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CONFORMED COPY
OTF GRANT NUMBER 10576-MA
OZONE PROJECTS TRUST FUND
GRANT AGREEMENT
(ODS Recycling Project)
between
MALAYSIA
and
INTERNATIONAL BANK FOR RECONSTRUCTION
AND DEVELOPMENT
acting as Trustee of the Ozone Projects
Trust Fund
Dated November 6, 1992
OZONE PROJECTS TRUST FUND GRANT AGREEMENT
AGREEMENT, dated, November 6 1992, between MALAYSIA (the Recipient) and 
INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT, acting as Trustee of grant 
funds provided by Parties to the Montreal Protocol on Substances that Deplete the 
Ozone Layer into the Ozone Projects Trust Fund (OTF) (the Trustee).
WHEREAS: (A) The International Bank for Reconstruction and Development (the 
Bank) pursuant to Resolution No. 91-5 of March 14, 1991, of the Executive Directors of 
the Bank (the Resolution), established a Facility, including the OTF, to assist in the 
protection of the global environment and promote thereby environmentally sound and 
sustainable economic development;
WHEREAS: (B) The Parties to the Montreal Protocol on Sub-stances that Deplete 
the Ozone Layer pursuant to the Vienna Con-vention for the Protection of the Ozone 
Layer have established the Interim Multilateral Fund (Fund) for the Implementation of 
the Montreal Protocol to operate under the authority of the said Parties to provide 
the financing to enable the Parties operating under paragraph 1 of Article 5 of the 
Protocol to comply with control measures provided for in the Protocol;
WHEREAS: (C) The Executive Committee of the Fund and the Bank have entered into 
an agreement effective on July 9, 1991, pursuant to which the Executive Committee has 
agreed to provide funds into the OTF to be administered by the Bank as Trustee in 
accordance with the provisions of the said agreement and the Resolution;
WHEREAS: (D) The Recipient, having satisfied itself as to the feasibility and 
priority of the Project described in Schedule 2 to this Agreement, has requested 
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assistance from the resources of the OTF in the financing of the Project, and the 
Trustee has determined that such assistance would be in accordance with the provisions 
of the Resolution; and
WHEREAS: (E) The Trustee has agreed, on the basis, inter alia, of the forgoing, 
to extend a grant (the OTF Grant) to the Recipient upon the terms and conditions set 
forth in this Agreement.
NOW THEREFORE  the parties hereto hereby agree as follows:
ARTICLE I
General Conditions; Definitions
Section 1.01. (a) The following provisions of the General Conditions Applicable 
to Loan and Guarantee Agreements of the Bank, dated January 1, 1985, with the 
modifications set forth in paragraph (b) of this Section (the General Conditions) 
constitute an integral part of this Agreement:
(i)
Article I;
(ii)
Sections 2.01 (1), (2), (3), (4), (6), (8), (9), (10), (11), (15), 
(18) and (20), 2.02 and 2.03;
(iii)
Section 3.01;
(iv)
Section 4.01 and the first sentence of Section 4.09;
(v)
Article V;
(vi)
Sections 6.01, 6.02 (a), (c), (d), (e), (f), (i) and (k), 6.03, 
6.04 and 6.06;
(vii)
Section 8.01 (b);
(viii)Sections 9.01 (a) and (c), 9.04, 9.05,. 9.06, 9.07, 9.08 and 9.09;
(ix)
Sections 10.01, 10.03 and 10.04;
(x)
Article XI; and
(xi)
Section 12.04.
(b)
The General Conditions shall be modified as follows:
(i)
the term "Bank", wherever used in the General Conditions, other 
than in Sections. 2.01 (8) and 6.02 (f) thereof and the last use 
of such term in Section 5.01 thereof, means the Trustee except 
that in Section 6.02, the term "Bank" shall also include the 
International Bank for Reconstruction and Development acting in 
its own capacity;
(ii)
the term "Borrower", wherever used in the General conditions, 
means the Recipient;
(iii)
the term "Loan Agreement", wherever used in the General 
Conditions, means this Agreement;
(iv)
the term "Loan" and "loan" wherever used in the General 
Conditions, means the OTF Grant; and
(v)
the term "Loan Account" wherever used in the General conditions, 
means the OTF Grant Account.
Section 1.02. Wherever used in this Agreement, unless the context otherwise 
requires, the several terms defined in the General Conditions and in the Recitals to 
this Agreement have the respective meanings therein set forth and the following 
additional terms have the following meanings:
(a) "DoE" means the Department of Environment in the Ministry of Science, 
Technology and Environment of the Recipient;
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(b) "FSD" means the Fire Service Department in the Ministry of Housing and Local 
Government of the Recipient; and
(c) "ODS" means Ozone Depleting Substances.
