Loan Number 3876 RU
LOAN AGREEMENT
BETWEEN RUSSIAN FEDERATION AND INTERNATIONAL
BANK FOR RECONSTRUCTION AND DEVELOPMENT
(Washington, 29.IX.1996)
Agreement, dated September 29, 1996, between Russian Federation
(the Borrower) and International Bank for Reconstruction and
Development (the Bank).
Whereas the Borrower, having satisfied itself as to the
feasibility and priority of the Project described in Schedule 2 to
this Agreement, has requested the Bank to assist in the financing
of the Project; and
Whereas the Bank has agreed, on the basis, inter alia, of the
foregoing, to extend the Loan to the Borrower upon the terms and
conditions set forth in this Agreement.
Now therefore the parties hereto hereby agree as follows:
Article I
General Conditions; Definitions
Section 1.01. The "General Conditions Applicable to Loan and
Guarantee Agreements" of the Bank, dated January 1, 1985, with the
modifications set forth below (the General Conditions) constitute
an integral part of this Agreement:
(a) The last sentence of Section 3.02 is deleted.
(b) The second sentence of Section 5.01 is modified to read:
"Except as the Bank and the Borrower shall otherwise agree, no
withdrawals shall be made: (a) on account of expenditures in the
territories of any country which is not a member of the Bank or
for goods produced in, or services supplied from, such
territories; or (b) for the purpose of any payment to persons or
entities, or for any import of goods, if such payment or import,
to the knowledge of the Bank, is prohibited by a decision of the
United Nations Security Council taken under Chapter VII of the
charter of the United Nations."
(c) In Section 6.02, subparagraph (k) is relettered as
subparagraph (l) and a new subparagraph (k) is added to read:
"(k) An extraordinary situation shall have arisen under which
any further withdrawals under the Loan would be inconsistent with
the provisions of Article III, Section 3 of the Bank's Articles of
Agreement."
Section 1.02. Unless the context otherwise requires, the
several terms defined in the General Conditions and in the
Preamble to this Agreement have the respective meanings therein
set forth and the following additional terms have the following
meanings:
(a) "Energy Efficiency Sub-project" means a specific energy
efficiency program of an Executing Agency intended to be carried
out by such Executing Agency utilizing the proceeds of a
Subsidiary Loan;
(b) "Executing Agency" means any system of district heating or
combined heat and power plants or other enterprises as may be
agreed with the Bank, in the territory of the Borrower in
accordance with the criteria set forth in Schedule 6 to this
Agreement, which shall have been accepted for participation in
accordance with Section 3.02 of this Agreement;
(c) "MFE" means the Ministry of Fuel and Energy of the
Borrower:
(d) "RESF" means the Russian Energy Saving Foundation;
(e) "Special Accounts" mean the accounts referred to in Section
2.02 (b) of this Agreement;
(f) "Subsidiary Loan" means any loan provided to an Executing
Agency for Energy Efficiency Sub-project, pursuant to Section 3.02
of this Agreement; and
(g) "Subsidiary Loan Agreement" means any agreement which shall
have been entered into by the Borrower, pursuant to Section 3.02
of this Agreement with an Executing Agency, in respect of an
Energy Efficiency Sub-project involving such an Executing Agency,
as the same agreement may be amended from time to time, and such
term includes all schedules to Subsidiary Loan Agreement.
Article II
The Loan
Section 2.01. The Bank agrees to lend to the Borrower, on the
terms and conditions set forth or referred to in the Loan
Agreement, various currencies that shall have an aggregate value
equivalent to the amount of seventy million dollars (70,000.000
USD), being the sum of withdrawals of the proceeds of the Loan,
with each withdrawal valued by the Bank as of the date of such
withdrawal.
Section 2.02. (a) The amount of the Loan may be withdrawn from
the Loan Account in accordance with the provisions of Schedule 1
to this Agreement for expenditures made (or, if the Bank shall so
agree, to be made) in respect of (the reasonable cost of goods and
services required for the Project described in Schedule 2 to this
Agreement and to be financed out of the proceeds of the Loan and
in respect of interest and other charges on the Loan.
