Colombia - Agricultural Research And Extension Project I : Loan 2303 - Loan Agreement - Conformed

LOAN NUMBER 2303 CO DOCUMENTS Loan Agreement (Agricultural Research and Extension Project 1) betveen INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT and INSTITUTO COLOMBIANO AGROPECUARIO Dated , 1983 LOAN NUMBER 2303 CO LOAN AGREEMENT AGREEMENT, dated 7 , 1983, between INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT (herein- after called the Bank) and INSTITUTO COLOMBIANO AGROPECUARIO (hereinafter called the Borrower). 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 Guarantee Agreements of the Bank, dated October 27, 1980, with the same force. and effect as if they were fully set.forth herein. Section 1.02. Wherever used in this Agreement, unless the context otherwise requires, the several terms defined in the General Conditions and in the Preamble to this Agreement have the respective meanings therein set forth and the following addi- tional terms have the following meanings: (a) "Special Account" means the account ref erred to in Section 2.03 of this Agreement; (b) "Pesos" means the currency*of the Guarantor; and (c) "Scientific Premia" means any salary bonus paid by the Borrower to its professional staff under Part D of the Project. ARTICLE II The Loan Section 2.01. The Bank agrees to lend to the Borrower, on the terms and conditions set forth or referred to in this Loan Agreement, an amount in various currencies equivalent to six' three million four hundred thousand dollars ($63,400,000). Section 2.02. The amount of the Loan may be withdrawn from the Loan Account in accordance with the provisions of Schedule 1 to this Agreement, as such Schedule may be amended from time to time by agreement between the Borrower and the Bank, for expendi- tures made (or, if the Bank shall so agree, to be made) in -2 - respect of the reasonable cost of goods and services required for the Project described in Schedu'e'2 to "this Agreement and to be financed out of the proceeds of the Loan. Section 2.03. (a) The Borrower- shall, 'for purposes of Parts A, B, C and E of the Project, open a'Special Account on terms and conditions satisfactory to the Bank in a bank acceptable to the Bank. Payments out of the Special Account shall be made exclu- sively to pay the reasonable v costs in pesos for works and services required to carry, out Parts A, B, C and E of the Project. (b) , After .the .Effective Date and upon receipt by the Bank of: (A) evidence satisfactory to the Bank .that the Special. Account has been established; z(B) a certified copy.of an Acuerdo- de Gastos ordering payment. to, .or for the account of the Borrower of an amount equivalent to not less than $500,000 (determined as of the date of the Acuerdo) on account of the Project; and (C) an appropriate' withdrawal -plication, the Bank 'shall' arrange for deposit from the 'Loan Acco6unt 'into the Special Account of the equivalent -in terms of pes6s of the pioceeds -of the Loan then allocated to Category '(8) of t'he' allocation set forth in para- graph 1 of Schedule 1 to this'Agreement. (c) Any withdrawal'"of procP' of the Loan'on account of any expenditure under Category k. or on account of local expenditures under Categories (1)', (2), (3), (5) and (6), of said allocation shall be made thereafter at the request of 'the Bor- rower by a similar deposit from the Loan Account into the Special Account, provided, however, that no such withdrawal or depbsit shall be made unles' the Bank shall 'have 'received: (A) evidence" satisfactory to the Bank that the amounts payable on account of the Project under any previously issued Acuerdo de Gastos have been paid into the Special Account; and (B) a certified copy of an Acuerdo de Gastos ordering payment to or for the account of the Borrower of the portion of such expenditure that shall not be represented by' said withdrawal 'and deposit. . (d) Without limitation of " its- obligations' under Section 3.01 (a) of '"this Agreemeti, and subject to the' Guarantor's' obligation to provide the appropriate funds pursuant to Section 2.02 of the Guarantee Agreement, the Borrower shall: (i) not later than 30 days after the depisit by the Bank referred to' in paragraph (b) above, deposit in the Special Account the initial amount referred to in that paragraph; and (ii) thereafter, not later than 60 days after each . .. deposit made by the Bank in the Special Account . :pursuant to paragraph (c) above, pay into such Account the amount payable under the Acuerdo de Gastos referred to under (B) of that paragraph in . respect of such deposit. (e) The Borrower shall request the Guarantor in a timely manner the issuance of Acuerdos de Gastos to ensure that the Special Account has at all times funds sufficient to allow an efficient and diligent execution of Parts A, B, C and E of the Project. (f) The-Borrower shall, by June 1 and December 1 of each year, agree with the Guarantor and the Bank on the funding requirements for a timely and efficient execution