ARTICLE II
The OTF Grant
Section 2.01. The Trustee agrees to make available to the Recipient, on the 
terms and conditions set forth or referred to in this Agreement, the OTF Grant in an 
amount in various currencies equivalent to one million six hundred thirty thousand 
dollars ($1,630,000).
Section 2.02. The amount of the OTF Grant may be withdrawn from the OTF Grant 
Account in accordance with the provisions of Schedule 1 to this Agreement for 
expenditures made (or, if the Trustee shall so agree, to be made) in respect of the 
reasonable cost of goods and services required for carrying out the Project and to be 
financed out of the proceeds of the OTF Grant.
Section 2.03. The Closing Date shall be June 30, 1995 or such later date as the 
Trustee shall establish. The Trustee shall promptly notify the Recipient of such later 
date.
Section 2.04. The Trustee shall not be obligated to make any payment under this 
Agreement except to the extent it shall have received funds for the purposes of the 
Project from the Executive Committee referred to in paragraph (C) of the Preamble to 
this Agreement.
ARTICLE III
Execution of the Project
Section 3.01. The Recipient declares its commitment to the objectives of the 
Project as set forth in Schedule 2 to this Agreement, and, to this end, shall carry 
out Part A of the Project through DOE and Part B of the Project through FSD with due 
dili-gence and efficiency and in conformity with appropriate adminis-trative, 
financial and engineering practices and with due regard to ecological and 
environmental factors, and shall provide, promptly as needed, the funds, facilities, 
services and other resources required for the Project.
Section 3.02. Except as the Trustee shall otherwise agree, procurement of goods 
and consultants' services required for the Project and to be financed out of the 
proceeds of the OTF Grant shall be governed by the provisions of Schedule 3 to this 
Agreement.
Section 3.03. The Recipient shall cause DOE, prior to distributing recycling 
units to eligible service stations, to enter into an operation and maintenance 
contract on terms and conditions satisfactory to the Trustee.
Section 3.04. The Recipient shall cause each of DOE and FSD to furnish the 
Trustee, on a semi-annual basis and commencing January 1, 1993, with progress reports 
on the implementation of Parts A and B of the Project, such reports to contain, inter 
alia, assessments of the performance of the recycling equipment provided to DOE and 
FSD under Parts A.2. and B.1 of the Project, respectively.
ARTICLE IV
Financial Covenants
Section 4.01. (a) The Recipient shall maintain or cause to be maintained records 
and accounts adequate to reflect in accordance with sound accounting practices the 
operations, resources and expenditures in respect of the Project of the departments or 
agen-cies of the Recipient responsible for carrying out the Project or any part 
thereof.
(b)
The Recipient shall:
(i)
have the records and accounts referred to in paragraph (a) of this 
Section for each fiscal year audited, in accordance with 
appropriate auditing principles consistently applied, by 
independent auditors acceptable to the Trustee;
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(ii)
furnish to the Trustee as soon as available, but in any case not 
later than nine (9) months after the end of each such year, the 
report of such audit by said auditors, of such scope and in such 
detail as the Trustee shall have reasonably requested; and
(iii)
furnish to the Trustee such other information concerning said 
records and accounts and the audit thereof as the Trustee shall 
from time to time reasonably request.
(c)
For all expenditures with respect to which withdrawals from the OTF Grant 
Account were made on the basis of statements of expenditure, the Recipient shall:
(i)
maintain or cause to be maintained, in accord-ance with paragraph 
(a) of this Section, records and accounts reflecting such 
expenditures;
(ii)
retain, until at least one year after the Trustee has received the 
audit report for the fiscal year in which the last withdrawal from 
the OTF Grant Account was made, all records (contracts,, orders, 
invoices, bills, receipts and other documents) evidencing such 
expenditures;
(iii)
enable the Trustee's representatives to examine such records, and
(iv)
ensure that such records and accounts are included in the annual 
audit referred to in paragraph (b) of this Section and that the 
report of such audit contains a separate opinion by said auditors 
as to whether the statements of expenditure submitted during such 
fiscal year, together with the procedures and internal con-trols 
involved in their preparation, can be relied upon to support the 
related withdrawals.
ARTICLE V
Effectiveness; Termination
Section 5.01. This Agreement shall become effective upon its execution by the 
parties.
Section 5.02. This Agreement shall continue in effect until the OTF Grant has 
been fully disbursed and the parties to this Agreement have fulfilled all their 
obligations hereunder.
ARTICLE VI
Representatives of the Recipient; Addresses
Section 6.01. The Director General of the Economic Planning Unit in the Prime 
Minister's Department of the Recipient is designated as representative of the 
Recipient for the purposes of Section 11.03 of the General Conditions.
