Development Credit Agreement
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Public Disclosure Authorized CONFORMED COPY CREDIT NUMBER 3730-ALB Development Credit Agreement Public Disclosure Authorized (Municipal Water and Wastewater Project) between ALBANIA and Public Disclosure Authorized INTERNATIONAL DEVELOPMENT ASSOCIATION Dated March 20, 2003 Public Disclosure Authorized 2 CREDIT NUMBER 3730-ALB DEVELOPMENT CREDIT AGREEMENT AGREEMENT, dated March 20, 2003, between ALBANIA (the Borrower) and INTERNATIONAL DEVELOPMENT ASSOCIATION (the Association). WHEREAS (A) the Borrower, having satisfied itself as to the feasibility and priority of the project described in Schedule 2 to this Agreement (the Project), has requested the Association to assist in the financing of the Project; (B) the Project will be carried out by Water and Wastewater Company of Durres, Water and Wastewater Company of Fier, Water and Wastewater Company of Lezhe and Water and Wastewater Company of Saranda with the Borrower’s assistance and, as part of such assistance, the Borrower will make the proceeds of the credit provided for in Article II of this Agreement (the Credit) available to Water and Wastewater Company of Durres, Water and Wastewater Company of Fier, Water and Wastewater Company of Lezhe and Water and Wastewate Company of Saranda, as set forth in this Agreement; and WHEREAS the Association has agreed, on the basis, inter alia, of the foregoing, to extend the Credit to the Borrower upon the terms and conditions set forth in this Agreement, in the agreement of even date herewith among the Association, Durres Region and Water and Wastewater Company of Durres (the Durres Project Agreement), in the agreement of even date herewith among the Association, the Municipality of Fier and Water and Wastewater Company of Fier (the Fier Project Agreement), in the agreement of even date herewith among the Association, the Municipality of Lezhe and Water and Wastewater Company of Lezhe (the Lezhe Project Agreement), and in the agreement of even date herewith among the Association, the Municipality of Saranda and Water and Wastewater Company of Saranda (the Saranda Project Agreement); NOW THEREFORE the parties hereto hereby agree as follows: - 2 - ARTICLE I General Conditions; Definitions Section 1.01. The “General Conditions Applicable to Development Credit Agreements” of the Association, dated January 1, 1985 (as amended through October 6, 1999) (the General Conditions), constitute an integral part of this Agreement. Section 1.02. 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) “Category” means the categories for the items to be financed out of the proceeds of the Credit as set forth in Schedule 1 to this Agreement. (b) “CMU” means the Contract Monitoring Unit established by the Borrower for the purpose of Project coordination and management. (c) “Durres Region” means the Durres Region including the Cities of Durres, Shijak and Kruje, Towns of Fushe Kruje, Sukth and Manz, Communes of Katundi i Ri, Rrashbull, Maminas, Gjepalas, Xhafzotaj, Ishem, Bubq, Nikel, Koder Thumane and Cudhi of the Borrower, or any successor thereto. (d) “EMPF” means the Environmental Management Plan Framework, satisfactory to the Association, adopted by the Borrower and submitted to the Association on July 23, 2002, setting forth measures to mitigate any adverse impacts to the environment. (e) “Executive Committee” means the Committee established by the Borrower and Durres Region, the Municipalities of Fier, Lezhe and Saranda to provide policy guidance and oversight of Project implementation. (f) “Financial Monitoring Report” or “FMR” means each report prepared in accordance with Section 4.02 of this Agreement. (g) “FY” means the fiscal year of the Borrower beginning on January 1 and ending on December 31 of each year. - 3 - (h) “Investment Fund” means the special fund established, administered and maintained by the Borrower for the purpose of financing essential investments under Part A of the Project for the repair, rehabilitation and management of the water supply system in Durres, Fier, Lezhe and Saranda. (i) “Management Contract” means the performance-based service contract that WWCD, WWCF, WWCL and WWCS will enter into with the Operator for: (i) the management of water supply and sanitation services in the service areas of Durres, Fier, Lezhe and Saranda; and (ii) the rehabilitation and operations improvement of the water supply and sanitation systems. (j) “Municipality of Fier” means the City of Fier of the Borrower, or any successor thereto. (k) “Municipality of Lezhe” means the City of Lezhe of the Borrower, or any successor thereto. (l) “Municipality of Saranda” means the City of Saranda and Villages of Gjashta and Metohu of the Borrower, or any successor thereto. (m) “Operator” means an internationally experienced private water utility operator that will enter into the Management Contract with WWCD, WWCF, WWCL and WWCS. (n) “Durres Project