of Parts A, B, C and E of the Project for the next following six-month period. (g) Prior to or at the time of each request for a deposit by the Bank into. the Special Account, the Borrower shall furnish to the Bank in respect of each payment made by the Borrower out of the Special Account such documents and other evidence as the Bank shall reasonably request, showing that the payment was made on account of the reasonable cost of goods or services required for. Parts A,..B, C and E of the Project and to be financed out of the proceeds of the Loan in accordance with Schedule 1 to this Agreement. (h) If the Bank shall have determined that any payment out of the Special Account (i) was made for any expenditure or in any amount not eligible for financing out of the proceeds of the Special Account or (ii) was not supported by the evidence furnished pursuant to paragraph (g) of this Section, the Borrower shall, promptly upon notice from the Bank and, unless otherwise determined by the Bank, prior to any further deposit in the Special Account by the Bank, deposit in the Special Account an amount equal to the amount of such payment not so eligible or justified. (i) Notwithstanding the provision of paragraph (a) of this Section, no further deposit in the Special Account shall be made by the Bank when the Bank shall have determined that all further withdrawals from the Loan Account can be made directly by the Borrower from the Loan Account under paragraph (a) of this Section, or when the total amount remaining unwithdrawn under Categories (1), (2), (3), (4), (5) and (6) of Schedule 1 to this Agreement less the amount of any qualified agreement to reimburse made by the Bank and of any special commitment entered into by the Bank pursuant to Section 5.02 of the General Conditions under such Categories, shall have reached the equivalent of $1,000,000 whichever shall be sooner. Withdrawal from the Loan Account of the remaining amount of the Loan assigned under said Categories (1), (2), (3), (4), (5) and (6) shall follow such procedures as shall be made only to the extent that the Bank shall be satisfied by the evidence submitted in support of the applications for such withdrawal that all payments by the Jorrower out of the Special Account were made on account of the reasonable costs of goods or services required for Parts A, B, C and E of the Project and to be financed out of the proceeds of the Loan in accordance with Schedule 1 to this Agreement. (j) The furnishings by the Borrower to the Bank of a certified copy of any Acuerdo de Gastos pursuant to paragraph (b) or (c) above, shall be deemed to be a representation by the Borrower to the Bank that the full amount that should be covered by such Acuerdo pursuant to paragraph (b) (B) or (c) (B) above is included in the amount or amounts provided to the Borrower under such Acuerdo. Section 2.04. Except as the Bank shall otherwise agree, procurement of the goods and civil works 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 this Agreement. Section 2.05. The Closing Date shall be June 30, 1990 or such later date as the Bank shall establish. The Bank shall promptly notify the Borrower and the Guarantor of such later date. Section 2.06. (a) The Borrower shall pay to the Bank a fee equivalent to one hundred fifty-eight thousand one hundred and five dollars ($158,105). (b) On or promptly after the Effective Date, the Bank shall, on behalf of the Borrower, withdraw from the Loan Account and pay to itself the amount of the said fee in such currency or currencies as the Bank shall determine. -5- Section 2.07. The Borrower shall pay to the Bank a commit- ment 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 2.08. (a) The Borrower shall pay interest on the principal amount of the Loan withdrawn and outstanding from time to time at a rate per annum for each Interest Period equal to one half percent per annum above the Cost of Qualified Borrowings for the last Semester ending prior to the commencement of such Interest Period. (b) As soon as practicable after the end of each Semester, the Bank shall notify the Borrower and the Guarantor of the Cost of Qualified Borrowings for such Semester. (c) For purposes of this Section: (i) "Interest Period" means the six-month period commencing-on each date specified in Section 2.09 of this Agreement, including the Interest Period in which this Agreement is signed. (ii) "Cost"9 of Qualified Borrowings means the cost, expressed as a percentage per annum, as reasonably determined by the Bank, provided that the amount of $8,520.5 million referred to in (iii) (B) hereunder shall be reckoned at a cost of 10.93% . per annum. (iii) "Qualified Borrowings" means (A) outstanding * borrowings of the Bank drawn down after June 30, 1982; and (B) until July 1, 1985, the amount of $8,520.5 million (representing borrowings of the Bank between July 1, 1981 and June 30, 1982) less any part thereof repaid earlier than July 1, 1985. (iv) "Semester" means the first six months or the