India - Mysore Agricultural Wholesale Markets Project : Credit 0378 - Project Agreement - Conformed

CONFORMED COPY CREDIT NUMBER 378 IN Project Agreement (Mysore Agricultural Wholesale Markets Project) BETWEEN INTERNATIONAL DEVELOPMENT ASSOCIATION AND AGRICULTURAL REFINANCE CORPORATION DATED MAY 9, 1973 CONFORMED COPY CREDIT NUMBER 378 IN Project Agreement (Mysore Agricultural Wholesale Markets Project) BETWEEN INTERNATIONAL DEVELOPMENT ASSOCIATION AND AGRICULTURAL REFINANCE CORPORATION DATED MAY 9, 1973 PROJECT AGREEMENT AGREEMENT, dated May 9, 1973, between INTERNATIONAL DEVELOPMENT ASSOCIATION (hereinafter called the Association) and AGRICULTURAL REFINANCE CORPORATION (hereinafter called ARC). WHEREAS by the Development Credit Agreement of even date herewith between India, acting by its President (hereinafter called the Borrower) and the Association, the Association has agreed to make available to the Borrower an amount in various currencies equivalent to eight million dollars ($8,000,000), on the terms and conditions set forth in the Development Credit Agreement, but only on condition, inter alia, that ARC agree to undertake such obligations towards the Association as hereinafter set forth; WHEREAS by an agreement of even date herewith between the Association and the State of Mysore, acting by its Governor, (hereinafter called Mysore), Mysore has agreed to undertake certain obligations in respect of the carrying out of the Project described in Schedule 2 to the Development Credit Agreement; WHEREAS by a subsidiary loan agreement to be entered into between the Borrower and ARC, the proceeds of the Credit under Category I will be made available to ARC, and ARC in turn will make the said proceeds available to the Participating Commercial Banks (as defined in the Development Credit Agreement) under a Refinance Agreement to be entered into between ARC and each Participating Commercial Bank; and WHEREAS ARC, 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. 4 ARTICLE II Execution of the Project Section 2.01. ARC shall carry out Part A of the Project, or cause said Part to be carried out, with due diligence and efficiency and in conformity with sound financial, administrative, engineering and town planning practices, and shall provide, or cause to be provided, promptly as needed, the funds, facilities, services and other resources required for the purpose. Section 2.02. (a) ARC shall enter into a subsidiary loan agreement with the Borrower under terms and conditions satisfactory to the Association, including, inter alia, those set forth in Schedule 4 to the Development Credit Agreement, as such Schedule may be modified from time to time with the agreement of the Association. (b) ARC shall enter into a refinance agreement with each PCB under terms and conditions satisfactory to the Association, including, inter alia, those set forth in Schedule 5 to the Development Credit Agreement, as such Schedule may be modified from time to time with the agreement of the Association. (c) ARC shall duly perform all its obligations under the Subsidiary Loan Agreement and under each Refinance Agreement. Except as the Association shall otherwise agree, ARC shall not take or concur in any action which would have the effect of amending, abrogating, assigning or waiving the Subsidiary Loan Agreement or any Refinance Agreement or any provision thereof included in Schedule 4 or 5 to the Development Credit Agreement. Section 2.03. Except as the Association shall otherwise agree, ARC shall take all necessary steps to ensure that all goods and services required for the Project and to be financed out of the proceeds of the Credit under Category I shall be procured in accordance with, and subject to, the provisions set forth or referred to in Schedule 3 to the Development Credit Agreement. Section 2.04. Except as the Association may otherwise agree, ARC shall cause all goods and services financed out of the proceeds of the Credit under Category I to be used exclusively for the Project. Section 2.05. ARC: (i) shall maintain or cause to be maintained records adequate to record the progress of Part A of the Project (including the cost thereof) and to identify the goods and services financed out of the proceeds of the Credit under Category I, and to disclose the use thereof in the Project; (ii) shall, without 5 limitation upon the provisions of Section 5.03 of this Agreement, enable the Association's representatives or cause them to be enabled to examine Part A of the Project, the goods financed out of such proceeds and any relevant records and documents; and (iii) shall furnish to the Association or cause the Association to be furnished all such information as the Association shall reasonably request concerning Part A of the Project, the expenditure of the proceeds of the Credit under Category I and the goods and services financed out of such proceeds. ARTICLE III Management and Operations of ARC Section 3.01. ARC shall: (a) at all times manage its affairs, maintain its financial position, plan its future expansion and carry on its operations, all in accordance with sound business and financial