Morocco - Second Industrial Equipment Fund Project - Fonei : Loan 1205 - Loan Agreement - Conformed

CONFORMED COPY LOAN NUMBER 1205 ME LOAN AGREEMENT (Second Industrial Equipment Fund Project-FONEI) between INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT and NACIONAL FINANCIERA, S.A. Dated April 30, 1976 LOAN AGREEMENT AGREEMENT, dated April 30, 1976, between INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT (hereinafter called the Bank) and NACIONAL FINANCIERA, S.A. (hereinafter called the Borrower). 0 -2- ARTICLE I General Conditions; Definitions Section 1.01. The parties to this Agreement accept all the provisions of the General Conditions Applicable to Loan and Guar- antee Agreements of the Bank, dated March 15, 1974, with the same force and effect as if they were fully set forth herein, subject, however, to the modifications thereof set forth in Schedule 2 to this Agreement (said General Conditions Applicable to Loan and Guarantee Agreements of the Bank, as so modified, being hereinafter called the General Conditions). Section 1.02. Wherever used in this Agreement, unless the context otherwise requires, the several terms defined in the General Conditions have the respective meanings therein set forth and the following additional terms have the following meanings: (a) "Trustee" means Banco de Mexico, S.A., as trustee of FONEI; (b) "FONEI" means Fondo de Equipamiento Industrial, a special fund entrusted by the Guarantor to the Trustee pursuant to the Trust Agreement; and such term includes the technical and admin- istrative organization, resources, staff and facilities used or to be used by the Trustee to operate FONEI; (c) "Trust Agreement" means the Contrato de Fideicomiso dated October 29, 1971 between the Government of United Mexican 0 -3- States and the Trustee, whereby the Fondo de Equipamiento Industrial has been entrusted to the Trustee; (d) "Project Agreement" means the agreement between the Bank and the Trustee of even date herewith, as such agreement may be amended from time to time; and such term includes all agreements supplemental to the Project Agreement and the schedule thereto; (e) "Participating Intermediary" means a credit institution approved by the Trustee for participating in carrying out the Proj- ect in accordance with the Operating Regulations; (f) "Operating Regulations" means the Reglas de Operaciones approved or to be approved by FONEI's Comite Tecnico; (g) "FONEI loan" means a loan made or proposed to be made by the Trustee, out of FONEI's resources, to a Participating Intermediary, for financing a sub-loan, and to be financed out of the proceeds of the Loan; (h) "sub-loan" means a loan made or proposed to be made by a Participating Intermediary to an Investment Enterprise for an Investment Project and to be financed out of FONEI's resources by means of a FONEI loan; and "free-limit sub-loan" means a sub- loan, as so defined, which qualifies as a free-limit sub-loan pur- suant to the provisions of Section 2.04(b) of the Project Agreement; (i) "Investment Enterprise" means an enterprise to which a Participating Intermediary proposes to make or has made a sub-loan; 01 -4- (j) "Investment Project" means a specific development proj- ect being carried out or to be carried out by an Investment Enter- prise, which complies with the requirements set forth in the Oper- ating Regulations; (k) "peso" means the currency unit of the Guarantor; and (1) "First Loan" means the loan provided for in the Loan Agreement (Industrial Equipment Fund /FONEf/ Project) between the Bank and the Borrower dated June 2, 1972. -5- ARTICLE II The Loan Section 2.01. The Bank agrees to lend to the Borrower, on the terms and conditions in the Loan Agreement set forth or referred to, an amount in various currencies equivalent to fifty million dollars ($50,000,000). Section 2.02. The amount of the Loan may be withdrawn from the Loan Account for amounts expended (or if the Bank shall so agree, required to meet expenditures to be made) by the Trustee under FONEI loans in respect of sub-loans for Investment Projects, to finance the c.i.f. cost of imported goods (or, 70% of the cost of imported goods purchased in Mexico where the c.i.f. cost of such goods cannot be ascertained), and the foreign currency cost of services, required under a sub-loan for the Investment Project in respect of which the withdrawal is requested; provided, however, that: (i) no withdrawal shall be made in respect of a sub-loan unless it shall have been approved by the Bank or it shall be a free-limit sub-loan in respect