(b) The Borrower may, for the purposes of Parts A and B of the
Project, respectively, open and maintain in dollars a special
deposit account in a bank on terms and conditions satisfactory to
the Bank, including appropriate protection against set-off,
seizure or attachment. Deposits into, and payments out of, the
respective Special Account shall be made in accordance with the
provisions of Schedule 7 to this Agreement.
Section 2.03. The Closing Date shall be June 30, 2001 or such
later date as the Bank shall establish. The Bank shall promptly
notify the Borrower of such later date.
Section 2.04. The Borrower shall pay to the Bank a commitment
charge at the rate of three-fourths of one percent (3/4 of 1%) per
annum on the principal amount of the Loan not withdrawn from time
to time.
Section 2.05. (a) The Borrower shall pay interest on the
principal amount of the Loan withdrawn and outstanding from time
to time, at a rate for each Interest Period equal to the Cost of
Qualified Borrowings determined in respect of the preceding
Semester, plus one-half of one percent (1/2 of 1%). On each of the
dates specified in Section 2.06 of this Agreement, the Borrower
shall pay interest accrued on the principal amount outstanding
during the preceding Interest Period, calculated at the rate
applicable during such Interest Period.
(b) As soon as practicable after the end of each Semester, the
Bank shall notify the Borrower of the Cost of Qualified Borrowings
determined in respect of such Semester.
(c) For the purposes of this Section:
(i) "Interest Period" means a six-month period ending on the
date immediately preceding each date specified in Section 2.06 of
this Agreement, beginning with the Interest Period in which this
Agreement is signed.
(ii) "Cost of Qualified Borrowings" means the cost, as
reasonably determined by the Bank and expressed as a percentage
per annum, of the outstanding borrowings of the Bank drawn down
after June 30, 1982, excluding such borrowings or portions thereof
as the Bank has allocated to fund: (A) the Bank's investments; and
(B) loans which may be made by the Bank after July 1, 1989 bearing
interest rates determined otherwise than as provided in paragraph
(a) of this Section.
(iii) "Semester" means the first six months or the second six
months of a calendar year.
(d) On such date as the Bank may specify by no less than six
months' notice to the Borrower, paragraphs (a), (b) and (c) (iii)
of this Section shall be amended to read as follows:
"(a) The Borrower shall pay interest on the principal amount of
the Loan withdrawn and outstanding from time to time, at a rate
for each Quarter equal to the Cost of Qualified Borrowings
determined in respect of the preceding Quarter, plus one-half of
one percent (1/2 of 1%). On each of the dates specified in Section
2.06 of this Agreement, the Borrower shall pay interest accrued on
the principal amount outstanding during the preceding Interest
Period, calculated at the rates applicable during such Interest
Period."
"(b) As soon as practicable after the end of each Quarter, the
Bank shall notify the Borrower of the Cost of Qualified Borrowings
determined in respect of such Quarter."
"(c) (iii) 'Quarter' means a three-month period commencing on
January 1, April 1, July 1 or October 1 in a calendar year."
Section 2.06. Interest and other charges shall be payable
semiannually on March 15 and September 15 in each year.
Section 2.07. The Borrower shall repay the principal amount of
the Loan in accordance with the amortization schedule set forth in
Schedule 3 to this Agreement.
Article III
Execution of the Project
Section 3.01. The Borrower declares its commitment to the
objectives of the Project as set forth in Schedule 2 to this
Agreement, and, to this end, shall carry out Part A of the Project
through MFE and Part B of the Project through RESF with due
diligence and efficiency and in conformity with appropriate
administrative and financial practices and shall provide, promptly
as needed, the funds, facilities, services and other resources
required for such Parts of the Project.
