Mali - Mali - Sud Agricultural Project : Credit 0669 - Project Agreement - Conformed

CONFORMED COPY CREDIT NUMBER 669-MLI PROJECT AGREEMENT (Mali-Sud Agricultural Project) between INTERNATIONAL DEVELOPMENT ASSOCIATION and COMPAGNIE MALIENNE POUR LE DEVELOPPEMENT DES TEXTILES Dated December 23, 1976 PROJECT AGREEMENT AGREEMENT, dated December 23, 1976, between INTERNATIONAL DEVELOPMENT ASSOCIATION (hereinafter called the Association) and COMPAGNIE MALIENNE POUR LE DEVELOPPEMENT DES TEXTILES (hereinafter called CMDT). WHEREAS by the Development Credit Agreement of even date herewith between the Republic of Mali (hereinafter called the Borrower) and the Association, the Association has agreed to make available to the Borrower an amount in various currencies equiva- lent to fifteen million five hundred thousand dollars ($15,500,000), on the terms and conditions set forth in the Development Credit Agreement, but only on condition that CMDT agree to undertake cer- tain obligations toward the Association as hereinafter set forth; WHEREAS by a Subsidiary Loan Agreement to be concluded be- tween the Borrower and CMDT, the proceeds of the credit provided for under the Development Credit Agreement will be made available to CMDT on the terms and conditions therein set forth; and WHEREAS CMDT, in consideration of the Association's entering into the Development Credit Agreement with the Borrower, has agreed to undertake the obligations hereinafter set forth; NOW THEREFORE the parties hereto hereby agree as follows: ARTICLE I Definitions Section 1.01. Wherever used in this Agreement, unless the context shall otherwise require, the several terms defined in the Development Credit Agreement and in the General Conditions (as so defined) have the respective meanings therein set forth. S -3 - ARTICLE II Execution of the Project Section 2.01. CMDT shall carry out Parts A B2 and E of the Project described in Schedule 2 to the Development Credit Agree- ment with due diligence and efficiency and in accordance with appropriate administrative, financial and agricultural practices and with the assistance of the Borrower's Ministries or departments. Section 2.02. The experts and consultants employed to assist C-DT in carrying out Part A of the Project shall possess adequate qualifications and experience, and shall be employed on appropriate terms and conditions. Section 2.03. Except as the Association shall otherwise agree, contracts for the purchase of goods or for civil works to be fi- nanced out of the proceeds of the Credit, shall be procured in accordance with the provisions of Schedule 3 to the Development Credit Agreement. Section 2.04. (a) CMDT undertakes to insure, or make adequate provision for the insurance of, the imported goods to be financed out of the proceeds of the Credit made available to it by the Bor- rower 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 CMDT to replace or repair such goods. 40 (b) Except as the Association may otherwise agree, CMDT shall cause all goods and services financed out of the proceeds of the Credit made available to it by the Borrower to be used ex- clusively for the Project. Section 2.05. (a) CMDT shall furnish to the Association, promptly upon their preparation, the plans, specifications, re- ports, contract documents and work and procurement schedules for the Project, and any material modifications thereof or additions thereto, in such detail as the Association shall reasonably re- quest. (b) CMDT: (i) shall maintain records adequate to record the progress of the Project (including the cost thereof) and to iden- tify the goods and services financed out of the proceeds of the Credit made available to it by the Borrower, and to disclose the use thereof in the Project; (ii) shall, without limitation upon the provisions of paragraph (c) of this Section, enable the Asso- ciation's representatives to visit the facilities and construction sites included in the Project and to examine the goods financed out of such proceeds and any relevant records and documents; and (iii) shall furnish to the Association all such information as the Association shall reasonably request concerning the Project, the expenditure of the proceeds of the Credit so made available to it and the goods and services financed out of such proceeds. (c) CMDT shall enable the Association's representatives to examine all plants, installations, sites, works, buildings, prop- erty and equipment of CMDT related to the Project and any relevant records and documents. -5- Section 2.06. CMDT shall duly perform all its obligations under the Subsidiary Loan Agreement. Except as the Association shall otherwise agree, CMDT shall not take any action which would have the effect of amending, abrogating, assigning or waiving the Subsidiary Loan Agreement or any provision thereof. Section 2.07. (a) CMDT shall, at the request of the Associa- tion, exchange views with the Association with regard to the prog- ress of the Project, the performance of its obligations under this Agreement and under the Subsidiary Loan Agreement, and other mat- ters relating to the purposes of the Credit. (b) CMDT shall promptly inform the Association of any con- dition which interferes or threatens to interfere with, the prog- ress of the Project, the accomplishment of the purposes of the Credit, or the performance by CMDT of its obligations under this Agreement and under the Subsidiary Loan Agreement. Section 2.08. In carrying out Part B2 of the Project, CMDT shall: (i) provide credits to blacksmiths under procedures and on terms and conditions satisfactory to the Borrower and the Association; and (ii) ensure that blacksmiths' repayments of such credits