OFFIC1AL DOCUMEN TS ACGF GRANT NUMBER TF092098 Agreement providing for the Amendment and Restatement of the Project Agreement (Fir ancial Services Project) between INTERNAITI:NA L DEVELOPMENT ASSOCIATION (acting as an ailministi ator of the Africa Catalytic Growth Fund) and ASSOCIATION POUR LA GES TION DU PROGRAMME D'APPUI AUX SERVICES FIN -ANCIERS (AGEPASEF) (Previously known as AGE 1CE D'EXECUTION DU PROJET MICROFINANCE) Dated (44.l tCk.( , 2013 ~I- a ACGF GRANT NUMBER TF092098 AGREEMENT PROl [DING ZOR THE AMENDMENT AND RESTATEMENT OF THE PROJECT AGREEMENT AGREEMENT, dated rCo,'t ru , 2013, entered into between INTERNATIONAL DEVELOPMlENT ASSOCIATION ("World Bank") acting as an administrator of the Af-ica Cat lytic Growth Fund and ASSOCIATION POUR LA GESTION DU PROGRAVMIME D'APPUI AUX SERVICES FINANCIERS - AGEPASEF, previously know n as AGENCE D'EXECUTION DU PROJET MICROFINANCE ("Pro. ect Impl amenting Entity"). The Recipient and the World Bank hereby agree as follows: ARTICLE I---A vIENDMENT AND RESTATEMENT 1.01. The Project Agrc eme!nt d ited July 15, 2008 between the World Bank, acting as an administratoi o:' the Africa Catalytic Growth Fund and the Project Implementing Entity. in c )nnection with the Africa Catalytic Growth Fund Grant Agreement ("Grnt Agree ment") of July 15, 2008 between the REPUBLIC OF MADAGASCAR (" Zecipient") and the World Bank for the provision of the ACGF Crant Numbe TF'92098 is hereby amended and restated so as to read as set forth in the An ne) hen to. A rTI CLI II- ENTRY INTO FORCE 2.01 This Agreement shall nct become effective until evidence satisfactory to the World Bank ha!: b:en I urnished to the World Bank that the condition of effectiveness has been sa.isfied, namely, that the Agreement Providing for the Amendment and Rostate ment of the Africa Catalytic Growth Fund Grant Agreement of t1e same date as this Agreement has become effective in accordance with its t rms. -2- AGREED at j &10 r t Qua , ., as of the day and year firsi. above writt .n. 11 4TERNATIONAL DEVELOPMENT ASSOCIATION a( ting as an administrator of the Africa Catalytic Growth F ind B i: utho d Representative Haleh Z. BRIDI Name: rnmtry Director for Madagascar, Mauritius, Comoros and Seycheltes Title: A SOCIATION POUR LA GESTION DU PROGRAMME D'APPUI AUX SERVICES FINANCIERS (AGEPASEF) B: Authorized Representative Name: Title: t AA ANNEX ACGF GRANT NUMBER TF092098 Project Agreement (Fin ancial Services Project) between INTERNA TO 3NA L DEVELOPMENT ASSOCIATION (acting as an a:lministr ator of the Africa Catalytic Growth Fund) and ASSOCIATION POUR LA GES-ION DU PROGRAMME D'APPUI AUX SERVICES FIN kNCIERS (AGEPASEF) (Previously known as AGE NCE D'EXECUTION DU PROJET MICROFINANCE) )ated July 15, 2008 -4- ACGF GRANT NUMBER TF092098 PR JJECT AGREEMENT AGREEMENT date d [uly 15, 2008, entered into between INTERNATIONAL DEVELOPMENT ASSOCIATION ('World Bank") and ASSOCIATION POUR LA GESTION DU PROGRAMME D'APF UI AU3 SERVICES FINANCIERS - AGEPASEF, previously known as AGENCE D'EXEIIOI\ DU PROJET MICROFINANCE ("Project Implementing Entity") ("Project Agreement ") in cor nection with the Grant Agreement ("Grant Agreement") of same date between the REPU BL C O:' MADAGASCAR ("Recipient") and the World Bank. The World Bank and the Project I npl ,mer ting Entity hereby agree as follows: ARTICLE I- GEr [ERAL CONDITIONS; DEFINITIONS 1.01. Unless the context requiies ot ierwise, the capitalized terms used in this Agreement have the meanings ascribe4I to them in the Grant Agreement or the Standard Conditions. ARTICLE II - PROJECT 2.01. The Project Implemeiitin,; Eni ity declares its commitment to the objectives of the Project. To this end, the Project Impl -menting Entity shall carry out the Project in accordance with the Recipient's obligatioins as set forth in the provisions of Article II of the Standard Conditions, and shall provide )romptly as needed, the funds, facilities, services and other resources rec uired foi the Proj -ct. 2.02. Without limitation upon he p -ovisions of Section 2.01 of this Agreement, and except as the World Bank and the Proj .ct Implementing Entity shall otherwise agree, the Project Implementin, Entity sha 1 car -y out the Project in accordance with the provisions of the Schedule to this Agreement. AFTIC LE III - TERMINATION 3.01. The date on which the- pr ovisi ns of this Agreement shall terminate is the date on which the Grant Agreemen shall te -minate in accordance with its terms pursuant to Section 6.02 of the S:andard Conditiot s. -5- ARTICLE IV - REPRESENTATIVE; ADDRESSES 4.01. The Project Implemeating En ity's Representative is its Executive Secretary. 