Exhibit 10.45
Information contained herein, marked with [***], is being filed pursuant to a
request for confidential treatment.
CHENGDU HUAXI ELECTRIC POWER (GROUP) COMPANY LTD.
AND CHINA NATIONAL AERO-ENGINE CORPORATION
AND
AES CHINA GENERATING COMPANY LIMITED
COOPERATIVE
JOINT VENTURE CONTRACT
FOR THE ESTABLISHMENT OF
SINO-FOREIGN CHENGDU AES KAIHUA GAS TURBINE POWER CO., LTD.
NOVEMBER 28, 1995
TABLE OF CONTENTS
PAGE
----
ARTICLE 1. GENERAL PROVISIONS ............................1
ARTICLE 2. DEFINITIONS ...................................1
ARTICLE 3. PARTIES TO THIS CONTRACT ......................4
ARTICLE 4. ESTABLISHMENT OF COOPERATIVE JOINT
VENTURE COMPANY ...............................5
ARTICLE 5. PURPOSE, SCOPE AND SCALE OF PRODUCTION
AND OPERATION .................................6
ARTICLE 6. TOTAL AMOUNT OF INVESTMENT AND
REGISTERED CAPITAL ............................6
ARTICLE 7. ANNUAL CAPITAL RETURN ........................11
ARTICLE 8. RESPONSIBILITIES OF THE PARTIES ..............11
ARTICLE 9. BOARD OF DIRECTORS ...........................13
ARTICLE 10. MANAGEMENT ORGANIZATION ......................17
ARTICLE 11. SITE .........................................18
ARTICLE 12. SALE OF ELECTRICITY ..........................18
ARTICLE 13. CONSTRUCTION .................................18
ARTICLE 14. FUEL SUPPLY ..................................19
ARTICLE 15. LABOR MANAGEMENT .............................19
ARTICLE 16. FINANCIAL AFFAIRS AND ACCOUNTING .............19
ARTICLE 17. TAXATION AND INSURANCE .......................22
ARTICLE 18. THE JOINT VENTURE TERM .......................23
ARTICLE 19. BREACH OF CONTRACT ...........................23
ARTICLE 20. TERMINATION AND LIQUIDATION ..................24
ARTICLE 21. FORCE MAJEURE ................................26
ARTICLE 22. SETTLEMENT OF DISPUTES .......................27
ARTICLE 23. APPLICABLE LAW ...............................28
ARTICLE 24. MISCELLANEOUS PROVISIONS .....................29
SIGNATURES ...............................................32
APPENDIX 1. RED LINE SITE MAP
APPENDIX 2. ANNUAL CAPITAL RETURNS
APPENDIX 3. ARTICLES OF ASSOCIATION
APPENDIX 4. LIST OF IMPORTED EQUIPMENT
APPENDIX 5. FORMATION OF EACH PARTY
COOPERATIVE JOINT VENTURE CONTRACT
----------------------------------
ARTICLE 1. GENERAL PROVISIONS
THIS CONTRACT is made in Beijing, the People's Republic of China on this 28th
day of November, 1995 by and among -------------------- Chengdu Huaxi Electric
Power (Group) Shareholding Company Ltd. (hereinafter referred to as "Party A"),
China National Aero-engine Corporation (hereinafter referred to as "Party B")
and AES China Generating Company Limited (hereinafter referred to as "Party C").
Each of Party A, Party B and Party C shall hereinafter individually be referred
to as a "Party" and collectively as the "Parties".
After friendly consultations conducted in accordance with the principles of
equality and mutual benefit, the Parties have agreed to organize Sino Froeign
Chengdu AES KAIHUA GAS Turbine Power Company, Ltd. (the "Company") in accordance
with the Law of the People's Republic of China on Sino-Foreign Cooperative Joint
Venture Enterprises (the "Cooperative Joint Venture Law"),law of Corporation of
P.R. China other relevant laws and regulations, and the provisions of this
Contract. Therefore, the creation of this contract:
ARTICLE 2. DEFINITIONS
2.01 Definitions
For purposes of this Joint Venture Contact, the capitalized terms set
forth below shall have the following corresponding meanings:
1. "Affiliate": Any company, through ownership of voting stock or
otherwise, directly or indirectly, controlling or controlled
by a Party; the term "control" being used in the sense of
power to elect directors or to direct the management of a
company.
2. "Articles of Association": The Company's articles of
associations, signed by the Parties, approved by the Company's
Board of Directors and the Examination and Approval Authority,
as amended from time to time when necessary with the approval
from the Board of Directors, attached as Appendix 3.
3. "Bank Supervision Agreement": An agreement between the Company
and the Bank of China for supervising each Party's
distributable as defined in Article 16.01 (d) (v).
4. "Board" or "Board of Directors": The highest authority of the
Company established in accordance with procedures set forth in
Article 9 of this Contract.
5. "Business License": The business license issued to the Company
by the local branch of State Administration of Industry and
Commerce.
6. "Chairman": Chairman of the Company's Board of Directors
appointed in accordance with Article 9 of this Contract.
7. "China": The People's Republic of China.
8. "Company": Sino-Foreign ChengDu AES KAIHUA Gas Turbine Power
Company Ltd. , a cooperative joint venture limited liability
company organized by the Parties pursuant to this Contract.
9. "Commencement of Operation": Date on which the Company
declares the GT Plant in commercial operation defined as Date
of Commercial Operation in the Power Purchase Contract
executed between the Company and ChengDu Huaxi Electric Power
share holding company (Group).
10. "EPC Contract": the fixed price, fixed schedule and fixed
scope construction contract for the design, construction,
completion and commissioning of the GT Plant.
11. "Contract": The Cooperative Joint Venture Contract for the
establishment and operation of Sino-Foreign ChengDu AES KAIHUA
Gas Turbine Power Co., Ltd.
12. "DGM of Finance": Deputy General Manager of Finance of the
Company appointed in accordance with Article 10 of this
Contract. The DGM of Finance will also be the Chief Accountant
of the Company.
13. "DGM of Operations": Deputy General Manager of Operations of
the Company appointed in accordance with Article 10 of this
Contract. The DGM of Operations will also be the Chief
Engineer.
14. "Directors": Member of the Company's Board of Directors
appointed in accordance with Article 9 of this Contract.
15. "Despatch Agreement": The electric power despatch agreement
entered into between the Company and the ChengDu Power Bureau.
16. "Examination and Approval Authority": The Ministry of Foreign
Trade and Economic Cooperation of the People's Republic of
China or its authorized organization.
17. "Fuel Supply Contract": Supply contract for the long term
supply of Natural Gas to the GT Plant to be entered into by
and between the Company and the gas supplier.
18. "General Manager": General Manager of the Company appointed in
accordance with Article 10 of this Contract.
19. "GT Plant ": The entire facility of a 63 MW combined cycle gas
turbine generating plant, complete with power generation and
control equipment, and all common services, ancillary
equipment, facility and the site.
20. "Interconnection Agreement": The interconnection agreement
entered into by and between the Company and the ChengDu Power
Bureau.
