Advanced Search

Law No. 69 Of 26 March 2004

Original Language Title:  LEGE nr. 69 din 26 martie 2004

Subscribe to a Global-Regulation Premium Membership Today!

Key Benefits:

Subscribe Now for only USD$40 per month.
LEGE no. 69 69 of 26 March 2004 on the ratification of the Financing Contract between Romania and the European Investment Bank and Bucharest Municipality for the financing of the Project on the Rehabilitation of Educational Infrastructure in Bucharest, signed in Bucharest on 1 October 2003 and in Luxembourg on 7 October 2003
ISSUER PARLIAMENT
Published in OFFICIAL MONITOR no. 347 347 of 21 April 2004



The Romanian Parliament adopts this law + Article 1 The financing contract between Romania and the European Investment Bank and Bucharest Municipality for the financing of the Project on the rehabilitation of the educational infrastructure in Bucharest, signed in Bucharest on October 1, 2003 and at the Luxembourg on 7 October 2003, amounting to EUR 112,2 million. + Article 2 (1) The application of the provisions of the financing contract will be carried out by Bucharest Municipality, through the Project Implementation Unit on the rehabilitation of the educational infrastructure in Bucharest, consisting of two representatives of the Bucharest Municipality, a representative of the sector mayoralties and a representative of the School Inspectorate of Bucharest Municipality. (2) The Ministry of Public Finance will conclude with the Municipality of Bucharest a subsidiary loan agreement, establishing the rights and obligations of the parties in the application of the provisions of the financing contract, including the distribution of the necessary amounts for the project on activities and funding sources. + Article 3 Romania's contribution to the project provided in art. 1 will be provided from the own funds of Bucharest Municipality and will be equal to the equivalent in lei of 37.4 million euros. This contribution will be increased by the amount of taxes and fees related to the project, which will be covered from the same source, namely the own funds of Bucharest. + Article 4 The funds in lei necessary for the repayment of the loan, the payment of interest, commissions and other costs related to the loan shall be ensured from the own funds of Bucharest Municipality. + Article 5 (1) The Romanian Government is authorized that, through the Ministry of Public Finance, in agreement with the European Investment Bank and Bucharest Municipality, to introduce during the use of the loan, in relation to the concrete conditions of financing contract, amendments to its content, which concern changes in the technical description, changes of deadlines, as well as any other changes that are not likely to increase Romania's financial obligations to the Bank European Investment or to determine new economic conditionings from those agreed initially between parties. ((2) Amendments to the financing contract, agreed with the European Investment Bank and Bucharest Municipality according to par. (1), will be approved by Government decision. This law was adopted by the Chamber of Deputies at its meeting on February 24, 2004, in compliance with the provisions of 76 76 para. (2) of the Romanian Constitution, republished. CHAMBER OF DEPUTIES PRESIDENT VALER DORNEANU This law was adopted by the Senate at its meeting on March 11, 2004, in compliance with the provisions of art 76 76 para. (2) of the Romanian Constitution, republished. SENATE PRESIDENT NICOLAE VACAROIU Bucharest, March 26, 2004. No. 69. EUROPEAN INVESTMENT BANK Be no. 22.214 Agora nr. 2001 2001 0158 Romania-Project on rehabilitation Educational infrastructure in Bucharest-AFI project FINANCING CONTRACT between Romania and the European Investment Bank and Bucharest Municipality *) _________ Note * *) Translation. This contract is concluded between: Romania, represented by the Ministry of Public Finance, based in str. Apolodor no. 17, sector 5, Bucharest, Romania, represented by Mr. Mihai Nicolae Tanasescu, minister, hereinafter referred to as the Loan, as the first part, European Investment Bank, headquartered in bd. Konrad Adenauer nr. 100, Luxembourg-Kirchberg, Grand Duchy of Luxembourg, represented by Mr. Rainer Saerbeck, Head of Department, and Mr. Gian Domenico Spota, Senior Advisor, hereinafter referred to as the Bank, as the second party, and Bucharest Municipality, based in bd. Queen Elizabeth no. 47, sector 5, Bucharest, Romania, represented by Mr. Traian Basescu, general mayor, hereinafter referred to as the Municipality, as the third party. Given that: 1. On February 1, 1993 the European Communities and the Loan concluded the European Association Agreement between the European Communities and their Member States, on the one hand, and Romania, on the other. 2. Within this European agreement the Board of Governors of the Bank authorized the continuation of loans for investment projects in Romania. 3. On 4/5 June 1997 a framework agreement (hereinafter referred to as the Framework Agreement) on financial cooperation was signed by the Bank and the Bank and is applicable to this contract. 4. The borrower proposed the initiation of a project (hereinafter referred to as the Project) to be carried out by the Municipality, which consists in the modernization and rehabilitation of 106 schools in the pre-university education in Bucharest, as specified in more detail in the technical description in Annex A to this contract ((hereinafter referred to as Technical Description). 5. The municipality, through the Department of Education, Culture (hereinafter referred to as DIC), will be responsible for the coordination of all project activities 6. The total cost of the Project, as estimated by the Bank, is EUR 149,600,000 (one hundred and forty-nine million six hundred thousand euros), including unforeseen expenses and interest during the execution period, but excluding taxes and fees. 7. The project cost is to be financed as follows: ● State/Municipality contribution and other funds: EUR 37,400,000 ● Bank loan: EUR 112.200,000 ● total: EUR 149,600,000 8. Consequently, the borrower asked the Bank for a loan in the amount equivalent to EUR 112,200,000 (one hundred twelve million two hundred thousand euros). 9. On May 17, 2003 Romania confirmed in writing that the Project is transmitted with its consent to be financed by the Bank. 10. Based on art. 3 of the Framework Agreement, the Loan agreed that the interest and all other payments owed to the Bank and arising as a result of the activities contemplated by the Framework Agreement as well as the Bank's assets and income related to such activities shall be exempt from taxes. 