of which the Bank shall have author- ized withdrawals from the Loan Account; and (ii) no withdrawal shall be made on account of expenditures made by an Investment Enterprise (A) if such expenditure shall have been made before the date of this Agreement, except that withdrawals may be made on account of expenditures made by Investment Enterprises after October 1, 1975 up to an aggregate amount of $5,000,000 equivalent, or (B) except as the Bank shall otherwise agree, more than 180 days prior to the date on which the Bank shall have received, in respect of such sub-loan, the application or request required under Section 2.04 of the Project Agreement. - 6 - Section 2.03. The Closing Date shall be December 31, 1979 or such other date or dates as shall be agreed between the Bank and the Borrower. Section 2.04. 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 withdrawn from time to time. Section 2.05. The Borrower shall pay interest at the rate of eight and one-half per cent (8-1/2%) per annum on the principal amount of the Loan withdrawn and outstanding from time to time. Section 2.06. Interest and other charges shall be payable semi-annually on February 15 and August 15 in each year. Section 2.07. The Borrower shall repay the principal amount of the Loan in accordance with the amortization schedule set forth in Schedule 1 to this Agreement. *7 - ARTICLE III Transfer of Loan Proceeds Section 3.01. (a) The Borrower shall make contractual arrange- ments with the Trustee, satisfactory to the Bank, providing, inter alia, for the transfer to the Trustee, for the account of FONEI, of the proceeds of the Loan for the purpose of carrying out the Project described in the Schedule tc the Project Agreement, and except as the Bank shall otherwise agree, the Borrower shall not amend, assign, abrogate or waive any provision of such arrangements. (b) The arrangements referred to in the preceding subsection shall, inter alia, provide for the non-repayment by FONEI to the Borrower of the proceedii of the Loan and for payment by FONEI to the Borrower in pesos of amounts equivalent to amounts to be paid by the Borrower to the Bank on account of interest and other charges on the Loan. -8- ARTICLE IV Financial Covenants Section 4.01. (a) The Borrower represents that at the date of this Agreement no lien exists on any of its assets as security for any external debt. (b) 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 in the creation of any such lien express provision will be made to that effect, at no cost to the Bank; provided, however, that the foregoing provisions of this paragraph shall not apply to: (A) any lien created on property, at the time of purchase thereof, solely as security for the payment of the purchase price of such property; or (B) any lien arising in the ordinary course of banking trans- actions and securing a debt maturing not more than one year after the date on which it is originally incurred. -9 - ARTICLE V Remedies of the Bank Section 5.01. For the purposes of Section 6.02 of the General Conditions, the following additional events are specified pursuant to paragraph (k) thereof: (a) the Trustee shall have failed to perform any of its obligations under the Project Agreement; and (b) a change shall have been muade in the Trust Agreement which shall adversely and materially affect the carrying out of the Project or the financial position, organization or other re- sources of FONEI. Section 5.02. For the purposes of Section 7.01 of the General Conditions, the following additional events are specified pursuant to paragraph (h) thereof: (a) the event specified in paragraph (a) of Section 5.01 of this Agreement shall occur and shall continue for a period of 60 days after notice thereof shall have been given by the Bank to the Guarantor and the Borrower; and (b) any event specified in paragraph (b) of Section 5.01 of this Agreement shall occur. - 10 - ARTICLE VI Effective Date; Termination Section 6.01. The following events are specified as additional conditions to the effectiveness of the Loan Agreement within the meaning of Section 12.01(c) of the General Conditions: (a) that the execution and delivery of the Project Agreement on behalf of the Trustee have been duly authorized or ratified by all necessary governmental and corporate action; (b) that the Borrower and the Trustee have entered into the contractual arrangements referred to in Section 3.01 of this Agree- ment; and (c) the Operating Regulations have been approved as required by Section 2.01(c)(i) of the Project Agreement. Section 6.02. The