second six months of a calendar year. Section 2.09. Interest and other charges shall be payable semiannually on March 1 and September 1 in each year. -6- Section 2.10. The Borrower shall repay the principal amount of the Loan in accordance with the amortization schedule set forth in Schedule 3 to this Agreement. ARTICLE III Execution of the Project Section 3.01. The Borrower shall carry out the Project with due diligence and efficiency and in conformity with appropriate administrative, financial, agricultural and livestock research and technology transfer practices. Section 3.02. In order to assist the Borrower in carrying out the Project, the Borrower shall employ training and agricul- tural research consultants whose qualifications, experience and terms and conditions of employment shall be satisfactory to the Bank, such consultants to be selected in accordance with prin-. ciples and procedures satisfactory to the Bank on the basis of the "Guidelines for the Use of Consultants by World Bank Bor- rowers and by the World Bank as Executing Agency" published by the Bank in August 1981. Section 3.03. The Bc)rrower shall: (a) by June 30, 1984, prepare in accordance with terms of reference satisfactory to the Bank, and furnish to the Bank for its review and comment, the study referred to in Part E of Schedule 2 to this Agreement; 0 (b) on the basis of such study and taking into considera- tion the Bank's comments, prepare not later than December 31, 1984, a plan of action for the improvement of the Borrower's technology transfer and extension activities, the preparation of such plan to include the review of the Borrower's agricultural research priorities and strategies. Section 3.04. The Borrower shall, by December 31, 1983, establish and thereafter maintain research consultative committees for the Borrower's research centers and stations, in numbers and with an organization and functions satisfactory to the Bank. -7- Secticn 3.05. The Borrower shall, by December 31, 1984, establish and thereafter maintain procedures, satisfactory to the Bank, for the carrying out of periodic reviews of the Borrower's overall agricultural research strategy and commodity research programs. Section 3.06. The Borrower shall: (a) jointly with the Guarantor, prepare and furnish to the Bank, by December 31, 1983, a plan of action for the reorganiza- tion of the Borrower with the purpose of divesting the Borrower from any regulatory and enforcement activities; (b) afford the Bank a reasonable opportunity to comment on such plan; and (c) not later than December 31, 1984 carry out such plan. Section 3.07. (a) The Borrower undertakes to insure, or make adequate provision for the insurance of, the imported goods to be financed out of the proceeds of the Loan against hazards incident to the acquisition, transportation and delivery thereof to the place of use or installation, and for such insurance any indem- nity shall be payable in a currency freely usable by the Borrower to replace or repair such goods. (b) The Borrower shall .cause all goods and services. financed out of the proceeds of the Loan to be used exclusively for the purposes of the Project. Section 3.08. (a) The Borrower shall furnish to the Bank, promptly upon their preparation, the plans, specifications, reports, contract documents and construction and prc.'azement schedules for the Project, and any material modifications thereof or additions thereto, in such detail as the Bank shall reasonably request. (b) The Borrower: (i) shall maintain records and procedures adequate to record and monitor the progress of the Project (including its cost and the benefits to be derived from it), to identify the goods and services financed out of the proceeds of the Loan, and to disclose their use in the Project; (ii)l shall enable the Bank's representatives to visit the facilities and construction sites included in the Project and to examine the goods financed out of the proceeds of the Loan and any relevant records and documents; and (iii) shall furnish to the Bank at regular intervals all such information as the Bank shall reason- ably request concerning the Project, its cost and, where appro- priate, the benefits to be derived from it, the expenditure of the proceeds of the Loan and the goods and services financed out of the proceeds. (c) Upon the award by the Borrower of any contract for goods, works or services to be financed out of the proceeds of the Loan, the Bank may publish a description thereof, the name and nationality of the party to whom the contract was awarded and the contract price. (d) The Borrower shall enable the Bank's representatives to examine all plants, installations, sites, works, buildings, property and equipment of the Borrower and any of the Borrower's records and documents which are relevant to the Project. (e) Promptly after completion of the Project, but in any event not later than six months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the Bank, the Borrower shall prepare and