11. By art. 4 4 of the Framework Agreement, the borrower agreed that, for the entire period of existence of any financial operation concluded in accordance with the Framework Agreement: a) to ensure: ((i) that the beneficiaries may change in any currency fully convertible, at the exchange rate prevailing, the amounts in the national currency of the Loan, necessary for the timely payment of all amounts due to the Bank in connection with the loans and guarantees relating to any project; and ((ii) that these amounts are transferable freely, immediately and effectively; and b) ensure: ((i) that the Bank may change in any currency fully convertible, at the exchange rate prevailing, the amounts in the national currency of the Loan, received by the Bank as payments for loans and guarantees or any other activity, and that the Bank may freely, immediately and effectively transfer the amounts thus exchanged; or, if the Bank opts otherwise, (ii) that the Bank may freely dispose of such amounts in the territory of the Loan. 12. Convinced that the present operation corresponds to the purposes of its functions and that it complies with the purposes of the Framework Agreement and taking into account the aforementioned aspects, the Bank decided to act on the request of the Loan, granting it a credit in the amount equivalent to EUR 112,200,000 (one hundred and twelve million two hundred thousand euros). 13. The Bank's Statute stipulates that the Bank must ensure that its funds are used as much as possible in the interest of the European Community and, as a result, the terms and conditions of its loan operations will be in line with Community policy European. 14. The signing of this contract on behalf of the Loan was fully authorized in the terms specified in Annex 1. 15. References of this contract to articles, preamble, subparagraphs, subparagraphs, paragraphs, annexes and attached documents represent references made to articles, preamble, paragraphs, subparagraphs, paragraphs, annexes and attached documents. this contract. As a result it was agreed by this contract as follows: + Article 1 Shooting 1.01. Credit amount By this contract the Bank grants the Loan, and the Loan accepts, a credit (hereinafter referred to as credit), in the amount equivalent to EUR 112,200,000 (one hundred twelve million two hundred thousand euros), which will be used exclusively for Partial financing of Project costs. 1.02. Drawing procedures A. The credit will be made available to be drawn by the Loan within the limit of 20 instalments (hereinafter referred to as tranches, and each referred to as a tranche). Each tranche will have an equivalent value of at least 5 million euros (less the last tranche). B. The drawing of each tranche will be carried out on the basis of a written request (hereinafter referred to as request) from the Municipality, on behalf of the Loan, according to the conditions mentioned in paragraph 1.04. Each request: a) specify the amount requested for drawing within the tranche; b) specify the currency in which the borrower requests to be drawn the tranche, as a currency referred to in paragraph 1.03; c) specify the applicable interest rate, if applicable, previously indicated by the Bank of the Loan, without commitment; d) specify the preferred date for making the draw, being understood that the Bank may lay off the tranche within up to 4 calendar months from the date of the request; and e) will be accompanied by supporting documents, requested according to paragraph 1.04. No application can be made after 31 December 2007. Subject to the provisions of subparagraphs 1.02C, each application is irrevocable. C. 10-15 days before the date of dismissal of the tranche, if the application complies with subparagraph 1.02B and in so far as the justification made available in accordance with the provisions of subparagraphs 1.02B para. e) is acceptable to the Bank, it shall submit to the Loan and the Municipality a notification (hereinafter referred to as the drawing notice) by which: a) confirm the value and currency of the specified tranche; b) specify the interest rate applicable to the tranche according to paragraph 3.01; and c) specify the date of the cut off. If one or more items specified in the drawing notice do not conform to the corresponding items in the application, the Municipality, on behalf of the Loan, within a period of 3 working days in Luxembourg from the receipt of the notice of drawing, may revoke the request by a notification to the Bank and, as a result, the request and the notice of firing will remain without effect. D. The draw will be carried out in that bank account, in the name and on account of the Loan, as the Loan or Municipality notifies the Bank at least 8 days before the date of the draw. For each such tranche only one account can be specified. 1.03. Currency drag Subject to the availability of availabilities, the Bank will lay off each tranche in foreign currency for which the Loan or Municipality, on behalf of the Loan, expressed a preference. Each drawing currency will be: a) euro; b) a foreign currency of one of the Member States of the Bank not participating in the third stage of the European Monetary and Economic Union; or c) any other currency that is widely traded on the main foreign exchange markets. For the calculation of the amounts to be drawn in currencies other than the euro, the Bank will apply the reference exchange rates calculated and published by the European Central Bank of Frankfurt or, in the absence thereof, the exchange rates prevailing on any other financial market chosen by the Bank, at a time of 15 days prior to the date of the draw, as decided by the Bank. 1.04. Drawing conditions A. The drawing of the first instalment, in accordance with paragraph 1.02, shall be subject to the satisfactory fulfilment of the following conditions for the Bank, namely that, before the date of the first application: a) The bank has received from a legal adviser of the Loan a legal opinion on the proper signing of this contract by the Loan, as well as on the relevant documents, in the form and content acceptable to the Bank; b) a legal adviser of the Municipality has issued a legal opinion on the proper signing of this contract by the Municipality, as well as on the relevant documents, in the form and content acceptable to the Bank; c) all necessary approvals regarding the control of foreign exchange (if applicable) have been obtained, in order to allow the Municipality to carry out draws under the terms of this contract and to the Loan to repay the loan (as defined in paragraph 2.01) and to pay interest and all other amounts due under this contract; such approvals must also extend to the opening and maintenance of the accounts in which the Municipality, on behalf of the Loan, requests Bank to lay off the credit; d) The bank has received satisfactory evidence, in English, stating that the Loan has authorized and fully empowered the Municipality to request drawdowns and to receive the corresponding amounts in accordance with this contract, on