Section 3.02. Without limitation or restriction upon any of its
other obligations under this Agreement, the Borrower shall, for
the purposes of carrying out Part B of the Project, and unless the
Bank shall otherwise agree:
(a) solicit and approve proposals from candidate agencies in
accordance with the eligibility criteria and procedures for
approval for Energy Efficiency Sub-projects set forth or referred
to in Schedules 5 and 6 to this Agreement;
(b) cause the Executing Agencies to carry out their respective
Energy Efficiency Sub-projects in accordance with the same
eligibility criteria and the terms of respective Subsidiary Loan
Agreements, and shall not take or permit to be taken any action
which would prevent or interfere with the carrying out by such
Executing Agencies of their respective activities under the Energy
Efficiency Sub-projects;
(c) make available to each such Executing Agency the amount of
financing required for such Energy Efficiency Sub-projects, under
the Subsidiary Loan Agreement to be entered into between the
Borrower and such Executing Agency, under terms and conditions
which shall have been approved by the Bank, and which shall
include, without limitation, those set forth in Schedule 5 to this
Agreement; and
(d) exercise its rights under the Subsidiary Loan Agreements in
such manner as to protect the interests of the Borrower and the
Bank and to accomplish the purposes of the Loan, the Borrower
shall not assign, amend, abrogate or waive any such Subsidiary
Loan Agreement or any provision thereafter.
Section 3.03. For the purposes of the efficient carrying out of
the Project and ensuring the effective supervision of the
execution of the Energy Efficiency Sub-projects, and without
limitation on the provisions of Sections 3.01 and 3.02 of this
Agreement, the Borrower shall cause an agreement to be entered
between MFE and RESF concerning the carrying out of their
respective responsibilities connected with the carrying out of
Part B of the Project.
Section 3.04. Without limitation upon the provisions of Article
IX of the General Conditions, the Borrower shall:
(a) prepare and furnish to the Bank not later than six (6)
months after the Closing Date or such later date as may be agreed
for this purpose between the Borrower and the Bank, a plan, of
such scope and in such detail as the Bank shall reasonably
request, for the future operation of the Project;
(b) afford the Bank a reasonable opportunity to exchange views
with the Borrower on said plan; and
(c) thereafter, carry out said plan with due diligence and
efficiency and in accordance with appropriate practices, taking
into account the Bank's comments thereon.
Section 3.05. Except as the Bank shall otherwise agree,
procurement of the goods and consultants' services required for
Parts A and B of the Project and to be financed out of the
proceeds of the Loan shall be governed by the provisions of
Schedule 4 to this Agreement.
Section 3.06. The Borrower shall:
(a) by June 30, 1997, carry out a study of the appropriate
legal and regulatory framework for the gas distribution sub-
sector; and
(b) by December 31, 1997, prepare a satisfactory action plan,
in consultation with the Bank, to improve the regulatory framework
for the gas distribution sub-sector.
Article IV
Financial Covenants
Section 4.01. (a) The Borrower shall maintain or cause to be
maintained records and accounts adequate to reflect in accordance
with sound accounting practices the operations, resources and
expenditures in respect of the Project of the departments or
agencies of the Borrower responsible for carrying out Parts A and
B of the Project or any part thereof.
(b) The Borrower shall:
(i) have the records and accounts referred to in paragraph (a)
of this Section including those for 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 available, but in any case
not later than six months after the end of each such year, the
report of such audit 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 concerning
said records and accounts and the audit thereof as the Bank shall
from time to time reasonably request.
(c) For all expenditures with respect to which withdrawals from
the Loan Account were made on the basis of statements of
expenditure, the Borrower shall:
(i) maintain or cause to be maintained, in accordance with
paragraph (a) of this Section, records and accounts reflecting
such expenditures;
(ii) retain, until at least one year after the Bank has
received the audit report for the fiscal year in which the last
withdrawal from the Loan Account or payment out of the Special
Account was made, all records (contracts, orders, invoices, bills,
receipts and other documents) evidencing such expenditures;
(iii) enable the Bank's representative to examine such records;
and
(iv) ensure that such records and accounts are included in the
annual audit referred to in paragraph (b) of this Section and that
the report of such audit contains a separate opinion by said
auditors as to whether the statement of expenditure submitted
during such fiscal year, together with the procedures and internal
controls involved in their preparation, can be relied upon to
support the related withdrawals.
Section 4.02. (a) The Borrower shall cause the Executing
Agencies to maintain records and accounts adequate to reflect in
accordance with sound accounting practices the operations and
financial condition of the Executing Agencies.