21. "Joint Venture Term": The term of the cooperative joint
venture as defined in Article 18 of this Contract.
22. "Loan Contracts": Contracts to be entered into between the
Company and Party B and Party C or an entity arranged by the
aforesaid Parties and acceptable to all of the Parties, to
provide loans to the Company in accordance with Article 6.03
hereof.
23. "Owner's Engineer": qualified engineering firm retained by the
Company to supervise the execution of the work contracted for
under the EPC Contract.
24. "Power Bureau": The --------------- ChengDu Power Bureau, an
economic entity legally authorised to execute on-grid and
dispatch contracts, in charge of the transmitting,
distribution, of electricity in the ChengDu area.
25. "Power Purchase Contract": Contract to be entered into between
the Company and ChengDu Huaxi Electric Power Co. (Group) for
the long-term sale of electricity.
26. "RMB": The lawful currency of the People's Republic of China.
27. "Site": The land in CHENGDU CITY, SICHUAN PROVINCE, China upon
which the GT Plant and all required auxiliary facilities are
located.
28. "State Land Use Right Transfer Contracts": Contracts with the
same length as the Joint Venture Term to be entered into
between the Company and ---------- Land Administration Bureau
or his Authorized Organization for the land use right transfer
of the Site.
29. "Third Party": Any party or parties other than the parties of
the Contract .
30. "USD": The lawful currency of the United States of America.
31. "Vice Chairmen": Vice Chairmen of the Company's Board of
Directors appointed in accordance with Article 9 of this
Contract.
ARTICLE 3. PARTIES TO THIS CONTRACT
3.01 The Parties
The Parties to this Contract are :
(a) Party A, Huaxi Electric Power Company (Group) a corporation
registered in ChengDu City, Sichuan Province, China with its
legal address at: No.24 NanSanDuan Y.Huan road ChengDu City,
SiChuan Province, PRC
Legal Representative of Party A :
Name: Qu De Lin
Position: General Manager
Nationality: Chinese
(b) Party B , China National Aero-engine Corporation, a Chinese
economic legal entity registered in China with its legal
address at:
No. 16 Donghuangchenggen, Dongcheng District, Beijing, China .
Legal Representative of Party B:
Name: ZHOU Xiaoqing
Position: General Manager
Nationality: Chinese
(c) Party C, AES China Generating Company Limited, a company
registered in Bermuda with its legal address at 9/F., Allied
Capital Resources Building, 32-38 Ice House Street, Central,
Hong Kong.
Legal Representative of Party C :
Name: Paul T. Hanrahan
Position: President
Nationality: USA
For the legal person formation of party A & B, please see appendix 5.
ARTICLE 4. ESTABLISHMENT OF COOPERATIVE JOINT VENTURE COMPANY
4.01 Establishment of the Company
The Parties hereby agree to organize the Company in accordance with the
Sino-foreign Cooperative Joint Venture Law, Coparative Law, other
relevant laws and regulations of the Peoples Republic of China, and
with the provisions of this Contract.
4.02 Name and Address of the Company;
(a) The name of the Company shall be " O-D Ia (0)I x/ (degree)(R)
OA E(1) (pound)- ?- --(a) E1/4 --u O-D I P (1)-- E3/4 in
Chinese, and ChengDu AES KAIHUA GAS Turbine Power Co. Ltd." in
English.
(b) The legal address of the Company shall be Chengdu City,
Sichuan Province, China.
4.03 Limited Liability Company
The form of organization of the Company shall be a limited liability
company. Creditors of the Company shall have recourse solely to the
assets of the Company and not to the assets of the individual Parties.
Except as otherwise provided herein, once a Party has paid in full its
contribution to the registered capital of the Company and the loans in
accordance with the Contract, it shall not be required to provide any
further funds to or on behalf of the Company by way of capital
contribution, loan, advance, guarantee or otherwise. The Company shall
indemnify the Parties against any and all losses, damages, or
liabilities in respect of any third party claims arising out of the
operation of the Company. Subject to the aforementioned responsibility
limitations, all Parties to this Contract shall share risks and losses
incurred by the Company within the limit of its respective share in
registered capital contribution.
4.04 Laws and Decrees
The Company is an economic entity established pursuant to the laws of
the People's Republic of China. The Company has the legal status of an
independent legal person. The activities of the Company shall be
governed and protected by the laws, decrees and relevant rules and
regulations of the People's Republic of China.
ARTICLE 5. PURPOSE, SCOPE AND SCALE OF PRODUCTION AND OPERATION
5.01 Operation Purpose of the Company
The Company's operation objectives are to build, own and operate the GT
Plant located in ChengDu Sichuan Province, China, to sell electric
power to the grid and to achieve a satisfactory return on investment
for the Parties.
5.02 Scope of Company Business
The Company's scope of business will be to generate and sell
electricity to the grid.
5.03 Construction Scale
The company shall construct a 63 MW combined cycle gas turbine
generating plant.
ARTICLE 6. TOTAL AMOUNT OF INVESTMENT AND REGISTERED CAPITAL
6.01 Total Investment
The total amount of investment required by the Company is presently
estimated to be 29.8 million US Dollars.
6.02 Registered Capital
The registered capital of the Company shall be 11.92 million US
Dollars.
6.03 Loans
The balance between the total investment and the registered capital
will be contributed as loans provided or arranged by Party B and Party
C upto 17.88 million US Dollars. Any addition funding needed and
approved by the Board shall be provided by all Parties in accordance
with their share of Registered Capital. The terms and conditions of the
loans will be fully defined in the Loan Contracts.
6.04 Contributions of Registered Capital
(a) Party A's Contribution to Registered Capital: Party A agrees
to contribute an amount of RMB equivalent to 4.172 million US
Dollars to the registered capital of the Company. This amount
represents 35.00% of the registered capital of the Company.
The value of Party A's contribution in RMB shall be calculated
at the USD/RMB Exchange Rate as announced by the People's Bank
of China on the date the contribution is made.
(b) Party B's Contribution to Registered Capital: Party B agrees
to contribute 3.576 million US Dollars to the registered
capital of the Company. This amount represents 30.00% of the
registered capital of the Company.
(c) Party C's Contribution to Registered Capital: Party C agrees
to contribute 4.172 million US Dollars to the registered
capital of the Company. This amount represents 35% of the
registered capital of the Company.
6.05 Payment of Registered Capital and Conditions Precedent thereto
Each Party agrees to make their first contribution of registered
capital to the Company, which shall not be less than 15% of the total
amount of their respective portions of registered capital share, within
thirty (30) days after satisfaction of the conditions precedent listed
below. The Parties agree to hold a Board of Directors meeting as soon
as possible after receiving the Business License of the Company to
execute the contracts listed below and decide a contribution schedule
for the balance of the registered capital according to relevant
regulations and construction need.