furnish to the Bank a report, of such scope and in such detail as the Bank shall reasonably request, on the execution and initial operation of the Project, its cost and the benefits derived and to be derived from it, the performance by the Borrower and the Bank. of their respective obligations under the Loan Agreement and the accomplishment of the purposes of the Loan. ARTICLE IV Management and Operations of the Borrower Section 4.01. The Borrower shall carry on its operations and conduct its affairs in accordance with sound administrative, financial and agricultural and livestock research and technology transfer practices and shall employ and maintain qualified and experienced management assisted by competent staff in adequate numbers. -9- Section 4.02. The Borrower shall at all times operate and maintain its plants, machinery, equipment and other property, and from time to time, promptly as needed, make all necessary repairs and renewals thereof, all in accordance with round engineering, financial and agricultural and livestock research and technology transfer practices. Section 4.03. The Borrower 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 V Financial Covenants Section 5.01. (a) The Borrower shall maintain records and separate accounts adequate to reflect in accordance w.lth consistently maintained appropriate accounting practices its operations and financial condition and the operations and financial condition of the Special Account, including, without limitation to the foregoing, separate accounts reflecting (i) all expenditures on account of which withdrawals are requested from the Loan Account on the basis of statements of, expenditure, and (ii) all deposits out of the proceeds of the Loan into the Special Account. (b) The Borrower shall retaIn, until one, year after the Closing Date, all records (contracts, orders, invoices, bills, receipts and other documents) evidencing the expenditures on account of which withdrawals are requested, from the Loan Account on the basis of statements of expenditure, and shall enable the Bank's representatives to examine such records.. Section 5.02. The Borrower shall: (a) have its accounts and financial statements (balance sheets, statements of income and expenses and related statements) for each fiscal year audited, in accordance with appropriate auditing principles consistently applied, by independent auditors acceptable to the Bank; (b) furnish to the Bank as soon as available, but in any case not later than six months after the end of each such year: (i) certified copies of its financial statements for such year as -10- so audited; (ii) the report of such audit by said auditors, of such scope and in such detail as the Bank shall have reasonably requested, including, without limitation to the foregoing, separate opinions by said auditors in respect of the expenditures and records referred to in Section 5.01 (b) of this Agreement, as to whether the proceeds of the Loan withdrawn from the Loan Account on the basis of statements of expenditure have been used for the purpose for which they were provided; (c) furnish to the Bank such other information concerning said accounts, financial statements,-records,and expenditures, as well as the audit thereof, as the Bank shall from time to time reasonably request; and (d) without limitation to the. provisions of paragraphs (a), (b) and (c) above, in respect of the Special Account, (i) for each semester starting January 1 and July 1 in each year respectively, have such Account 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 three months after the end of each auditing period, the report of such audit by said auditors, of such scope and in such detail as the Bank shall reasonably request, including without limitation to the foregoing a separate opinion by said auditors as to whether the proceeds of the Loan withdrawn from the Special Account on the basis of certificates of expendi- tures. were used to make payments for goods received, or works or services were eligible for financing under this Agreement and were used in the carrying out of Parts A, B, C and E of the Project; and (iii) furnish to the Bank (A) each month, certified statements of the Special Account, and (B) such other information concerning such Account and the said certificates of expenditures and the audit thereof as the Bank shall from time to time, reasonably request. - 11 - Section 5.03. (a) The Borrower represents that at the date of this Agreement no lien exists on any of its assets as security for any debt except as otherwise currently reported to the Bank or stated in writing. (b) The Borrower undertakes that, except as the Bank shall otherwise agree: (1) if the Borrower shall create any lien on any of its assets as security for any debt, such lien will 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; and (ii) if any statutory lien shall be created on any assets of the Borrower as security for any debt, the Borrower 0 shall grant, aL no cost to the Bank, an