behalf of and On account of Lending; e) The bank has received satisfactory evidence of the empowerment of the person or persons authorized to sign the applications, as well as the authenticated signature specimens of this or these persons; f) The bank has received satisfactory evidence that an implementation unit of the Project (called the IPU) for the implementation of the Project was properly established by the Municipality, in accordance with paragraph 6.09; g) The bank has received satisfactory evidence that consultants have been employed according to paragraph 6.12; and h) The bank has received satisfactory evidence, in English, regarding the powers granted to the signatories of this contract to sign the contract on behalf of the Loan and, respectively, on behalf of the Municipality, as well as a copy of the decision that authorizes the Municipality to conclude this contract If an application for the first instalment is made before the Bank has received satisfactory evidence demonstrating that these conditions have been met, such an application will be deemed to have been received by the Bank on that date. which the conditions will have been met. B. The drawing of each subsequent tranche of the first tranche shall be subject to receipt by the Bank, at or before the date of the request for drawing: a) of certified copies of the contract or contracts which were financed from all previously drawn instalments, contract or contracts which were concluded in terms of satisfactory to the Bank; and b) a statement from the Loan, through the Municipality, confirming that all expenses were incurred for the articles to be financed by the Bank according to the Technical Description (excluding taxes and fees payable in Romania), in an amount equal to the value of all amounts previously dismissed minus the equivalent of 1 million euros, except for the last draw. C. For the calculation of the euro equivalent of the amounts spent, the Bank shall apply the exchange rate referred to in paragraph 1.03. D. If any part of the evidence provided by the Loan under sub-paragraph 1.04B is not satisfactory to the Bank, it may either act in accordance with the provisions of the last sentence of subparagraphs 1.04A or may release proportionally more. than the amount requested. E. In addition, the redundancy of each tranche will be subject to the fact that the Bank has been convinced that sufficient funds continue to be available in accordance with paragraph 6.07 so as to ensure timely implementation and completion of the Project. 1.05. Credit cancellation If the cost of the Project will be less than the figure estimated in the preamble, the Bank may, through a notification to the Loan, cancel the credit proportionally with the difference. The borrower can at any time, through a notification to the Bank, cancel in full or in part any amount not drawn from the credit. However, if the Loan cancels any tranche that was the subject of a drawing notice and which has not been revoked in accordance with subparagraph 1.02C, it will pay a fee calculated for the cancelled amount at a fixed rate equal to. half the interest rate applicable to that tranche. The bank may, at any time after April 30, 2008, by notifying the Loan and the Municipality, cancel any part of the credit for which no shooting has been carried out. 1.06. Cancellation and suspension of credit The Bank may, by notifying the Loan and the Municipality, cancel, in whole or in part, at any time and with immediate effect, the undrawn part of the credit: a) as a result of the occurrence of any event referred to in subparagraphs 10.01A or 10.01B; b) if exceptional circumstances arise which will adversely affect the Bank's access to the national capital market or relevant international capital markets; or c) as long as, acting reasonably, the Bank will not be satisfied with the way in which the guarantees and commitments granted by the Loan and the Municipality have been observed according to paragraphs 6.15 and 8.04. Alternatively, through a notification addressed to the Loan and Municipality, the Bank may suspend any undrawn portion of the credit, if in its opinion an event has occurred or a situation described above and which is temporary has occurred. In this case, the suspension will continue until the Bank is able to lay off the credit again. However, the Bank will not be entitled to cancel or suspend, under par. b) above, no tranche which was the subject of a drawing notice. The undrawn part of the credit will be considered cancelled if the Bank requests reimbursement based on art. 10. If any tranche subject to the drawing notice is cancelled or suspended pursuant to paragraph 1. a) and c) above, the Loan will pay a commission for the amount cancelled or suspended, at an annual rate of 0.75%, calculated from the date of the drawing notice, respectively until the date of cancellation. Such a commission will be payable in addition to any commission payable under paragraph 1.05. 1.07. Currency of commissions The fees payable by the Bank on the basis of this Article 1 shall be calculated and payable in euro. + Article 2 Loan 2.01. Loan amount The loan (hereinafter referred to as the loan) will include the total amounts made redundant by the Bank, as notified by the Bank on the occasion of the redundancy of each instalment, according to paragraph 2.04. 2.02. Currency of repayment Each refund based on art. 4 or, as the case may be, art. 10 will be carried out in the laid-off currencies and in the proportions in which they are contained in the balance of the loan. 2.03. Interest and other payment obligations Interest and other payment obligations due according to art. 3, 4 and 10 will be calculated and payable proportionally in each currency in which the loan is refundable. Any other payment will be made in foreign currency specified by the Bank, taking into account the currency in which the expenses to be repaid by that payment were made. 2.04. Bank Notifications After the redundancy of each tranche, the Bank will transmit to the Loan and Municipality a summary situation comprising the amount, the date of the draw and the interest rate for that tranche + Article 3 Interest 3.01. Interest rate A. The non-repaid balance of any tranche will be interest bearing at the rate specified in the drawing notice related to it, which will be the interest rate applied by the Bank on the date of issue of the drawing notice, in accordance with the procedures issued periodically by the Board of Directors for loans denominated in that currency and granted by the Bank to its borrowers, under the same conditions of repayment and under the same conditions of interest payment as those for the tranche in question. B. The interest will be payable semi-annually on the dates specified in paragraph 5.03. 