(b) The Borrower shall cause Executing Agencies to:
(i) have their records, accounts and financial statements
(balance sheets, statements of income and expenses and related
statements) and the records and accounts for 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 available, but in any case
not later than six (6) months after the end of each such year: (A)
certified copies of their 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 Bank shall have reasonably
requested; and
(iii) furnish to the Bank such other information concerning
such records, accounts and financial statements and the audit
thereof as the Bank shall from time to time reasonably request.
Section 4.03. For the purpose of administering Part B of the
Project, the Borrower shall ensure payment of one-half of one
percent (1/2 of 1%) of the amounts disbursed and outstanding for
energy efficiency investements under Part B.1 of the Project to
RESF under arrangements satisfactory to the Bank.
Section 4.04. Once the number of Subsidiary Loans exceeds ten,
the Borrower shall select a bank satisfactory to the Bank and
enter into an arrangement, containing terms and conditions
satisfactory to the Bank, with such a bank to manage and
administer the repayment of the Subsidiary Loans.
Article V
Remedies of the Bank
Section 5.01. Pursuant to Section 6.02 (1) of the General
Conditions, the following additional events are specified:
(a) Subject to paragraph (b) of this Section:
(i) the right of the Borrower to withdraw the proceeds of any
loan or grant made to the Borrower for the financing of the
Project shall have been suspended, canceled or terminated in whole
or in part, pursuant to the terms of the agreement providing
therefor; or
(ii) any such loan shall have become due and payable prior to
the agreed maturity thereof.
(b) Paragraph (a) of this Section shall not apply if the
Borrower establishes to the satisfaction of the Bank that:
(i) such suspension, cancellation, termination or prematuring
is not caused by the failure of the Borrower to perform any of its
obligations under such agreement; and
(ii) adequate funds for the Project are available to the
Borrower from other sources on terms and conditions consistent
with the obligations of the Borrower under this Agreement.
Section 5.02. Pursuant to Section 7.01 (h) of the General
Conditions, the following additional event is specified, namely,
that the event specified in Section 5.01 (a) (ii) of this
Agreement shall occur, subject to the proviso of paragraph (b) of
that Section.
Article VI
Effective Date; Termination
Section 6.01. The date ninety (90) days after the date of this
Agreement is hereby specified for the purposes of Section 12.04 of
the General Conditions.
Article VII
Representatives of the Borrower; Addresses
Section 7.01. The Minister or the Deputy Minister of Finance of
the Borrower is designated as representative of the Borrower for
the purposes of Section 11.03 of the General Conditions.
Section 7.02. The following addresses are specified for the
purposes of Section 11.01 of the General Conditions:
For the Borrower:
Ministry of Finance
103097 Moscow
Ilyinka Street 9
Russian Federation
Telex:
112008
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 248423 (RCA)
Washington, D.C. 82987 (FTCC)
64145(WUI) or
197688 (TRT)
In witness whereof, the parties hereto, acting through their
duly authorized representatives, 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.