equivalent lien satis- factory to the Bank to secure the payment of the principal of, and interest and other chrges on, the Loan; 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 as security for the payment of debt incurred for the purpose of financing the purchase 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. Section 5.04. The Borrower shall, by June 30, 1984, review its current accounting system with a view to design a new system to improve the presentation and flow of accounting information to the Borrower's management. Section 5.05. The Borrower shall take all the necessary actions to ensure that: (a) the funds allocated in its budget for research programs, maintenance and operations of each of the Borrower's research centers or stations and technology transfer divisions are iirectly and timely made available to the corre- sponding research center or station, or research program or technology transfer division; and (b) a working fund in adequate amounts shall be established and maintained for each of the Borrower's research centers and stations to cover day-to-day expenses. ARTICLE VI Remedies of the Bank Section 6.01. For the purposes of Section 6.02 of the General Conditions, the following additional event is specified -12 - pursuant to paragraph (k) thereof, namely, that Decrees No. 2420 and 133, dated September 19, 1968 and January 26, 1976, respec- tively, of the Guarantor shall have been amended, suspended, abrogated, repealed or waived so as to, in the Bank's opinion, affect materially and adversely the ability of the Borrower to perform any of its obligations under this Agreement. Section 6.02. For the purposes of Section 7.01 of the General Conditions, the following additional event is specified pursuant to paragraph (h) thereof, namely, that the event specified in Section 6.01 of this Agreement shall occur. ARTICLE VII Effective Date; Termination 0 Section 7.01. The following event is specified as an additional condition to the effectiveness of the Loan Agreement within the meaning of Section 12.01 (c) of the General Conditions, namely that the Special Account has been established. Section 7.02. The date , is hereby specified for the purpose of Section 12.04 of the General Conditions. ARTICLE VIII Addresses Section 8.01. 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 I Street, N.W. Washington, D.C. 20433 United States of America Cable address: INTBAFRAD Washington, D.C. - 13 - For the Borrower: Instituto Colombiano Agropecuario Apartado A'reo 7984 Bogota Colombia Cable address: ICA Bogota IN WITNESS WHEREOF, the parties hereto, acting through their O representatives thereunto duly authorized, 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 RECONSTRUCTION AND DEVELOPMENT By Regional Vice President Latin America and the Caribbean 0 INSTITUTO COLOMBIANO AGROPECUARIO By Authorized Representative -14-, SCHEDULE 1 Withdrawal of the Proceeds of the Loan 1. The table below sets forth the Categories of items to be financed out of the proceeds of the Loan, the allocation of the amounts of the Loan to each Category and the percentage of expenditures for items so to be financed in each Category: Amount of the Loan Allocated % of (Expressed in Expenditures Category Dollar Equivalent) to be Financed (1) Civil works 6,200,000 100% (2) Equipment, 24,600,000 100% of foreign materials, expenditures and agrochemicals, 60% of local spare parts and expenditures furniture (3) Vehicles 6,600,000 100% of foreign expenditures and 60% of local expenditures (4) Incremental 5,550,000 60% of local operating expenditures expenses (5) Consultants' services: (a) under Part A of the Project 400,000 100% (b) under Part B of the Project 400,000 100% (c) under Part E of the Project 50,000 100% -15- Amount of the Loan Allocated % of (Expressed in Expenditures Category Dollar Equivalent to be Financed (6) Training 8,800,000 100% of foreign expenditures and 60% cif local expenditures (.7) Scientific Premia 4,700,000 50% of local expenditures (8) Initial Deposit 500,000 Amount due under in Special Account Section 2.03 of this Agreement (9) Fee 158,105 Amount due under Section 2.06 of this Agreement (10) Unallocated 5,441,895 TOTAL 63,400,000 2. .- For the purposes of this Schedule: * (a) the term "foreign expenditures" means expenditures in the currency of any country other than the Borrower and for goods or services supplied from the territory of any country other than the Borrower; (b) the term "local expenditures" means expenditures in the currency of the Borrower or for goods or services supplied from the territory of the Borrower; and (c) the term "Incremental Operating Expenses" means operating expenses incurred by the Borrower in connection with the carrying out of the Project, excluding salaries, benefits and related contributions. 