Section 6.02. The following addresses are specified for the purposes of section 
11.01 of the General Conditions:
For the Recipient:
Director General
Economic Planning Unit
Prime Minister's Department
Jalan Dato' Onn
50592 Kuala Lumpur
Malaysia
Cable address:
Telex:
ECONOMICS
EPU MA 30098.
Kuala Lumpur
For the Trustee:
International Bank for
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   Reconstruction and Development
1818 H Street, N.W.
Washington, D.C. 20433
United States of America
Cable address:
Telex:
INTBAFRAD
197688 (TRT),
Washington, D.C.
248423 (RCA),
 64145 (WUI) or
 82987 (FTCC).
IN WITNESS WHEREOF, the parties hereto, acting through their duly authorized 
representatives, have caused this Agreement to be signed in their respective names in 
Washington, D.C., as of the day and year first above written.
MALAYSIA 
By /s/ Dato Ali Abdel b.Sulaiman
Director General, Economic Planning Unit, 
Prime Minister’s Department
INTERNATIONAL BANK FOR
   RECONSTRUCTION AND DEVELOPMENT as
Trustee of the Ozone Projects Trust Fund
By /s/
Regional Vice President
East Asia and Pacific
SCHEDULE 1
Withdrawal of the Proceeds of the OTF Grant
1.
The table below sets forth the Categories of items to be financed out of the 
proceeds of the OTF Grant, the allocation of the amounts of the OTF Grant to each 
Category and the percentage of expenditures for items so to be financed in each 
Category:
  Amount of the
OTF Grant Allocated
% of
  (Expressed in 
Expenditures
Category
Dollar Equivalent)
to be Financed
(1)
 Equipment
    1,253,000
100% of foreign
expenditures;
100% of local
expenditures (ex-
factory cost) and
85% of local
expenditures for
other items
procured locally
(2)
Consultants'
     227,000
100%
services
(3)
Training
     150,000
100%
TOTAL
1,630,000
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2.
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.
3.
If the Trustee shall have determined at any time that any payment made from the 
OTF Grant Account was used for any expendi-ture not consistent with the provisions of 
this Agreement, the Recipient shall, promptly upon notice from the Trustee, refund to 
the Trustee for deposit into the OTF Grant Account, an amount equal to the amount so 
used or the portion thereof as specified by the Trustee.
SCHEDULE 2
Description of the Project
The objectives of the Project are to (i) assist the Recipient in reducing ODS 
use and emissions with available coat-effective technologies; and (ii) enhance 
institutional capabilities of Recipient agencies participating in ODS recycling 
activities.
The Project consists of the following parts, subject to such modifications 
thereof as the Recipient and the Trustee may agree upon from time to time to achieve 
such objectives:
Part A:
Mobile Air-Conditioning and ODS Recycling
1.
Provision of computer equipment to DOE.
2. 
Provision of about 200 sets of recycling and leak detection equipment for 
distribution to selected service stations and for training of technicians.
3. Training of (i) about 4,000 mobile air-conditioning technicians on the use of ODS 
recycling equipment; and (ii) local trainers in the field of ODS recycling.
4.
Preparation of a public awareness campaign on the benefits of ODS recycling.
5.
Provision of technical assistance to DOE in the areas of technical training and 
establishing computerized data bases. 
6.
Provision of technical assistance to DOE for the purposes of  Project 
implementation and monitoring.
Part B:
Halon Control Recovery and Recycling
1.
Provision and installation of Halon 1211 recovery/ recycling facilities at about 
50 fire stations and one central location.
2.
Installation of a Halon 1301 recovery/recycling and storage unit at a location 
to be elected by FSD.
3.
Provision of laboratory equipment.
4.
Assistance in the set up of an inventory and registration system  for Halon 1311 
recovery/ recycling units already installed.
5. Provision of engineering services to carry out demonstration recovery/recycling 
activities at seven locations to be selected by FSD.
6.  Training of FSD personnel on the use of the ODS recovery/recycling units.
7. Provision of technical assistance for the strengthening of FSD's Project 
implementation and monitoring capabilities.
The Project is expected to be completed by December 31, 1994.
SCHEDULE 3
Procurement and Consultants' Services
Section I: Procurement of Goods
Items or groups of items of equipment may be purchased under contracts awarded 
on the basis of comparison of price quotations obtained from at least three suppliers 
from at least three differ-ent countries eligible under the "Guidelines for 
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Procurement under IBRD Loans and IDA Credits" published by the Trustee in May 1985.
Section II: Employment of Consultants
In order to assist the Recipient in carrying out the Project, the Recipient 
shall employ consultants whose qualifications, experience and terms and conditions of 
employment shall be satis-factory to the Trustee. Such consultants shall be selected 
in accordance with principles and procedures satisfactory to the Trustee on the basis 
of the "Guidelines for the Use of Consultants by World Bank Borrowers and by the World 
Bank as Executing Agency" published by the Trustee in August 1981.