3.02. Interest on amounts with maturity exceeded Without contravening the provisions of art. 10 and as an exception to paragraph 3.01, the interest will accrue daily to any delayed amount, payable under the terms of this contract, for any currency, from the due date until the date of payment, at a rate equal to that which is higher of: a) the sum of: ((i) 0.25% (25 basis points) per year; and ((ii) the periodic rate applicable in accordance with paragraph 3.01 for the tranche for which the amount due is unpaid; b) the sum of: ((i) the interest rate on interbank deposits at one month offered by the main interbank markets, for that currency (e.g. for the U.S. dollar on the London interbank market and for the euro on the European interbank market), as is chosen by the Bank; and ((ii) 2% (200 basis points) per year. For the purposes of this paragraph b), the reference interest periods will consist of successive periods of one month, starting from the due date of the outstanding amount. This interest is payable in the same currency as the outstanding amount for which it is due. + Article 4 Reimbursement 4.01. Regular reimbursement The borrower will repay the loan according to the repayment schedule shown in Annex B. 4.02. Voluntary early repayment A. The Borrower may reimburse, in whole or in part, a tranche, on the basis of written communication (hereinafter referred to as early repayment notice) specifying the amount (amount of the early repayment) to be repaid anticipated and the proposed date for early repayment (date of early repayment), which will be a date specified in paragraph 5.03 (each referred to as the payment date). The early repayment notice will be submitted to the Bank at least one month before the anticipated repayment date. Early repayment will be conditional upon the payment by the Loan of a compensation, if applicable, due to the Bank in accordance with the provisions of subparagraphs B and C below. B. The amount of the compensation will be the amount of the interest difference not collected by the Bank for each semester concluded on the payment dates after the date of the early repayment, calculated as specified in the following subparagraph and reduced in compliance with the provisions of subparagraphs 4.02C. The amount of this difference will be calculated as the amount by which: x) interest that would have been payable during that semester for the tranche or for the part of the instalment repaid in advance surpasses y) interest that would have been so payable during that semester if it had been calculated at the reference rate; for this purpose, the reference rate means the annual interest rate (reduced by 15 basis points) that the Bank sets by one month before the date of repayment anticipated as the standard rate for a loan granted by the Bank to its borrowers, expressed in the currency of that tranche, having the same financial characteristics as the tranche to be repaid in advance, in the same periodicity for the payment of interest, the same period remaining until repayment capital and the same type of reimbursement. The interest rate on which the Bank, following the procedures established by the Board of Governors of the Bank, establishes it for a loan is, in accordance with the Bank's Statute, determined on the basis of the prevailing conditions on the capital market C. Each amount calculated in this way will be reduced on the date of early repayment, by applying a discount rate equal to the rate determined according to par. y) of subparagraphs 4.02B. D. The Bank will notify the Loan of the amount of compensation due or, as the case may be, the failure to collect any compensation, until 12,00 p.m. Luxembourg time, on a working day in Luxembourg and Bucharest, following the date on which it was transmitted the early repayment notification. If until 5.00 p.m. Luxembourg time, on the date of notification, the Loan does not confirm in writing its intention to carry out the early repayment, under the conditions communicated by the Bank, the anticipated repayment notice will remain without effect. With the exception of such a previously mentioned case, the Loan will be required to make payment in accordance with the early repayment notice, along with interest due on the amount of the early repayment as well as any other amount due according to paragraph 4.02. 4.03. Compulsory early repayment A. If The Borrower, voluntarily, partially or fully reimburses any other loan initially contracted over a period of more than 5 years, the Bank may request the early repayment of part of the amount not reimbursed at that time. the loan in the same proportion as that of the amount repaid in advance and the total default amount of all those loans. The bank shall address the borrower's request, if any, within 4 weeks of receipt of the respective notification according to sub-paragraph 8.02a). Any amount requested by the Bank will be paid, together with interest due, on the date indicated by the Bank, the date that will not precede the date of the anticipated repayment of the other loan. Early repayment of a loan through a new repayment term loan at least as high as the unexpired term of the early repayment loan will not be considered early repayment. B. If the total cost of the Project would be significantly below the figure specified in the preamble, the Bank may demand the early repayment of the loan, in proportion to the difference. 4.04. General provisions on early repayment under this Article 4 The early repayment will be made in all currencies of the loan, in proportion to the respective non-reimbursed amounts, unless the Loan can choose instead to repay in advance, under paragraph 4.02, the entire amount Defaulted, in one installment. In the case of partial early repayment in all currencies, each repaid amount anticipated will be applied a pro rata discount for each remaining rate to be repaid. The provisions of this Article 4 will not contravene art. 10. + Article 5 Payments 5.01. Payment place Each amount payable by the Loan under this contract will be paid in the respective account communicated to the Loan and Municipality by the Bank. The bank will indicate the account at least 15 days before the due date for the first payment that the Loan will make and will notify any change to the account at least 15 days before the date of the first payment to which the change applies. This period of notification shall not apply to payments made on the basis of art. 10. 5.02. Calculation of payments for a fraction of a year Any amount due in the form of interest, commission or otherwise by the Loan under this contract and calculated for any fraction of the year will be calculated on the basis of a 360-day year and a 30-day month. 