Loan Agreement Public Disclosure Authorized (Minas Gerais Second Rural Development Project)
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Public Disclosure Authorized OFFICIAL DOCUMENTS LOAN NUMBER 1877 BR Loan Agreement Public Disclosure Authorized (Minas Gerais Second Rural Development Project) between INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT Public Disclosure Authorized and STATE OF MINAS GERAIS Dated , 1980 Public Disclosure Authorized LOAN NUMBER 1877 BR LOAN AGREEMENT AGREEMENT, dated 15, 1980, between INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT (hereinafter called the Bank) and STATE OF MINAS GERAIS (hereinafter called the Borrower). WHEREAS (A) the Borrower has requested the Bank to assist in the financing of the Project described in Schedule 2 to this Agreement by making the Loan as hereinafter provided; (B) the Federal Senate of the Guarantor has, by Resolution No. r72 , dated f&keD)I010 , authorized the Borrower to enter into this Loan Agreement, pursuant to the provisions of Article 42, IV, of the Guarantor's constitution; (C) the Borrower intends to secure additional external financing in an amount equivalent to about fifty million dollars ($50,000,000) by June 30, 1981 (hereinafter called the Private Bank Loan) for purposes of assisting in financing the Project; and (D) the Bank has agreed, on the basis, inter alia, of the foregoing, to make the Loan to the Borrower upon the terms and conditions hereinafter set forth; NOW THEREFORE the parties hereto hereby agree as follows: ARTICLE I General Conditions; Definitions Section 1.01. The parties to this Agreement accept all the provisions of the General Conditions Applicable to Loan and Guarantee Agreements of the Bank, dated March 15, 1974, with the same force and effect as if they were fully set forth herein, (said General Conditions Applicable to Loan and Guarantee Agree- ments of the Bank being hereinafter called the General Conditions). Section 1.02. Wherever used in this Agreement, 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: -2- (a) "Project Area" means an area within the State of Minas Gerais of about 61,000 square kilometers which comprises the municipalities listed in Schedule 5 to this Agreement, as such Schedule may be amended from time to time. (b) "PCU" means the project coordinating unit of the Bor- rower; and "Project Director" means the director of the PCU. (c) "Participating Banks" means Banco do Brasil S.A., Banco do Estado de Minas Gerais S.A., Banco de Credito Real de Minas Gerais S.A. and Caixa Economica do Estado de Minas Gerais. (d) "Participating Agencies" means the agencies and insti- tutions set forth in Schedule 6 to this Agreement. (e) "Collaborating Agencies" means the agencies and institu- tions set forth in Schedule 6 to this Agreement. (f) "CAMIG" means Companhia Agricola de Minas Gerais, the Borrower's Agricultural Trading Company. (g) "CASEMG" means Companhia de Armazens e Silos de Minas Gerais, the Borrower's storage company; (h) "CEMIG" means Centrais Eletricas de Minas Gerais S.A., the Borrower's Electrification Company. (i) "DAE" means Departamento de Agua e Energia Eletrica de Minas Gerais, the Borrower's Water and Electric Energy Agency. (j) "DER-MG" means Departamento de Estradas de Rodagem do Estado de Minas Gerais, the Borrower's Highway Department. (k) "EMATER-MG" means Empresa de Assist^ncia Tecnica e Extens2o Rural de Minas Gerais, the Borrower's Technical Assis- tance and Rural Extension Company. (1) "EPAMIG" means Empresa de Pesquisa Agropecudria de Minas Gerais, the Borrower's Agricultural Research Institute. (m) "IEF" means Instituto Estadual de Florestas, the Bor- rower's Forestry Institute. -3- (n) "RURALMINAS" means Fundago Rural Mineira, Colonizagao e Desenvolvimento Agr5rio, a Rural Development Foundation located in the State of Minas Gerais. (o) "SEA" means Secretaria de Estado da Agricultura de Minas Gerais, the Borrower's Secretariat of Agriculture. (p) "SEE" means Secretaria de Estado da Educago de Minas Gerais, the Borrower's Secretariat of Education. (q) "SEPLAN-MG" means Secretaria de Estado do Planejamento e Coordenago Geral de Minas Gerais, the Borrower's Secretariat of Planning and General Coordination. (r) "SES" means Secrataria de Estado da Saude de Minas Gerais, the Borrower's Secretariat of Health. (s) "SETAS" means Secretaria de Estado do Trabalho, Ago Social e Desportos de Minas Gerais, the Borrower's Secretariat of Labor, Social Action and Sports. (t) "SUDECOOP" means Superintendencia de Cooperativismo da SEA, the Borrower's Superintendency of Cooperatives. (u) "UFV" means Universidade Federal de Vigosa, the Guaran- tor's University of Vicosa. (v) "MVR" means Maior Valor de Referencia, the monetary correction factor established and periodically adjusted by