be deposited into a revolving fund for the sole purpose of financing the purchase of equipment for them in the Project area. -6- Section 2.09. CMDT shall promptly furnish to the Borrower such data as are necessary for the determination by the Borrower of the cost price allocations included in the Bar4mes and for their adjustment when necessary. ARTICLE III Management and Operations of CMDT Section 3.01. (a) CMDT shall at all times manage its affairs, maintain its financial position, and carry on its operations, all in accordance with appropriate administrative, financial, engineer- ing, agricultural and industrial practices and under the supervi- sion of qualified and experienced management and staff. (b) CMDT shall adequately maintain the works, installations and equipment used in its operations and promptly make all neces- sary renewals and repairs thereof, all in accordance with sound engineering, industrial and agricultural practices. (c) CMDT shall at all times take all such action as shall be necessary on its part to acquire, maintain and renew all rights which are necessary or useful for the purpose of carrying out its obligations under this Agreement. Section 3.02. CMDT shall take out and maintain with respon- sible insurers, or make other provisions satisfactory to the As- sociation for, insurance against such risks and in such amounts as shall be consistent with appropriate practice. Section 3.03. CMDT shall enter into arrangements, satisfac- tory to the Association, with ITEMA and COMATEX ensuring adequate and timely supply of cotton lint to ITEMA and COMATEX based on their expected monthly purchases as indicated by them to CMDT -8- within the periods stipulated in the protocoles in effect between the CMDT and such companies. 0 -9- ARTICLE IV Financial Covenants Section 4.01. CMDT shall maintain separate records and ac- counts adequate to reflect in accordance with consistently main- tained appropriate accounting practices its operations, resources and expenditures in respect of the Project. Section 4.02. CMDT shall: Ci) have its accounts and finan- cial statements (balance sheets, statements of income and expenses and related statements), including (A) the separate accounts re- ferred to in Section 4.01 of this Agreement and (B) separate ac- counts for the revolving fund referred to in Section 2.08 (iii) of this Agreement, for each fiscal year audited, in accordance with appropriate auditing principles consistently applied, by independent auditors acceptable to the Borrower and the Association; (ii) fur- nish to the Association as soon as available, but in any case not later than four months after the end of each such year, (A) certi- fied 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 Association shall have reasonably requested; and (iii) furnish to the Association such other information con- cerning the accounts and financial statements of CMDT and the audit thereof as the Association shall from time to time reasonably re- quest. -10- 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 Development Credit Agreement becomes effective. Section 5.02. (a) This Agreement and all obligations of the Association and of CMDT thereunder shall terminate on the earlier of the following two dates: (i) the date on which the Development Credit Agreement shall terminate in accordance with its terms; or (ii) a date twenty years after the date of this Agreement. (b) If the Development Credit Agreement terminates in ac- cordance with its terms before the date specified in paragraph (a) (ii) of this Section, the Association shall promptly notify CMDT of this event. Section 5.03. All the provisions of this Agreement shall con- tinue in full force and effect notwithstanding any cancellation or suspension under Article VI of the General Conditions. * - 11 - ARTICLE VI 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 radiogram 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 des- ignated by notice to the party giving such notice or making such request. The addresses so specified are: For the Association: International Development Association 1818 H Street, N.W. Washington, D.C. 20433 United States of America Cable address: Telex: INDEVAS 40098 (ITT) Washington, D.C. 248423 (RCA) or 6415 (wUI) For CMDT: Compagnie Malienne pour le Developpement des Textiles B.P. 487 Bamako, Republic of Mali Cable address: Telex: CIMATEX 972554 Bamako - 12 - Section 6.02. Any action required or permitted to be taken, and any documents required or permitted to be executed, under this Agreement on behalf of CMDT or under the Development Credit Agree- ment by CMDT on behalf of the Borrower, may be taken or executed by the Directeur General of CMDT or such other person or persons as CMDT shall designate in writing. Section 6.03. CMDT shall furnish to the Association sufficient evidence of the authority and the authenticated specimen signature of the person or persons who will, on behalf of CMDT or the Bor- rower, take any action or execute any documents required or per- mitted to be taken or executed by CMDT pursuant to any of the pro- visions of this Agreement or of the Development Credit Agreement. Section 6.04. This Agreement may be executed in several coun- terparts, each of which shall be an original, and all collectively but one instrument. -13- IN WITNESS WHEREOF, the parties hereto, acting through their representatives thereunto duly authorized, have caused this Agree- ment 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 DEVELOPMENT ASSOCIATION By /s/ E. P. Wright Director Country Programs 1 Western Africa COMPAGNIE MALIENNE POUR LE DEVELOPPEMENT DES TEXTILES By /s/ Ibrahima Sima Authorized Representative