Conditions precedent to payment of registered capital are:
(a) Issuance of approval by the Examination and Approval Authority
approving this Contract and the Articles of Association
without varying the terms hereof or imposing any additional
terms or conditions;
(b) Issuance of a duplicate of the Company's Business License by
the local branch of the State Administration for Industry and
Commerce of China;
(c) Approval from the local Foreign Exchange Administration
Bureau, approving that the Company will have the priority in
converting RMB into foreign exchange to satisfy its need for
foreign exchange.
(d) Execution and approval of the State Land Use Right Contract
for the Site, the Power Purchase Contract, the Fuel Supply
Contract, the CAREC Personnel Contract and the AES Personnel
Contract, the Loan Contracts, the EPC Contract, the Bank
Supervision Agreement, the Interconnection Agreement, the
Despatch Agreement and other aspects of the transactions
described in the Contract. Approval shall be from all Chinese
government authorities required to approve these Contracts
without varying the terms or imposing any additional terms or
conditions. If any of the above contracts do not require
approval in accordance with Chinese laws and regulations, no
Party may claim a lack of approval as a reason to not fund
their registered capital.
(e) Opening of a bank account with a relevant bank in the name of
the Company;
(f) Approval by the -------- Provincial Pricing Bureau of the
tariff formula in the Power Purchase Contract for the entire
term of the Contract which determines the price of electricity
sold by the Company to the Huaxi Electric Power Company
(Group) Ltd. in accordance with the Policy of fund raising for
power generating.
(g) Obtain a legal opinion from the legal counsel of each Party,
stating that the Joint Venture Company has obtained all
required approvals, and that all the contracts listed in
Article 6.05(d) are legal and enforceable.
(h) Approval by each parties board of directors to authorize each
party to enter into this Contract.
Each of the aforesaid conditions precedent must be met satisfactorily
to each of the Parties. In the event any of the above conditions have
not been met thirty (30) days after the Company has been issued a
duplicate of its Business License, and the Parties do not agree in
writing to waive such conditions precedent, or extend the time for
their fulfillment, any Party shall have the right to terminate this
Contract. Should any Party terminate the Contract, no Party shall have
the right to require that Party to make further contributions to the
registered capital nor shall any Party claim any damages from that
Party.
If within thirty (30) days after satisfaction of the conditions
precedent, any Party has not made its contribution to the registered
capital of the Company, or if a Party fails to make contributions in
accordance with the schedule approved by the Board, the Party or
Parties failing to make such contribution shall be charged with a
penalty equal to 0.05% of the delinquent part of payment on a daily
basis, from the date of the scheduled contribution until the date of
the actual contribution, and shall be in default under this Contract.
6.06 Drawdown of Loans
Loans provided or arranged by Party B and Party C shall be deposited to
the bank account of the Company in accordance with the financial
requirements of the construction progress. The specific dates shall be
set in the Loan Contracts. Failure to make payments on time will be
treated in accordance with the provisions of the Loan Contracts.
6.07 Investment Certificate
After each Party submits its contribution in full to the registered
capital, a certified public accountant registered in China will verify
the contribution and issue a contribution verification report.
Thereupon, the Company shall issue an investment certificate to each
Party having made its contribution, which will be signed by the
Chairman and the Vice Chairmen of the Board.
6.08 Assignment of Registered Capital
(a) APPROVAL OF THE BOARD OF DIRECTORS AND RIGHT OF FIRST REFUSAL:
Any Party to this Contract may assign, sell or otherwise
transfer all or part of its ownership interest in the Company
(such Party being hereinafter referred to as "the Transferring
Party") to any Third Party (hereinafter referred to as the
"Transferee"), provided such transfers get a unanimous
approval of the Board of Directors. Such transfers will be
allowed provided the other Parties have a right of first
refusal to purchase the interest in the Company being
transferred under the same terms and conditions agreed between
the Transferring Party and the Transferee. The Transferring
Party shall notify the other Parties in writing of the terms
and conditions of the transfer. If the other Parties do not
exercise their right of first refusal within thirty (30) days
after receipt of such notice, they will be deemed to have
consented to the transfer. The Transferring Party may then
transfer its ownership interest in the Company provided the
Transferee executes a document by which it becomes a Party to
this Contract and expressly assumes the Transferring Party's
obligations herein. The requirement for unanimous approval of
the Board do not apply if a Party is assigning its rights to
distributions from the Company as security to obtain loans for
itself or an Affiliate. Nor shall the Company take any
collatural responsibility for it. If a Party is assigning,
selling or otherwise transferring all or any part of its
rights, title and interest in the Company to an Affiliate, the
right of first refusal shall not apply.
(b) GOVERNMENT APPROVAL: Any sale or assignment of ownership
interest in the Company shall be submitted to the Examination
and Approval Authority of this Contract for examination and
approval. The sale or assignment shall become effective only
after the approval is received. Upon receipt of the approval
from such Examination and Approval Authority the Company shall
register the change in ownership with the local branch of the
State Administration for Industry and Commerce of China.
(c) SIMULTANEOUS TRANSFER OF REGISTERED CAPITAL AND LOANS
INTEREST: Any Party to this Contract assigning, selling or
otherwise transferring all or part of its registered capital
interest in the Company to any third party shall also
transfer, or cause to be transferred, a proportional share of
its loans to the Company.
6.09 Increase of Registered Capital
Any increase in the registered capital must be first agreed to by the
Parties and unanimously approved by the Board of Directors before being
submitted to the Examination and Approval Authority of this Contract
for approval. In principle, increases in registered capital will be met
by the Parties in proportion to their then existing interest in the
Company's registered capital. Upon approval by such Examination and
Approval Authority, the Company shall register the increase in
registered capital with the local branch of the State Administration
for Industry and Commerce of China.
6.10 Failure to Make Registered Capital Contributions
In the event any Party fails to make its registered capital
contribution (or any portion thereof) as provided herein or fails to
provide its share of any increase in the Company's registered capital
as described in Article 6.09 above, then in addition to any other
rights the Company may have against the defaulting Party as described
in Article 6.05, the Company shall offer such unsubscribed portion of
registered capital to the non-defaulting Parties. The non-defaulting
Parties will be offered the portion not paid by the defaulting Party in
proportion to each Party's registered capital contribution. Such change
in each Party's investment ratio and transfer in interest of registered
capital as described in this paragraph shall be subject to the approval
of the Examination and Approval Authority of this Contract.
6.11 Development Expenses
Development expenses shall only include the expenses incurred by the
Parties for the sole purpose of preliminary work of the GT Plant and
those agreed upon by the Parties. The Parties hereby agree that the
development expenses for Party A is [***] and Party B is [***]
respectively and for Party C is [***]. These amounts will be either
counted as part of the registered capital contribution provided by the
Parties or paid to the Parties by the Company, in accordance with the
decision of the Board.
[***] Filed separately with the Commission pursuant to a request for
confidential treatment.
