Iraq - Wadi-Tharthar Flood Control Project : Loan 0026 - Project Agreement - Conformed

Project Funds Agreement BETWEEN THE GOVERNMENT OF IRAQ AND NATIONAL BANK OF IRAQ INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT DATED JUNE 15, 1950 PRESS OF BYRON S. ADAMS, WASHINGTON Project Funds Agreement BETWEEN THE GOVERNMENT OF IRAQ AND NATIONAL BANK OF IRAQ AND INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT DATED JUNE 15, 1950 PRESS OF BYRON S. ADAMS, WASHINGTON Svoject funbk @greement AGREEMENT, dated June 15, 1950, between THE GOVERNMENT OF IRAQ (hereinafter called Iraq) and NATIONAL BANK OF IRAQ (hereinafter called the National Bank) parties of the first part, and INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT (hereinafter called the Bank) party of the second part. WHEREAS, by an agreement dated June 15, 1950 between Iraq and the Bank (which agreement and the Schedules therein referred to are hereinafter called the Loan Agreement) the Bank has agreed to make a loan to Iraq in the aggregate principal amount of twelve million eight hundred thousand dollars ($12,800,000) on the terms and conditions set forth in the Loan Agreement, but only on condition that Iraq make provision that the funds (in addition to those provided by such loan) required to com- plete the Project described in Schedule 2 to the Loan Agree- ment be made available as required; and WHEREAS Iraq and the National Bank have agreed to make such provision and for that purpose have agreed to execute this Project Funds Agreement with the Bank; Now THEREFORE the parties hereto hereby agree as follows: ARTICLE I Wherever used in this Project Funds Agreement, unless the context shall otherwise require the following terms shall have the respective meanings hereinafter in this Article set forth: (1) The term Indenture of Assignment means the in- denture of even date herewith between Iraq and the Bank whereby Iraq has assigned certain oil royal- ties to the Bank. 2 (2) The term Project means the project described in Sebedule 2 to the Loan Agreement as such Schedule shall be amended from time to time by agreement in writing between Iraq and the Bank. (3) The term Concessions means Concessions as such term is defined in Article I of the Indenture of Assignment. (4) The term oil royalties means oil royalties as such term is defined int Article I of the Indenture of Assignment. (5) The term Financial Agency means the National Blaik or aiy other party which shall have been sub- stituted for the National Bank pursuant to Section 5 of Article V of this Project Funds Agreement. (6) The term Executive Agency shall mean the agency, institution or board of Iraq responsible for the carrying out of the Project. (7) The term Project Funds means the funds to be paid to the Financial Agency as provided in Article II of this Project Funds Agreemenit. ARTICLE II SnoTIoN 1. Subject and expressly subordinated to the assignment provided for in the Indenture of Assignment, Iraq hereby covenants that it will pay or cause to be paid to the Financial Agency out of its oil royalties the amounts of funds specified in Schedule 1 to this Project Funds Agreement, as such Schedule shall be amended from time to time by agreement in writing between Iraq and the Bank. SecmoN 2. Iraq will make arrangements satisfactory to the Bank to provide for the payment of the Project Funds to the Financial Agency. 3 ARTICLE III SECTION 1. The Financial Agency shall open a Project Funds Account on its books in the name of the Executive Agency. The Project Funds shall be kept in the Project Funds Account by the Financial Agency segregated from its other funds. Except as otherwise agreed in writing between Iraq and the Bank the Project Funds shall be paid out by the Financial Agency only as provided in Article IV of this Project Funds Agreement. SE'CTION 2. To the extent required for expenditures for the Project, Project Funds received by the Financial Agency in any currency other than the currency of Iraq may be exchanged by the Financial Agency for currency of Iraq on the basis of the par values established by the International Monetary Fund for such currencies. SECTION 3. Iraq will cause the Financial Agency and the Executive Agency to maintain books, accounts and records sufficient to show receipts of Project Funds, the person or persons to whom any and all payments of Project Funds were ma,de, to identify the goods or services purchased by means of such payments, and to disclose the end-use of such goods or services in the Project. Such books, accounts and records may be maintained entirely by the Financial Agency or entirely by the Executive Agency or partly by one and partly by the other. Iraq will enable the Bank to inspect any and all such books, accounts and records. SECTION 4. Iraq will furnish or cause the Financial Agency or the Executive Agency to furnish the Bank all such information at such times and in such detail as the Bank shall reasonably request with regard to receipts of Project Funds, withdrawals of Project Funds, the goods or services purchased therewith, and the use thereof in the Project. 