3. The disbursement percentages have been calculated in com- pliance with the policy of the Bank that no proceeds of the Loan -16 shall be disbursed on account of payments for taxes levied by, or in the territory of, the Guarantor on goods or services, or on the importation, manufacture, procurement or supply thereof; to that end, if the amount of any such taxes levied on or in respect of any item to- be financed out of the proceeds of the Loan decreases or increases, the Bank may, by notice to the Borrower, increase or decrease the disbursement percentage then applicable to such item as required to be consistent with the aforementioned policy of the Bank. 4. Notwithstanding the provisions of paragraph 1 above, no withdrawals shall be made in respect of: (a) expenditures made prior to the date of this Agreement, except that withdrawals, in an aggregate amount not exceeding the equivalent of $1,000,000, may be made in respect of Categories (1), (2), (4), (5) (a) and (5) (c), on account of payments made for sunch expenditures before that date but after January 1, 1983; (b) expenditures on account of Categories (6) unless the Bank is furnished with a plan, satisfactory to the Bank, for the carrying out of Part C of the Project; (c) any expenditure on account of Category (4) or .(7) unless: (i) the. Bank is furnished with evidence, satisfactory to the Bank, that such expenditure was made in -accordance with criteria acceptable to the Bank; and (ii) the sum of the aggre- gate amount already disbursed under Category (4) or (7), as the case may be, during a calendar year plus the amount to be dis- bursed in respect to such expenditure in the same calendar year does not exceed, during such year, the yearly. limit- for expendi- tures to be disbursed on account of the respective Category, each such limit to be annually determined by the Bank on a declining basis; and (d) any expenditure under Part A (b) of the Project, unless the Bank is furnished with a detailed plan, satisfactory to the Bank, for the carrying out of such Part of the Project. 5. Notwithstanding the allocation of an amount of the Loan or the disbursement percentages set forth in the table in paragraph I above, if the Bank has reasonably estimated that the amount of the Loan then allocated to any Category will be insufficient to finance the agreed percentage of all expenditures in that - 17 - Category, the Bank may, by notice to the Borrower: (i) reallocate to such Category, to the extent required to meet the estimated shortfall, proceeds of the Loan which are then allocated to another Category and which in the opinion of the Bank are not needed to meet other expenditures; and (ii) if such reallocation cannot fully meet the'estimated shortfall, reduce the disburse- ment percentage then applicable to such expenditures in order that further withdrawals under such Category may continue until all expenditures thereunder shall have been made. 6. If the Bank shall have reasonably determined that the pro- curement of any item in any Category is inconsistent with the procedures set forth or referred to in this Agreement, no expenditures for such item shall be financed out of the proceeds of the Loan and the Bank may, without in any way restricting or limiting any other right, power or remedy of the Bank under the Loan Agreement, by notice to the Borrower, cancel such amount of the Loan as, in the Bank's reasonable opinion,' represents the amount of such expenditures which would otherwise have been eligible for financing out of the proceeds of the Loan. O -18 SCHEDULE 2 Description of the Project The main purposes of the Project are the rehabilitation and the improvement of the Borrower's agricultural and livestock. research and technology transfer activities. The Project consists of the following Parts:. Part A: (a) Rehabilitation and development of about 15 of the Borrower's existing agricultural and livestock research centers and stations 'and about two of the Borrower's existing veterinary laboratories, including the employment of about 300 new researchers and about L,00Q. new technical support staff, for the carrying out of. commodity research programs and related support, programs... (b) .Establishment .of one new agricultural and livestoc. research station.' . Part B: Improvement of the Borrower's management and accounting systems and monitoring and evaluation of its agricultural and livestock research and technology transfer activities. Part C: Training of about 270 of the Borrower's agricultural and livestock research and technology transfer staff members at the post graduate level, and prdvision of short-term courses to about 250 of the Borrower's research and support staff members. Part D: Improvement of the Borrower's agricultural and live- stock research and -transfer of technology activities through the provision of Scientific Premia to attract and retain highly qualified professional staff. Part E: A study to provide a basis for a national plan of action aimed at improving and coordinating all forms of technical assistance to the Colombian agricultural sector with special emphasis on the improvement of the Borrower's technology transfer and extension activities. The