RELATED TO CREDIT NUMBER 2404 ALB Development Grant Agreement (in Conjunction with the Critical Imports Project) between ALBANIA and INTERNATIONAL DEVELOPMENT ASSOCIATION ACTING AS ADMINISTRATOR ON BEHALF OF THE MINISTER FOR DEVELOPMENT COOPERATION OF TE NETHERLANDS Dated ec0, 1992 RELATED To CREDIT NUMBER 2404 ALE DEVELOPMENT GRANT AGREEMENT AGREEMENT, dated 2- , 1992, between ALBANIA (the Beneficiary) and the INTERNATIONAL DEVELOPMENT ASSOCIATION (the Association), acting as Administrator (the Administrator) on behalf of the MINISTER FOR DEVELOPMENT COOPERATION OF THE NETHERLANDS (the Minister). WHEREAS (A) Pursuant to the Development Credit Agreement (Critical Imports Project), dated June 29, 1992, between Albania (the Beneficiary) and the Association (the Development Credit Agreement), the Associat.on has agreed to extend to the Beneficiary a Credit in an amount i various currencies equivalent to thirty million dollars Special Drawing Rights (SDR 30,000,000) to assist in the financing of a project (the Project) as described in Schedule 2 to the Development Credit Agreement. (B) Pursuant to the Arrangement for Administration, dated December 11, 1986, entered into between the Minister and the Association (the Administration Arrangement), the Minister has appointed the Association as Administrator of the Grant and has authorized the Association to do all such acts and things as may be necessary or appropriate to carry out such administration, including entering into this Development Grant Agreement on behalf of the Minister, and to extend the Grant on the terms and conditions set forth in this Agreement. (C) The Association has agreed on the basis, inter alia, of the foregoing to act as Administrator of the Grant. NOW THEREFORE the parties hereto hereby agree as follows: ARTICLE I General Conditions; Definitions Section 1.01. The "General Conditions Applicable to Development Credit Agreements of the International Development Association, dated Yanuary 1, 1985, with the modifications set forth below (the General Conditions) constitute an integral part of this Agreement: -2- (a) the term "Association", whenever used in the General Conditions, means the Association acting as Administrator of the Grant; (b) the term "Borrower", whenever used in the General Conditions, means the Beneficiary; (c) the term "Credit", whenever used in the General Conditions, means the Grant; (d) the term "Credit Account", whenever used in the General Conditions and herein, means the separate account opened by the Administrator in its books in the name of the Beneficiary pursuant to Section 3.01 (a) of the Administration Arrangement, to which the amount of the Grant is credited; (e) the term "Development Credit Agreement", whenever used in the General Conditions, means this Development Grant Agreement; (M) Sections 3.02, 3.03, 3.04, 3.05, 4.01, 4.02, 4.03, 4.04, 4.06, Section 6.02 (except paragraph (a) thereof), 7.01, 8.01 (a), 12.05, and the second sentence of Section 5.01, are deleted; and (g) in Sections 2.01 and 6.02, the term "Association" shall include also the Bank acting in its own capacity. Section 1.02. Whenever used in this Agreement, unless the context otherwilse requires, the several terms defined in the General Conditions and in the Preamble to this Agreement have the respective mecnings therein set forth. ARTICLE II The Grant Section 2.01. The Administrator agrees to extend to the Beneficiary, on the terms and conditions set forth or referred to in this Agreement and subject to the receipt of the funds to be made available to the Administrator pursuant to Section 1.04 of the Administration Arrangement, a grant in the amount of four million and five hundred thousand Netherlands Guilders (DFL 4,500,000). Section 2.02. (a) The amount of the Grant may be withdrawn from the Credit Account in accordance with the provisions of the Schedule to this Agreement, as such Schedule may be amended from -3- time to time by agreement between the beneficiary and the Administrator, for expenditures made (or, if the Administrator shall so agree, to be made) in respect of the reasonable cost of carrying out the Project and to be financed out of the Grant. (b) Whenever a disbursement from the Credit Account is required to be made in a currency other than Netherlands Guilders for the purposes of this Grant Agreement, the Administrator shall withdraw from the Credit Account an amount in Netherlands Guilders sufficient for the Administrator to purchase the required amount of the appropriate currency. Section 2.03. Except as the Administrator shall otherwise agree, procurement of the goods, and consultants' services required for the Project and to be financed out of the proceeds of the Grant shall be governed by the relevant provisions referred to in Section 3.02 of the Development Credit Agreement. Section 2.04. The Closing Date shall be December 31, 1995, or such later date as the Administrator shall establish. The Administrator shall promptly notify the Beneficiary of such later date. ARTICLE III Effective Date; Termination; Representatives Section 3.01. The following event is specifiid as an additional condition to the effectiveness of this Agreement within the meaning of Section 12.01 (b) of the General Conditions, namely, that the Administrator shall have received the funds referred to in Section 2.01 of this Agreement. Section 3.02. The date 90 days after the date of this Agreement is hereby specified for the purposes of Section 12.04 of the General Conditions. Section 3.03. Ministry of Finance and Economy of the Beneficiary is designated as representative of the Beneficiary for the purposes of Section 11.03 of the General Conditions. Section 3.04. The addresses specified in Section 7.02 of the Development Credit Agreement shall be the addresses specified for the purposes of Section 11.01 of the General Conditions. Section 3.05. All the provisions of this Agreement shall continue in full force and effect notwithstanding any cancellation or suspension under the Development Credit Agreement. ARTICLE IV Transfer of Rights and Obligations Section 4.01. In accordance with Section 5.03 of the Administration Arrangement, the rights and obligations of the Administrator under this Agreement may be transferred to the Minister. The Beneficiary accepts and agrees that, upon notice by the Administrator to the Beneficiary to that effect, the Minister shall, i2so facto, from the date specified in such notice, be substituted in all rights and obligations of the Administrator under this Agreement as if the Minister had been an original party to this Agreement, without any further action or formality required on the part of any party, and from such date the Administrator shall cease to have any rights or obligations as a party under this Agreement. 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. ALBANIA Authorized Representative INTERNATIONAL DEVELOPMENT ASSOCIATION as Administrator on behalf of the MINISTER FOR DEVELOPMENT COOPERATION OF THE NETHERLANDS Authorized Representative .W6- SCHEDULB Withdrawal of the Grant 1. The table below eets forth the Categories of items to be financed out of the Grant, the allocation of the amount of the Grant to each Category and the percentage of expenditures for items so to be financed in each Category: Amount of the Grant Allocated % of (Expressed in Expenditures Category DFL Equivalent) to be Financed (1) Goods and materials, 4,500,000 100% of foreign including livestock, expenditures for Parts A, B and C of the Project TOTAL 4,500,000 2. For the purposes of this Schedule 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. 3. Notwithstanding the provisions of paragraph 1 above, no withdrawals shall be made in respect of payments made for expenditures prior to the date of this Agreement.