4.02. The World Bank's A:ldress is International Bank fa r Rccons truction and Development 1818 H Street, N.W. Washington, D.C. 20133 United State; of Am rice Cable: 'ele): Facsimile: INDEVAS 2484: 3 (MCI) or 1-202-477-6391 Washington, D.C. 6414: (MCI) 4.03. The Project Impleme lting Eni ity's Address is: Association pour I Gestio i du Programme d'Appui aux Services Financiers - AGEPASEF 22-23 rue Re.initovo Ant5havc la Antananarivo Madagascar AGREED at Antananari,o, Republic of Madagascar, as of the day and year first above written. INTERNATIIEONAL DEVELOPMENT ASSOCIATION acting as an adminis rator of the Africa Catalytic Growth Fund By: /s/ Robert R. Blake Authorized Representative ASS OCIATI ON PO1 JR LA GESTION DU PROGRAMME D'APPUI AUX SERVICES FINANCIERS - AGEPASEF Pre-iously: AGENC 1 D'EXECUTION DU PROJET MICROFINANCE By: Is/ Haja Nirina Razafinjatovo Authorized Representative -6- SCHEDULE Project Execution Section I. Institutional and Oti er Arranaements A. Institutional Arrangement (1) The Projeci Implementing Entity shall maintain at all times throughout the implementation of th:- Piojec1 its organization, methods of operation, functions, staffing and resources satisfac tor) to ti e World Bank. (2) Without limitation 10 the generality of the foregoing provision of paragraph (1) immediately above, tlie Proje, t Implementing Entity shall ensure: (i) overall day-to-day management as well is cverall coordination and implementation of activities; (ii) consolidation of I he Iraft work plans and budgets; (iii) maintenance of records and accounts for all tranact ons; (iv) timely preparation of quarterly and annual financial statements, Project IReports a id other reports; (v) cash management and preparation of withdrawal applicati:ns; (vi procurement; and (vii) monitoring and evaluation of activities. (3) Without limitation lo tie generality of the foregoing provision of paragraph (1) immediately above, tlie Froje t Implementing Entity shall include the following staff: (i) a Project coordinator; (i[) at accounting and financial management specialist; (iii) a procurement speciali:nt; (iv) a monitoring and evaluation specialist; and (v) two micro finance and banking spec alist .. (4) (a) Without limil ation to the generality of the foregoing provision of paragraph (1) immediately above, the Steering Committee shall be maintained with composition aind :erm of reference satisfactory to the World Bank. (b) Without limil ation to the generality of the foregoing provision of paragraph (a) immediately ibo ie, tie Steering Committee shall include representatives from the Recipient's tr-asu y directorate (including its service responsible for national coordination Ior nicr('finance) in MFB, the Recipient's professional association for bmks and professi )nal association for microfinance institutions. (c) Without limilation to :he generality of the foregoing provision of paragraph (a) immediately ibove, th,- Steering Committee shall ensure the overall guidance for the Project, iricluding planning and supervision of Project activities, problem solvi rig and gene -al o ersight of the Project. The Steering Committee shall meet at least twice a year. -7- (5) (a) Witt out limi aticn to the generality of the foregoing provision of paragraph (1) immediately above, t ie General Assembly shall be maintained with composition and terms of ref -renc e satisfactory to the World Bank. (b) Without limitation t( the generality of the foregoing provision of paragraph (a) immediately ab ve, the General Assembly shall include representatives from BCM, MFB anc the (ecipient's Ministry responsible for economy. (c) Without limitation tc the generality of the foregoing provision of paragraph (a) immediately above, he General Assembly shall provide policy directions and ensure the si rate gic g aidance for the Project. 