Dominican Republic - Second Education Project : Loan 1142 - Amending Agreement - Conformed

II LOAN NUMBER 1.142 DO Amending Agreement (Second Education Project) between DOMINICAN REPUBLIC and INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT Dated , 19 82 LOAN NUMBER 1142 DO AMENDING AGREEMENT AGREEMENT, dated , 1982, between DOMINICAN REPUBLIC (hereinafter called the Borrower) and INTER- NATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT (hereinafter called the Bank). WHEREAS by a Loan Agreement (hereinafter called the Loan Agreement), dated July 17, 1975, between the Borrower and the Bank, the Bank has made a loan to the Borrower in an amount in various currencies equivalent to eight million dollars ($8,000,000) on the terms and conditions set forth in the Loan Agreement; and WHEREAS the Borrower and the Bank have agreed to certain changes in the Loan Agreement and, for such purpose, have agreed to enter into this Agreement (hereinafter called the Amending Agreement), upon the terms and conditions hereinafter set forth; NOW THEREFORE, the parties hereto hereby agree as follows: ARTICLE I Section 1.01. The Loan Agreement is amended as follows: (a) Section 1.02 is deleted and the following new Section 1.02 is added: "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) "Project Unit" means the Project implementa- tion unit maintained for the purpose of carrying out the Project, as required by Section 3.04 of this Agreement; (b) "Special Account" means the account to be opened pursuant to Section 2.02 (b) of this Agreemer.t; (c) "Project Account" means the account to be opened pucsuant to Section 3.01 (b) of this Agree- ment; and -2- (d) "peso" means the currency unit of the Borrower." (b) Section 2.02 is amended by adding "(a)" before the first sentence of the Section and by adding the following paragraphs (b) through (g) to the Section: "(b) The Borrower shall, for purposes of Parts A, C and D of the Project, establish and maintain a Special Account in Banco Central de la Repfiblica Dominicana (hereirafter called Banco Central), on terms and conditions satisfactory to the Bank. Disbursements from the Special Account shall be made exclusively to finance the reasonable cost of goods and services required to carry out Parts A, C and-D of the Project. (c) The Bank shall, promptly after the effective- neg of the Amending Agreement and upon receipt of a withdrawal request from the Borrower, withdraw on behalf of the Borrower from the Loan Account and deposit in the Special Account the proceeds of the Loan allocated to Category (7)-of the table set forth in paragraph 1 of Schedule 1 to this Agree- iunt,. Thereafter, at the request of the Borrower, the Bank shall further so withdraw on behalf of the Borrower from the Loan Account and deposit in the Special Account such amounts as shall be required to reimburse the Borrower for payments made out of the Special Account for expenditures for Parts A,, C and D of the Project eligible for financing under this Agreement, but only to the extent that the amount of any such deposit, together with any amount remaining-un deposit in the Special Account as of the date of such request, shall not exceed in the aggregate the equivalent of $280,000. Except as the Bank shall otherwise determine, each such deposit after the first deposit shall be withdrawn by the Bank on behalf of the Borrower from the Loan Account under Category (1) o,f paragraph 1 of Schedule 1 to this Agreement, and in the same respective amounts as have been justified by the evidence supporting the request for such deposit furnished pursuant to paragraph (e) of this Section. -3- (d) Prior to or at the time of each request for a withdrawal by the Borrower from the Special Account, the Borrower shall- furnish to Banco Central, in respect of each payment made by the Borrower, an application for withdrawal containing such statements and agreements as shall be satis- factory to the Bank and Banco Central. Banco Central shall authorize the Borrower to withdraw from the Special Account on the basis of the foregoing application, an amount in pesos deter- mined on the basis of the rate of exchange between the dollar and the peso in effect at the time of the withdrawal from the Special Account. (e) Prior to or at the time of each request by, the Borrower for a deposit by the Bank on behalf of the Borrower 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 and services required for Parts A, C or D of the Project and to be financed out of the proceeds of the Loan. (f) If the Bank shall have determined that any payment out of the Special Account (i) was made for )ny expenditure or in any amount not eligible for inancing from the Loan Account, or (ii) was not justified by the evidence furnished pursuant to paragraph (e) 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 or the portion thereof not so eligible or justified. (g) Notwithstanding the provision of paragraph (c) of this Section, no further deposit in the Special Account shall be requested by the Borrower when