Daily Rules, Proposed Rules, and Notices of the Federal Government
The Board of Directors of the Millennium Challenge Corporation ("MCC") has approved an amendment (the "Amendment") to the existing approximately US$295.3 million, five-year Millennium Challenge Compact between the United States of America, acting through MCC, and the Government of Georgia (the "Compact").
The Compact was signed September 12, 2005 and entered into force on April 7, 2006. Compact projects focused on
MCC proposes to make up to US$100 million in additional funding available under the Compact. The proposed additional funding is necessary to complete works contemplated by the original Compact in the Roads, Regional Infrastructure Development and Energy Activities. Due to cost overruns and a declining dollar, MCC cannot fully fund these projects as originally contemplated by the Compact.
The Compact Amendment will allow for the completion of the Road Rehabilitation Activity as set forth in the Compact. The Amendment will also permit the expansion of the Regional Infrastructure Development ("RID") Activity and the Energy Activity in ways consistent with the original Compact. Additionally, furthering MCC's investment in Georgia can boost investor confidence and contribute to economic stability. Such effects, together with the direct impacts of the original Compact, promote Georgia's economic growth and assist the millions of Georgians who live in poverty.
Approximately US$60 million of the additional funding would be used to build three sections of road that, although originally contemplated by the Compact, could not be constructed because of cost overruns and a shortage of funds. Those sections will fully connect the Samtskhe-Javakheti region to Turkey and Central Georgia and will upgrade a road to the principal tourist attraction in the region.
The RID is an investment facility authorized to fund improvements to municipal infrastructure. Approximately US$26 million will be made available to the RID to make up for funds that were previously reallocated to the Road Rehabilitation Activity and adjust for the decline of the dollar. Approximately US$18.5 million will be used to complete the Borjomi and Kobuleti water systems by building waste water networks. A municipal water system is made up of several components: A water supply, a potable water network, a waste water treatment plant and a waste water network. MCC had already committed to rehabilitate the water supplies and potable water networks. The European Bank for Reconstruction and Development and other donors have agreed to finance the waste water treatment plants. The additional funding will permit MCC to finish these water projects in their entirety. Approximately US$5 million will be used to further complete rehabilitation of the Kutaisi potable water system. MCC has already committed to rehabilitate the pumps, the pipeline transmitting water to Kutaisi and the water distribution network in a portion of the city. The additional funds will permit rehabilitation of the distribution network in more of the city. The remaining funds will be used to fund feasibility studies and designs for future funding by donors.
The Compact provided US$5 million to "support the Ministry of Energy to further develop and implement its energy sector strategy, including * * * providing technical and feasibility studies." An initial feasibility study has already begun focusing on underground gas storage--a critical element to Georgia's energy security and strategy to reduce seasonal fluctuations in gas prices. The additional US$13 million permits MCC to finish a full economic, geological and environmental study, technical design and public/private financing plan for the gas storage facility and associated infrastructure.
This First Amendment To Millennium Challenge Compact (this "
Whereas, the Parties entered into that certain Millennium Challenge Compact by and between the United States of America, acting through MCC, and the Government, on September 12, 2005 (the "
Whereas, MCC now desires to grant additional funding to the Government in an amount not to exceed One Hundred Million United States Dollars (US$100,000,000) to cover shortfalls in the original budget for the Projects and allow completion of the Projects as originally contemplated by the Compact (the "
Whereas, the Parties desire to amend certain parts of the Compact as more fully described herein to memorialize the Additional Funding;
Now, Therefore, in consideration of the foregoing and the mutual covenants and agreements set forth herein and in the Compact, the Parties hereby agree as follows:
Section 2.1(a) (
"(a) MCC's Contribution. MCC hereby grants to the Government, subject to the terms and conditions of this Compact, an amount not to exceed Three Hundred Ninety-Five Million, Three Hundred Thousand United States Dollars (US$395,300,000) ("
Section 5.1 (
"To MCC: Millennium Challenge Corporation, Attention: Vice President, Compact Implementation, (with a copy to the Vice President and General Counsel), 875 15th Street, NW., Washington, DC 20005, United States of America, Telephone: +1 (202) 521-3600, Facsimile: +1 (202) 521-3700, E-mail:
Section 5.2 (
Section 5.11 (
Exhibit A (
Schedule 1 to Annex I (
"(i) Sub-Activities. MCC Funding will be used to rehabilitate or construct, as applicable, the road sections set out below (the "
(C) Ninotsminda--the Armenian border;
(D) Akhalkalaki--the Turkish border; and
(E) Khertvisi to Vardzia."
