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April 10, 1981
LOAN AND PROJECT AGREEMENT
dated 22 MAR 1982 between KREDITANSTALT FUR WIEDERAUFBAU and the
REPUBLIC OF THE PHILIPPINES and the NATIONAL HOUSING AUTHORITY for DM
10,000,000.--
- Resettlement Dasmariñas -
LOAN AND PROJECT AGREEMENT
between
KREDITANSTALT FUR WIEDERAUFBAU, Frankfurt am Main,
("Kreditanstalt") on the one part
and the
REPUBLIC OF THE PHILIPPINES
("Borrower")
and the
NATIONAL HOUSING AUTHORITY, Quezon City,
("Project Sponsor")
on the other part.
On the basis of the agreements dated December 13, 1978 and August 29, 1980 between the Government of the Federal Republic of Germany and the Government of the Republic of the Philippines on financial co-operation ("Government Agreements"), and the exchange of notes dated February 24, 1982 the Borrower, the Project Sponsor, and Kreditanstalt hereby conclude the following Loan and Project Agreement:
ARTICLE 1
Amount and Purpose of the Loan 1.1 Kreditanstalt undertakes to extend to the Borrower a Loan not exceeding
DM 10,000,000.-- (in words: ten million Deutsche Mark).
1.2 The Borrower shall channel the Loan in full to the Project Sponsor according to Article 2. The Project Sponsor shall use the Loan exclusively for Resettlement Dasmariñas, Area E, ("Project") and primarily to pay the foreign exchange costs. By separate agreement, the Project Sponsor and Kreditanstalt shall determine the details of the Project as well as the goods and services to be financed from the Loan.
1.3 Taxes and other public charges to be borne by the Project Sponsor and import duties shall not be financed from the Loan.
ARTICLE 2
Channelling of the Loan to the Project Sponsor
2.1 The Borrower shall channel the Loan to the Project Sponsor under a subsidiary loan agreement on the terms and conditions laid down in Article 4, sections 4.1, 4.2, 4.3 and 4.4.
2.2 Prior to the first disbursement from the Loan, the Borrower shall furnish Kreditanstalt with a copy of the loan agreement specified in Article 2.1.
2.3 The channelling of the Loan shall not constitute any liability of the Project Sponsor vis-a-vis Kreditanstalt for payment obligations under this Agreement.
ARTICLE 3 Disbursement
3.1 Kreditanstalt shall disburse the Loan upon request of the Project Sponsor in accordance with the progress of the Project. By separate agreement, the Project Sponsor and Kreditanstalt shall agree on the disbursement procedure, in particular on the evidence to be furnished by the Project Sponsor for the disbursement of the Loan, proving the use of the loan amounts for the purpose stipulated in this Agreement.12 Philippines, Mar 3.2 Kreditanstalt shall have the right to refuse to make disbursements after December 31, 1985.
3.3 The Borrower shall be entitled to cancel any loan amounts which have not yet been requested, if Kreditanstalt and the Project Sponsor have consented thereto.
ARTICLE 4
Commitment Charge, Interest, and Repayments 4.1 The Borrower shall pay a commitment charge of 1/4 % p.a. (one quarter of one per cent per annum) on un-disbursed loan amounts. The commitment charge shall be computed for a period beginning three months after the signing of this Agreement and ending at the respective dates at which disbursements are debited.
4.2 The Borrower shall pay interest on the Loan at a rate of 2 % p.a. (two per cent per annum). Interest shall be charged from the dates at which disbursements are debited to the dates at which repayments are credited to Kreditanstalt's account specified in Article 4.9.
4.3 The Borrower shall pay the commitment charge, the interest, and the interest on arrears pursuant to Article 4.5, if any, semi-annually on June 30 and on December 31 for the half-year then ending. The first commitment charge shall be due together with the first interest payment.
4.4 The Borrower shall repay the Loan as follows:
4.5 If repayments are not at Kreditanstalt's disposal when due, Kreditanstalt shall be entitled to increase the rate of interest on arrears to the discount rate of Deutsche Bundesbank prevailing at the respective due date plus 3 % p.a. for the period beginning with the due date and ending at the date at which such repayments in default are credited. In the case of arrears of interest, Kreditanstalt shall be entitled to claim damages. Such damages shall not exceed the amount arrived at if interest on arrears were charged at the discount rate of Deutsche Bundesbank prevailing at the respective due date plus 3 % p.a.
