Conformed Copy - L3201 - Community Child Care and Nutrition Project - Project Agreement

Page 1 CONFORMED COPY LOAN NUMBER 3201-CO Project Agreement (Community Child Care and Nutrition Project) between INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT and INSTITUTO COLOMBIANO DE BIENESTAR FAMILIAR Dated August 1, 1990 LOAN NUMBER 3201-CO PROJECT AGREEMENT AGREEMENT, dated August 1, 1990, between INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT (the Bank) and INSTITUTO COLOMBIANO DE BIENESTAR FAMILIAR (ICBF). WHEREAS (A) by the Loan Agreement of even date herewith between the Republic of Colombia (the Borrower) and the Bank, the Bank has agreed to make available to the Borrower an amount in various currencies equivalent to twenty-four million dollars ($24,000,000), on the terms and conditions set forth in the Loan Agreement, but only on condition that ICBF agree to undertake such obligations toward the Bank as are set forth in this Agreement; (B) by a subsidiary agreement to be entered into between the Borrower and ICBF, the proceeds of the loan provided for under the Loan Agreement will be made available to ICBF on the terms and conditions set forth in said subsidiary agreement; and WHEREAS ICBF, in consideration of the Bank's entering into the Loan Agreement with the Borrower, has agreed to undertake the obligations set forth in this Agreement; Page 2 NOW THEREFORE the parties hereto hereby agree as follows: ARTICLE I Definitions Section 1.01. Unless the context otherwise requires, the several terms defined in the Loan Agreement, the Preamble to this Agreement and the General Conditions (as so defined) have the respective meanings therein set forth. ARTICLE II Execution of the Project Section 2.01. (a) ICBF declares its commitment to the objectives of the Project as set forth in Schedule 2 to the Loan Agreement, and, to this end, shall carry out the Project with due diligence and efficiency and in conformity with appropriate administrative, financial, child care, and health practices, and shall provide, or cause to be provided, promptly as needed, the funds, facilities, services and other resources required for the Project and each Annual Implementation Plan. (b) As part of, and without limitation to, the foregoing, ICBF shall enter into an agreement, satisfactory to the Bank, with the Fiduciary for purposes, inter alia, of transferring to the Fiduciary, in its capacity as administrator, the proceeds of the Loan required to make Subloans under Part C.2 of the Project. (c) (i) ICBF undertakes that, Subloans shall be made in accordance with the terms and conditions of the Operational Manual; and (ii) except as the Bank shall otherwise agree, ICBF shall not amend, abrogate, waive or fail to enforce any provision of the Operational Manual. (d) ICBF shall execute its rights in relation to each Subloan in such manner as to (i) protect the interests of the Bank, the Borrower and ICBF, (ii) comply with all its obligations under this Agreement, and (iii) achieve the purposes of the Project. (e) ICBF shall duly perform all of its obligations under the Fiduciary Agreement and Subsidiary Agreement. Except as the Bank and ICBF shall otherwise agree, ICBF shall not take or concur in any action which would have the effect of amending, abrogating, assigning or waiving said agreements, or any provision thereof. Section 2.02. ICBF shall: (a) carry out under terms or reference satisfactory to the Bank: (i) not later than March 31, 1991, the study referred to in Part A.l of the Project; (ii) not later than September 30, 1991, the study referred to in Part A.2 of the Project; and (iii) not later than March 31, 1991, the study referred to in Part B.l of the Project; (b) promptly upon the completion of each such study, furnish to the Bank a copy of its recommendations and findings; (c) afford the Bank a reasonable opportunity to comment on such recommendations and findings; (d) based on the recommendations and findings of each study, and the Bank's comments thereon, furnish to the Bank action plans, satisfactory to the Bank, (i) not later than June 30, 1991, in respect of the studies referred to in (a) (i) and (a) (iii) above and (ii) not later than December 31, 1991, in respect of the study referred to in (a) (ii) above; and (e) carry out such action plans in a manner and according to a timetable satisfactory to the Bank. Section 2.03. ICBF shall put into effect in terms satisfactory to the Bank: (a) not later than June 30, 1991, the management information system included under Part B.2 of the Project; and (b) not later than June 30, 1991, the monitoring and impact Page 3 evaluation systems referred to under Part B.3 of the Project. Section 2.04. In the carrying out of the training programs under the Project, ICBF shall: (a) furnish to the Bank for approval the content of such programs as well as the schedule for their implementation; (b) select the beneficiaries of such training programs in accordance with criteria satisfactory to the Bank; and (c) furnish to the Bank a report of such scope and detail as the Bank shall reasonably request, on the results of each of such training program and the benefits to be derived therefrom. Section 2.05. (a) Without limitation to the provisions of Section 9.01 of the General Conditions, ICBF shall, prepare and furnish to the Bank, not later than August 31 each year, a report of such scope and detail as the Bank shall reasonably request on the execution of the Project and the Program and the benefits to be derived therefrom, such report to include, inter alia, specific information on the amount and kind of the subsidies provided by ICBF and other agencies of the Borrower with regard to the sub loans under Part C.2 of the Project; (b) Without limitation to Section 2.11 (a) of this Agreement, not later than September 30 of each year, ICBF shall exchange views with the Bank on the execution of the Project and the Program. Section 2.06. ICBF shall: (a) based on the results of the exchange of views referred to in Section 2.05 (b) of this Agreement, prepare and furnish to the Bank for approval, not later than November 30 of each year, a detailed plan (including policy, institutional and investment activities) for the execution of the Program during the following calendar year (the Annual Implementation Plan); (b) carry out each Annual Implementation Plan in a manner and in accordance with