URBAN GAS DEVELOPMENT AGREEMENT (For Wholly Owned Gas Company) Party A: Construction Bureau of Yutian County Party B: Beijing Zhong Ran Wei Ye Gas Co., Ltd. Date: November 7, 2003
[Stamp
Tax]
(For
Wholly Owned Gas Company)
Party
A: Construction
Bureau of Yutian County
Party
B: Beijing
Zhong Ran Wei Ye Gas Co., Ltd.
Date: November
7, 2003
Contract
SN: YTWY-001
Signatory
Location: Construction
Burea of Yutian
Party
A: Construction
Bureau of Yutian County
Party
B: Beijing
Zhong Ran Wei Ye Gas Co., Ltd.
Chapter
I
General
Principles
| 1.1 |
WHEREAS,
(i) the Government of Yutian County agrees to authorize Party B the
exclusive right to develop, construct and operate the pipeline gas
project
in the urban area of Yutian County (the “Pipeline
Project”),
(ii) based on the Contact
Law of the People’s Republic of China,
the
Cooperative Joint Venture Law of the People’s Republic of China
and
other relevant applicable laws and regulations, and (ii) after field
study
and friendly consultations, the Parties hereby agree as follows in
relation to the construction of the Pipeline Project in Yutian County
(the
“Agreement”).
|
Chapter
II Parties
| 2.1 |
Construction
Bureau of Yutian County (hereinafter referred to as “Party
A”)
|
Legal
representative: Xxxx
Xxxxxxx
Legal
address: Xx.
000
Xxxxxxx Xxxx, Xxxxxx Xxxxxx, Xxxxx Xxxxxxxx
Tel.: (0000)
0000000
| 2.2 |
Beijing
Zhong Ran Wei Ye Gas Co., Ltd. (hereinafter referred to as “Party
B”)
|
Legal
representative: Xxx
Xxxxxxx
Legal
address: Xx.
0
Xxxxxx Xxxxxxx, Xxxxxxxx Xxxx Xxxx, Xxxxxxxx Xxxxxxxx, Xxxxxxx
Tel.: (000)
00000000
Chapter
III Establishment
of the Company
| 3.1 |
Party
A, authorized by and on behalf of the Government of Yutian County,
agrees
that Party B will be responsible for the urban Pipeline Project of
Yutian
Country and the total financing of the Pipeline
Project.
|
| 3.2 |
Name
of the Company: Xxxxxx
Xxxxx Ran Wei Ye Gas Co., Ltd.
(Interim)
|
| 3.3 |
The
Company as a legal person und the PRC law: is subject to the jurisdiction
and protection of the PRC laws, regulations and relevant rules
(hereinafter referred to as “PRC
laws”),
and is authorized to conduct its business activities in compliance
with
the PRC laws.
|
2
Chapter
IV Business
Scope
| 4.1 |
Business
Scope of the Company: within
the urban planned area of Yutian County, to: design, construct, manage,
develop and operate the pipeline network of natural gas and its auxiliary
facilities, and provide relevant maintenance and emergency repair
services; construct and operate natural gas stations; supply natural
gas
and provide after-sale services to industrial transmission, commercial
construction, civic utility and public transportation; exploit natural
gas
reserves, design for the transportation and transmission thereof,
construct and management the operation related
thereto.
|
Chapter
V Exclusive
Operating Right
| 5.1 |
Party
A authorizes Party B to execute the pipe natural gas project within
the
urban planned area of Yutian County and guaranties that Party B has
the
exclusive right to develop and construct the pipe gas project within
the
urban planned area of Yutian County for 50
years.
|
| 5.2 |
Party
A will consider extending the 50 year exclusive operation term; provided,
that Party B can ensure the normal supply of gas during such
period.
|
| 5.3 |
If
Party A breaches this Agreement during the term of this Agreement,
Party A
shall bear the losses resulting from such breach. If Party A or any
of its
agents or entrusted parties breach this Agreement during the term
of this
Agreement (which causes Party B to lose the exclusive operating right
granted hereunder), Party A shall compensate Party B for its projected
economic benefits for the term of this Agreement. If Party B breaches
this
Agreement or fails to accurately forecast the natural gas market,
or it
fails to conduct normal operation, which causes suspension of operation
or
bankruptcy, Party B shall compensate the customers for the initial
installation fees incurred by them, and Party A shall have the right
to
terminate this Agreement and engage new natural gas
suppliers.
|
Chapter
VI Rights
& Obligations of the Parties
| 6.1 |
The
Parties shall construct the Pipeline Project based to the high standards
and principles. The Pipeline Project is designed for supply gas to
an
aggregate of 20,000 units with the total investment of approximately
RMB
86 million. The first stage of the Pipeline Project is to supply
for 1,500
units for the Changsheng Community (the “First Stage”). Party B agrees
that it shall complete the First Stage and start gas supply to the
first
customers within 6 months.
|
| 6.2 |
Party
A shall be responsible for the coordination with the local government
and
relevant departments of the government and shall provide the following
warranties to Party B in the form of official government
documents:
|
| 6.2.1 |
to
grant Party B the exclusive right to construct and operate natural
gas
project within the urban planned area of Yutian County for 50 years
and
ensure the legality thereof; not to approve any new pipe gas project
during such time;
|
3
| 6.2.2 |
to
ensure that Party B shall enjoy the relevant government preferential
policies relating to business investment and raising of capital,
urban
infrastructure construction and land grant in Yutian County. Considering
that the Pipeline Project is an urban infrastructure project, any
government fees to be incurred by Party B for the destruction of
municipal
roads for the construction of the condensed gas station and pipeline
network shall be deducted by 50%.