ARTICLE 7. ANNUAL CAPITAL RETURN
7.01 The investment return rate for the Parties is calculated based on the
GT Plant operating at full load with an annual equivalent operation
hour of [***] hours. After all taxes and contribution to required funds
according to relevant regulations are paid, the USD financial internal
return rate (FIRR) on equity for the Parties shall be [***]. Based on
an annual equivalent full load operation hour of [***] hours, and an
FIRR of [***], the annual capital returns of the Parties calculated in
USD (including profit distribution) are calculated and listed in
Appendix 2.
[***] Filed separately with the Commission pursuant to a request for
confidential treatment.
7.02 In the event that the annual equivalent full load operating hours
exceeds [***] hours, or the generation costs are reduced, the Parties
may get annual returns in the current year greater than those in
Appendix 2 in the current year.
[***] Filed separately with the Commission pursuant to a request for
confidential treatment.
ARTICLE 8. RESPONSIBILITIES OF THE PARTIES
8.01 Responsibilities of Party A
In addition to its other obligations under this Contract, Party A shall
have the following responsibilities :
(a) Be responsible for obtaining all necessary approvals, permits
and licenses for the establishment of the Company and have the
obligation to use their best efforts in obtaining all the
approvals necessary for the ongoing operation of the Company;
(b) Be responsible for carrying out all registration procedures
for land use right for the Site, and all other land use rights
needed by the Company, in a timely manner so as not to delay
development and construction of the GT Plant.
(c) Obtain, on behalf of the Company, all infrastructure needed,
including external water supply, power supply, Gas supply,
transportation, communications, and other services, on the
most favorable terms and conditions available;
(d) Assist the Company in applying for the most preferential tax
treatment and other investment incentives available under
applicable laws and regulations;
(e) Assist the Company in obtaining necessary approvals to import
raw materials and equipment. Assist the Company in arranging
for transportation of imported materials and equipment between
Chinese ports and the Site;
(f) Assist the Company with the procedures for procuring import
licenses and facilitating customs formalities for the import
of machinery and equipment, fuel, materials, supplies and
office equipment on preferential terms;
(g) Assist the Company's expatriates to obtain all necessary entry
visas and work permits;
(h) Assist the Company in opening Renminbi and foreign currency
bank accounts;
(i) Assist the Company in recruiting qualified Chinese personnel;
(j) Obtain necessary approvals for the Company to utilize various
methods permitted under Chinese law to balance its foreign
exchange as needed and to meet the Company's foreign exchange
needs, including Party C's ability to convert dividends and
return of capital into foreign exchange for remittance
overseas;
(k) Handle other reasonable matters entrusted by the Company from
time to time.
8.02 Responsibilities of Party B:
In addition to its other obligations under this Contract, Party B shall
have the following responsibilities :
(a) Be responsible for drafting feasibility study report of the
project, and submitting engineering and technical documents
necessary for the examination and approval of the project;
(b) Be responsible for importing machinery equipment as an agent
entrusted by the Company;
(c) Assist the Company's expatriates to obtain all necessary entry
visas and work permits;
(d) Assist the Company in appointing qualified O&M personnel of
the GT Power Plant and in arranging the training of
personnel;According to the needs of the Company, assist the
Company in the recruitment and employment of qualified
operations and maintenance personnel for the GT Plant; assist
the Company to arrange training;
(e) Be responsible for preparing the Company's engineering
construction proposals;
(f) Handle other reasonable matters entrusted by the Company from
time to time.
8.03 Responsibilities of Party C:
In addition to its other obligations under this Contract, Party C shall
have the following responsibilities :
(a) Assist the Company in purchasing equipment, supplies and
materials inside or outside China to ensure that they are of
the proper quantity and quality;
(b) Introduce modern management techniques and financial
management expertise to the Company;
(c) Assist Company staff and representatives in arranging foreign
visas/work permits for overseas training, as required for the
operation and management of the GT Plant;
(d) Assist the Company in recruiting qualified expatriate
personnel and international consultants, as required by the
Company;
(e) Handle other reasonable matters entrusted by the Company from
time to time.
(f) Assist the Company is obtaining working capital loan for the
operation of the GT Plant.
ARTICLE 9. BOARD OF DIRECTORS
9.01 Formation of the Board
(a) The Board of Directors shall be established on the date of
registration of the Company.
(b) The Board shall consist of nine(9) Directors including the
Chairman of the Board, three(3) of whom shall be appointed by
Party A, three(3) by Party B and three(3) by Party C. At the
time this Contract is executed and at any time a Director is
appointed or removed, each Party shall provide written notice
to the other Parties of the names of its appointed or removed
Directors.
(c) In general, each Director shall be appointed for a term of
four (4) years and may serve consecutive terms if reappointed
by the Party originally appointing him. Each Director shall
serve and may be removed by the Party who made that Director's
appointment. In the event a Director vacates the Board through
retirement, resignation, illness, disability or death, or in
the event a Director is removed by the Party who originally
appointed that Director, the Party who originally appointed
that Director may appoint a successor to serve out the
departing Director's remaining term.
(d) Directors will serve without remuneration, but all reasonable
costs incurred by the Directors in performance of their duties
as members of the Board will be borne by the Company.
(e) The Chairman of the Board shall be appointed by Party A. The
Chairman of the Board shall be the legal representative of the
Company. The Chairman will exercise his authority within the
limits prescribed by the Board and in compliance with the
Company Law of P.R. China and may not under any circumstance
contractually bind the Company or otherwise take any action on
behalf of the Company without prior approval of the Board.
Whenever the Chairman of the Board is unable to perform his
responsibilities for any reason, one Vice Chairman may be
designated by the Chairman or the Board to temporarily assume
the Chairman's duties until the Chairman is able to resume his
position as Chairman.
(f) There shall be two Vice Chairmen, one appointed by Party B and
one appointed by Party C.
(g) The Company hereby indemnifies each Director against any
claims arising from that Director's action in his capacity as
a Director of the Company, except for such acts in violation
of criminal laws.
9.02 Powers of the Board
(a) The Board of Directors shall be the highest authority of the
Company;
(b) Resolutions involving the following matters may only be
adopted at a duly constituted and convened meeting of the
Board whereupon such resolution receives the unanimous
affirmative vote of each and every Director of the Board
voting in person or by proxy at such meeting :
(i) Amendment of the Articles of Association;
(ii) Merger, integration of the Company with another
organization, or establishment of subsidiaries of the
Company;
(iii) Dissolution of the Company;
(iv) Increase or transfer of the registered capital of the
Company;
(v) Sale of any assets of the Company.
(vi) Execution, supplement, modification, termination,
substitution or assignment by the Company of any
credit or financing agreements, any power purchase
contract, long term fuel supply and transportation
contract, operation and management contract, and
major construction contract or other material
contract;
(vii) Additional capital requirement or financing amounts,
above total investment amounts as set forth in
Article 6.01;
(viii) Appointment of General Manager and Deputy General
Managers of the Company; and
(ix) Annual operation goals, financial budget, final
financial accounts and profit distribution plans of
the Company. If no unanimous agreement is achieved on
the profit distribution, the balance of the profit
shall be distributed after the allocation of 10% of
the after-tax profit to the required funds.