5.03. Payment dates The amounts due on a semi-annual basis under this contract are payable to the Bank on 20 June and 20 December each year. Any payment due on a non-working day shall be payable on the working day immediately following. Business day means a day when banks are open for transactions in the financial centre of the country whose national currency is the currency of the amount due, with the indication that, in the case of the euro, working day means a day when the instructions for credit or transfer in euro is processed through the euro settlement system, called the Trans-European Automated Rapid transfer with respect to real time gross settlements (TARGET). Other amounts due under this contract are payable within 7 working days from the receipt by the Loan of the request issued by the Bank. An amount owed by the Loan will be considered paid at the time it is received by the Bank. + Article 6 Special commitments 6.01. Use of the loan and other funds The borrower will use the loan amounts and the other funds mentioned in the financing plan described in the preamble exclusively for the realization of the Project. 6.02. Project completion The municipality will carry out the Project according to the Technical Description and will complete it until the dates specified therein, as they can be modified periodically with the approval of the Bank. 6.03. Increased cost of the Project If the Project cost exceeds the estimated figure presented in the preamble, the Loan and/or Municipality will obtain funding to cover exceeding the cost without turning to the Bank so as to allow the Municipality to complete The project according to the Technical Description. Plans to finance the additional cost will be communicated to the Bank in due time for approval. 6.04. Tendering procedure The municipality undertakes to purchase goods and services and to order works for the Project, where appropriate and satisfactory for the Bank, through international tender open to participants from all countries. 6.05. Insurance As long as the loan is defaulted, the Municipality will properly provide all the works and properties that are part of the Project, in accordance with the usual practice for similar works of public interest. 6.06. Maintenance As long as the loan is defaulted, the Municipality will take care that all the properties that are part of the Project are maintained, repaired, checked and renovated, as necessary, in order to be maintained in good working order. 6.07. Fund allocation The borrower and the Municipality undertake to allocate annually to the Project sufficient budget funds and/or other financial resources to complete the financing plan of the Project not covered by the loan, allowing its timely completion in Compliance with Technical Description. 6.08. Financial programming The municipality will prepare each year a pertinent financing plan and a 3-year spending program, as well as financial and treasury projections, in order to establish a program-based budget system and to strengthen the entire process. of budget execution. 6.09. Project implementation unit The municipality will establish UIP within the DIC, satisfactorily the Bank, which will be responsible for all problems related to the management and implementation of the Project. 6.10. Project Operation As long as the loan is defaulted, if the Bank has not given its consent otherwise in writing, the Municipality will retain its title of ownership and possession of the assets that are part of the Project or, as the case may be, replace and renew these assets and will keep the Project in constant operation, in accordance with its original purpose. The Bank may not give its consent only if the proposed action would harm the interests of the Bank as a creditor of the Loan or make the Project ineligible for funding from the Bank. 6.11. Environmental provisions As long as the loan is repaid, the Municipality: a) must ensure that the activities related to the Project will be carried out in accordance with applicable environmental legislation and European Union environmental protection standards, as they may be amended and amended, after case, and will obtain and maintain all necessary government authorizations, applicable in this regard; b) will carry out all maintenance, construction and rehabilitation work, as well as the environmental impact reduction policies that may be required under the Project, in accordance with good practice and the standards referred to in par. a) of this paragraph; and c) will carry out all maintenance and rehabilitation works for the facilities of the Project, which can be requested by the competent authorities. 6.12. Consulting services The municipality undertakes to hire, following a satisfactory selection procedure for the Bank, consultants whose qualification, experience and terms of reference will be satisfied to the Bank, for the following purposes: a) to provide assistance to the Municipality and the UIP in terms of analysis, design and specifications of the Project; b) to provide assistance to the Municipality and the PIU for the preparation of tender documents c) obtain relevant building permits; d) to supervise the works; e) to provide the Municipality and UIP with general studies on the methodology for the revision of building structure calculations and protection against earthquakes; f) to provide the Municipality and UIP support for the preparation of the maintenance strategy; g) to certify the expenditure incurred referred to in paragraph 1.04; and h) to supervise and report on the implementation of the Project. 6.13. Special arrangements The municipality will have to submit to the Bank by December 31, 2004 a maintenance strategy for the schools included within the Project, in order to be able to maintain or extend (if applicable) the period of operation of the respective assets. As long as the loan is repaid, the Municipality will allocate the necessary funds for the implementation of the mentioned maintenance strategy 6.14. Visits A. The borrower and the Municipality understand that the Bank may be obliged to disclose to the Court of Auditors of the European Communities (hereinafter referred to as the Court of Auditors) those documents relating to the Loan and the Municipality and to the Project, which are necessary for the performance of the tasks of the Court of Auditors in accordance with European Union B. The borrower and the Municipality will allow the persons designated by the Bank, who may be accompanied by representatives of the Court of Auditors, to visit the sites, facilities and works included in the Project and to carry out those checks that they I wish For this purpose, the Lending and the Municipality will grant them or ensure that all necessary assistance will be provided to them. On the occasion of such a visit the representatives of the Court of Auditors may request the Municipality to submit the documents falling under subparagraphs 6.14A. 6.15. Commitment to integrity The borrower and the Municipality guarantee and undertake