Ecuador - Port Of Guayaquil Project : Loan 0212 - Loan Agreement - Conformed

LOAN NUMBER 212 EC Loan Agreement (Port of Guayaquil Project) BETWEEN INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT AND AUTORIDAD PORTUARIA DE GUAYAQUIL DATED OCTOBER 9, 1958 LOAN NUMBER 212 EC Loan Agreement (Port of Guayaquil Project) BETWEEN INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT AND AUTORIDAD PORTUARIA DE GUAYAQUIL DATED OCTOBER 9, 1958 1[vau Agrmunt AGREEMENT, dated October 9, 1958, between INTE1NA- TIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT (here- inafter called the Bank) and AUTORIDAD POR1TUA11A DE GUAY- AQJTIL (hereinafter called the Borrower). ARTICLE I Loan Regulations; Special Definitions 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 (said Loan Regulations No. 4 being hereinafter called the Loan Regulations), with the same force and effect as if they were fully set forth herein. SECTION 1.02. Unless the context shall otherwise require, the following terms shall have the following meanings: (a) the term "Charter ' shall mean Emergency Decree Law No. 15 of the Guarantor published in the Registro Oficial of the Guarantor dated April 12, 1958. (b) the term "Port " shall mean the area within the juris- diction of the Borrower as set forth in the Charter. (c) the term "New Port" shall mean the port facilities to be constructed as provided in Schedule 2. 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 thirteen million dollars ($13,000,000). SECTION 2.02. The Bank shall open a Loan Account on its books in the name of the Borrower and shall credit to 4 such Account the amount of the Loan. The amount of the Loan may be withdrawn from the Loan Account as provided in, and subject to the rights of cancellation and suspension set forth in, the Loan Regulations.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charge at the rate of three-fourths of one per cent (3/ of 1%/) per annum on the principal amount of the Loan not so withdrawn from time to time. Notwithstanding the provisions of Section 2.02 of the Loan Regulations, such commitment 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shall accrue from a date sixty days after the date of this Agreement to the respective dates on which amounts shall be withdrawn by the Borrower from the Loan Account as provided in Article IV of the Loan Regulations or shall be cancelled pursuant to Article V of the Loan Regulations.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 three-fourths per cent (5%/) 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 commit- ments entered into by the Bank at the request of the Bor- rower pursuant to Section 4.02 of the Loan Regulations shall be at the rate of one-half of one per cent ( of 1/o) 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 semi-annually on February 1 and August 1 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. 5 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 and services required to carry out the Project described in Schedule 2 to this Agreement. The specific goods and services to be financed out of the proceeds of the Loan and the methods and procedures for the procurement of such goods and services shall be determined. by agreement between the Bank and the Borrower, subject to modification by further agreement between them. SECTION 3.02. 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 exclu- sively in the carrying out of the Project. ARTICLE IV Bonds SiErION 4.01. The Borrower shall execute and deliver 13ods representing the principal amount of the Loan as provided in the Loan Regulations. SEcnoN 4.02. The Presidente dcl Directorio and the (lerente Genciral of the Borrower or either of them and such peisoin or persons as either of them shall appoint in writing are designated as authorized representatives of the Bor- rower for the purposes of Section 6.12 (a) of the Loan Reg- ulations. ARTICLE V Particular Covenants SECTION 5.01. (a) The Borrower -hall carry out the Project with due diligence and efficiency and in conformity with sound engineering aid financial practices. (b) In the carrying out of the Project the Borrower shall employ engineering coisultants, and, except as the Bank 6 and the Borrower shall otherwise agree, the Borrower shall employ contractors for the construction of the Project. The engineering consultants and the contractors, and the terms and conditions on which they are employed, shall be mutual- ly satisfactory to the Bank and the Borrower. (c) The Borrower shall furnish to the Bank, promptly upon their preparation, 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 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 the Project, the goods and any relevant records and documents; and shall furnish to the Bank all such informa- tion as the Bank shall reasonably 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 services thereof. The Borrower shall promptly inform the Bank of any condition which interferes with, or threatens to interfere with, the accomplishment of the purposes of the Loan or the maintenance of the service thereof. 