SCHEDULE 1
WITHDRAWAL OF THE PROCEEDS OF THE LOAN
1. The table below sets forth the Categories of items to be
financed out of the proceeds of the Loan, the allocation of the
amounts of the Loan to each Category and the percentage of
expenditures for items so to be financed in each Category:
-------------------------T-------------------T-------------------¬
¦ ¦ Amount of the ¦ ¦
¦ ¦ Loan Allocated ¦ % of ¦
¦ Category ¦ (Expressed in ¦ Expenditures ¦
¦ ¦Dollar Equivalent) ¦ to be Financed ¦
+------------------------+-------------------+-------------------+
¦ Part A of the Project¦ ¦ ¦
¦ ¦ ¦ ¦
¦(1) Technical assistance¦ 10,000,000 ¦ 100% ¦
¦ ¦ ¦ ¦
¦ Part B of the Project¦ ¦ ¦
¦ ¦ ¦ ¦
¦(2) Goods ¦ 47,500,000 ¦ 100% of foreign ¦
¦ ¦ ¦ expenditures, ¦
¦ ¦ ¦ 100% of local ¦
¦ ¦ ¦ expenditures ¦
¦ ¦ ¦ (ex-factory ¦
¦ ¦ ¦ cost) and 70% ¦
¦ ¦ ¦ of local ¦
¦ ¦ ¦ expenditures ¦
¦ ¦ ¦ for other ¦
¦ ¦ ¦ items procured ¦
¦ ¦ ¦ locally ¦
¦ ¦ ¦ ¦
¦(3) Technical ¦ 2,000,000 ¦ 100% ¦
¦ assistance ¦ ¦ ¦
¦ ¦ ¦ ¦
¦(4) Unallocated ¦ 10,500,000 ¦ ¦
+------------------------+-------------------+-------------------+
¦ TOTAL ¦ 70,000,000 ¦ ¦
L------------------------+-------------------+--------------------
2. For the purposes of this Schedule:
(a) the term "foreign expenditures" means expenditures in the
currency of any country other than that of the Borrower for goods
or services supplied from the territory of any country other than
that of the Borrower; and
(b) the term "local expenditures" means expenditures in the
currency of the Borrower or for goods or services supplied from
the territory of the Borrower; provided, however, that if the
currency of the Borrower is also that of another country from the
territory of which the goods and services are supplied,
expenditure in such currency for such goods or services shall
deemed to be "foreign expenditures".
3. Notwithstanding the provisions of paragraph 1 above, no
withdrawals shall be made in respect of:
(a) payments made for expenditures prior to the date of this
Agreement; and
(b) payments for expenditures under Category (2) of this
Schedule to finance an Energy Efficiency Sub-project under any
Subsidiary Loan, until the Bank shall have communicated its
acceptance to the Borrower of evidence that a Subsidiary Loan
Agreement has been duly executed on behalf of, and is legally
binding upon, the Borrower and the Executing Agency concerned in
respect of such Subsidiary Loan.
4. The Bank may require withdrawals from the Loan Account to be
made on the basis of statements of expenditure for expenditures
under contracts for goods and services not exceeding 50,000 USD
equivalent, under such terms and conditions as the Bank shall
specify by notice to the Borrower.
SCHEDULE 2
DESCRIPTION OF THE PROJECT
The objectives of the Project are to increase the efficiency of
energy use in Russia and to support policy reform in the gas
distribution sub-sector.
The Project consists of the following parts, subject to such
modifications thereof as the Borrower and the Bank may agree upon
from time to time to achieve such objectives:
Part A. Borrower's MFE
1. Technical assistance in support of institutional
strengthening and policy development.
2. Technical assistance to identify investments projects and
changes in procedures in the natural gas supply and utilization
system.
Part B. Borrower's RESF
1. Energy efficiency investments to be carried out by the
Executing Agencies.
2. Technical assistance in support of Project implementation.
The Project is expected to be completed by December 31, 2000.
SCHEDULE 3
AMORTIZATION SCHEDULE
-----------------------------------T-----------------------------¬
¦ ¦ Payment of Principal ¦
¦ Date Payment Due ¦ (expressed in dollars) <*> ¦
+----------------------------------+-----------------------------+
¦On each March 15 and September 15 ¦ ¦
¦ ¦ ¦
¦ beginning September 15, 2001 ¦ ¦
¦ through September 15,2012 ¦ 2,915,000 ¦
¦ ¦ ¦
¦And on March 15,2013 ¦ 2,955,000 ¦
L----------------------------------+------------------------------
--------------------------------
<*> The figures in this column represent dollar equivalents
determined as of the respective dates of withdrawal. See General
Conditions, Sections 3.04 and 4.03.