that they have not committed and that no person, after their knowledge, has committed any of the following acts and that they will not commit neither they nor any other person, with their assent with their notice Previously, none of the following acts, such as: a) provide, give, receive or request any undue advantage to influence the action of a person holding a public office or a function or director or employee of a public authority or public undertaking or a director or official of an international public organization, in connection with any procurement procedure or in the performance of any contract related to those elements of the Project specified in the Technical Description; b) any act that influences illegally or intends to illegally influence the procurement or implementation process of the Project, at the expense of the Loan or the Municipality, including the agreements between the bidders. The borrower and the Municipality undertake to inform the Bank if they will become aware of any fact or important information regarding the commission of such an act. + Article 7 Guarantees 7.01. Guarantees If The Borrower will grant a third party any guarantee for the fulfillment of any of its external debt obligations or any kind of preference or priority in relation to them, the Loan, if the Bank requests, will provide The Bank shall provide an equivalent guarantee for the fulfilment of its obligations under this contract or give the Bank a preference or equivalent priority. The borrower confirms that there is currently no such guarantee, preference or priority. + Article 8 Information 8.01. Information on Project Municipality: a) shall ensure that its records show all the operations relating to the financing and implementation of the Project; b) will transmit to the Bank, in English or in English translation: ((i) by 20 December 2003 and subsequently half-yearly on the dates of 20 June and 20 December, by the end of the Project, one report on the implementation of the Project, which shall be endorsed by the consultants referred to in paragraph 6.12; ((ii) 6 months after the end of the Project, a report on its termination; and ((iii) periodically, any other documents or additional information on the financing, implementation and operation of the Project, as the Bank may reasonably request; c) submit to the Bank's approval, without delay, any substantial change in the overall plans, execution schedule, financing plans or in the Project's expenses program, in connection with the issues made known to the Bank before signing this contract; d) inform the Bank in due time of any situation requiring the consent of the Bank, in accordance with paragraph 6.10; and e) will generally inform the Bank of any fact or event that is known to him, which could damage substantially or affect the execution or operating conditions of the Project. 8.02. Information on Lending The loan will inform the Bank: a) immediately, of any decision taken by him for any reason or about any situation that obliges him or about any request that has been made to him to repay in advance any loan initially granted for a period of more than 5 years; b) immediately, of any intention on its part to grant in favour of a third party any guarantee for any of its assets; or c) in general, on any situation or event that could prevent the fulfilment of any obligation of the borrower assumed under this contract or that would substantially harm the times would affect the conditions of execution or running of the Project. 8.03. Information on Municipality A. The Municipality, through the IPU, will transmit to the Bank, in English or in English translation: a) until 20 December 2003 and thereafter annually, until the end of the Project, the documentation of the financial programming in accordance with paragraph 6.08; and b) within one month after the approval of the own budget, a statement of revenue and expenditure. B. Municipality, through IPU, will inform the Bank: a) immediately, in connection with any change to its basic documents and any change in the legal status or of its mandate; b) in general, about any situation or event that could prevent the fulfilment of any of its obligations under this contract. 8.04. Verification and information In addition, Lending and Municipality must: a) undertake those actions reasonably required by the Bank to verify and/or terminate any act that is or is likely to be of the nature of those described in paragraph 6.15; b) to inform the Bank of the measures taken to recover damages from the persons responsible for any loss resulting from any such act; c) facilitate any verification that the Bank may carry out on such an act. + Article 9 Speze and expenditure 9.01. Taxes, fees and commissions The borrower and/or the Municipality will pay all taxes, fees, commissions and other charges of any kind, including stamp duties and registration fees, related to the signing or implementation of this contract or any related document of this and for the preparation of any loan guarantee. The borrower will pay in full the capital, interest, commissions and other amounts due under this contract, gross, without the deduction of any national or local taxation of any kind, provided that, if the Loan is legally bound to do any such deduction, will increase the amount of payment to the Bank so that, after deduction, the net amount received by the Bank is equivalent to the amount due. 9.02. Other spates The borrower will bear any professional, banking, transfer or foreign exchange costs, occasioned by the signing or implementation of this contract or the documents related to it and the preparation of any guarantee for the loan. + Article 10 Early repayment as a result of a case of default 10.01. Right to request reimbursement The borrower will repay the loan or any part thereof, based on the request made in this regard by the Bank: A. immediately: a) whether any important information or any document delivered to the Bank by or on behalf of the Loan or of the Municipality in connection with the negotiation of this contract or during the period in which it is in force proves to have been incorrect in any detail of material nature; b) if the borrower does not repay at the due date any part of the loan, does not pay interest on it or does not make any other payment to the Bank, as provided for in this contract; c) if, following the non-fulfilment of any obligation in connection with this loan, the Loan or Municipality is required to repay in advance any loan initially granted for a term of more than 5 years; d) if any event occurs or any situation that is likely to jeopardise the fulfilment of the payment obligations arising from the loan or adversely affect any guarantee granted to it; e) if any obligation assumed by the Loan and referred to in point 10 and 11 of the preamble cease to be fulfilled