7 SECTION 5.03. 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 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 com- mercial 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 5.04. 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 Agree- ment or the Bonds, or the payment of principal, interest or other charges thereunder; provided, however, that the pro- visions of this Section Oshall 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 5.05. 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 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 Guar- antee Agreement or the Bonds. 8 SECTION 5.06. Except as shall be otherwise agreed be- tween the Bank and the Borrower, the Borrower shall insure or cause to be insured the goods financed out of the proceeds of the Loan against risks incident to their purchase and importation into the territories of the Guarantor. Such insurance shall be consistent with sound commercial prac- tice and shall be payable in dollars or in the currency in which the cost of the goods insured thereunder shall be payable. SECTION 5.07. (a) The Borrower shall at all times main- tain its existence and right to carry on operations and shall, except as the Bank shall otherwise agree, take all steps necessary to maintain and renew all rights, powers, privi- leges and franchises which are necessary or useful in the conduct of its business, and shall not, except as the Bank and Borrower shall otherwise agree, amend or cause its Charter to be amended. (b) The Borrower shall operate and maintain the Port facilities all in accordance with sound engineering and financial practices. SECTION 5.08. The Borrcwer will establish charges for its services which are calculated to assure that, in any fiscal year after the Project shall have been completed, its total receipts from such charges will exceed its total expenses (except the provision for depreciation of plant and equipment and interest and other charges on long term debt) by an amount which is at least 150%c of the total service of long term debt of the Borrower. The Bor- rower covenants that it will maintain charges for its serv- ices calculated to maintain such an excess of receipts over expenses. If during any fiscal year of the Borrower the receipts from the charges of the Borrower for its services shall not be sufficient to yield such an excess of receipts from such charges over expenses then the Borrower will consult with the Bank to determine what corrective meas- ures shall be taken. 9 For the purposes of this Section 5.08 the term "service of long term debt " shall mean all payments on account of amortization and interest and other charges on all debt which by its terms matures more than one year after its date. Whenever for the purposes of this Section 5.08 it shall be necessary to value in Ecuadorian currency debt payable in another currency, such valuation shall be made on the basis of the rate of exchange at which such other currency is, at the time such valuation is made, obtainable for the purposes of servicing such debt. SECTION 5.09. The Borrower shall at all times employ a qualified and experienced general manager mutually satis- factory to the Bank and the Borrower and on terms and conditions mutually satisfactory to the Bank and the Bor- rower. SECTIoN 5.10. The Borrower will make adequate provi- sion for the recruitment and training of the personnel required for the operation of the New Port. 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 Regu- lations 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 outstand- ing 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. 10 ARTICLE VII Effective Date; Termination SECTION 7.01. The following events are specified as addi- tional conditions to the effectiveness of this Agreement within the meaning of Section 9.01 (a) (ii) and Section 9.01 (b) (ii) of the Loan Regulations: (a) that the Guarantee Agreement has been ratified by the Congress of the Republic of Ecuador; (b) that the Borrower holds clear and unencumbered title to the real property required for the carrying out of the Project, without any liability arising out of the acquisition of such title; (c) that the Borrower has fur-nished to the Bank evidence satisfactory to the Bank that the undertakings by Banco Central del Ecuador in Section 3.01 of the Guarantee Agreement contained are valid and bind- ing obligations of Banco Central del Ecuador; (d) that the Borrower has furnished to the Bank evi- dence satisfactory to the Bank that after the date of this Agreement and prior to the Effective Date Banco Central del Ecuador shall have taken no action which would have constituted a violation of the pro- visions of