(c) All other issues that require a resolution by the Board may be
raised at a duly convened meeting of the Board. Such
resolution must be adopted by the affirmative vote of a
majority of the Directors present at such meeting in person or
by proxy. In the event that the Board has a tie vote , the
Chairman shall have the deciding vote.
(d) Any matter to be decided by the Board may be decided without a
meeting if all Directors consent in writing to such matter.
Such written consent will be filed with the minutes of the
Board proceedings and will have the same force and effect as a
unanimous vote taken by the Directors physically present.
9.03 Meetings
(a) ANNUAL MEETINGS: The first meeting of the Board of Directors
will be held within fifteen(15) business days from the date
the Company is issued a duplicate of its Business License
pursuant to this Contract. Thereafter, the Board shall meet at
least once every year. Meetings shall be held at the
registered address of the Company or such other address in
China or abroad as is designated by the Board. The Chairman of
the Board will set the meeting's agenda after consultation
with the Vice Chairmen of the Board, The Chairman is
responsible for convening and presiding over all meetings.
(b) PROXY: Meetings may be attended by Directors in person or by
proxy. If a Director is unable to participate in a Board
meeting, he may issue a proxy and entrust a representative to
participate in the meeting on his behalf. The representative
so entrusted shall have the rights and powers as stated in the
proxy.
(c) INTERIM MEETINGS: Interim meetings of the Board may be held
provided five(5) or more of the Directors submit written
requests for such meetings to the Chairman specifying the
matters to be discussed. Within thirty (30) days upon receipt
of such written notice, the Chairman will convene an interim
meeting of the Board. If the Chairman is unable to participate
in an interim meeting, in his absence the Vice Chairman taking
his place shall decide on the time and location of such
interim meetings.
(d) QUORUM: Six (6) Directors, including at least one Director
from each Party , present in person or by proxy shall
constitute a quorum necessary for the conduct of business at
any meeting of the Board . If at any properly convened
meeting, no quorum is constituted because less than six (6)
Directors are present in person or by proxy or there is not at
least one Director from each Party present in person or by
proxy then the meeting shall be cancelled, then the Chairman
shall call another meeting with seven (7) days' notice. Any
Director absent from a meeting without giving a reason
therefor and without having appointed a proxy shall be
considered to have abstained from voting. Resolutions, except
those concerning the issues prescribed in Article 9.02(b),
will be valid if passed by a majority of the Directors
present.
(e) NOTICE OF MEETING: The notice of a Board meeting shall be sent
to all directors fifteen (15) days in advance of each meeting.
The notice shall state the time,venue and main agenda of the
meeting. including relevant documents and information.
(f) MINUTES: The Board will cause complete and accurate minutes
(in both English and Chinese) to be kept of all meetings
(including a copy of the notice of the meeting) and of
business transacted at such meetings. Minutes of all meetings
of the Board shall be distributed to all the Directors as soon
as practicable after each meeting but not later than ten (10)
days from the date of such meeting. Any director who wishes to
propose any amendment or addition thereto shall submit the
same in writing to the Chairman and the Vice-Chairmen within
one (1) week after receipt of the proposed minutes. The
minutes shall be finalized by the Chairman and Vice-Chairmen
not later than thirty (30) days after the relevant meeting and
signed by all the directors within one (1) week after receipt
of the final minutes.
ARTICLE 10. MANAGEMENT ORGANIZATION
10.01 Management Organization
The Company shall adopt a management system under which the management
organization shall be responsible to and under the leadership of the
Board of Directors. The Company management shall include a General
Manager, a DGM of Operations, a DGM of Finance, and a number of
Department Managers. Party C shall nominate the General Manager, Party
B shall nominate DGM of Operations, who is concurrently the Chief
Engineer and Party A shall nominate the first DGM of Finance, who is
concurretly the Chief Account, and the Board of Directors needs to
unanimously approve the appointment of the General Manager and the two
Deputy General managers. The term of appointment for the General
Manager and the two Deputy General managers shall be four (4) years.
The General Manager and Deputy General managers may be removed only by
a majority resolution of the Board. If the General Manager or the
Deputy General Manager is removed by the Board or finishes his tenure,
a successor shall be nominated by the Parties for approval by the Board
of Directors.
10.02 Responsibilities and Powers of the General Manager
The General Manager shall at all times be responsible to the Board of
Directors and will carry out all matters entrusted by the Board. The
DGM of Operations and the DGM of Finance shall assist the General
Manager. The General Manager shall be in charge of the day-to-day
operation and management of the Company. The DGM of Operations shall be
in charge of the operation and maintenance of the GT Plant. The DGM of
Finance shall be responsible for the financial affairs of the Company.
The General Manager , the DGM of Operations and the DGM of Finance
shall meet regularly to discuss and solve important issues arising from
the operation and management of the Company.
10.03 Operation and Management
The Company will be responsible for the operation and management of the
GT Plant . The Company will endeavor to introduce modern management
techniques to ensure high availability and efficiency of the GT Plant.
ARTICLE 11. SITE
11.01 Site
The area of the Site for the GT Plant is approximately MU. Details
regarding the Site are set forth in the Red Line Site Map attached
hereto as Appendix 1.
11.02 Land Use Rights
The Company shall enter into a State Land Use Rights Transfer Contract
with the Chengdu Land Bureau and its authorized department in order to
obtain for at least the Term of this Contract land use right of the
Site for a term no less than the term of the Joint Venture Contract.
ARTICLE 12. SALE OF ELECTRICITY
12.01 Power Sales
The sale of electricity produced by the GT Plant will be made pursuant
to the Power Purchase Contract entered into by and between the Company
and Huaxi Electric Power (Group) Shareholding Company Ltd. The PPC,
shall state clearly that the Huaxi Electric Power (Group) Shareholding
Company Ltd. shall be responsible for arranging the execution of
on-grid agreement and dispatch agreement entered into by and between
the Company & the Power Bureau.
12.02 Tariff Determination
The tariff of the power generated by the GT Plant shall be determined
by the tariff formula prescribed in the Power Purchase Contract entered
into by and between the Company and the Huaxi Electric Power (Group)
Shareholding Company Ltd., and approved by relevant price
administration departments.
ARTICLE 13. CONSTRUCTION
13.01 Construction Management
The Parties agree that Party B and A shall be responsible for the
construction of the GT Plant. The Company shall enter into an EPC
Contract with Party B. The EPC Contract shall be comparable with
internationally accepted parties in similar projects in the areas of
construction schedules, quality and cost. The detailed clauses shall be
specified in the EPC Contract. The Company shall employ an Owner's
Independent Engineer to supervise and manage the construction of the GT
Plant.
ARTICLE 14. FUEL SUPPLY
14.01 Fuel Supply
The Company will sign a long-term natural gas supply contract with
Chengdu Huachuan Oil and Natural Gas Exploration and Development
Corporation.