on any loan granted to any borrower from Romania from the resources of the Bank or the European Union; f) if the Loan or the Municipality does not fulfill any obligation regarding any other loan granted by the Bank from the resources of the Bank or of the European Union; or g) (i) if an executor takes possession of any part of the assets of the Municipality or if a creditor, liquidator or administrator is designated for any part thereof; or g) (ii) if any detention, execution, seizure or any other process is perceived or applied to the property of the Municipality; or B. upon expiry of a reasonable period specified by the Bank in a communication to the Lending, without the problem having been satisfactorily remedied for the Bank: a) if the Loan or the Municipality does not meet any obligation resulting from this contract, other than that mentioned in subparagraph 10.01A para. b); or b) if any essential fact provided for in the preamble is amended or proved to be erroneous and if the modification either damages the interest of the Bank, as creditor of the Loan, or adversely affects the implementation or operation of the Project. 10.02. Other legal rights Paragraph 10.01 will not limit any other legal right of the Bank to require early repayment of the loan. 10.03. Damage In the case of the application of the early repayment according to paragraph 10.01, the Loan will pay to the Bank an amount calculated on the date on which the request was made, whichever is greater of: a) an amount calculated according to the provisions of subparagraphs 4.02A, applied on the amount that has become due and payable and with effect from the maturity date specified in the written request of the Bank; and b) an amount calculated at an annual rate of 0.25% from the date of the request until the date on which each repayment rate of the amount requested would have been refundable if the request had not been made. 10.04. Derogations No non-compliance or delay by the Bank in the exercise of any of its rights under this Article 10 shall be regarded as a waiver of such a right. 10.05. Use of received The amounts received as a result of the request made under this Article 10 will be used, first of all, for the payment of damages, commissions and interest, in this order, and, secondly, for the coverage of the default rates, in Reverse order of maturities. They will apply between the instalments, as the Bank will consider. + Article 11 Law and jurisdiction 11.01. Law This contract, as well as its preparation, interpretation and validity will be governed by the law of the Grand Duchy of Luxembourg. The place of this contract is the headquarters of the Bank. 11.02. Jurisdiction All disputes concerning this contract will be subject to the Court of Justice of the European Communities (hereinafter referred to as the Court). The parties to this contract waive, thereby, any immunity or right to object to the jurisdiction of the Court. A decision of the Court, issued in accordance with this paragraph 11.02, shall be final and binding on the parties, without restriction or reserve. 11.03. Proof of amounts In any legal action arising from this contract the certification by the Bank of any amount due to the Bank under this contract will constitute the prima facie proof of such an amount. + Article 12 Final clauses 12.01. Notifications Notifications and other communications remitted in connection with this contract will be sent to the addresses referred to in item 1 1) below, except for notifications to the Loan in connection with pending or triggering disputes, which will be sent to the addresses specified in item 1. 2 2) below, where the borrower chooses its seat: --for Bank: 1) Bd. Konrad Adenauer nr. 100 100, L-2950, Grand Duchy of Luxembourg, -for Loan: 1) Str. Apolodor no. 17, Sector 5, RO-70060 Bucharest, Romania; 2 2) Romania's mission to the European Communities, str. Montoyer no. 12 12, B-1000 Brussels, Belgium; -for Municipality: 1) Bd. Queen Elizabeth no. 47 47, Sector 5, Bucharest, Romania; 2 2) Romania's mission to the European Communities, str. Montoyer no. 12 12, B-1000 Brussels, Belgium. Each Party may, by notifying the other Party, change the addresses referred to above, specifying that the address referred to in point (a). 2 2) above can only be changed to another address within the European Union. If the Loan and the Municipality will not otherwise specify in writing to the Bank, the Loan and the Municipality will determine that the head of the UIP be responsible for the contacts with the Bank for the purposes of paragraphs 6.15 and 8.04. 12.02. Notification form Notifications and other communications, for which fixed periods are mentioned in this contract or which themselves fix mandatory periods for the recipient, will be transmitted personally, by registered letter, telegram, telex or any other means of transmission which make it possible to prove receipt by the recipient. The date of registration or, as the case may be, the date declared of receipt of the submitted document will be conclusive for the determination of 12.03. Preamble, attachments and attached documents The preamble and the following annexes are an integral part of this contract: -Annex A 'Technical description'; --Annex B "Refund chart". The following Annex is attached to this Agreement: -Annex 1 "Empowerment for the signing of the Loan". As a result, the parties to this contract agreed that it should be signed in four original copies in English, each page being initialled on behalf of the Loan by Mr. Stefan Petrescu, General Manager external public, on behalf of the Bank by Mrs. Reka Balogh, counselor, and on behalf of the Municipality by Emilian Radu, director. Signed for and on behalf of Romania, M. N. Tanasescu Signed for and on behalf of the European Bank Investments, R. Saerbeck G.D. Spota Signed for and on behalf of Bucharest Municipality, T. Basescu Bucharest, October 1, 2003. Luxembourg, 7 October 2003. + Annex A Romania-The project on rehabilitation educational infrastructure in Bucharest TECHNICAL DESCRIPTION 1. Purpose The project includes several schemes to support the rehabilitation of school infrastructure in Bucharest. 2. Description The project includes 106 schools in pre-university education. Bucharest is divided into 6 sectors. The schools are located in Bucharest. The list of schools to be funded together with a short description are included in Table no. 1. The project, with differentiations from school to school, includes: strengthening buildings against earthquakes; building new buildings and multifunctional gyms; rehabilitation of sanitary and sewerage infrastructure; rehabilitation of utilities (water supply, heating, electrical grid, telephone and Internet); provision of furniture and equipment (including computers), teacher training for the use of computing equipment (limited to teachers in schools that will be equipped within the Project) and administrative expenses of the Project. The project also comprises the design of schools and the supervision of works, including all necessary consulting services. 