June
30, 1992 December 31, 1992 June 30, 1993 December 31, 1993 June 30, 1994 December 31, 1994 June 30, 1995 December 31, 1995 June 30, 1996 December 31, 1996 June 30, 1997 December 31, 1997 June 30, 1998 December 31, 1998 June 30, 1999 December 31, 1999 June 30, 2000 June
30, 2001 December 31, 2000 December
31, 2001 June
30, 2002 December
31, 2002 June
30, 2003 December
31, 2003 June
30, 2004 December
31, 2004 June
30, 2005 December
31, 2005 June
30, 2006 December
31, 2006 June
30, 2007 December
31, 2007 June
30, 2008 December
31, 2008 June
30, 2009 December
31, 2009 June
30, 2010 December
31, 2010 June
30, 2011 December
31, 2011 June
30, 2012
4.6 Commitment charge, interest, and additions for default pursuant to Article 4.5, if any, shall be computed on the basis of a 360-days year and of 30-days months
4.7 Undisbursed or prematurely repaid loan amounts shall be set off against such redemption instalments as shall fall due last under the repayment schedule except as otherwise agreed upon in a particular case.
4.8 Kreditanstalt shall be entitled to set off, at its discretion, payments received against payments due under this Agreement or under other loan agreements concluded between Kreditanstalt and the Borrower.
4.9 The Borrower shall remit all payments in no other currency than Deutsche Mark to Kreditanstalt's account No. 504 091 00 with Deutsche Bundesbank, Frankfurt am Main, no set-off against such payments being permitted.
ARTICLE 5
Suspension of Disbursements and Premature Repayment
5.1 The Borrower shall be entitled at any time
(a) subject to his obligations under Article 8, to forgo any loan amounts not yet withdrawn, and
(b) to repay the Loan in whole or in part in advance of maturity.
5.2 Kreditanstalt shall be entitled to suspend disbursement only if
(a) the Borrower shall have failed to perform his obligation vis-a-vis Kreditanstalt to make payments when due;5.3 If any event specified in Article 5.2 (a), (b) or (c) shall have occurred and shall continue for a period to be specified by Kreditanstalt which shall, however, not be less than 30 days Kreditanstalt shall be entitled
(b) obligations under this Agreement or under separate agreements pertaining to this Agreement shall not have been duly performed;
(c) the Project Sponsor shall not be able to prove the use of the loan amounts for the purpose stipulated in this Agreement or
(d) any extraordinary situation shall have arisen which shall preclude or seriously jeopardize the accomplishment of the purpose of the Loan, the execution of the Project or the performance of the payment obligations assumed by the Borrower under this Agreement.
(a) in the case of events specified in Article 5.2 {a) or 5.2 (b) to demand the immediate repayment of all loan amounts outstanding as well as payment of all interest accrued and all other incidental charges or
(b) in the case of the event specified in Article 5.2 (c) to demand the immediate repayment of such loan
amounts which the Project Sponsor is unable to prove to have been used for the purpose stipulated
in this Agreement.ARTICLE 6
Costs and Public Charges
6.1 The Borrower shall make all payments to be made under this Agreement without any deduction for taxes, other public charges or other costs and shall pay any transfer and conversion costs arising in connection with the disbursement of the Loan.
6.2 The Borrower by itself or through the Project Sponsor shall bear all taxes and other public charges imposed by the Republic of the Philippines accruing in connection with the conclusion and implementation of this Agreement.
ARTICLE 3
Validity of the Loan and Project Agreement and Power of Attorney
7.1 In due course prior to the first disbursement evidence satisfactory to Kreditanstalt shall be furnished to Kreditanstalt proving that
(a) the Borrower has met all requirements under his constitution and other laws for the valid assumption of all his obligations under this Agreement;7.2 The Minister of Finance and such persons as designated by him to Kreditanstalt and authorized by specimen signature authenticated by him shall represent the Borrower in the implementation of this Agreement. The General Manager of the National Housing Authority and such persons as designated by him to Kreditanstalt and authorized by specimen signature authenticated by him shall represent the Project Sponsor in the implementation of this Agreement. In the event that a change in the representation shall occur the person authorized to represent the respective contracting party shall notify Kreditanstalt of the newly designated representative and of his address. The power of attorney shall expire only when its express revocation by the representative authorized at the time shall have been received by Kreditanstalt.
(b) the Project Sponsor has met all requirements under Philippine law for the valid assumption of all his obligations under this Agreement.
7.3 Amendments of, and additions to, this Agreement and any notice or statement which shall be given or made under this Agreement by the contracting parties shall be in writing. Any such notice or statement shall be deemed to have been received when it shall have been delivered at the following addresses of the contracting parties, or at such other address as notified to the other contracting parties:
For Kreditanstalt
Postal address: Kreditanstalt fiir Wiederaufbau
Postfach 11 11 41
Palmengartenstrasse 5-9
D - 6000 Frankfurt am Main
Federal Republic of GermanyFor the Borrower:
Postal address:
Ministry of Finance Metro Manila Republic of the Philippines National Housing Authority For the Project Sponsor:
Quezon Memorial Elliptical Road Diliman Quezon City Republic of the Philippines
Any change in the above addresses shall be effective only when notification thereof shall have been received by the other contracting parties.