ARTICLE 15. LABOR MANAGEMENT
15.01 Governing Principles
The Company shall be responsible for its own labor management,
recruitment, employment , dismissal, resignation, wages and welfare of
working personnel in accordance with the "Labor Management Regulations
of the PRC for Foreign Investment Enterprises" (the "Labor
Regulations") and other relevant regulations. The organization chart,
qualifications and number of employees shall be determined by the Board
of Directors in accordance with the operating needs of the Company.
15.02 Operation and Management Personnel
The Company shall enter into a Contract with Party B, specifying the
terms and conditions under which the Company shall engage qualified and
professional operation and management personnel from an entity
designated by Party B & A. When necessary, the Company shall also enter
into an agreement with Party C specifying the terms and conditions
under which the Company shall engage the required personnel from Party
C (the "AES Personnel Contract").
ARTICLE 16. FINANCIAL AFFAIRS AND ACCOUNTING
16.01 Accounting System
(a) The DGM of Finance, under the leadership of the General
Manager, shall be responsible for the financial management of
the Company.
(b) The DGM of Finance shall prepare the Company's accounting
system and procedures in accordance with the "Accounting
System of the People's Republic of China for Foreign
Investment Enterprises" and the "Financial Management System
of the People's Republic of China for Foreign Investment
Enterprises". The Company shall also conduct its accounting in
accordance with such internationally recognized accounting
principles as any foreign lender to the Company may require.
The Company's accounting system and procedures shall be
submitted to the Board for approval. Once approved by the
Board, the accounting system and procedures shall be filed for
the record with the government department in charge of the
Company and with the relevant local department of finance and
tax authorities.
(c) The Company shall adopt RMB as its bookkeeping base currency.
(d) The distribution of available cash shall be carried out in
accordance with the following priority of payments:
(i) Operation and maintenance costs (including VAT) of
the GT Plant and management costs of the Company;
(ii) Principal and interest payments due pursuant to the
Loan Contracts;
(iii) Income and any other taxes;
(iv) Contributions to statutory funds; and
(v) Profits for distribution.
(e) All accounting records, vouchers and books of the Company
shall be made and kept in Chinese. At the request of Party C,
some part of the records and books will be provided to Party C
in English. All Company accounting statements shall be made
and kept in English and Chinese.
16.02 Auditing
(a) The Company will engage an independent accounting firm
registered in China as its auditor to examine and verify the
annual financial report. The Parties agree that such
accounting firm shall be of international standard and shall
be appointed by the Board. The Company shall submit to the
Parties an annual statement of final accounts (including the
audited profit and loss statement and the balance sheet for
the fiscal year) within two (2) months after the end of the
fiscal year. Such documentation will be submitted together
with an audit report prepared by the accounting firm
registered in China.
(b) Each Party may, at its own expense, appoint an accountant who
is either an accountant registered abroad or registered in
China. On behalf of the Party, the independent accountant may
audit the Company's accounts. Such accountants will be given
reasonable access to the Company's financial records and will
keep confidential all documents under their auditing.
(c) The Company shall present to the Parties balance sheets,
profit and loss statements and other supplementary information
requested by the Board on a monthly basis. Such information
will be provided to the Parties in both English and Chinese.
16.03 Bank Accounts and Foreign Exchange Control
The Company will open a foreign exchange account and a Renminbi account
at banks within or outside China; such banks will be approved by the
State Administration of Exchange Control of China. The Company's
foreign exchange transactions shall be handled in accordance with the
regulations of China relating to foreign exchange control.
16.04 Foreign Exchange Balance
(a) In the event the Company borrows foreign currency from lenders
not located in China, the Company shall, in accordance with
applicable foreign exchange regulations of the People's
Republic of China, open USD cash accounts at a bank approved
by the relevant authorities for the repayment of principal of
and the payment of interest on, foreign currency loans.
(b) Funds in the Company's foreign exchange account shall be used
as determined by the Board of Directors to satisfy foreign
exchange debt, expenses, remittances of profit and other
remittances in accordance with relevant foreign exchange
regulations of the People's Republic of China.
(c) All remittances to Party C due in accordance with the
provisions of this Contract shall be made to a foreign bank
account designated by Party C in United States Dollars or in
any other freely convertible foreign currencies in accordance
with the foreign exchange regulations of China and the
commitment of local foreign exchange administration
departments. The Company shall pay for the fee occurred in the
conversion. The Company may also remit all or a portion of
remittances due to Party C in RMB if Party C elects to do so.
(d) From the time the profit distribution plan is approved by the
Board of Directors until the actual time of exchange, the risk
of foreign exchange rate fluctuating shall be borne by the
Company.
16.05 Fiscal Year
The Company shall adopt the calendar year as its fiscal year, which
shall begin on January 1 and end on December 31 of the same year. The
first fiscal year of the Company shall commence on the date that the
Company is established and granted a Business License, and shall end on
the immediately succeeding December 31.
16.06 Distribution of Profits
(a) After the payment of any applicable related taxes and fees by
the Company, the Board will determine the annual allocations
to the required funds as required by Chinese accounting laws
and regulations. The sum of the annual allocations to the
required funds shall be 10% of the after-tax profit of the
year under consideration (unless otherwise required by law).
Any increase or decrease in the percentage to the required
funds must be unanimously approved by the Board of Directors.
(b) All distributable profits shall be distributed to the Parties
in proportion to their respective share of the Registered
Capital.
(c) If the Company carries losses from the prior year, the profit
of the current year shall be used first to cover losses. No
profit shall be distributed unless the deficit from previous
years is made up. The profit retained by the Company and
carried over from the prior year may be distributed together
with the distributable profit of the current year.
ARTICLE 17. TAXATION AND INSURANCE
17.01 Taxes
(a) The Company and its Chinese and expatriate employees shall pay
tax under the relevant tax laws of China.
(b) Following approval of this Contract by the Examination and
Approval Authority, the Company will submit an application for
confirmation of the Company as a technically advanced
enterprise in accordance with the "Implementing Measures of
the Ministry of Foreign and Economic Relations and Trade on
the Conformation and Examination of Export Oriented and
Technologically Advanced Enterprises and Foreign Investment"
in order to obtain the most favorable tax rats.
17.02 Insurance
The insurance for the Company for various kinds of risks shall be
purchased from insurance companies registered within PRC. The Company
shall undertake to procure the following types of insurance:
(a) Property All Risks Insurance , Contractor's All Risk and
Erection All Risks Insurance (including domestic
transportation insurance for equipment) before and after the
construction completion of the GT Plant and thereafter in
respect of any upgrading or maintenance works to the GT Plant;
(b) Property All Risks Insurance, Machinery Breakdown Insurance,
Business Interruption Insurance, Machinery Breakdown Business
Interruption Insurance, Bodily Injury Insurance, Personal
Accident Insurance and Additional Cover for Medical Expenses
for the period after the construction completion of the GT
Plant; and
(c) other insurance coverage which the Board of Directors decides
is necessary.
ARTICLE 18. THE JOINT VENTURE TERM
18.01 Joint Venture Term
The term of the Joint Venture established under this Contract shall
commence on the date the Company is granted a Business License and
shall terminate sixteen (16) years thereafter ( including one year of
construction) .