practices and under the supervision of experienced and competent management assisted by experienced and competent staff in adequate number; and (b) take all steps necessary to acquire, maintain and renew all rights, powers, privileges and franchises which are necessary or useful in the conduct of its business or in the carrying out of Part A of the Project. ARTICLE IV Financial Covenants Section 4.01. ARC shall maintain records adequate to reflect in accordance with consistently maintained appropriate accounting practices its operations and financial condition. Section 4.02. ARC shall: (i) establish and maintain separate accounts in respect of all funds disbursed and received on account of the Project: (ii) have its accounts and financial statements (balance sheets, statements of income and expenses and related statements) for each fiscal year audited, in accordance with sound auditing principles consistently applied, by independent auditors acceptable to the Association; (iii) furnish to the Association as soon as available, but in any case not later than four months after the end of each such year, (A) certified 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 (iv) furnish to the Association such other information concerning the accounts and financial statements of ARC and the audit thereof as the Association shall from time to time reasonably request. 6 ARTICLE V Consultation, Information and Inspection Section 5.01. The Association and ARC shall cooperate fully to assure that the purposes of the Credit will be accomplished. To that end, the Association and ARC shall from time to time, at the request of either party, exchange views through their representatives with regard to the performance of their respective obligations under this Agreement, the obligations of ARC under the Subsidiary Loan Agreement, the respective obligations of ARC and each PCB tinder each Refinance Agreement the administration, operations and financial condition of ARC and other matters relating to the purpose of the Credit. Section 5.02. The Association and ARC shall promptly inform each other of any condition which interferes with, or threatens to interfere with, the accomplishment of the purposes of the Credit, the performance by either of them of its obligations under this Agreement, the performance by ARC of its obligations under the Subsidiary Loan Agreement, or the performance by ARC and each PCB of their respective obligations under each Refinance Agreement. Section 5.03. ARC shall enable the Association's representatives to inspect all properties and its records and documents relevant to the Project. ARTICLE VI Effective Date; Termination; Cancellation and Suspension Section 6.01. This Agreement shall come into force and effect on the date upon which the Development Credit Agreement becomes effective. Section 6.02. (a) This Agreement and all obligations of the Association and of ARC thereunder shall terminate on the earlier of the following two dates: (i) the datc on which the Development Credit Agreement shall terminate in accordance with its terms; or (ii) a date when all principal amounts withdrawn by ARC under the Subsidiary Loan Agreement, and by each PCB under each Refinance Agreement, and all interest and charges thereon, shall have been repaid. 7 (b) If the Development Credit Agreement terminates in accordance with its terms before the date specified in paragraph (a)(ii) of this Section, the Association shall promptly notify ARC of this event. Section 6.03. All the provisions of this Agreement shall continue in full force and effect notwithstanding any cancellation or suspension under the Development Credit Agreement. ARTICLE VII Miscellaneous Provisions Section 7.01. 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 designated 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: INDEVAS Washington, D.C. For ARC: Managing Director Agricultural Refinance Corporation Shri Niketan F Block Shiv Sagar Estate Dr. Annie Besant Road Worli, Bombay, 18 W.B. India 8 Cable address: AGROFINANS Bombay Section 7.02. Any action required or permitted to be taken, and any documents required or permitted to be executed, under this Agreement on behalf of ARC may be taken or executed by its Managing Director or such other person or persons as ARC shall designate in writing. Section 7.03. ARC 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 ARC, take any action or execute any documents required or permitted to be taken or executed by ARC pursuant to any of the provisions of this Agreement. Section 7.04. This Agreement may be executed in several counterparts, each of which shall be an original, and all collectively but one instrument. IN WITNESS WHEREOF, the parties hereto, acting through their representatives thereunto duly authorized, have caused this Agreement to be signed in their respective names and delivered in the District of Columbia, United States of America, as of the day and year first above written. INTERNATIONAL DEVELOPMENT ASSOCIATION By /s/ I.P.M. Cargill Regional Vice President Asia AGRICULTURAL REFINANCE CORPORATION By /s/ Eric Gonsalves Authorized Representatie