7.4 Amendments of this Agreement affecting only the payment obligations of the Borrower shall not require the approval of the Project Sponsor.
ARTICLE 8
The Project
8.1 The Project Sponsor shall:
(a) prepare, carry out, and maintain the Project in conformity with sound financial and engineering practices as well as substantially in accordance with the plans and data submitted to Kreditanstalt;
(b) assign the preparation and supervision of the construction of the Project to independent, German qualified consulting engineers and the Project's execution to. qualified Philippine firms upon prior national public invitation to tender;
(c) maintain, or cause to be maintained, books and records showing all costs of goods and services required for the Project and identifying the goods and services financed from the Loan;
(d) enable the representatives of Kreditanstalt at any time to inspect such books and records as well as any other documentation relevant to the execution of the Project and to visit the Project and all the installations related thereto;
(e) supply any information and reports on the Project and its further progress which Kreditanstalt may request;
(f) take appropriate action to ensure an adequate extension of the high school in "Area B" by the relevant ministry;
(g) carry out a job creation scheme in the project area (livelihood component), modeled on the corresponding scheme already existing in Dasmariñas ("Area C"), and establish a training centre for this purpose;
(h) continue also in Dasrnariñas with the consultation of the squatters concerned regarding the implementation and operation of the Project as practiced in Dagat Dagatan and support the establishment of self-help organizations;
(i) in due time submit to Kreditanstalt in order to reach consent on the lending procedure and the terms and conditions of the building material credits possibly to be extended as well as of the credit schemes for promotion of small-scale industry; such credit schemes shall ensure that also the members of the lower income brackets will have access to credits;
(j) fix the rent or the hire-purchase rates in accordance with the financial affordability of the squatters, so that members of the lower income brackets will be enabled to enter into renters ' agreements and are not precluded from the acquisition of land titles;
(k) take appropriate action to help families of the lower income brackets in cases of need to meet the obligations undertaken by them;
(l) in due time submit to Kreditanstalt for its comment drafts of the renters' agreements or hire-purchase agreements to be concluded, and
(m) in due time prior to the termination of the resettlement submit to Kreditanstalt for approval a draft of a workable rent collection system.
8.2 The Project Sponsor and Kreditanstalt shall lay down the details pertaining to Article 8.1 in a separate Agreement.
8.3 The Borrower and the Project Sponsor shall
(a) secure the full financing of the Project and, upon request of Kreditanstalt, furnish it with evidence proving that all costs not to be paid from the Loan are covered;
(b) of their own accord promptly inform Kreditanstalt of any circumstances seriously affecting or jeopardizing the accomplishment of the purpose of this Agreement, above all the execution or operation of the Project;
(c) together with the relevant authorities take appropriate action to prevent further immigration to Dulo Puting Bato after the census has been carried out, and
(d) apply for supporting measures within the framework of German Technical Co-operation with the Philippines to work out a comprehensive approach to industrial settlement, promotion of small-scale industry, and vocational training in the project area.
8.4 The Borrower shall
(a) assist the Project Sponsor in conformity with sound financial and engineering practices in the execution of the Project and in the performance of his obligations under this Agreement and, in particular, grant the Project Sponsor all permissions legally possible and necessary for the execution of the Project;
(b) cause his relevant ministries and authorities- to co-operate with the Project Sponsor in the execution of the Project, including the Dasmariñas High School ("Area B"), and, if this should prove necessary, to provide funds required for implementing the Project according to schedule, and
- to take over established buildings and facilities from the Project Sponsor after completion and to properly run and maintain them.
8.5 Regarding sea and air transport of the goods to be financed from the Loan the provisions of the Government Agreements, which are known to the Borrower, shall apply.
ARTICLE 9
Miscellaneous Provisions
9.1 The invalidity of one provision of this Agreement shall not affect the validity of the other provisions. Any gap resulting in consequence shall be filled by a provision consistent with the purpose of this Agreement.
9.2 The Borrower shall not assign or transfer, pledge or mortgage any rights under this Agreement.
9.3 This Agreement shall be governed by the law of the Federal Republic of Germany. The place of performance shall be Frankfurt am Main. In case of doubt as to the interpretation of this Agreement, the German text shall be controlling.
DONE in six originals, three in German and three in English
Arbitration Clause
All disputes arising from the foregoing Agreement, including disputes on the validity of such Agreement and this Arbitration Clause, which cannot be settled amicably between the contracting parties shall be submitted to arbitration as agreed upon in the trilateral Arbitration Agreement pertaining to the Loan and Project Agreement dated April 10, 1981 (Urban Housing Dagat Dagatan II A/B). If and when all the payment obligations under the foregoing Agreement shall have been performed such Arbitration Agreement shall forthwith terminate.