On ratification of the Agreement between the Government of the Republic of Kazakhstan and the Government of Georgia on Debt Restructuring of the Government of Georgia on State Loans provided to the Government of Georgia by the Government of the Republic of Kazakhstan

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On ratification of the Agreement between the Government of the Republic of Kazakhstan and the Government of Georgia on Debt Restructuring of the Government of Georgia on State Loans provided to the Government of Georgia by the Government of the Republic of Kazakhstan

3The LAW OF THE REPUBLIC OF KAZAKHSTAN dated December 31, 1996 N 63-I

To ratify the Agreement between the Government of the Republic of Kazakhstan and the Government of Georgia on Debt Restructuring of the Government of Georgia on State Loans provided to the Government of Georgia by the Government of the Republic of Kazakhstan, signed in Almaty on July 1, 1996.

President of the Republic of Kazakhstan

Agreement between the Government of the Republic of Kazakhstan and the Government of Georgia on restructuring the debt of the Government of Georgia on state loans provided by To the Government of Georgia by the Government of the Republic of Kazakhstan

(Official website of the Ministry of Foreign Affairs of the Republic of Kazakhstan - Entered into force on February 27, 2004)

The Government of the Republic of Kazakhstan, hereinafter referred to as the Kazakh Side, and the Government of Georgia, hereinafter referred to as the Georgian Side, and together hereinafter referred to as the Parties, - considering the need to develop, harmonize and further deepen integration processes within the framework of the Commonwealth of Independent States; - sharing the efforts of the people of Georgia to implement the Economic Reform Program supported by the Government of the Republic of Kazakhstan, The International Monetary Fund, the World Bank and the global community as a whole; - Recognizing the need for an early settlement of the debt problem of the Government of Georgia on state loans provided to it by the Government of the Republic of Kazakhstan in accordance with intergovernmental agreements, we have agreed as follows:

 ARTICLE 1 The Parties agree to restructure the debt of the Georgian Side on government loans provided to it by the Kazakh Side in accordance with the following intergovernmental agreements: "Agreement between the Government of the Republic of Kazakhstan and the Government of the Republic of Georgia on the conversion of technical loan debt based on the results of 1992 into a state loan of the Government of the Republic of Kazakhstan" dated 06/01/93 (hereinafter referred to as the First Agreement), "Agreement between the Government of the Republic of Kazakhstan and the Government of the Republic of Georgia on the conversion of debt based on the results of trade and economic cooperation for January-October 1993 into a state loan to the Government of the Republic of Georgia" dated 11/24/1994 (hereinafter referred to as the Second Agreement),

 ARTICLE 2 2.1. The Parties agree to convert into a restructured loan from the Government of the Republic of Kazakhstan to the Government of Georgia the total debt of the Georgian Side in the amount of USD 27.774 million, arising from its debt obligations under the two agreements specified in Article 1 of this Agreement, and calculated from the beginning of the said agreements as of January 1, 1996. 2.2. The restructured loan of the Government of the Republic of Kazakhstan in the amount of 27.774 million. US dollars are considered to have been provided to the Government of Georgia from 01.01.1996 for a period of 10 (ten) years, of which the first 5 (five) years form a grace period during which the Georgian Side makes payments to repay only the amount of interest-bearing debt.

 ARTICLE 3 3.1. The Georgian Side undertakes to repay the amount of the principal debt on the restructured loan in the period from 01.01.2001 to O1.01.2006. 3.2. The calculation of the amount for periodic payment to repay the amount of the principal debt is based on the number of quarters in the period from 01.01.2001 to 01.01.2006 and the equality of quarterly shares of the amount of the restructured loan. 3.3. Payments to repay the principal amount are made quarterly in equal installments amounting to one twentieth of the amount of the restructured loan. 3.4. The payment period for repayment of the principal amount is determined by the last month of the quarter. The date of payment is considered to be the date of receipt of the amount to the account of the authorized bank(s) of the Kazakh Side. 3.4.1. The Parties have agreed that the payment of the principal amount, not made during the period specified in clause 3.4. of Article 3 of this Agreement, shall be considered an overdue payment to repay the principal debt for this quarter. 3.4.2. The Georgian Side will make the first payment to repay the principal amount by July 01, 2001. 3.5. The Georgian Side has the right to early repayment of the principal amount in agreement with the Kazakh Side.  