Section 3.01 of the Guarantee Agreement had it been effective on the date such action was taken. SECTION 7.02. The following are specified as additional matters, 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: (a) that the ratification of the Guarantee Agreement by the Congress of the Republic of Ecuador has been duly given; 11 (b) that the title of the Borrower to, or other interest in, the real estate where the Project is to be carried out, is free and clear of all liens, charges and encurn- brances; (c) that the undertakings by Banco Central del Ecuador in Section 3.01 of the Guarantee Agreement con- tained constitute valid and binding obligations of Banco Central del Ecuador in accordance with their terms. SECTION 7.03. A date 60 days after the date of this Agree- ment 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 January 31, 1963. SECTION 8.02. The following addresses are specified for the purposes of Section 8.01 of the Loan Regulations: For the Borrower: Autoridad Portuaria de Gutiayaquil Calle Pichincha 103 Guayaquil, Ecuador Or Apartado Postal 5739 Guayaquil, Ecuador Alternative address for cab] egrams and radiograms: Aportuaria Guayaquil 12 For the Bank: International Bank for Reconstruction and Development 1818 11 Street, N.W. Washington 25, D. C. United States of America Alternative aiddress for cablegrams and ractiograms: Intbafrad Washington, D. C. IN T.ITNESS WB.EREOF, the parties hereto, acting through their representatives thereunto duly authorized, have caused this Loan Agreement to be signed in their respective nmes and delivered 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/ DAVIDSON SOMMERS Vice President AUTORIDAD PORTUARIA DE GIJAYAQUJIL By /s/ JUAN X. MARCOS Authorized Representative 13 SCHEDULE 1 Amortization Schedule Payment of Principal Date Payment Due (expressed in dollars)* February 1, 1963 $163,000 August 1, 1963 168,000 February 1, 1964 173,000 August 1, 1964 178,000 February 1, 1965 183,000 August 1, 1965 188,000 February 1, 1966 194,000 August 1, 1966 199,000 February 1, 1967 205,000 August 1, 1967 211,000 February 1, 1968 217,000 August 1, 1968 223,000 February 1, 1969 229,000 August 1, 1969 236,000 February 1, 1970 243,000 August 1, 1970 250,000 February 1, 1971 257,000 August 1, 1971 264,000 February 1, 1972 272,000 August 1, 1972 280,000 February 1, 1973 288,000 August 1, 1973 296,000 February 1, 1974 305,000 August 1, 1974 313,000 February 1, 1975 322,000 August 1, 1975 332,000 February 1, 1976 341,000 August 1, 1976 351,000 February 1, 1977 361,000 August 1, 1977 372,000 February 1, 1978 382,000 August 1, 1978 393,000 February 1, 1979 405,000 August 1, 1979 416,000 February 1, 1980 428,000 August 1, 1980 440,000 February 1, 1981 453,000 August 1, 1981 466,000 February 1, 1982 480,000 August 1, 1982 493,000 February 1, 1983 508,000 August 1, 1983 522,000 * 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. 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 3 years before maturity. . / of 1% More than 3 years but not more than 6 years before maturity.............. More than 6 years but not more than 11 years before maturity.......... 1 More than 11 years but not more than 1M years before maturity.......... 2 More than 16 years but not more than 21 years before maturity.. ......... 3 Afore than 21 vears but not more than 23 years before maturity ............ 4%% More than 23 years before maturity. . . . % 15 SCHEDULE 2 Description of Project The Project consists of the construction of a new port for Guayaquil. It includes the following main features: 1. The main port facilities to be sited on the Estero del Muerto immediately north of the Estero Cobina will include the following: (a) A marginal wharf approximately 3,000 feet long with a 35-foot depth of water at low tide. (b) A filled area about 100 acres in extent adjoining the marginal wharf and of sufficient length to permit the extension of the marginal wharf by approxi- mately 1,800 feet at a later date. (c) Four transit sheds, paved storage areas, circulating roads, and ancillary buildings, including adminis- trative and customs buildings, workshops, garage, security building, and a gate house. (d) Water supply, electricity, sewage and communica- tions services. (e) Dredged areas to permit the berthing and swing- ing of vessels. 2. A channel approximately 400 feet wide, 31 feet deep at low water, and approximately ten miles long will be dredged in the Estero Salado. Arrangements will be made to ensure the future maintenance dredging of this channel. 3. A canal approximately 150 feet wide and 12 feet deep at low water will be constructed connecting the New Port with the River Guayas. The canal will be provided with a lock to regulate tidal flow. 4. Navigational aids will be provided in the Estero Salado. 5. Cargo handling equipment, minor floating equipment, and other miscellaneous equipment will be purchased.