following is specified as an additional matter, within the meaning of Section 12.02(c) of the General Conditions, to be included in the opinion or opinions to be fur- nished to the Bank, namely, that the Project Agreement has been duly authorized or ratified by, and executed and delivered on behalf of, the Trustee and is legally binding upon the Trustee in accordance with its terms. - 11 - Section 6.03. The date July 30, 1976 is hereby specified for the purposes of Section 12.04 of the General Conditions. -12- ARTICLE VII Addresses Section 7.01. The following addresses are specified for the purposes of Section 11.01 of the General Conditions: For the Bank: international Bank for Reconstruction and Development 1818 H Street, N.W. Washington, D.C. 20433 United States of America Cable address: INTBAFRAD Washington, D.C. For the Borrower: Nacional Finanaciera, S.A. Isabel la Catolica 51 Mcico 1, D.F. b4xico Telex address: NAFIN 383-1772538 Mexico City -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 BANK FOR RECONSTRUCTION AND DEVELOPMENT By /s/ Adalbert Krieger Regional Vice President Latin America and the Caribbean NACIONAL FINANCIERA, S.A. By /s/ G. Romero Kolbeck Authorized Reptresentative - 14 - SCHEDULE 1 Amortization Schedule Payment of Principal Date Payment Due (expressed in dollars)* August 15, 1979 1,090,000 February 15, 1980 1,135,000 August 15, 1980 1,185,000 February 15, 1981 1,235,000 August 15, 1981 1,285,000 February 15, 1982 1,340,000 August 15, 1982 1,400,000 February 15, 1983 1,460,000 August 15, 1983 1,520,000 February 15, 1984 1,585,000 August 15, 1984 1,650,000 February 15, 1985 1,720,000 August 15, 1985 1,795,000 February 15, 1986 1,870,000 August 15, 1986 1,950,000 February 15, 1987 2,035,000 August 15, 1987 2,120,000 February 15, 1988 2,210,000 August 15, 1988 2,305,000 February 15, 1989 2,400,000 August 15, 1989 2,505,000 February 15, 1990 2,610,000 August 15, 1990 2,720,000 February 15, 1991 2,835,000 August 15, 1991 2,955,000 February 15, 1992 3,085,000 * To the extent that any portion of the Loan is repayable in a currency other than dollars (see General Conditions, Section 4.02), the figures in this column represent dollar equivalents determined as for purposes of withdrawal. -15 - Premiums on Prepayment The following percentages are specified as the premiums pay- able on repayment in advance of maturity of any portion of the principal amount of the Loan pursuant to Section 3.05(b) of the General Conditions or to Section 2.08(a) of the Loan Agreement: Time of Prepayment Premium Not more than three years before maturity 1-1/2% More than three years but not more than six years before maturity 2-3/4% More than six years but not more than eleven years before maturity 5-3/4% More than eleven years but not more than fourteen years before maturity 7% More than fourteen years before maturity 8-1/2% - 16 - SCHEDULE 2 Modifications of the General Conditions For the purposes of the Loan Agreement, the provisions of the General Conditions are modified as follows: (1) Paragraph 11 of Section 2.01 is amended to read: "The term Project means the project for which the Loan is granted, as described in the Project Agreement and as such description may be amended from time to time by agreement between the Guarantor, the Bank, the Borrower and the Trustee". (2) The words "and the Investment Projects" are added after the words "the Project" at the end of Section 5.03. (3) Section 6.03 is deleted and replaced by the following new Section: "Section 6.03. Cancellation by the Bank. If (a) the right of the Borrower to make withdrawals from the Loan Account shall have been suspended with respect to any amount of the Loan for a continuous period of thirty days, or (b) by the date specified in Section 2.04(d) of the Project Agreement no applications or requests referred to in paragraph (a) thereof shall have been received by the Bank in respect of any portion of the Loan, or having been so received, shall have been denied, or (c) after the Closing Date an amount of the Loan shall remain unwithdrawn from the Loan Account, or (d) the Bank shall have received notice from the Guarantor -17 - pursuant to Section 6.07 with respect to an amount of the Loan, the Bank may by notice to the Guarantor and the Borrower terminate the right of the Trustee or the Borrower to submit such applications or requests or to make withdrawals from the Loan Account, as the case may be, with respect to such amount or portion of the Loan. Upon the giving of such notice such amount or portion of the Loan shall be cancelled."