13. Contractual Arrangi!ments (1) For purposes of carr,'ing out Part 1(i) of the Project, no later than January 1, 2015, or such other date as shEll h we t een agreed with the World Bank, the Project Implementing Entity shall cause the PPCG F md to enter into the Fund Management Agreement. (2) The Project I mpleme!iting En ity shall, no later than January 1, 2015, or such other date as shall have been alirecd w th the World Bank, recruit and thereafter maintain for a minimum of two (2) yea s, a :onsultant of international repute, with terms of reference, qualifications and e:cpefienc( satisfactory to the World Bank, to support the Fund Manager in the ir pleinent;Ltion of its obligations under the Fund Management Agreement. (3) Matching Gr ants (a) (i) For he imp ementation of Part 2(iii) of the Project, the Project Implcme lting Entity shall extend Matching Grants to eligible microfinance nstitutions (each a "Beneficiary") for the partial financing of th;ir :pentions in Targeted Regions (each a "Subproject"), under eligibility crit nria, terms and conditions acceptable to the Recipient and the Worl I Ba: ik and in accordance with procedures, all further described in the Operati )nal Manual. (ii) Without limi ation to the generality of the foregoing provisions of parag raph (i) .mmediately above, Subproject expenditures eligible for a finan;:ing froia the proceeds of a Matching Grant shall be limited to Minor HWorks equipment, staff Training and salaries of staff which are not ni embers of the Recipient's civil service. (b) The Project lmi lemc nting Entity shall make each Matching Grant under a Matching Gr:mt Agrcement, in the form attached to the Operational Manual, which shall inclide, inter alia, adequate rights of the Project Implementing Entity to prolect the I roject Implementing Entity's and the Recipient's interests and those of the Work Bank, including the following: -8- (i) the Proj ect I nplementing Entity shall have the right to suspend or termi natc the -ight of the Beneficiary to use the proceeds of the Matching Gran]., oi obtE in a refund of all or any part of the amount of the Matching Grani thon w thdrawn, upon the Beneficiary's failure to perform any of its of ligations under the Matching Grant Agreement; and (ii) each Be iefic ary shall be required to: (A) use the proceeds of the Matching Gra at with due diligence and efficiency and in accordance with sound te chni-:al, economic, financial, managerial, environmental and social. sttndar Is and practices satisfactory to the World Bank, including in accorlancc with the provisions of the Anti-Corruption Guidelines appli;:able to -ecipients of Grant proceeds other than the Recipient; and; (B) provide, promptly as needed, the resources required for its Subproject; (C) procure the goods, works and services to be financed out of the lMatc ling Grant in accordance with the provisions of this Agre :ment; (D) maintain policies and procedures adequate to enable it to monil:or and -valuate in accordance with indicators acceptable to the World Bank, the progress of its Subproject and the achievement of its objectives; (E) (1) maintain a financial management system and prepare financial statc ments in accordance with consistently applied accounting standard. acc.:ptable to the World Bank, both in a manner adequate to reflec t the iperations, resources and expenditures related to its Subproject; aid (2) at the Project Implementing Entity's, the Recipient's or th,:e World Bank's request, have such financial statements audited by independent z uditors acceptable to the World Bank, in accordance with consistertly applied auditing standards acceptable to the World Bank, promptly fuinish the statements as so audited to the Project Implcme iting Entity, the Recipient and the World Bank, and allow the WorlH Bank o make the Matching Grant Agreement and all financial statemen :s au lited pursuant to sub-paragraph (E)(2) immediately above avail:Lble to tl e public in accordance with the World Bank's policies on access tc infirmation; (F) enable the Project Implementing Entity, the Recil:ien: anc the World Bank to inspect the Subproject, its operation and a ny -elev nt records and documents; and (G) prepare and furnish to the Project In Lplementing Entity, the Recipient and the World Bank all such infcrmat on as the Project Implementing Entity, the Recipient or the Worl:1 Bank s iall reasonably request relating to the foregoing. (c) The Project Implem(nting Entity shall exercise its rights and carry out its obligations u idej eaci Matching Grant Agreement in such manner as to protect the interests of the Re. ipient and the World Bank and to accomplish the purposes of tf e Grant Lxcef t as the World Bank shall otherwise agree, the Project Imple,mentinj: Er tity ;hall not assign, amend, abrogate or waive any Matching Grant Agreerent or a:iy of its provisions. -9- C. Anti-Corruption The Project I mpleme itin; Eniity shall ensure that the Project is carried out in accordance with the provisions of the Ant -Corruption Guidelines. 