3. Duration The project will be completed in 2003-2008. The schemes will become functional as soon as they are ready. Table 1 Romania-The project on rehabilitation of educational infrastructure in Bucharest SCHOOL LIST School Address School Address School School District 1 Music High School "G. Enescu" Str. Gheorghe Manu nr.30 M (8 schools) School no.7 Str. Neagoe Voda nr.11 S School nr.13 Str. Petrila nr.10-12 S School of music and arts No. 3 "Nest with stork" Str. Stirbei Voda nr.101 M School nr.118 Str. Stirbei Voda nr.32-34 S School nr.118 Str. Pavlov nr.2-4 S Agricultural School Group " V. Harnaj "B-dul Ficusului nr.18 LT School nr.17" Pia Brateanu " Str. Petoffi Sándor nr.14-16 S Sector 2 School no.30 Str. S (15 schools) School no.50 Str. Ion Marinescu nr.32 S School nr.66 Str. Logofat Dan nr.1 S Technical College "Traian" Str. Luigi Galvani nr.20 LT School nr.62 Str. Potarnichii nr.3 S School nr.23 Str. Oltarului nr.11 S School nr.41 Str. Nicolae Apostol nr.2 S "Spiru Haret" National High School Str. Italian no.17 L School no.49 *) Str. Vatra Lumină nr.99 S School nr.145 Str. Heliade between Vii nr.36 S School nr.40 Str. Peris nr.27 S Technical College "Edmond Nicolau" B-dul Dimitrie Pompei nr.3 LT School nr.31 B-dul Lake Tei nr.116 S College National "Cantemir Voda" Str. Future No. 60 L Central School Str. Icon No. 3-5 LE Sector 3 School No. 16 In. Constantin Brancusi nr.7 S (11 schools) School no.22 *) B-dul 1 Decembrie 1918 nr.28 S Industrial school group "Republic" B-dul Basarabia nr.256 LT School no.87 Str. Ramnicu Valcea nr.52 S School nr.47 Str. Vasile Lucaciu nr.16 S School nr.81 Str. Nerva Traian nr.33 S School no.20 Str. S Kindergarten no.160 Alley Perisor no.9 G School Group "Nichita Stanescu" Str. Lucretiu Patrascanu nr.3 LT School nr.84 Calea Vitan nr.135 S Scoala nr.149 Aleea Petrisoru nr.4 S Sector 4 School nr.102 Str. Captain. Eremia Popescu nr.27 S (21 schools) School no.79 *) Str. Cuza Voda nr.51 S School nr.100 Calea Vacaresti nr.51 S Scoala nr.120 Str. Martisor nr.39 S School nr.74 Calea Serban Voda nr.62-64 S Scoala nr.165 Aleea Slatioara nr.8 S Scoala nr.111 Str. Stoian Militaru nr.72 S School no.36 Str. Costila nr.2 S School nr.190 Str. serg. Nitu Vasile nr.16 S Scoala nr.93 Aleea Emil Racovita nr.1 S Scoala nr.133 Str. S School No. 194 *) Str. Alexandru Obrejia nr.3A S School no.129 *) Str. Izvorul Crisului nr.6 S School nr.98 *) Str. Hives No. 1 S School No. 109 Str. Petre Tutea nr.3 S Scoala nr.189 Aleea Ciceu nr.12 S School nr.308 Str. River Falcon No. 8 S School No. 110 Str. Argesului nr.6 S School nr.97 Str. Viores nr.7 S School No. 119 Str. Almasul Mic nr.4 S School nr.113 Str. Parincea nr.4 S Sector 5 School no.146 *) Sos. Panduri nr.42 S (14 schools) School no.136 *) Prel Ferentari nr.68 S The economic college "Viilor" Sos. Viilor nr.38 LE School nr.2 Str. Lake Enjoy no.14 S Energy Technical College Alley Bridge Giurgiului no.5 LT Theoretical High School "Dimitrie Bolintineanu" Calea Rahovei nr.311 L School no.148 Str. Bachus nr.42 S School nr.147 Str. Bacau nr.1 S School Industrial Group "Dimitrie Gusti" Str. Samuil Vulcan nr.35 LT School no.141 *) Str. Amurgului nr.35 S Technical College "Dumitru Motoc" Str. Spataru nr.16 LT Gradinita nr.73 Splaiul Independentei nr.68 G Gradinita nr.205 Calea Ferentari nr.2 G School nr.115 Calea 13 September nr.177 S Sector 6 Industrial school group Technometal Str. Corn nr.52 LT (17 schools) School no.153 Str. Sabareni nr.21 S School nr.198 Str. Apusului nr.73-75 S School nr.202 Calea Crangasi nr.140 S Scoala nr.161 Calea Giulesti nr.486A S School nr.279 " Sf. Michael and Gavril " *) Prel. Ghencea nr.24 S School No. 167 Sos. Ciurel nr.9-11 S School nr.174 *) Str. Rosia Montana nr.41 S School No. 142 Str. S School No. 206 Arinis Alley no.5 S School No. 191 Alley Poiana Muntelui nr.1 S School No. 193 *) Str. M. R. Marcu no.3 S School no.156 Str. Dealul Tugulea nr.35 S School no.164 *) Str. Pravat nr.22 S School nr.311 Str. Garleni nr.10 S Gradinita nr.250 Str. Dealul Tugulea nr.35 G School nr.310 Str. Roșia Montană nr.42 S Special schools School for deaf no. 1 Str. , sector 1 SS (20 schools) Special School no.7 Str. Sisters no.4, sector 1 SS Special School no.8 Str. Victor Daimaca nr.2 sect.1 SS Special School no.10 Str. G-ral Berthelot nr.20-25, sector 1 SS Centre of cura-tiva pedagogy and social therapy Corabia Str. Corabia nr.57-59, sector 2 SS School Center No. 1 Str. Vatra Lumină nr.108, sector 2 SS School Center no.3 Str. Austrului nr.37, sector 2 SS Special vocational school no.2 Sos. Pantelimon nr.299, sector 2 SS Special vocational school no.3 Str. Iancu Marcel nr.7, sector 2 SS School for ambliopi Str. Austrului nr. 33, sector 2 SS School for hypoacuics Str. Compass no.6, sector 2 SS Special School no.2 Str. Popa Petre nr.31-41 sect.2 SS Special School no.5 Str. Turturelelor nr.13, sector 3 SS Special School no.4 Sos. Oltenia nr.208, sector 4 SS Special School no.6 Str. Sld. Enache Ion nr.31, sector 4 SS Special School no.9 Str. Trumpet no.34, sector 5 SS School for deaf no.2 Istrum alley no.6, sector 6 SS Special School no.3 Str. Topnr.nr.10, sector 6 SS Special School no.11-Special Kindergarten no.2 Istrum alley no.4, sector 6 SS Special School no.1 Str. Popa Rusu nr.13, sector 2 SS S School with grades 1-8 L High School LT Technical High School LE High School Economic M School of Music G Kindergarten SS Special School Note *) The gym whose construction is funded from another government program + Annex B Romania-The project on rehabilitation educational infrastructure in Bucharest REPAYMENT SCHEDULE The maturity date of the repayment of the Sume tranches which will be refunded expressed as a percentage of loan 1. 20 20 December 2009 2.63% 2. 20 20 June 2010 2.63% 3. 20 December 2010 2.63% 4. 20 June 2011 2.63% 5. 20 December 2011 2.63% 6. 20 June 2012 2.63% 7. 20 December 2012 2.63% 8. 20 20 June 2013 2.63% 9. 20 20 December 2013 2.63% 10. 20 June 2014 2.63% 11. 20 December 2014 2.63% 12. 20 June 2015 2.63% 13. 20 December 2015 2.63% 14. 20 June 2016 2.63% 15. 20 December 2016 2.63% 16. 20 June 2017 2.63% 17. 20 December 2017 2.63% 18. 20 June 2018 2.63% 19. 20 December 2018 2.63% 20. 20 June 2019 2.63% 21. 20 December 2019 2.63% 22. 20 June 2020 2.63% 23. 20 December 2020 2.63% 24. 20 June 2021 2.63% 25. 20 December 2021 2.63% 26. 20 June 2022 2.63% 27. 20 December 2022 2.63% 28. 20 June 2023 2.63% 29. 20 December 2023 2.63% 30. 20 June 2024 2.63% 31. 20 December 2024 2.63% 32. 20 June 2025 2.63% 33. 20 December 2025 2.63% 34. 20 June 2026 2.63% 35. 20 December 2026 2.63% 36. 20 June 2027 2.63% 37. 20 December 2027 2.63% 38. 20 20 June 2028 2.69% -------