18.02 Extensions to the Joint Venture Term
The term of the Joint Venture Contract may be extended upon unanimous
approval of the Parties. An application for such extension should be
filed with the original Examination and Approval Authority at least six
months prior to the expiration of the term of this Contract.
ARTICLE 19. BREACH OF CONTRACT
19.01 Breach of Contract
In the event the Company is unable to continue its operation or achieve
the business purposes stipulated in this Contract due to failure of a
Party to fulfill its obligations under this Contract and its
Appendices, the non-defaulting Parties will have the right to terminate
this Contract in accordance with Article 20 herein and the liabilities
arising from breach of contract shall be borne by the Party in breach
as provided for in this Contract and its Appendices. The defaulting
Party shall make the consequent payment arisen from such a breach to
the non-defaulting parties.
ARTICLE 20. TERMINATION AND LIQUIDATION
20.01 Termination
(a) TERMINATION OF THIS CONTRACT: No Party shall have the right,
in its sole discretion and without cause, to terminate this
Contract. This Contract may only be terminated under the
following circumstances:
(i) The Contract expires at the end of the Term as
described in Article 18 hereof;
(ii) The Parties unanimously agree in writing to terminate
this Contract at any time;
(iii) Subject to the notification requirements of Section
20.02 herein, a Party may submit written notice to
the other Parties of its desire to terminate this
Contract upon the occurrence of an event of default
as further described in Section (b) below.
(b) CAUSES FOR TERMINATION: Any of the following occurrences shall
be considered causes for termination:
(i) A Party materially breaches this Contract or violates
the Articles of Association, and such breach or
violation is not cured within thirty (30) days of
written notice to the defaulting Party by a
non-defaulting Party;
(ii) The Company, or any, or all of the Parties become
bankrupt, or is the subject of liquidation or
dissolution proceedings or ceases to carry on
business or becomes unable to pay its debts as they
come due and as a result there are significant
adverse consequences to the Company;
(iii) Any superior authority having authority over a Party
requires any provision of this Contract to be revised
in such a way as to cause significant adverse
consequences to the Company or to the other Parties;
(iv) The conditions or consequences of Force Majeure as
hereinafter defined in Article 21 significantly
interfere with the normal functioning of the company
for a period in excess of eighteen (18) months and
the Parties are unable to find an equitable solution
pursuant to Article 22 hereof ;
(v) Any Party fails to make its contribution to the
registered capital in accordance with Article 6.05;
(vi) Any Party fails to make its contribution to the loans
in accordance with Article 6.06;
(vii) The Power Purchase Contract is terminated.
20.02 Notification Procedure
Mere submission by any Party of a notice indicating a desire to
terminate this Contract shall not by itself constitute a termination of
this Contract. In the event that any Party gives notice pursuant to
Article 20.01 hereof of a desire to terminate this Contract, the
Parties shall within a two (2) month period after such notice is given
conduct negotiations and endeavor to resolve the situation which
resulted in the giving of such notice. In the event that the situation
which resulted in the giving of such notice is not cured and that
matters are not resolved to the satisfaction of the Parties within two
(2) months of such notice, the notifying Party may follow the relevant
procedures and laws and apply to the Examination and Approval
Authorities for the termination of the Contract. In the event a breach
is committed by a Party to this Contract which results in the
termination of this Contract, the Party in breach will bear full
liability and costs associated with such breach of Contract.
20.03 Normal Termination of the Contract
The Contract shall be terminated upon expiration of the term of this
Contract as per specified in Article 18.01, unless it is extended
pursuant to Article 18.02 hereof.
20.04 Liquidation
(a) DISSOLUTION OF THE COMPANY: The Company shall be dissolved
upon expiration of the term of this Contract pursuant to
Article 18 hereof, or upon earlier termination of this
Contract pursuant to Article 20.01 hereof. The Company shall
carry out the procedures for liquidation of the Company in
accordance with the law of the People's Republic of China.
(b) LIQUIDATION COMMITTEE: The Board of Directors shall form a
Liquidation Committee, comprised of three (3) members
appointed by Party A, three (3) members appointed by Party B
and three (3) members appointed by Party C (the "Liquidation
Committee"). The Liquidation Committee shall conduct a
thorough examination of the assets and liabilities of the
Company and develop a liquidation plan in compliance with this
Contract and with relevant laws and regulations of the
People's Republic of China for the liquidation of the Company.
No member of the Liquidation Committee shall have the power to
take any action binding on the Liquidation Committee or on the
Board of Directors or the Company without the express
authorization and the unanimous consent of the entire
Liquidation Committee. All actions of the Liquidation
Committee shall require the unanimous approval of the entire
Liquidation Committee. The Liquidation Committee will value
and liquidate the Company's assets based on the actual
circumstances of the Company valued as a going concern, so as
to cause the Parties to receive the then market value for the
assets. The final liquidation plan shall be unanimously
approved by the entire Liquidation Committee.
(c) LIQUIDATION PLAN:
Upon expiration of the Joint Venture Term as described in
Article 18 hereof, or upon earlier termination of this
Contract pursuant to Article 20.01 hereof, the liquidation
plan shall provide first for payment of the Company's debts
and expenses. Following such payments, the Company's assets
shall be distributed to Party A, Party B and Party C
proportionally in accordance with each Party's registered
capital share of the Company.
ARTICLE 21. FORCE MAJEURE
21.01 Force Majeure
(a) "Force Majeure" shall mean all events which are beyond the
control of the Parties to this Contract, and which are
reasonably unforeseen, unavoidable or insurmountable, and
which arise after the signing of this Contract and which
prevent total or partial performance by any Party of its
obligations under this Contract. Such events shall include
earthquakes, typhoons, flood, fire, strikes, political
disturbances, war, or any other instances which can not be
foreseen, prevented or controlled.
(b) If occurrence of an event of Force Majeure prevents a party
from fulfilling its obligations under this Contract, the Party
will be suspended from performing such obligations provided;
(i) Suspension of performance is of no greater scope and
no longer duration than is reasonably required to
correct consequences caused by the event of Force
Majeure; and
(ii) Suspension of performance will not apply to any
obligation to make payments under this Contract.
(c) In the event any Party is unable to fulfill its obligation
under this Contract as a result of Force Majeure, the Party
claiming Force Majeure shall promptly inform the other Parties
in writing within 15 days of such occurrence. Such
notification will state the nature of the event, the
anticipated duration and any action taken by the affected
party to mitigate the effect. In the event of Force Majeure,
the Parties shall immediately consult with each other in order
to find an equitable solution and shall use all reasonable
endeavors to minimize the consequences of such Force Majeure.
ARTICLE 22. SETTLEMENT OF DISPUTES
22.01 Conciliation and Mediation
Any dispute in connection with this Contract will be settled through
friendly consultation or conciliation among the Parties. Consultations
will occur immediately upon the request of one Party to the other
Parties regarding disputes. Disputes may also be mediated by a third
party appointed by the Parties to this Contract. If mediation is not
successful within 30 days, disputes may also be submitted to binding,
non -appealable arbitration for settlement.