1). Safeguards The Project Impleir enting Entity shall ensure that the Project is implemented in accordance with the envirolmental and social safeguard requirements described in Section I.D cf Schedtile: to the Grant Agreement. E. Annual Work Plans anI Bu Igets Each year the Project Impleiienting Entity, with input from the Fund Manager, shall prepare and submit tc the Stee ring Committee and then to the World Bank for approval, a draft annual work p] an 'incl iding Training and Operating Costs), and budget for the Project, for each sub!:eqtent 3 ear of Project implementation, of such scope and detail as the World Bank shall hav e rea ;onably requested. 2. The Project [mplementing En:ity shall furnish to the World Bank, as soon as available, but in any case not latel tha November 30 of each year, the annual work plans and budgets, for their re-v ew and approval; except for the annual work plan and budget for the Project for the first year c fProject implementation which shall be furnished no later than one (1) month aLfle' the Effective Date. Only the activities included in an annual work plan and budget e)pres ;ly approved by the World Bank (each an "Annual Work Plan and Budget") arc eligible to a financing from the proceeds of the Grant. Training shall be cat riec out on the basis of Annual Work Plans and Budgets, which shall, inter a !ia, ideni Ify: (a) r articulars of the training envisaged; (b) the personnel to be trained; (c) the selection neth d of the institution or individuals conducting such training; (d) the institution cor ducting ;uch training if identified; (e) the purpose and justification for such training; (f tho loc ition and duration of the proposed training; and (g) the estimate of the cost o 'such training. 4. Annual Work Plans znd Budgets may be revised as needed during Project implementation subje;,t to the World Bank's prior approval. F. Project Mar uals 1. The Project Impler enting Entity shall, no later than July 30, 2013, amend the Operational Manual in 5orm and substance satisfactory to the World Bank, for the purpose of, nter alia, reflecl ing the changes made in the execution of the Project as described or referred :o ir this Agreement. 2. (a) The Project Implime iting Entity shall carry out the Project in accordance with the Operational Manual; :ind (b) e Kcept as the World Bank shall otherwise agree, the Project Implementing Entity :hal I not assign, amend, abrogate, or waive the Operational Manual, or any provision there of. -10- 3. In the event of any conf ict be-tween the provisions of the Operational Manual and those of this Agreement, the piovisi Dns of this Agreement shall prevail. Section II. Proj ect MoriitoiiM Reporting and Evaluation A. Project Reports; Cc mpletio i Report 1. The Project Implemcnting Ei tity shall monitor and evaluate the progress of the Project and prepare Project Reports in accordance with the provisions of Section 2.06 of the Standard Conditions and on 1 -ie basis of indicators acceptable to the World Bank. Each Project Report shall cover the period of one (1) calendar quarter, and shall be furnished to the World B mk not later than 45 days after the end of the period covered by such report. 