Project is expected to be completed by June 30, 1989. - 19 - SCHEDULE 3 Anjrtization Schedule Payment of Principal Date Payment Due (expiessed in dollars)* On each March 1 and September 1 beginning March 1, 1988 through March 1, 2000 2,440,000 On September 1, 2000 2,400,000 The figures in this column represent dollar equivalents determined as of the respective dates of withdrawal; see General Conditions, Section 3.04. -20- Premlums.,on Prepayment The following percentages are specified as the premiums payable on repayment 't-advance of maturity of any portion of the principal amount of the Loan pursuant to Section 3.04 (b) of the General Conditions:. Time of Prepayment Premium The interest rate (ex- pressed as a percentage per annum) applicable to the balance outstanding on. the Loan on the day of prepayment multiplied by: Not more than three years 0.18 before maturity More than three years but 0.35 not more than six years before maturity More than six years but 0.65 not more than eleven years before maturity More than eleven years but 0.88 not more than fifteen years before maturity More than fifteen years 1.00 before maturity - 21 - SCHEDULE 4 Procurement A. International Competitive Bidding 1. Except as provided in Part C hereof, goods and equipment shall be procured under contracts awarded in accordance with pro- cedures consistent with those set forth in the current edition of the "Guidelines for Procurement under World Bank Loans and IDA Credits" published by the Bank in March 1977 (hereinafter called the Guidelines), on the basis of international competitive bid- ding as described in Part A of the Gnidelines. 2. For goods and works to be procured on the basis of inter- national competitive bidding, and in addition to the requirements of paragraph 1.2 of the Guidelines, the Borrower shall prepare and forward to the Bank as soon as possible, and in any event not later than 60 days prior to the date of availability to the public of the first tender or prequalific,tion documents relating thereto, as the case may be, a general procurement notice, in such form and detail and containing such information as the Bank shall reasonably request; the Bank will arrange for the publica- tion of such notice in order to provide timely notification to prospective bidders of the opportunity to bid for the goods and works in question. The Borrower shall provide the necessary information to update such notice annually so long as any goods or works remain to be procured on the basis of international competitive bidding. 3. For the purpose of evaluation and comparison of bids for the supply of goods to be procured on the basis of international com- petitive bidding: (i) bidders shall be required to state in their bid the c.i.f. (port of entry) price for the -imported goods, *or the ex-factory price or off-the-shelf price of other goods offered in such bid; (ii) customs duties and other import taxes levied in connection with the importation, or the sales and similar taxes levied in connection with the sale or delivery, pursuant to the bid, of the goods shall not be taken into account in the evaluation of the bids; and (iii) the cost of inland freight and other expenditures incidental to the delivery of the goods to the place of their use or installation shall be included. - 22 B. Preference for Domestic Manufacturers In the procurement of goodp .in accordance with the proce- dures described in Part A of this Schedule, goods manufactured in Colombia may be granted a margin of preference in accordance with, and subject to, the following provisions: 1. All bidding documents for the procurement of goods shall clearly indicate .any preference which, will' 'be granted, the information required to establish the eligibility of a bid for such preference and .the, following methods and stages that will be. followed in the evaluation and cqpparson..of bds. 2. After evaluation, responsive bids will be classified in one of the following three groups: (1) Group A:.,.bids offering goods manufactured. in Colombia if the bidder shall have established .to' the. satisfaction of the Borrower and the Bank that the manufacturing cost of such goods' includes a value added in Colombia equal to at least 20% .of the ex-factory bid price of such goods. (2) Group B: all other .domestic bids. (3) Group C:.. bids offering any other goods., 3. In order,, to - determine the lowest evaluated bid of each group, all evaluated bids in each group shall first be compared among themselves, without taking into account customs duties and other import taxes levied in connection,with.,the importation, and sales and ,similar taxes levied in connection with the sale. or delivery, pursuant, to, the. ..bids,. of the goods. $uch lowest evaluated,bids shall ..then be compared with each other, and if, as a result of this comparison, a bid from group A or group.B is, the lowest,,it shall be selected..for the award.. . . 