France - Iron Ore Project : Loan 0249 - Guarantee Agreement - Conformed

LOAN NUMBER 249 FR Guarantee Agreement (Iron Ore Project) BETWEEN REPUBLIC OF FRANCE AND INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT DATED MARCH 17, 1960 LOAN NUMBER 249 FR Guarantee Agreement (Iron Ore Project) BETWEEN REPUBLIC OF FRANCE AND INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT DATED MARCH 17, 1960 AGREEMENT, dated March 1'7, 1960, between REPUBLIC * OF FRANCE (hereinafter called the Guarantor) and INTER- NATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT (hereinafter called the Bank). WHEREAS by agreement of even date herewith between the Bank and Societe' Anonyme des Mines de Fer de Mauri- tanie, " Mif erma"I (hereinafter called the Borrower), which agreement and the schedules therein referred to are here- inafter called the Loan Agreement, the Bank has agreed to make to the Borrower a loan in various currencies equiv- alent to sixty-six million dollars ($66,000,000), on the terms and conditions set forth in the Loan Agreement, but only on condition that the Guarantor agree to guarantee the obligations of the Borrower in respect of such loan as here- inafter provided; and 0 WHEREAS Republic of Mauritania, in consideration of the Bank's entering i.nto the Loan Agreement with the Bor- rower, has agreed to guarantee such loan as provided in the Republic of Mauritania Guarantee Agreement; and WHEREAS the Guarantor, in consideration of the Bank's entering into the Loan Agreement with the Borrower, has agreed to guarantee such loan as hereinafter provided; Now THEREFORE the parties hereto hereby agree as follows; ARTICLE I SECTION 1.01. The parties to this Guarantee Agreement accept all the provisions of Loan Regulations No. 4 of the Bank dated J-une 15, 1956, subject, however, to the modifi- cations thereof set forth in Schedule 3 to the Loan Agree- ment (said Loan Regulations No. 4 as so modified being hereinafter called the Loan Regulations), with the same force and effect as if they were fully set forth herein. 4 SECTION 1.02. The terms defined in the Loan Agreement shall have the same meaning herein. ARTICLE II SECTION 2.01. Without limitation or restriction upon any of the other covenants on its part in this Agreement con- tained, the Guarantor hereby unconditionally guarantees, as primary obligor and not as surety merely, the due and punctual payment of the principal of, and the interest and other charges on, the Loan, the principal of and interest on the Bonds, and the premium, if any, on the prepayment of the Loan or the redemption of the Bonds, all as set forth in the Loan Agreement and in the Bonds. ARTICLE III SECTION 3.01. It is the mutual understanding of the Guarantor and the Bank that, except as otherwise herein provided, the Guarantor will not grant in favor of any external debt any preference or priority over the Loan. To that end, the Guarantor undertakes that, except as other- wise herein provided or as shall be otherwise agreed be- tween the Guarantor and the Bank, if any lien shall be created as security for any external debt of the Guarantor or if any lien shall be created by action of the Guarantor as security for any external debt, such lien shall 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 shall be made to that effect. This Section shall not apply to the following: (a) the creation of any lien on any property purchased at the time of the purchase, solely as security for the pay- ment of the purchase price of such property; (b) any pledge in the ordinary course of banking busi- ness to secure any indebtedness maturing not more than one year after its date. 5 For the purposes of this Section, the expression "debt of the Guarantor" shall include debt as to which the Guar- antor has guaranteed payment and the term "Guarantor" as used in such expression shall include any territorial sub- division of the Republic of France which has power to raise revenues by taxation and to charge any of its assets as security for external debt. SECTION 3.02. (a) The Guarantor and the Bank shall co- operate 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 re- quest with regard to the general status of the Loan. On the part of the Guarantor, such information shall include in- formation with respect to financial and economic conditions in the territories of the Guarantor and the international balance of payments position of the Guarantor. (b) The Guarantor and the Bank 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 service thereof. The, Guarantor shall promptly inform the Bank of any condition which inter- feres with, or threatens to interfere with, the accomplish- ment of the purposes of the Loan or the maintenance of the service thereof. (c) The Guarantor shall afford all reasonable opportu- nity for accredited representatives of the Bank to visit any part of the territories of the Guarantor for purposes related to the Loan. SECTION 3.03. The principal of, and interest and other charges on, the Loan and the Bonds shall be paid without deduction for, and free from, any taxes or fees imposed under the laws of the Guarantor or laws in effect in its territories; provided, however, that the provisions of this 6 Section shall not apply to taxation of, or fees upon, pay- ments under any Bond to a holder thereof other than the Bank when such Bond is beneficially owned by an indi- vidual or corporate resident of the Guarantor. SECTION 3.04. This Agreement, the Loan Agreement, the Republic of Mauritania Guarantee Agreement and the Bonds shall be free from any taxes or fees that shall be imposed under the laws of the Guarantor or laws in effect in its territories on or in connection with the execution, issue, delivery or registration thereof. SECTION 3.05. The principal of, and interest and other charges on, the Loan and the Bonds shall be paid free from all restrictions imposed under the laws of the Guarantor or laws in effect in its territories. ARTICLE IV SECTION 4.01. The Guarantor shall endorse, in accord- ance with the provisions of the Loan Regulations, its guar- antee on the Bonds to be executed and delivered by the Borrower. The Minister of Finance of the Guarantor and such person or persons as he shall designate in writing are designated as the authorized representatives of the Guar- antor for the purposes of Section 6.12 (b) of the Loan Regulations. ARTICLE V SECTION 5.01. The following addresses are specified for the purposes of Section 8.01 of the Loan Regulations: For the Guarantor: Ministere des Finances Paris ler, France Alternative address for cablegrams and radiograms: Ministere Finances Paris, France 7 For the Bank: International Bank for Reconstruction and Development 1818 H Street, N.W. Washington 25, D. C. United States of America Alternative address for cablegrams and radiograms: Intbafrad Washington, D. C. SECTION 5.02. The Ambassador of Republic of France and of the Community in Washington is designated for the purposes of Section 8.03 of the Loan Regulations. IN WITNESS WHEREOF, the parties hereto, acting through their representatives thereunto duly authorized, have caused this Guarantee Agreement to be signed in their re- spective names and delivered in the District of Columbia, United States of America, as of the day and year first above written. REPUBLIC OF FRANCE )y HERVE ALPHAND Authorized Representative INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT by J. BURKE KNAPP Vice President