a timetable satisfactory to the Bank; and (c) unless the Bank shall otherwise agree, not change an Annual Implementation Plan or any part thereof once it has been agreed with the Bank. Section 2.07. ICBF shall: (a) maintain staff, in number and positions satisfactory to the Bank, to adequately manage and supervise the implementation of the Project and the Program; and (b) without limitation to (a) above, maintain, with qualifications and experience satisfactory to the Bank, the staff referred to in Section 6.01 (b) of the Loan Agreement. Section 2.08. (a) ICBF shall carry out the Subsidy Reduction Plan with due diligence and efficiency and in a manner and according to a timetable satisfactory to the Bank. (b) Unless the Bank shall otherwise agree, ICBF shall not amend, suspend or abrogate the Subsidy Reduction Plan or any part thereof. Section 2.09. Except as the Bank shall otherwise agree, procurement of the goods, works and consultants' services required for the Project and to be financed out of the proceeds of the Loan, shall be governed by the provisions of Schedule 4 to the Loan Agreement. Section 2.10. ICBF shall carry out the obligations set forth in Sections 9.04, 9.05, 9.06, 9.07, 9.08 and 9.09 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) in respect of the Project Agreement and the Project. Section 2.11. (a) ICBF shall, at the request of the Bank, exchange views with the Bank with regard to progress of the Project, the Program, the performance of its obligations under this Agreement, the Subloan Agreements, Fiduciary Agreement and under the Subsidiary Agreement, and other matters relating to the purposes of the Loan. Page 4 (b) ICBF shall promptly inform the Bank of any condition which interferes or threatens to interfere with the progress of the Project, the carrying out of each Annual Implementation Plan, the accomplishment of the purposes of Loan, or the performance by ICBF of its obligations under this Agreement and the agreements referred to in (a) above. ARTICLE III Management and Operations of ICBF Section 3.01. ICBF shall carry on its operations and conduct its affairs in accordance with sound administrative, financial, health and nutritional practices under the supervision of qualified and experienced management assisted by competent staff in adequate number. Section 3.02. ICBF shall take out and maintain with responsible insurers, or make other provision satisfactory to the Bank for, insurance against such risks and in such amounts as shall be consistent with appropriate practice. ARTICLE IV Financial Covenants Section 4.01. (a) ICBF shall maintain or cause to be maintained records and accounts adequate to reflect in accordance with sound accounting practices its operations and financial condition including separate records and accounts at the national, zonal and local levels to reflect the resources and expenditures in respect of the Project. (b) ICBF shall: (i) have its records, accounts and financial statements (balance sheets, statements of income and expenses and related statements) and the records and accounts referred to in paragraph (a) of this Section for each fiscal year audited, in accordance with appropriate auditing principles consistently applied, by independent auditors acceptable to the Bank; (ii) furnish to the Bank as soon as available, but in any case not later than six months after the end of each such year, (A) certified copies of its financial statements for such year as so audited and (B) the report of such audit by said auditors of such scope and in such detail as the Bank shall have reasonably requested; and (iii) furnish to the Bank such other information concerning said records, accounts and financial statements as well as the audit thereof, as the Bank shall from time to time reasonably request. ARTICLE V Effective Date; Termination; Cancellation and Suspension Section 5.01. This Agreement shall come into force and effect on the date upon which the Loan Agreement becomes effective. Section 5.02. This Agreement and all obligations of the Bank and of ICBF thereunder shall terminate on the date on which the Loan Agreement shall terminate in accordance with its terms, and the Bank shall promptly notify ICBF thereof. Section 5.03. All the provisions of this Agreement shall continue in full force and effect notwithstanding any cancellation or suspension under the General Conditions. ARTICLE VI Page 5 Miscellaneous Provisions Section 6.01. Any notice or request required or permitted to be given or made under this Agreement and any agreement between the parties contemplated by this Agreement shall be in writing. Such notice or request shall be deemed to have been duly given or made when it shall be delivered by hand or by mail, telegram, cable, telex or radio gram to the party to which it is required or permitted to be given or made at such party's address hereinafter specified or at such other address as such party shall have designated by notice to the party giving such notice or making such request. The addresses so specified are: For the Bank: International Bank for Reconstruction and Development 1818 H Street, N.W. Washington, D.C. 20433 United States of America Cable address: Telex: INTBAERAD 197688 (TRT) Washington, D.C. 248423 (RCA) 64145 (WUI) or 82987 (FTCC) For ICBF: Instituto Colombiano de Bienestar Familiar Avenida 68, Numero 64.01 Bogota, D.E. Colombia Cable address: Telex: ICBFA 43289 MHACO Bogota Section 6.02. Any action required or permitted to be taken, and any document required or permitted to be executed, under this Agreement on behalf of ICBF may be taken or executed by the Director General or such other person or persons as the Director General shall designate in writing, and the Director General shall furnish to the Bank sufficient evidence of the authority and the authenticated specimen signature of each such person. Section 6.03. This Agreement may be executed in several counterparts, each of which shall be an original, and all collectively but one instrument. IN WITNESS WHEREOF, the parties hereto, acting through their duly authorized representatives, 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. INTERNATIONAL BANK FOR RECONSTRUTION AND DEVELOPMENT By /s/ Armeane Choksi Acting Regional Vice President Latin America and the Caribbean INSTITUTO COLOMBIANO DE BIENESTAR FAMILIAR Page 6 By /s/ Ximena de Casalino Authorized Representative