22.02 Arbitration
The following rules and procedures will apply to an arbitration of
disputes between the Parties under this Contract.
(a) Arbitration under this Contract will be conducted by an
arbitral tribunal in accordance with UNCITRAL arbitration
rules contained in Resolution 31/98 adopted by the United
Nations General Assembly on December 15, 1976 and entitled
"Arbitration Rules of the United Nations Commission on
International Trade Law" or its amendments as in force at the
time such arbitration is commenced. Should there be a conflict
between the rules and provisions of this Contract and the
arbitration rules, the provisions of this Contract will
govern.
(b) The arbitral tribunal will have three (3) members. Each Party
will appoint one arbitrator within 30 days after giving or
receiving demand for arbitration. The third arbitrator shall
be appointed by the other two arbitrators within 10 days of
the appoint of the second arbitrator. If any of the
arbitrators are not appointed within the time limits set forth
in this section, arbitrators will be appointed by the
Secretary General of the International Center for Settlement
Disputes.
(c) All arbitrators must be fluent in Mandarin and English. The
arbitration will be conducted in Mandarin and English. Any
subsequent arbitration award will also be written in Mandarin
and English.
(d) The site and the organization for arbitration can be Singapore
International Arbitration Centre or other international
locations and arbitration organizations acceptable to the
Parties.
(e) The final arbitration award will specify with reasonable
detail the facts of the dispute and the reasons justifying the
tribunal's decision. The Parties agree to accept the
arbitration award as final and binding. The Parties renounce
their right to appeal the arbitration award.
(f) The Parties agree to bear all costs as determined and
allocated in the arbitration award.
22.03 Continuing Rights and Obligations
The Parties shall continue to exercise their remaining respective
rights, and fulfill their remaining respective obligations, under this
Contract, except in respect of those matters under dispute.
22.04 Waiver of Immunity
To the extent the Parties may claim for themselves or their assets and
revenues, immunity from suit, execution, attachment or other legal
process, the Parties agree not to claim such immunity and agree to
irrevocably waive such immunity to the full extent permitted by
applicable law.
ARTICLE 23. APPLICABLE LAW
23.01 Applicable Law
The validity, interpretation and implementation of this Contract shall
be governed by the laws of the People's Republic of China which are
published and publicly available. In the event that there is no
published and publicly available law in China governing a particular
matter relating to this Contract, reference shall be made to general
international commercial practices.
23.02 Economic Adjustment for Change of Law
As used herein "Change of Law" means the promulgation of any new laws,
rules or regulations in China or the amendment or interpretation of any
existing laws, rules or regulations in China relating to taxes, custom
duties, environmental issues or other matters concerning this Contract.
In the event that a Change of Law adversely and materially affects a
Party's economic benefit under this Contract, the Parties shall
promptly consult with each other and use their best endeavors to
implement adjustments necessary to maintain each Party's economic
benefits derived from this Contract. The basis of this adjustment will
be no less favorable than the economic benefits it would have derived
if such laws, rules or regulations had not been promulgated or amended
or so interpreted.
23.03 Preferential Treatment
The Company and the Parties shall be entitled to any tax, investment or
other benefits or preferences that become available or publicly known
after the signing of this Contract and which are more favorable than
those set forth in this Contract.
ARTICLE 24. MISCELLANEOUS PROVISIONS
24.01 Environmental
The Company shall undertake environmental protection measures in
accordance with the "Law of the People's Republic of China on
Environmental Protection" and other relevant laws and regulations.
24.02 Waiver
To the extent permitted by Chinese law, failure or delay on the part of
any Party hereto to exercise a right, power or privilege under this
Contract and the Appendices hereto shall not operate as a waiver
thereof or other rights, powers or privileges; nor shall any single or
partial exercise of a right, power or privilege preclude any other
future exercise thereof.
24.03 Binding Effect
This Contract is made for the benefit of the Parties and their
respective lawful successors and assignees and is legally binding on
them. This Contract may not be changed orally, but only by a written
instrument signed by all Parties and approved by the appropriate
Examination and Approval Authority.
24.04 Language
This Contract is executed in the Chinese language in eight (8)
originals and in the English language in eight (8) originals. Both
language versions shall be equally effective.
24.05 Entire Agreement
This Contract and the Appendices attached to this Contract constitute
the entire agreement between the Parties with respect to the subject
matter of this Contract and supersede all prior discussions,
negotiations and agreements between them. In the event of any conflict
between the terms and provisions of this Contract and the Articles of
Association the terms and provisions of this Contract shall prevail.
24.06 Notices
Any notice or written communication provided for in this Contract by
any Party to the others, including but not limited to any and all
offers, writings, or notices to be given thereunder, shall be in
writing made in English and Chinese , and shall be sufficiently given
if addressed as set forth below and sent by registered mail or an
internationally recognized overnight courier services, hand delivered
or transmitted clearly by facsimile, however all facsimile shall be
confirmed by courier service delivered letter, promptly transmitted or
addressed to the appropriate Party. The date of actual receipt of a
notice or communication thereunder shall be deemed to be the effective
date. All notices and communications shall be sent to the appropriate
address set forth below, until the same is changed by notice given in
writing to the other Parties.
PARTY A: Chengdu Hua Xi Electric Power (Group) Share
holding Company Ltd.
Address:
Telephone No.:
Facsimile No.:
Attention: Qu Delin
Zip Code:
PARTY B: China National Aero-engine Corporation
Address: No. 16 Donghuangchenggen, Dongcheng
District, Beijing, China
Telephone No.: 8610 4054595
Facsimile No.: 8610 4036107
Attention: Zhou Xiaoqing
Zip Code: 100717
PARTY C: AES China Generating Company Limited
Address: 9/F, Allied Capital Resources Bldg.,
32-38 Ice House Street, Central, HK
Telephone No.: (852) 28425111
Facsimile No.: (852) 25301673
Attention: Edward C. Hall III
24.08 Appendices
The Appendices listed below are made an integral part of this Contract
and are equally binding with Articles 1 through 24 herein.
Appendix 1. Red Line Site Map
Appendix 2. Annual Capital Returns
Appendix 3. Articles of Association
Appendix 4. List of Imported Equipment
APPendix 5. List of Companies Represented by Each Party
SIGNATURES
IN WITNESS WHEREOF, each of the Parties hereto have caused this
Contract to be executed by their duly authorized representatives on the
date first set forth above.
PARTY A : Chengdu Hua Xi Electric Power (Group) Share holding
Company Ltd.
[Signature Illegible]
------------------------
Name: Cheng Zhigang
Title: General Manager Assistant
Nationality: Chinese
PARTY B : China National Aero-engine Corporation
[Signature Illegible]
------------------------
Name: Li Yue Ting
Title: Deputy General Manager
Nationality: Chinese
PARTY C : AES China Generating Company Limited
[Signature Illegible]
------------------------
Name: Thomas T.M. Wu
Title: Vice President
Nationality: U.S.A.