the Guarantor pursuant to the Guarantor's Law No. 6205, dated April 29, 1975, and the Guarantor's Decree No. 75704, dated May 8, 1975. (w) "Beneficiary" means a small farmer in the Project Area who farms his own land or who is a sharecropper or a tenant farmer, and who lives on or near his farm and derives not less than 50% of total family income from agricultural activities. (x) "Sub-loan" means a loan made for purposes of Part A of the Project by a Participating Bank to a Beneficiary in the Project Area, which the Borrower will partially finance out of the proceeds of the Loan, and which will be provided to Benefi- ciaries in the sub-regions of Nordeste and Vale do Rio Doce who own or cultivate less than 100 ha and to Beneficiaries in the sub-regions of Zona da Mata and Sul de Minas who own or cultivate -4- less than 50 ha, with the exception of credit for reforestation purposes, which will be provided to Beneficiaries in the sub- regions referred to herein who own or cultivate less than 100 ha. (y) "First Rural Development Project" means the rural development project in Minas Gerais being carried out under the Loan Agreement between the Bank and the Borrower dated February 23, 1977. (z) "Small non-farm enterprise" means an enterprise having less than ten employees, fixed assets of less than 300 MVR and annual sales of less than 600 MVR. ARTICLE II The Loan Section 2.01. The Bank agrees to lend to the Borrower, on the terms and conditions in the Loan Agreement set forth or referred to, an amount in various currencies equivalent to sixty-three million dollars ($63,000,000). Section 2.02. The amount of the Loan may be withdrawn from the Loan Account in accordance with the provisions of Schedule 1 to this Agreement, as such Schedule may be amended from time to time by agreement between the Borrower and the Bank, for expendi- tures 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. Section 2.03. Except as the Bank shall otherwise agree, contracts for the purchase of goods or for civil works, to be financed out of the proceeds of the Loan, shall be governed by the provisions of Schedule 4 to this Agreement. Section 2.04. The Closing Date shall be December 31, 1985 or such later date as the Bank shall establish. The Bank shall promptly notify the Borrower and the Guarantor of such later date. Section 2.05. The Borrower shall pay to the Bank a commit- ment charge at the rate of three-fourths of one per cent (3/4 of 1%) per annum on the principal amount of the Loan not withdrawn from time to time. -5- Section 2.06. The Borrower shall pay interest at the rate of eight and twenty-five hundredths per cent (8.25%) per annum on the principal amount of the Loan withdrawn and outstanding from time to time. Section 2.07. Interest and other charges shall be payable semiannually on February 15 and August 15 in each year. Section 2.08. 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 shall carry out the Project through 'the respective agencies and institutions of the Borrower and the Guarantor designated for that purpose in accordance with the provisions of Schedule 6 to this Agreement, with due diligence and efficiency and in conformity with appropriate administrative, financial, engineering and agricultural practices, and shall provide, or cause to be provided, promptly as needed, the funds, facilities, services and other resources required for the purpose. Section 3.02. The B rower shall employ consultants whose qualifications, experienc and terms and conditions of employment shall be satisfactory to the Borrower and the Bank, such consul- tants for purposes of Part B (4) (b) of the Project to be employed not later than June 30, 1981. Section 3.03. The Borrower shall: (a) cause SEPLAN-MG and SEA to enter into and maintain an agreement setting forth the adminis- trative structure for the purpose of the execution of the Project and the responsibilities and obligations of SEA as the coordina- ting agent of the Project; (b) cause SEPLAN-MG and SEA to enter into an agreement with each Participating Agency setting forth the obligations of each Participating Agency in executing the Project, the targets of the Project, as described in Schedule 2 to this Agreement, the source of funds and the schedule for carrying out the Project; (c) cause the Participating Agencies to enter into agreements with the Collaborating Agencies setting forth the responsibilities and obligations of the Collaborating Agency under the Project; and (d) cause the Participating Agencies, prior to the initiation of construction of civil works, to enter into -6- agreements with the municipalities and the communities located in such municipalities in which such works are to be performed, setting forth operation and maintenance responsibilities of each of the contracting parties.