PREMIUMS ON PREPAYMENT
Pursuant to Section 3.04 (b) of the General Conditions, the
premium payable on the principal amount of any maturity of the
Loan to be prepaid shall be the percentage specified for the
applicable time of prepayment below:
----------------------------T------------------------------------¬
¦ Time of Prepayment ¦ Premium ¦
+---------------------------+------------------------------------+
¦ ¦ The interest rate (expressed as a¦
¦ ¦ percentage per annum) applicable to¦
¦ ¦ the Loan on the day of prepayment¦
¦ ¦ multiplied by: ¦
¦ ¦ ¦
¦Not more than three years ¦ 0.18 ¦
¦before maturity ¦ ¦
¦ ¦ ¦
¦More than three years but ¦ 0.35 ¦
¦not more than six years ¦ ¦
¦before maturity ¦ ¦
¦ ¦ ¦
¦More than six years but ¦ 0.65 ¦
¦not more than 11 years ¦ ¦
¦before maturity ¦ ¦
¦ ¦ ¦
¦More than 11 years but not ¦ 0.88 ¦
¦more than 15 years ¦ ¦
¦before maturity ¦ ¦
¦ ¦ ¦
¦More than 15 years before ¦ 1.00 ¦
¦maturity ¦ ¦
L---------------------------+-------------------------------------
SCHEDULE 4
PROCUREMENT AND CONSULTANTS' SERVICES
SECTION I. PROCUREMENT OF GOODS
Part A
GENERAL
Goods shall be procured in accordance with the provisions of
Section 1 of the "Guidelines for Procurement Under IBRD Loans and
IDA Credits" published by the Bank in January 1995, revised in
January 1996 (the Guidelines) and the following provisions of this
Section, as applicable.
Part B
INTERNATIONAL COMPETITIVE BIDDING
1. Except as otherwise provided in Part C of this Section,
goods shall be procured under contracts awarded in accordance with
the provisions of Section II of the Guidelines and paragraph 5 of
Appendix 1 thereto.
2. The following provisions shall apply to goods to be procured
under contracts awarded in accordance with the provisions of
paragraph 1 of this Part B, namely, that the provisions of
paragraphs 2.54 and 2.55 of the Guidelines and Appendix 2 thereto
shall apply to goods manufactured in the territory of the
Borrower.
Part C
OTHER PROCUREMENT PROCEDURES
International shopping
Goods estimated to cost less than 500,000 USD equivalent per
contract may be procured under contracts awarded on the basis of
international shopping procedures in accordance with the
provisions of paragraphs 3.5 and 3.6 of the Guidelines.
National Shopping
Goods estimated to cost less than 100,000 USD equivalent per
contract may be procured under contracts awarded on the basis of
national shopping procedures in accordance with the provisions of
paragraphs 3.5 and 3.6 of the Guidelines.
Part D
REVIEW BY THE BANK OF PROCUREMENT DECISIONS
With respect to each contract for goods, the procedures set
forth in paragraphs 2 and 3 of Appendix 1 to the Guidelines shall
apply. Where payments for such contract are to be made out of the
Special Account, such procedures shall be modified to ensure that
the two conformed copies of the contract required to be furnished
to the Bank pursuant to said paragraph 2 (d) shall be furnished to
the Bank prior to the making of the first payment out of the
Special Account in respect of such contract.
SECTION II. EMPLOYMENT OF CONSULTANTS
1. In order to assist the Borrower in carrying out Parts A and
B of the Project, the Borrower shall employ consultants whose
qualifications, experience and terms and conditions of employment
shall be satisfactory to the Bank. Such consultants shall be
selected in accordance with principles and procedures satisfactory
to the Bank on the basis of the "Guidelines for the Use of
Consultants by World Bank Borrowers and by The World Bank as
Executing Agency" published by the Bank in August 1981 (the
Consultant Guidelines). For complex, time-based assignments, the
Borrower shall employ such consultants under contracts using the
standard form of contract for consultants' services issued by the
Bank, with such modifications as shall have been agreed by the
Bank. Where no relevant standard contract documents have been
issued by the Bank, the Borrower shall use other standard forms
agreed with the Bank.
2. Notwithstanding the provisions of paragraph 1 of this
Section, the provisions of the Consultant Guidelines requiring
prior Bank review or approval of budgets, short lists, selection
procedures, letters of invitation, proposals, evaluation reports
and contracts shall not apply to: (a) contracts for the employment
of consulting firms estimated to cost less than 100,000 USD
equivalent each; or (b) contracts for the employment of
individuals estimated to cost less than 50,000 USD equivalent
each. However, said exceptions to prior Bank review shall not
apply to: (a) the terms of reference for such contracts; (b)
single-source selection of consulting firms; (c) assignments of a
critical nature, as reasonably determined by the Bank; (d)
amendments to contracts for the employment of consulting firms
raising the contract value to 100,000 USD equivalent or above; or
(e) amendments to contracts for the employment of individual
consultants raising the contract value to 50,000 USD equivalent or
above.