Agreement” means the agreement among the Association, Durres Region and WWCD of even date herewith, as the same may be amended from time to time, and such term includes all schedules and agreements supplemental to the Project Agreement. (o) “Fier Project Agreement” means the agreement among the Association, Municipality of Fier and WWCF of even date herewith, as the same may be amended from time to time, and such term includes all schedules and agreements supplemental to the Project Agreement. (p) “Lezhe Project Agreement” means the agreement among the Association, Municipality of Lezhe and WWCL of even date herewith, as the same may be amended from time to time, and such term includes all schedules and agreements supplemental to the Project Agreement. - 4 - (q) “Saranda Project Agreement” means the agreement among the Association, Municipality of Saranda and WWCS of even date herewith, as the same may be amended from time to time, and such term includes all schedules and agreements supplemental to the Project Agreement. (r) “Project Agreements” means collectively the Agreements referred to in Paragraphs (n), (o), (p) and (q) of this Section, and the term “Project Agreement” means any of the Project Agreements. (s) “Project Preparation Advance” means the project preparation advance granted by the Association to the Borrower pursuant to the Letter Agreement signed on behalf of the Association on December 1, 1995, and on behalf of the Borrower on December 26, 1995. (t) “PIP” means the Project Implementation Plan for carrying out of the Project prepared and adopted by the Borrower, as the same may be amended from time to time with the agreement of the Association. (u) “Special Account” means the account referred to in Section 2.02(b) of this Agreement; (v) “Durres Subsidiary Loan Agreement” means the agreement entered into between the Borrower and WWCD pursuant to Section 3.01(b) of this Agreement, as the same may be amended from time to time, and such term includes all schedules to the Subsidiary Loan Agreement. (w) “Fier Subsidiary Loan Agreement” means the agreement entered into between the Borrower and WWCF pursuant to Section 3.01(b) of this Agreement, as the same may be amended from time to time, and such term includes all schedules to the Subsidiary Loan Agreement. (x) “Lezhe Subsidiary Loan Agreement” means the agreement entered into between the Borrower and WWCL pursuant to Section 3.01(b) of this Agreement, as the same may be amended from time to time, and such term includes all schedules to the Subsidiary Loan Agreement. (y) “Saranda Subsidiary Loan Agreement” means the agreement entered into between the Borrower and WWCS pursuant to Section 3.01(b) of this Agreement, as the same may be amended from time to time, and such term includes all schedules to the Subsidiary Loan Agreement. - 5 - (z) “Subsidiary Loan Agreements” means collectively the Agreements referred to in Paragraphs (v), (w), (x) and (y) of this Section, and the term “Subsidiary Loan” means any of the Subsidiary Loans provided under any of the Subsidiary Loan Agreements. (aa) “WWCD” means the Water and Wastewater Company of Durres. (bb) “WWCF” means the Water and Wastewater Company of Fier. (cc) “WWCL” means the Water and Wastewater Company of Lezhe. (dd) “WWCS” means the Water and Wastewater Company of Saranda. ARTICLE II The Credit Section 2.01. The Association agrees to lend to the Borrower, on the terms and conditions set forth or referred to in the Development Credit Agreement, an amount in various currencies equivalent to eleven million four hundred thousand Special Drawing Rights (SDR 11,400,000). Section 2.02. (a) The amount of the Credit may be withdrawn from the Credit Account in accordance with the provisions of Schedule 1 to this Agreement for expenditures made (or, if the Association shall so agree, to be made) in respect of the reasonable cost of goods and services required for the Project and to be financed out of the proceeds of the Credit. (b) The Borrower may, for the purposes of the Project, open and maintain in dollars a special deposit account in a bank on terms and conditions satisfactory to the Association, including appropriate protection against set-off, seizure or attachment. Deposits into, and payments out of, the Special Account shall be made in accordance with the provisions of Schedule 4 to this Agreement. (c) Promptly after the Effective Date, the Association shall, on behalf of the Borrower, withdraw from the Credit Account and pay to itself the amount required to repay the principal amount of the Project Preparation Advance withdrawn and outstanding as of such date and to pay all unpaid charges thereon. The unwithdrawn balance of the authorized amount of the Project Preparation Advance shall thereupon be canceled. - 6 - Section 2.03. The Closing Date shall be December 31, 2009 or such later date as the Association shall establish. The Association shall promptly notify the Borrower of such later date.