Exhibit A to Annex II (
Each Party hereby covenants and agrees, without necessity of any further consideration, to execute and deliver any and all such further documents and take any and all such other action as may be reasonably necessary or appropriate to carry out the intent and purpose of this Amendment.
From and after the Amendment Effective Date (as defined below), the Compact and this Amendment shall be read together and construed as one document, and each reference in the Compact to the "Compact," "hereunder," "hereof" or words of like import referring to the Compact, and each reference to the "Compact," "thereunder," "thereof" or words of like import in any Supplemental Agreement or in any other document or instrument delivered pursuant to the Compact or any Supplemental Agreement, shall mean and be construed as a reference to the Compact, as amended by this Amendment.
Except as expressly amended by this Amendment, all of the provisions of the Compact remain unchanged and in full force and effect.
This Amendment shall enter into force on the date of the last letter in an exchange of letters between the Principal Representatives of each Party confirming that each Party has completed its domestic requirements for entry into force of this Amendment (including as set forth in Paragraph 12) and that all conditions set forth in Paragraph 13 have been satisfied by the Government and MCC (the "
Promptly after the conclusion of this Amendment, the Government shall proceed in a timely manner to seek domestic ratification of this Amendment as necessary or required by the laws of Georgia, or similar domestic requirement, in order that: (a) This Amendment shall be considered an international agreement under Georgian law, (b) each of the provisions of this Amendment is valid, binding and in full force and effect under the laws of Georgia and (c) the Compact, as amended hereby, continues to be an international agreement and valid, binding and in full force and effect under the laws of Georgia. Notwithstanding anything to the contrary in this Amendment, this Paragraph 12 shall provisionally apply prior to the Amendment Effective Date.
As conditions precedent to this Amendment entering into force, the Government shall deliver:
(a) A certificate signed and dated by the Principal Representative of the Government, or such other duly authorized representative of the Government acceptable to MCC, that:
(i) Certifies that the Government has completed all of its domestic requirements for this Amendment to be fully enforceable under Georgian law; and
(ii) Attaches thereto, and certifies that such attachments are, true, correct and complete, copies of all decrees, legislation, regulations or other governmental documents relating to its domestic requirements for this Amendment to enter into force and the satisfaction of Paragraph 12, which MCC may post on its Web site or otherwise make publicly available.
(b) A written statement as to the incumbency and specimen signature of the Principal Representative executing this Amendment, such written statement to be signed by a duly authorized official of the Government other than the Principal Representative.
This Amendment is prepared and executed in English and, in the event of any ambiguity or conflict between this official English version and any translation into any language made for the convenience of the Parties, this official English version shall prevail.
The Parties acknowledge and agree that this Amendment is an international agreement entered into for the purpose of amending the Compact and as such will be interpreted in a manner consistent with the Compact and will be governed by the principles of international law.
This Amendment may be executed in counterparts, each of which shall constitute an original, but when taken together, shall constitute one instrument.
Upon signature of this Amendment, the Parties will provisionally apply this Amendment until the Amendment Effective Date.
In Witness Whereof, the undersigned, duly authorized by their respective governments, have signed this Amendment as of the date first written above and this Amendment shall enter into force in accordance with the terms hereof.