Turkey - Technical Assistance Project For State Economic Enterprises : Loan 2400 - DYB Agreement - Conformed

OFFICIAL LOAN NUMBER 2400 TU DOCUMENTS DYB Agreement (Technical Assistance Project for State Economit Enterprises) between INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT and DEVLET YATIRIM BANKASI Dated / , 1984 LOAN NUMKBER 2400 TU DYB AGREEMENT AGREEMENT, dated , 1984, between INTER- NATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT (hereinafter called the Bank) and DEVLET YATIRIM BANKASI (hereinafter called DYB). WHEREAS by the Loan Agreement of even date herewith between the Republic of Turkey (hereinafter called the Borrower) and the Bank, the Bank has agreed to make available to the Borrower an amount in various currencies equivalent to seven million six hundred thousand dollars ($7,600,000), on the terms and condi- tions set forth in the Loan Agreement, but only on condition that DYB agree to undertake such obligations toward the Bank as are hereinafter set forth; WHEREAS by a subsidiary loan agreement to be entered into between the Borrower and DYB, part of the proceeds of the Loan provided for under the Loan Agreement will be made available to DYB on the terms and conditions therein set forth; WHEREAS by finance agreements to be entered into between DYB and TKI, Sumerbank, TCDD-ADVAS and any other state economic enterprise as may be agreed pursuant to Part E of the Project, respectively, the proceeds of the Loan made available by the Borrower to DYB will be relent by DYB to TKI, Sumerbank, TCDD- ADVAS and any other state economic enterprise as may be agreed pursuant to Part E of the Project, respectively, on the terms and conditions therein set forth; and WHEREAS DYB, in consideration of the Bank's entering into the Loan 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 Loan Agreement and in the General Conditions (as so defined) have the respective meanings therein set forth. -2- ARTICLE II Execution of the Project Section 2.01. For the purpose of carrying out Parts A, B, C and E of the Project described in Schedule 2 to the Loan Agree- ment, DYB shall make available to TKI, Sumerbank, TCDD-ADVAS and any other state economic enterprise as may be agreed pursuant to Part E of the Project, respectively, the proceeds of the Loan made available to DYB by the Borrower under a finance agreement to be entered into between DYB and each such Beneficiary under terms and conditions which shall have been approved by the Bank, including that: (a) the proceeds relent to each such Beneficiary shall be repaid over a term of seventeen years, including four years of grace; (b) each Beneficiary shall pay interest on such proceeds at the rate of 0.5% above that applicable to the Loan; (c) each Beneficiary shall pay commitment charges on such pro- ceeds at the rate applicable to the Loan; and (d) TKI, Sumerbank and TCDD--ADVAS shall pay DYB a fee, on the Effective Date, on the amount of the proceeds relent by DYB which is proportionate to the fee paid by the Borrower under Section 2.05 of the Loan Agreement. Section 2.02. Except as the Bank shall otherwise agree, procurement of the guods and services to be financed out of the proceeds of the Loan made available by DYB to the Beneficiaries shall be governed by the provisions set forth or referred to in Section 2.03 of the Project Agreement. Section 2.03. DYB shall duly perform all its obligations under the DYB Subsidiary Loan Agreement and under the Finance Agreements. Except as the Bank shall otherwise agree, DYB shall not take or concur in any action which would have the effect of amending, abrogating, assigning or waiving the Subsidiary Loan Agreement or the Finance Agreements or any provision thereof. Section 2.04. DYB shall: (a) at the request of the Bank, exchange views with the Bank with regard to the progress of the Project, the performance of its obligations under this Agreement, under the Subsidiary Loan Agreement and under the Finance Agree- ments, and other matters relating to the purposes of the Loan; and (b) promptly inform the Bank of any condition which inter- feres or threatens to interfere with the progress of the Project, -3- the accomplishment of the purposes of the Loan, or the perfor- mance by DYB of its obligations under this Agreement, under the Subsidiary Loan Agreement and under the Finance Agreements. ARTICLE III Management and Operations of DYB Section 3.01. DYB shall at all times manage its affairs, maintain its financial position, plan its future expansion and carry on its operations in accordance with sound managerial, administrative, business and financial practices. ARTICLE IV Other Covenants Section 4.01. DYB shall maintain records adequate to reflect, in accordance with consistently maintained appropriate accounting practices, its operations and financial condition related to the Project. Section 4.02. DYB shall: (a) maintain records and procedures adequate to record and monitor the progress of Parts A, B, C and E of the Project (including the cost and the benefits to be derived from such Parts), to identify the goods and services financed out of the proceeds of the Loan for such Parts and to disclose their use in such Parts; (b) furnish to the Bank at. regular intervals all such information as the Bank shall reasonably request concerning such Parts of the Project, the cost and, where appropriate, the benefits to be derived from such Parts, the expenditure of such proceeds of the Loan and the goods and services financed out of such proceeds; and (c) assist the Borrower in furnishing the report referred to in Section 3.05 (d) of the Loan Agreement. ARTICLE V Effective Date; Termination; Cancellation and Suspension Section 5.01. This Agreement shall come into force and effect on the date upon which the Loan Agreement becomes effective. Section 5.02. This Agreement and all obligations of the Bank and of DYB hereunder shall terminate on the date on which the Loan Agreement shall terminate in accordance with its terms, and the Bank shall promptly so notify DYB thereof. Section 5.03. All the provisions of this Agreement shall continue in full force and effect notwithstanding any cancella- tion or suspension under the General Conditions. ARTICLE VI Miscellaneous Provisions Section 6.01. 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 Bank: International Bank for Reconstruction and Development 1818 H Street, N.W. Washington, D.C. 20433 United States of America Cable address: Telex: INTBAFRAD 440098 (ITT), Washington, D.C. 248423 (RCA) or 64145 (WUI) For DYB: Devlet Yatirim Bankasi Milli Mudafaa Caddesi No. 20 Ankara, Turkey Cable address: Telex: YATIRIMBANK 42606 DYB TR Ankara -5- Section 6.02. Any action required or permitted to be taken, and any document required or permitted to be executed, under this Agreement on behalf of DYB may be taken or executed by its General Manager or such other person or persons as DYB shall designate in writing, and DYB shall furnish to the Bank suffi- cient evidence of the authority and the authenticated specimen signature of each such person. Section 6.03. 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 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 Europe, Middle East and North Africa DEVLET YATIRIM BANKASI By Authorized Representative 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