the Bank shall have determined that all further with- drawals from the Loan Account may be made directly -4 by the Borrower from the Loan Account under para- graph (a) of this Section, or when the total amount withdrawn from the Loan Account under Category (1) of paragraph 1 to Schedule 1 to this Agreement plus 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, shall have reached the equivalent of $2,000,000, whichever shall be sooner. Withdrawals from the Loan Account of the remaining amount of the Loan allocated to Parts A, C and D of the Project shall follow such procedures as shall be agreed between the Borrower and the Bank and shall be made only to the extent that the Bank shall be satisfied by the evidence furnished in support of the application for such withdrawal that all payments by the Borrower out of the Special Account were made on account of the reasonable cost of goods or services required for Parts A, C or D of the Project and to be financed out of the proceeds of the Loan in accordance with this Agreement." (c) Section 3.01 is amended by adding "(a)" before the first sentence of the Section and by adding the foll6wing paragraph (b) to the Sectijn: '(b) Without limitation or restriction upon the provisions of paragraph (a) of this Section, the Borrower shall: (i) establish and maintain until the completion of the Project, in Banco de Reserva, on terms and conditions satisfactory to the Bank, the Project Account for the purposes of financing the carrying out of Parts A, C and D of the Project; (ii) replenish such account as required for the timely and efficient execution of Parts A, C and D of the Project but not less than the equivalent in pesos of $250,000 each month; (iii) keep, at all times in such account not less than the equivalent in pesos of $525,000; and (iv) operate such account in accordance with rules and guidelines satisfactory to the Bank." (d) Section 4.02 is amended by adding "(a)" before the first sentence of the Section and by adding the following new paragraph (b): -5- (b) The Borrower shall: (i) have the Special Account for each fiscal year audited, in accordance with appropriate auditing principles consistently applied, by independent auditors acceptable to the Bank; (ii) furnish to the Bank as soon as avail- able, 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 reports of such audits by said auditors, of such scope and in such detail as the Bank shall have reasonably requested; and (iii) furnish to the Bank such other information concern- ing said account and the audit thereof as the Bank shall from time to time reasonably request." (f) The table set forth in paragraph 1 of Schedule 1 is amended to read as follows: Amount of the Loan Allocated % of (Expressed in Expenditures "Category Dollar Equivalent) to be Financed (1) Civil Works and 2,560,000 35% Furniture for Parts A, C and D of the Project (2) Professional 300,000 100% Services (3) Equipment 3,420,000 100% of for- eign expendi- tures or 85% of local expenditures (4) Technical 900,000 100% Assistance and Training Abroad of Instructors and other Local Staff Amount of the Loan Allocated % of (Expressed in Expenditures "Category Dollar Equivalent) to be Financed (5) Teacher Training, 330,000 100% Feasibility Study, Preparation of Third Project (6) Project Administration 100,000 100% (7) Initial Deposit in 280,000 Special Account, pursuant to Section 2.02 (b) of this Agreement (8) Unallocated 110,000 TOTAL 8,000,000" (g) The following is added to paragraph 2 of Schedule 1: "; and the term "local expenditures" means expendi- tures in the currency of the Borrower or for goods or services supplied from the territory of the Borrower." ARTICLE II Section 2.01. Except as shall be otherwise agreed by the Bank and the Borrower, the Amending Agreement shall come into force and effect on the date upon which the Bank dispatches to the Borrower notice of its acceptance of the evidence required hereinafter: (a) evidence, satisfactory to the Bank, that the Special Account has been established; (b) evidence, satisfactory to the Bank, that the Project Account has been established and that the Borrower has deposited therein the equivalent in pesos of $525,000; (c) an opinion or opinions satisfactory to the Bank of Counsel acceptable to the Bank showing, on behalf of the Borrower, that the Amending Agreement has been duly authorized or ratified by, and executed and delivered on behalf of, the Borrower, and is legally binding upon the Borrower in accordance with its terms. IN WITNESS WHEREOF, the parties hereto, acting through their respective representatives thereunto duly authorized, have caused the Amending 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 above written. DOMINICAN REPUBLIC By Authorized Representative INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT By 4y4 Regional Vice President Latin America and the Caribbean INTERNATIONAL 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- cate and affixed the Seal of the Bank thereunto this day of- , 198 . FOR SECRETARY