4 ARTICLE IV SECTION 1. The Project Funds shall be applied by Iraq exclusively to the payment of the cost, incurred after the 6ate of this Project Funds Agreement, of goods and serv- ices required for the carrying out of the Project. SECTION 2. The Executive Agency shall be entitled, from time to time, subject to the provisions of this Project Funds Agreement, to withdraw Project Funds from the Project Funds Account in such amounts as shall be required (i) to reimburse itself for payments made to meet the cost, incurred subsequent to the date of this Project Funds Agreement, of goods and services required for the Project; and (ii) to enable it to pay the reasonable cost, incurred subsequent to the date of this Project Funds Agreement, of such goods and services not theretofore paid. SECTION 3. Whenever the Executive Agency shall de- sire to withdraw any amount of Project Funds from the Project Funds Account it shall present to the Financial Agency: (A) An application in writing substantially in the form set forth in Schedule II to this Agreement, and (B) A certificate of a qualified engineer, satisfactory to the Bank, substantially in the form set forth in Schedule III to this Agreement. SECTION 4. Upon presentation of such application and certificate duly executed and delivered in accordance with the provisions of this Project Funds Agreement the Finan- cial Agency shall duly pay such amount to or on the order of the Executive Agency. ARTICLE V SECTION 1. Any notice, demand or request required or permitted to be given under this Project Funds Agreement shall be in writing and shall be deemed to have been duly 5 given when it shall be delivered in writing or by telegram, cable or radiogram to the party to which such notice, de- mand or request is required or permitted to be given at its address hereinafter specified, or at such other address as such party shall have designated by notice in writing to the party giving or making such notice, demand or request. The addresses so specified are: For Iraq: Minister of Finance, Ministry of Finance, Baghdad, Iraq. For the Bank: International Bank for Reconstruction and Development, 1818 H Street, N.W., Washington 25, D. C., United States of America. For the Financial Agency: National Bank of Iraq, Baghdad, Iraq. SECTION 2. This Project Funds Agreement may be exe- cuted in several counterparts, each of which shall be an original and all collectively but one instrument. SECTION 3. Any action required or permitted to be taken, and any documents required or permitted to be exe- cuted, under this Project Funds Agreement on behalf of Iraq may be taken or executed by the Minister of Finance of Iraq or any person thereunto authorized in writing by him. Any modification or amplification of the provisions of this Project Funds Agreement may be agreed to on be- half of Iraq by written instrument executed on behalf of Iraq by its Minister of Finance or any person thereunto authorized in writing by him. 6 SECTION 4. Iraq shall furnish to the Financial Agency and, if requested, to the Bank the name or names of the person or persons who are authorized to sign the applica- tions for withdrawal of Project Funds provided for in Article IV of this Project Funds Agreement or who will, on behalf of Iraq, take any action or execute any documents required or permitted to be taken or executed by Iraq pur- suant to any of the provisions of this Project Funds Agree- ment and the authenticated specimen signature of each such person. SECTION 5. A development board or any other official institution or agency of Iraq may, by agreement of the par- ties hereto, assume the rights and obligations of the Na- tional Bank hereunder. ARTICLE VI .SECTION 1. This Project Funds Agreement shall come into force and effect on the day and year first above written. SEcTION 2. L 1-e Loan Agreement and all the obliga- tions of the parties thereunder shall terminate pursuant to Section 3 of Article XI or Section 3 of Article XII thereof, this Project Funds Agreement and all obligations of the parties hereunder 8ball terminate forthwith. IN WITNEss WHEREOF the parties hereto have caused this Project Funds Agreement to be signed in their respective 7 names by their representatives thereunto duly authorized as of the day and year first above written. THE GOVERNMENT OF IRAQ by S. HAIDER Authorized Representative NATIONAL BANK OF IRAQ by S. HAIDER Authorized Representative INTERNATIONAL BANK FOR RECON- STRUCTION AND DEVELOPMENT by W. A. B. ILIFF Loan Director 8 SCHEDULE I Amounts of Project Funds (Iraqi Dinar equivalent of following amounts of pounds sterling) January 1, 1951 £100,000 January 1, 1952 £830,000 January 1, 1953 £1,750,000 January 1, 1954 £2,170,000 January 1, 1955 £800,000 9 SCHEDULE II Application for Withdrawal of Project Funds from Project Funds Account Application No. To: National Bank of Iraq 1. Pursuant to Section 2 of Article IV of the Project Funds Agreement dated between Kingdom of Iraq and International Bank for Reconstruction and Development and National Bank of Iraq, (insert name of Executive Agency) desires to withdraw [insert amount] of Project Funds from the Project Funds Account provided for in such Agreement. 2. Such amount is required to reimburse (insert name of Executive Agency) for or to enable (insert name of Executive Agency) to meet the following payments made or to be made for the following goods or services purchased or to be purchased from the following suppliers. Name and Description of Total Amt. of Date of Use of Goods Address of Goods and Cost of Payment Payment or Services Supplier Services Goods in Project or Contractor 3. No previous withdrawal or application for withdrawal from the Project Funds Account has been made for any amounts for the purpose of reimbursing (insert name of Executive Agency) for or enabling (insert name of Execu- tive Agency) to meet such payments. 4. Such payments have been or will be made for goods and services required for carrying out the Project defined in said Project Funds Agreement. 10 5. The cost and terms of purchase of such goods and services are reasonable. Please make payment of the amount requested by [check to the order of ] [bank transfer to the account of (Name of Executive Agency) by Authorized Representative SCHEDULE III Certificate of Engineer 1. I have examined the foregoing APPLICATION FOR WITI- DRAWAL OF PROJECT FUNDs FROM PROJECT FUNDS AccouNT- Application No. , and the Schedules attached thereto, requesting a withdrawal in the total amount of 2. The goods and services listed therein are required for the carrying out of the Project defined in the Project Funds Agreement referred to therein. The cost and terms of pur- chase of such goods and services are reasonable. Engineer