2. The Project [mplemernting En ity shall prepare the Completion Report in accordance with the provisions of Sec tior 2.0( of the Standard Conditions. The Completion Report shall be furnished to the World Bar k not later than six (6) months after the Closing Date. 3. Seventy two (72) mc nth; aftc r the Effective Date, or such other date as the World Bank shall have agreed with the Recipient, the Project Implementing Entity shall, in conjunction with the World E ank, the Recipient and the Fund Manager, carry out a mid- term review of the F roje ct (th te "Mid-term Review"), covering the progress achieved in the implementation of the Pioject. The Project Implementing Entity shall prepare and furnish to the World Baik not less than three (3) months prior to the beginning of the Mid-term Review, r. re )ort integrating the results of the monitoring and evaluation activities performed pursuant to this Agreement, on the progress achieved in the carrying out of the Project duiring the 1eriod preceding the date of such report, and setting out the measures recommen:led to (nsure the efficient carrying out of the Project and the achievement of the obj -ctiv of the Project during the period following such date. Following tf e Mid-term Revi w, the Project Implementing Entity shall act promptly and diligently in order to tak e, or cause to be taken, any corrective action deemed necessary by the World Bank to: remedy any shortcoming noted in the carrying out of the Project in furtherance of the ob ective ol the Project. 4. Six (6) months befor. th. Clc sing Date, or such other date as the World Bank shall have agreed with the Recipient, tht Project Implementing Entity shall, in conjunction with the World Bank, the Recipient at d the Fund Manager, carry out a pre-closing review of the Project (the "Pre-Clo :ing Rev ew"), covering the progress achieved in the performance of the PPCG Find and the Funi I Manager. The Project Implementing Entity shall prepare and furnish to the Wcrld BanI not less than three (3) months prior to the beginning of the Pre-Closing Review, a epor integrating the results of the monitoring and evaluation activities performed :ursuant to this Agreement, on the progress achieved by the PPCG Fund and the Fund Mar ager during the period preceding the date of such report, and including a description of the measures designed to ensure the continued implementation of the PPCG Fund's ictiities in accordance with the PPCG Fund Governing Documents after the Closing Da':e. Follc wing the Pre-Closing Review: (A) the World Bank shall determine, in its own di icret on, no later than one (1) month before the Closing Date, -11- whether the Funds dih bur;ed u rider Category 7 which have not been used on or before the Closing Date by the PPCG F md to support the issuance of PPCGs shall be refunded to the World Bank for cancellition or shall remain available to the PPCG Fund but exclusively for the purpose of supporting the issuance of PPCGs, or funding Permitted Activities, and (B) the Project Implementing Entity shall act promptly and diligently in order to take, or cause to be t;ken, any corrective action deemed necessary by the World Bank to remedy any shor tcom ng noted in the carrying out of the PPCG Fund's activities. B. Financial Management; Fin incial Reports; Audits 1. The Project Implemonting E itity shall ensure that a financial management system is maintained throughcut the mplementation of the Project in accordance with the provisions of Section 2.0 7 of I he Standard Conditions. 2. The Project .mplemeating En ity shall ensure that interim unaudited financial reports for the Project are prepared and f imished to the World Bank not later than 45 days after the end of each alendar quE rter, covering the quarter, in form and substance satisfactory to the World Bank. 3. The Project Implem.-nti ig E -tity shall have its Financial Statements for the Project audited in accordanc! wi :h tht provisions of Section 2.07 (b) of the Standard Conditions. Such audit of the Finncial St itements shall cover the period of one (1) Fiscal Year. The audited Fina-icial Stai:ements "or each such period shall be furnished to the World Bank not later thar. six (6) months a ter the end of such period. 4. In order to ensure the timely c irrying out of the audits referred to in Section II. B.3 of this Schedule, the Project Implem:nting Entity shall engage auditors for the purpose not later than six (6) months alter the I ffective Date, in accordance with the provisions of Section III of this Sc iedule. Section III. Procuremenl: All Minor H& orks, go Ads, non. consultant services and consultant services required for the Project and to be f inar ced aut of the proceeds of the Grant shall be procured in accordance with the prov[sion; of Section III of Schedule 2 to the Grant Agreement.