4. If, -as a result of. the, comparison under paragraph 3. above, the lowest bid is a.bid.from group C, all group C bids shall be further compared with the lowest evaluated bid from group-A after adding to the evaluated bid price of the imported goods offered in each group C bid, for-the purpose of this further comparison only, an amount equal to: (i) the amount of customs duties and other import taxes which a non-exempt importer would have to pay - 23 - for the importation of the goods offered in such group C bid; or (ii) 15% of the c.i.f. bid price of such goods if said customs duties and taxes exceed 15% of such price. If the group A bid in such further comparison is the lowest, it shall be selected for the award; if not, the bid from group C which as a result of the comparison under paragraph 3 is the lowest evaluated bid shall be selected. C. Other Procurement Procedures Civil works estimated to cost the equivalent of $50,000 or more, and contracts for goods estimated to cost, after grouping in accordance with appropriate procurement standards, the equiva- lent of less than $100,000 up to an aggregate amount equivalent to $3,000,000, shall be procured through .local competitive bid- ding procedures acceptable to the Bank, with foreign bidders having the opportunity to participate. D. Review of Procurement Decisions by the Bank 1. Review of invitations to bid and of proposed awards and final contracts: With respect to all contracts for goods estimated to cost the equivalent of $150,000 or more and to all contracts for civil works estimated to cost the equivalent of $700,000 or more: (a) Before bids are invited, the Borrower shall furnish to the Bank, for its comments, the text of the invitations to bid Oand the specifications and other bidding documents, together with a description of the advertising procedures to be followed for the bidding, and shall make such modifications in the said docu- ments or procedures as the Bank shall reasonably request. Any further modification to the bidding documents -shall require the Bank's concurrence before it is issued to the prospective bidders. (b) After bids have been received and evaluated, the Borrower shall, before a final decision on the award is made, inform the Bank of the name of the bidder to which it intends to award the contract and shall furnish to the Bank, in sufficient time for its review, a detailed report on the evaluation and comparison of the bids received, and such other information as the Bank shall reasonably request. The Bank shall, if it deter- mines that the intended award would be inconsistent with the -24- Guidelines or this Schedule, promptly inform the Borrower and state the reasons for such determination. (c) The terms and conditions of the contract shall not, without the Bank's concurrence, materially differ from those on which bids were asked or prequalification was invited. (d) Two conformed copies of the contract shall be furnished to the Bank promptly after its execution and prior to the submis- sion to the Bank of the first application for withdrawal of funds from the Loan Account in respect of -such contract. 2. With respect to each coatract not governed by the preceding paragraph (except for contracts on account of which withdrawals are allowed from the Loan Account on the basis of statements of expenditures), the Borrower shall furnish to the Bank, promptly after its execution and prior to the submission to the Bank of the first application for withdrawal of funds from the Loan Account in respect of such contract, two conformed copies of such contract, together with the analysis of the respective bids, recommendations for award and such other information as the Bank shall reasonably request. The Bank shall, if it determines that the award of the contract was not consistent with the Guidelines or this Schedule, promptly inform the Borrower and state the reasons for such determination. 3. Before agreeing to any material modification or waiver of the terms and conditions of a contract, or granting an extension of the stipulated time for performance of such contract, or issuing any change order under such contract (except in cases of extreme urgency) which would increase the cost of-the contract by more than 20% of the original price, the Borrower shall inform the Bank of the proposed modification, waiver, extension or change order and the reasons therefor. The Bank, if it determines that the proposal would be inconsistent with the provisions of this Agreement, shall promptly inform the Borrower and state the reasons for its determination. E. Procurement without Contracting Civil works estimated to cost less than the equivalent of $50,000 may be carried out through the use of force account. 01INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT CERTIFICATE I hereby certify that the foregoing is a true copy of the original in the archives of the Interna- tional Bank for Reconstruction and Develop- ment. In witness whereof I have signed this Certifi- 0 cate and affixed the Seal of the Bank thereunto this N day of 64m 198 FOR SECRETARY