Burundi - Fisheries Development Project : Credit 0626 - Project Agreement - Conformed

CONFORMED COPY CREDIT NUMBER 626 BU PROJECT AGREEMENT (Fisheries Development Project) between INTERNATIONAL DEVELOPMENT ASSOCIATION * and SOCIETE REGIONALE DE DEVELOPPEMENT "USINES DE POISSONS DU BURUNDI" and BANQUE NATIONALE DE DEVELOPPEMENT ECONOMIQUE Dated June 11, 1976 PROJECT AGREEMENT AGREEMENT, dated June 11, 1976, between INTERNATIONAL DEVEL- OPMENT ASSOCIATION (hereinafter called the Association) and SOCIETE REGIONALE DE DEVELOPPEMENT "USINES DE POISSONS DU BURUNDI" (here- inafter called the Corporation) and BANQUE NATIONALE DE DEVELOPPE- MENT ECONOMIQUE (hereinafter called BNDE). WHEREAS by the Development Credit Agreement of even date herewith between the Republic of Burundi (hereinafter called the Borrower) and the Association, the Association has agreed to make available to the Borrower an amount in various currencies equiv- alent to six million dollars ($6,000,000), on the terms and con- ditions set forth in the Development Credit Agreement, but only on condition that the Corporation and BNDE agree to undertake such obligations toward the Association as hereinafter set forth; WHEREAS by subsidiary loan agreements to be entered into be- tween the Borrower and BNDE and between BNDE and ".he Corporation, respectively, the proceeds of the Subsidiary Loan will be made available to the Corporation by the Borrower, through BNDE, on the terms and conditions set forth in such subsidiary loan agreements; WHEREAS the proceeds of the Credit provided for under the Development Credit Agreement to finance goods, works and operating expenses for Part E of the Project will also be made available to the Corporation by the Borrower, on a grant basis; and -2- WHEREAS the Corporation and BNDE, in consideration of the Association's entering into the Development Credit Agreement with the Borrower, have agreed to undertake the obligations hereinafter set forth; NOW THEREFORE the parties hereto hereby agree as follows: -3- 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. ARTICLE II Execution of the Project Section 2.01. The Corporation shall carry out Parts A through E of the Project described in Schedule 2 to the Development Credit Agreement with due diligence and efficiency and in conformity with appropriate administrative, financial, engineering, fishing and marketing practices, and with the Statutes of the Corporation. Section 2.02. (a) BNDE shall relend the proceeds of the Sub- sidiary Loan to the Corporation under a subsidiary loan agreement to be entered into with the Corporation under terms and conditions satisfactory to the Association. (b) BNDE shall duly perform all its obligations under the BNDE Subsidiary Loan Agreement and the Corporation Subsidiary Loan Agreement and shall exercise its rights thereunder in such manner as to protect the interests of the Borrower and the Asso- ciation. Except as the Association shall otherwise agree, BNDE shall not take or concur in any action which would have the effect of amending, abrogating, assigning or waiving the BNDE Subsidiary Loan Agreement or any provision thereof, nor assign, amend, abrogate or waive the Corporation Subsidiary Loan Agree- ment or any provision thereof. (c) The Corporation shall duly perform all its obligations under the Corporation Subsidiary Loan Agreement. Excent as the -5- Association shall otherwise agree, the Cornoration shall not take or concur in any action which would have the effect of amending, abrogating, assigning or waiving the Corporation Subsidiary Loan Agreement or any provision thereof. Section 2.03. BNDE shall assist the Corporation in: (a) carrying out Part B (iii) of the Project, and super- vise the activities of the Corporation with resnect to said Part of the Project; (b) establishing a7prooriate management procedures and accounting systems; and (c) carrying out periodic reviews of the Corporation's financial performance. Section 2.0I. (a) The Corporation shall carry out Parts A through E of the Project with the technical assistance of experts and consultants to be employed, for said purpose, by the Borrower and whose qualifications, experience and terms and conditions of employment shall be satisfactory to the Association and the Cor- poration, as follows: (i) four experts, one each for each of the Corporation's divisions in charge of: (A) fisheries development and extension; (B) fish processing; -6- (C) fish marketin7; and (D) administration and finance; and (ii) such other experts and consultants as shall be agreed between the Borrower, the Association and the Corporation. (b) To assist BNDE in carrying out its obligations under Section 2.03 of this Agreement, BNDE shall use the services of an expert to be employed, for said purpose, by the Borrower and whose qualifications, experience and terms and conditions of employment shall be satisfactory to the Association and BvDE. Section 2.05. Excent as the Association shall otherwise agree, the goods and works for Parts A through E of the Project to be fi- nanced out of the proceeds of the Credit, shall be nrocured in ac- cordance with the provisions set forth or referred to in Schedule 3 to the Development Credit Agreement. Section 2.06. (a) The Cornoration undertakes to insure, or make adequate provision for the insurance of, the imported goods to be financed out of the proceeds of the Credit allocated to Parts A through E of the Project aqainst hazards incident to the acquisition, transporation and delivery thereof to the place of use or installation, and for such insurance any indemnity shall be payable in a currency freely usable by the Corporation to re- place or repair such goods. -7- (b) Except as the Association may otherwise