SCHEDULE 5
ELIGIBILITY, APPRAISAL PROCEDURES OF ENERGY
EFFICIENCY SUB-PROJECT AND PRINCIPAL TERMS AND
CONDITIONS OF SUBSIDIARY LOAN AGREEMENTS
(A) Sub-projects shall meet the following eligibility criteria
for financing under Part B of the Project:
(1) 20% Economic Rate of Return;
(2) 10% Financial Rate of Return;
(3) Technical feasibility;
(4) Satisfactory implementation plan;
(5) Demonstrated financial ability of the Executing Agency to:
(i) finance local costs of the Sub-project from internally
generated funds; and
(ii) provide debt service coverage of not less than 1.2; and
(6) An environmental assessment which meets Russian
requirements.
(B) Subsidiary Loans shall have the following terms:
(1) Interest rate of 3 percent above Bank's rate, of which 0.5
percent will cover the fee payable to RESF under Section 4.03;
(2) Maturity of 10 year inclusive of 3 years grace period; and
(3) Executing Agency bears foreign exchange risk.
SCHEDULE 6
Executing Agencies that are located in any of the following
cities:
(1) Saratov
(2) Voronezh
(3) Cherepovets
(4) Ryazan
(5) St. Petersburg
(6) Stavropol
(7) Rostov-on-Don
(8) Samara
(9) Nizhny-Novgorod
(10) Vladimir
SCHEDULE 7
SPECIAL ACCOUNT
1. For the purposes of this Schedule:
(a) the term "eligible Categories" means Category (1) in
respect of the Special Account for Part A of the Project, and
Categories (2), (3) and (4) in respect of the Special Account for
Part B of the Project, set forth in the table in paragraph 1 of
Schedule 1 to this Agreement;
(b) the term "eligible expenditures" means expenditures in
respect of the reasonable cost of goods and services required for
the Project and to be financed out of the proceeds of the Loan
allocated from time to time to the eligible Category in accordance
with the provisions of Schedule 1 to this Agreement; and
(c) the term "Authorized Allocation" means an amount equivalent
to 300,000 USD in respect of each of the respective Special
Accounts to be withdrawn from the Loan Account and deposited in
the Special Accounts pursuant to paragraph 3 (a) of this Schedule,
provided, however, that unless the Bank shall otherwise agree, the
Authorized Allocation shall be limited to an amount equivalent to
100,000 USD in respect of each of the respective Special Accounts
until the aggregate amount of withdrawals from the respective
Categories of the Loan Account plus the total amounts of all
outstanding special commitments entered into by the Bank pursuant
to Section 5.02 of the General Conditions shall be equal to or
exceed the equivalent of 1,000,000 USD.
2. (a) Payments out of the respective Special Account shall be
made exclusively for eligible expenditures in accordance with the
provisions of this Schedule.
(b) Each payment (including a payment under a letter of credit)
for an eligible expenditure in an amount equal to or less than the
equivalent of 30,000 USD shall be made exclusively out of the
respective Special Account. The Bank may from time to time, by
notice to the Borrower, revise the threshold amount specified in
the preceding sentence.
3. After the Bank has received evidence satisfactory to it that
the Special Accounts have been duly opened, withdrawals of the
Authorized Allocation and subsequent withdrawals to replenish the
respective Special Account shall be made as follows:
(a) For withdrawals of the Authorized Allocation, the Borrower
shall furnish to the Bank a request or requests for deposit into
the respective Special Account of an amount or amounts determined
by the Bank to be required to pay for eligible expenditures during
the four months following the date of each such request, which
amount shall not exceed the aggregate amount of the Authorized
Allocation. On the basis of such request or requests, the Bank
shall, on behalf of the Borrower, withdraw from the Loan Account
and deposit into the Special Account such amount or amounts as the
Bank shall have determined to be so required.
