Harbor. 2. Improvement of the River Hooghly The navigability of the Fulta Point-Hooghly Point reach of the River Hooghly will be improved by cutting back Fulta Point a maximum of about 1,200 feet, constructing dikes above and below the mouth of the Damodar River for the purpose of extending the River Hooghly bank river- ward, and carrying out other related works, in general accordance with the scheme recommended by the Poona Rescqrch Station. The warping jetty at the entrance to King Geo-r D' l - k will be reconstructed and the bull nose at the upstream siae of the entrance will be removed. 3. Improvement of railway facilities The existing marshalling yard will be improved and extended, and the related work of reconstructing the Majer- hat Bridge and relocating the Budge Budge section of the 14 Eastern Railway will be carried out. Nine diesel locomo- tives will be purchased, a repair shed will be provided and the existing railway workshop will be modernized. 4. Floating craft and facilities The following additional floating equipment will be acquired: a) A suction hopper dredger. b) A bucket dredger and two hopper barges. c) A jet dredger. d) A salvage tug-cum-despatch vessel. e) A pilot vessel. f) Two firefloats with dumb barges. g) Two anchor vessels. h) Three launches for Dock Master. i) Other salvage equipment. Existing shops for the maintenance and repair of the Borrower's floating craft will be extended and additional plant and machinery installed. 5. Miscellaneous works A new tea warehouse will be built. The existing fire- fighting system will be improved and new fire protection devices installed. 15 SCHEDULE 3 Modifications of Loan Regulations No. 4 For the purposes of this Agreement the provisions of Loan Regulations No. 4 of the Bank, dated June 15, 1956, shall be deemed to be modified as follows: (a) by the deletion of Section 2.02. (b) The second sentence of Section 7.02 is amended to read as follows: " Such obligations shall not be subject to any prior notice to, demand upon or action against the Bor- rower or to any prior notice to or demand upon the Guarantor with regard to any default by the Bor- rower, and shall not be impaired by any of the following: any extension of time, forbearance or concession given to the Borrower; any assertion of, or failure to assert, or delay in asserting, any right, power or remedy against the Borrower or in respect of any security for the Loan; any modification or amplification of the provisions of the Loan Agree- ment contemplated by the terms thereof; any modi- fication or amplification of any other document related to the Loan or related to any security there- for; any failure of the Borrower to comply with any requirement of any law, reiziItion or order of the Guarantor or of any politic . - -%,sion or agency of the Guarantor." (c) Paragraph 6 of Section 10.01 is amended to read as follows: "6. The term 'Borrower' means the party to the Loan Agreement to which the Loan is made; and the term 'Guarantor' means India, acting by its President."