agree, the Cor- poration shall cause all goods and services financed out of the proceeds of the Credit allocated to Parts A through E of the Project to be used exclusively for said Parts of the Project. Section 2.07. (a) The Corporation shall furnish to the Asso- ciation, promptly upon theii preparation, the plans, specifications, reports, contract documents and work and procurement schedules for Parts A through E of the Project, and any material modifications thereof or additions thereto, in such detail as the Association shall reasonably request. (b) The Corporation: (i) shall maintain records adequate to record the progress of Parts A through E of the Project (including the cost thereof) and to identify the goods, works and services financed out of the proceeds of the Credit allocated to said Parts of the Project, and to disclose the use thereof in said Parts of the Project; (ii) shall, without limitation upon the provisions of paragraph (c) of this Section, enable the Association's representa- tives to visit the facilities and construction sites included in Parts A through E of the Project, and to examine the goods fi- nanced out of such proceeds and any relevant records and documents; and (iii) shall furnish to the Association all such information as the Association shall reasonably request concerning Parts A through E of the Project, the expenditure of the proceeds of the Credit so allocated and the goods, works and services financed out of such Droceeds. (c) The Corporation shall enable the Association's repre- sentatives to examine all plants, installations, sites, works, -8- buildings, property and equipment of the Corporation and any relevant records and documents. (d) BNDE shall: (i) furnish to the Association all such in- formation as the Association shall reasonably request concerning Parts A through D of the Project and the expenditure of the pro- ceeds of the Subsidiary Loan, and (ii) enable the Association's accredited representatives to examine any records and documents of BNDE relevant to said Parts of the Project. Section 2.08. (a) The Cornoration shall, at the request of the Association, exchange views with the Association with regard to the progress of Parts A through E of the Project, the Derfor- mance of its obligations under this Agreement and under the Corporation Subsidiary Loan Agreement, and other matters relating to the purposes of the Credit. (b) The Corporation shall promptly inform the Association of any condition which interferes or threatens to interfere with, the progress of Parts A through E of the Project, the accomplishment of the purposes of the Credit, or the performance by the Corpora- tion of its obligations under this Agreement and under the Corporation Subsidiary Loan Agreement. Section 2.09. (a) BNDE shall, at the request of the Associa- tion, exchange views with the Association with regard to the pro- gress of Parts A through D of the Project, the nerformance of its obligations under this Agreement, under the BNDE Subsidiary Loan Agreement and under the Corporation Subsidiary Loan Agreement, and other matters relating to the nurnoses of the Credit. 9 (b) BNDE shall promptly inform the Association of any condi- tion which interferes or threatens to interfere with, the progress of Parts A through D of the Project, the accomplishment of the purposes of the Credit, or the performance by BNDE of its obliga- tions under this Agreement, under the BNDE Subsidiary Loan Agree- ment and under the Corporation Subsidiary Loan Agreement. Section 2.10. (a) In carrying out Part B(iii) of the Project, the Corporation shall: (i) select the Sub-borrowers on the basis of criteria satisfactory to the Association and including, inter alia, specific require- ments to ensure that Sub-borrowers possess experience with artisanal fishing and have their permanent residence near one of the fishing centers or fishing stations included in Part A of the Project; (ii) enter into loan contracts with the Sub- borrowers which shall follow a model con- tract satisfactory to the Association and provide for an interest rate satisfactory to the Association; and (iii) submit to the Association for its review and prior concurrence any change of said criteria, model contract or interest rate considered by the Corporation. - 10 - (b) The Corporation shall periodically consult with the Borrower, the Association and BNDE on the appropriate level of interest rates on loans to Sub-borrowers. Section 2.11. Prior to the establishment of facilities for the manufacturing of fishing boats by the Corporation, the Corporation shall furnish to the Association for its review and concurrence a detailed plan for the boat building activities to be carried out by the Corporation. Section 2.12. The Corporation shall consult with the Associa- tion prior to carrying out Parts D(ii) or D(iv) of the Project. - 11 - ARTICLE III Management and Operations of the Corporation Section 3.01. (a) The Corporation shall employ adequate and qualified staff. (b) Without any limitation to te generality of paragraph (a) of this Section, the Corporation shall annoint a qualified counter- part to each of the experts referred to in Section 2.04 (a) (i) of this Agreement. (c) Before appointing any of the counterparts referred to in paragraph (b) of this Section, the Cornoration shall furnish to the Association the nwnes and all pertinent information regarding the qualifications and experience of the persons considered for such appointment and afford the Association an opportunity to ex- change views with the Corporation on the qualifications and exper- ience of such persons. Section 3.02. The Corporation shall establish its management procedures and accounting systems with the assistance of BNDE. Section 3.03. The Cornoration shall take out and maintain with responsible insurers, or make other provisions satisfactory to the Association for, insurance against such risks and in such amounts as shall be consistent with anprooriate practice. Section 3.04. The Corporation shall maintain the facilities included in Parts A through E of the Project in accordance with -12- sound administrative. engineering and fishing Dractices and shall provide promptly as needed, the funds. facilities and resourceS therefor. 