(b) (i) For replenishment of the respective Special Account,
the Borrower shall furnish to the Bank requests for deposits into
the respective Special Account at such intervals as the Bank shall
specify.
(ii) Prior to or at the time of each such request, the Borrower
shall furnish to the Bank the documents and other evidence
required pursuant to paragraph 4 of this Schedule for the payment
or payments in respect of which replenishment is requested. On the
basis of each such request, the Bank shall, on behalf of the
Borrower, withdraw from the Loan Account and deposit into the
respective Special Account such amount as the Borrower shall have
requested and as shall have been shown by said documents and other
evidence to have been paid out of the Special Account for eligible
expenditures.
All such deposits shall be withdrawn by the Bank from the Loan
Account under the respective eligible Categories, and in the
respective equivalent amounts, as shall have been justified by
said documents and other evidence.
4. For each payment made by the Borrower out of the respective
Special Account, the Borrower shall, at such time as the Bank
shall reasonably request, furnish to the Bank such documents and
other evidence showing that such payment was made exclusively for
eligible expenditures.
5. Notwithstanding the provisions of paragraph 3 of this
Schedule, the Bank shall not be required to make further deposits
into the Special Accounts:
(a) if, at any time, the Bank shall have determined that all
further withdrawals should be made by the Borrower directly from
the Loan Account in accordance with the provisions of Article V of
the General Conditions and paragraph (a) of Section 2.02 of this
Agreement;
(b) if the Borrower shall have failed to furnish to the Bank,
within the period of time specified in Section 4.02 (b) (ii) of
this Agreement, any of the audit reports required to be furnished
to the Bank pursuant to said Section in respect of the audit of
the records and accounts for the respective Special Account;
(c) if, at any time, the Bank shall have notified the Borrower
of its intention to suspend in whole or in part the right of the
Borrower to make withdrawals from the Loan Account pursuant to the
provisions of Section 6.02 of the General Conditions; or
(d) once the total unwithdrawn amount of the Loan allocated to
the respective eligible Category for such Account, minus the total
amount of all outstanding special commitments entered into by the
Bank pursuant to Section 5.02 of the General Conditions with
respect to said part of the Project, shall equal the equivalent of
twice the amount of the Authorized Allocation.
Thereafter, withdrawal from the Loan Account of the remaining
unwithdrawn amount of the Loan allocated to the eligible Category
shall follow such procedures as the Bank shall specify by notice
to the Borrower. Such further withdrawals shall be made only after
and to the extent that the Bank shall have been satisfied that all
such amounts remaining on deposit in the respective Special
Account as of the date of such notice will be utilized in making
payments for eligible expenditures.
6. (a) If the Bank shall have determined at any time that any
payment out of the respective Special Account: (i) was made for an
expenditure or in an amount not eligible pursuant to paragraph 2
of this Schedule; or (ii) was not justified by the evidence
furnished to the Bank, the Borrower shall, promptly upon notice
from the Bank: (A) provide such additional evidence as the Bank
may request; or (B) deposit into the respective Special Account
(or, if the Bank shall so request, refund to the Bank) an amount
equal to the amount of such payment or the portion thereof not so
eligible or justified. Unless the Bank shall otherwise agree, no
further deposit by the Bank into the respective Special Account
shall be made until the Borrower has provided such evidence or
made such deposit or refund, as the case may be.
(b) If the Bank shall have determined at any time that any
amount outstanding in the Special Accounts will not be required to
cover further payments for eligible expenditures, the Borrower
shall, promptly upon notice from the Bank, refund to the Bank such
outstanding amount.
(c) The Borrower may, upon notice to the Bank, refund to the
Bank all or any portion of the funds on deposit in the Special
Accounts.
(d) Refunds to the Bank made pursuant to paragraphs 6 (a), (b)
and (c) of this Schedule shall be credited to the Loan Account for
subsequent withdrawal or for cancellation in accordance with the
relevant provisions of this Agreement, including the General
Conditions.
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