ARTICLE 4 4.1. The Georgian Side undertakes to repay the amount of the interest-bearing debt for the use of the restructured loan in the period from 01.01.1996 to O1.01.2006. 4.2. To calculate the amount of interest-bearing debt on the actual rolling balance of the loan amount, based on the actual number of days in the calculated quarter, interest is charged at a fixed rate of 4% (four percent) per annum based on 360 days per year. 4.3. Payments to repay the amount of interest-bearing debt are made in quarters. 4.4. The period of payments to repay the amount of interest-bearing debt is determined by the last month of the quarter. The date of payment is considered to be the date of receipt of the amount to the account of the authorized bank(s) of the Kazakh Side. 4.4.1. The Parties have agreed that any payment of the amount of the interest-bearing debt not made during the period specified in clause 4.4. of Article 4 of this Agreement shall be considered an overdue payment to repay the interest-bearing debt for this quarter. 4.4.2. The Georgian Side will make the first payment to repay the amount of the interest-bearing debt by July 31, 1996.  

ARTICLE 5 5.1. The Georgian Side undertakes to repay the amount of the penalty debt, which is based on the debt to repay the amount of the principal debt and/or the debt to repay the amount of the interest debt, until it is fully repaid. 5.2. In order to calculate the amount of the penalty debt for the actual rolling balance of the debt amount (for repayment of the principal debt and/or for repayment of the interest debt), penalty interest is accrued for each day of debt at a fixed rate of 5% (five percent) per annum based on 360 days per year. 5ARTICLE 5 5.1. The Georgian Side undertakes to repay the amount of the penalty debt, which is based on the debt to repay the amount of the principal debt and/or the debt to repay the amount of the interest debt, until it is fully repaid. 5.2. In order to calculate the amount of the penalty debt for the actual rolling balance of the debt amount (for repayment of the principal debt and/or for repayment of the interest debt), penalty interest is accrued for each day of debt at a fixed rate of 5% (five percent) per annum based on 360 days per year. 5.3. Payments to repay the amount of the penalty debt are made by quarters.  

ARTICLE 6 In the event that the Georgian Side fails to fulfill the obligations assumed by it in paragraph 3.1. of Article 3, paragraph 4.1. of Article 4 and paragraph 5.1. of Article 5 of this Agreement, it undertakes to make payments to repay the principal and interest debts, as well as payments to repay the penalty debt up to their full repayment.  

ARTICLE 7 Payments for repayment of the principal debt, interest and penalty debts are made by the Georgian Side in US dollars.  

Article 8 8.1. If one or another payment undeArticle 8 8.1. If one or another payment under this Agreement falls on a day that is not a working banking day in the Republic of Kazakhstan or Georgia, such payment is made on the next working banking day. 8.2. Authorized banks of the Parties are obliged to: - within one month to agree on the technical procedure for making settlements and maintaining accounts arising from the terms of this Agreement, - officially submit to the Ministries of Authorized banks of the Parties are obliged to: - within one month to agree on the technical procedure for making settlements and maintaining accounts arising from the terms of this Agreement, - officially submit to the Ministries of Finance of the Parties the technical procedure for making settlements and maintaining accounts agreed upon by them, arising from the terms of this Agreement, formalized in the form of an interbank agreement between them, - independently of each other, within 10 (ten) days from the end of the reporting quarter, officially submit to both Ministries of Finance of the Parties a certificate on the status of the Parties' accounts as of the end of the reporting quarter.  

ARTICLE 9 The Georgian Side undertakes to allocate forRTICLE 9he Georgian Side undertakes to allocate for the repayment of debts and/or debts arising from its obligations under this Agreement, part of the international financial assistance provided to it by international financial organizations for servicing its restructured external debt on the terms agreed with these organizations.

 ARTICLE 10 The obligations of the Parties under this Agreement are unconditional and all payments under it will be made without any withdrawals, deductions or offsets of any kind, and will also be free and cleared of all taxes, commissions and fees existing in the territories of the Parties.

ARTICLE 11 This Agreement shall enter into force on the date of the last notification by the Parties to each other of their completion of the internal procedures necessary for its entry into force, and shall expire on the date of full fulfillment by the Parties of their obligations under this Agreement.

ARTICLE 12 With the entry into force of this Agreement, all intergovernmental agreements referred to in Article 1 of this Agreement, as well as the rights and obligations of the Parties under these agreements, shall cease to be valid and may not serve as a basis for the Parties to submit financial or other claims to each other.

Done in Almaty, Republic of Kazakhstan, on July 01, 1996, in 2 (two) original copies, each in Kazakh, Russian and Georgian languages, and each of them has the same legal force.

In case of a difference in the interpretation by the Parties of the provisions of this Agreement, the text in Russian will be used.

On behalf of the Government On behalf of the Government of the Republic of Kazakhstan of Georgia

President

Republic of Kazakhstan

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