0 - 13 - ARTICLE IV Financial Covenants of the Corporation Section 4.01. The Corporation shall maintain records adequate to reflect in accordance with consistently maintained anpropriate accounting practices its operations and financial condition; such records shall include separate accounts for Part E of the Project. Section 4.02. The Corporation shall: (i) 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 indeDendent auditors acceptable to the Association; (ii) fur- nish to the Association as soon as available, but in any case not later than six months after the end of each such year, (A) certi- fied copies of its financial statements for such year as so au- dited 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 (iii) furnish to the Association such other infor- mation concerning the accounts and financial statements of the Corporation and the audit thereof as the Association shall from time to time reasonably request. Section 4.03. The Corporation shall undertake joint periodic reviews of its financial performance with BNDE. ARTICLE V Management, Operations and Financial Covenants of BNDE Section 5.01. BNDE shall take all action necessary to ensure that BNDE disposes of sufficient qualified and experienced staff for the purpose of carrying out its obligations under Section 2.03 of this Agreement. Section 5.02. BNDE shall maintain records adequate to reflect in accordance with consistently maintained anpropriate accounting practices its operations in respect of the Subsidiary Loan. Section 5.03. BNDE shall: (i) 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 apnlied, by indepen- dent auditors acceptable to the Association; (ii) furnish to the Association as soon as available, but in any case not later than six 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 (iii) furnish to the Association such other information con- cerning the accounts and financial statements of BNDE and the audit thereof as the Association shall from time to time reason- ably request. - 15 - Section 5.04. BNDE shall use the proceeds of the Subsidiary Loan which have been repaid by the Corporation and not yet repaid by BNDE to the Borrower, for the purpose of investments in the artisanal fisheries sector in aeco-4ar,e with an Investment 'nrogrwr to be approved, annually, by the Association. -16 - 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 the Corporation and BNDE thereunder shall termi- nate on the earlier of the following two dates: (i) the date on which the DeveloTAment Credit Agreement shall terminate in accordance with its terms; or (ii) a date 20 years after the date of this Agreement. (b) If the Development Credit Agreement terminates in accor- dance with its terms before the date snecified in paragraph (a)(ii) of this Section, the Association shrll promptly notify the Corpora- tion and BNDE of this event. Section 6.03. All the provisions of this Agreement shall con- tinue in full force and effect notwithstanding any cancellation or suspension under the Development Credit Agreement. - 17 - 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 per- mitted to be given or made at such party's address hereinafter specified or at such other address as such party shall have desig- nated by notice to the party giving such notice or making such re- quest. 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 the Corporation: Soci't' Regionale de Developpement "Usines de Poissons du Burundi" Bujumbura Burundi Cable address: SRD "USINES DE POISSONS DU BURUNDI" Bujumbura -18 0 For BNDE: Banque Nationale de Dgveloppement A Economique Boite Postale 1620 Bujumbura Burundi Cable address: DEVBANK Bujumbura Section 7.02. (a) Any action required or permitted to be taken, and any documents required or permitted to be executed, un- der this Agreement on behalf of the Corporation may be taken or executed by the General Manager of the Corporation or such other person or persons as the General Manager shall designate in writ- ing. (b) The Corporation shall furnish to the Association suffi- cient evidence of the authority and the authenticated specimen signature of the person or persons who will, on behalf of the Corporation, take any action or execute any documents required or permitted to be taken or executed by the Corporation pursuant to any of the provisions of this Agreement. Section 7.03. (a) Any action required or permitted to be taken, and any documents required or permitted to be executed, un- der this Agreement on behalf of BNDE may be taken or executed by the President of BNDE or such other person or persons as the Pres- ident shall designate in writing. (b) BNDE shall furnish to the Association sufficient evidence of the authority and the authenticated specimen signature of the - 20 - IN WITNESS WHEREOF, the parties hereto, acting through their representatives thereunto duly authorized, have caused this Agree- ment 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 DEVELOPMENT ASSOCIATION By Is/ Stanley Please Acting Regional Vice President Eastern Africa SOCIETE REGIONALE DE DEVELOPPEMENT "USINES DE POISSONS DU BURUNDI" By /s/ Clment Sambira Authorized Representative BANQUE NATIONALE DE DEVELOPPEMENT ECONOMIQUE By /s/ Clement Sambira Authorized Representative