|
| 6.2.3 |
to
require the inclusion of construction of pipeline gas project as
part of
any new real estate development project and any renovation or expansion
projects related thereto in order to obtain the required government
approval; The government departments that are in charge of urban
construction, planning, public utilities, real estate must supervise
closely to ensure that pipeline gas projects are designed, constructed
and
inspected simultaneously and together with the principal projects,
and can
only be constructed by Party B; otherwise, such projects shall not
be
approved for construction, inspection and no sales permit shall be
issued
therefor.
|
| 6.3 |
Party
A shall be responsible for assisting Party B in the following
matters:
|
| 6.3.1 |
the application and registration procedures to establish the gas
project
company;
|
| 6.3.2 |
the
procedures for land use, planning, fire protection and commencement
of
project construction;
|
| 6.3.3 |
making
available water, electricity and transportation and handle other
infrastructure related matters and assisting Party B to organize
the
design and construction of the
project;
|
| 6.3.4 |
application
of all potentially available tax and administrative fee waivers and
deductions;
|
| 6.3.5 |
timely
provision of the municipal planning and relevant materials to Party
B upon
its request;
|
| 6.3.6 |
uniform
planning, implementation and management of pipeline gas project in
accordance with the urban planning of Yutian Country; complete and
improve
the pipe gas network in stages in accordance with users’
requests.
|
| 6.4 |
Party
B’s Responsibilities
|
| 6.4.1 |
raising
funds for the Pipeline Project;
|
| 6.4.2 |
project design and construction, and operation management upon completion
of the Pipeline Project;
|
4
| 6.4.3 |
repair
of broken facilities during
construction;
|
| 6.4.5 |
periodic
inspection, repair and maintenance of gas stations and pipelines
inside
and outside residential buildings according to the PRC rules to ensure
year-round safe operation;
|
| 6.4.6 |
guaranteeing
that the quality of gas supplied hereunder complies with the relevant
PRC
rules;
|
| 6.4.7 |
organizing
project inspection by the relevant parties upon completion of the
Pipeline
Project;
|
| 6.4.8 |
[guaranteeing
that the pipeline networks constructed by Party B in Yutian County
pursuant to this Agreement accept natural gas when the long natural
gas
pipeline reaches Yutian County, and the continual operation of the
pipeline network];1
The meaning of the original Chinese text for this provision is clear.
|
| 6.4.9 |
guaranteeing
that the initial residential installation fee shall be no higher
than RMB
2,000/unit and the residential sale price shall be no higher than
RMB 2.1
per cubic meter within the first 2 years. Thereafter, if there is
any
adjustment to the national industrial standard and gas price, the
initial
installation fee and gas sale price may be adjusted accordingly after
approval by the county government, and periodical hearings on gas
prices
will be held among residential owners and the government departments
in
charge of gas pricing.
|
| 6.4.10 |
guaranteeing
that the Pipeline Project will be duly executed and completed in
accordance with to the plan and schedule [agreed to by the
Parties.]
|
Chapter
VII Miscellaneous
Provisions
| 7.1 |
Any
modification to this agreement and its supplemental agreement(s)
shall not
be valid and effective unless such modification is in writing and
signed
by both parties to this Agreement.
|
| 7.2 |
Should
any Party fail to perform any of its obligations under this agreement
or
materially breach the provisions of this agreement, which causes
the
project company to discontinue its operation or be unable to meet
the
operational purposes of the Pipeline Project as provided under this
agreement, the breaching Party shall be deemed to have unilaterally
terminated the agreement, and the non-breaching Party shall have,
in
addition to any right to and claim for damages, the right to apply
to the
original approving government authority for the termination of this
Agreement in accordance with this
Agreement.
|
| 7.3 |
Should
any Party be prevented from performing its obligations under this
agreement due to the occurrence of any event of Force Majeure such
as
earthquake, windstorm, flood, fire, war and any other unforeseeable
event
whose occurrence and consequences are beyond control, such Party
shall
immediately notify the other Party, and within 15 days [following
the
occurrence of such event], provide documents stating the details
of such
event, the reasons for complete or partial nonperformance by such
Party
and documents evidencing the occurrence of such events. Such documents
shall be issued by a notary public institution located at the place
where
such event occurs. The Parties shall negotiate whether to cancel
the
entire Agreement or to discharge certain obligations of the non-performing
party under this agreement based on the extent to which the performance
of
this Agreement has been affected.
|
1 The meaning of the original Chinese text for this provision is clear.
5
| 7.4 |
Any
and all disputes arising out of or relating to the performance of this
Agreement shall be settled by the Parties through friendly consultations.
If the disputes are not resolved through friendly consultations,
then each
party agrees to be subject to the jurisdiction of the People’s Court of
the locality where this Agreement is
executed.
|
| 7.5 |
In
the course of judicial procedures, the Parties shall continue to
perform
their respective obligations under this Agreement, with the exception
of
those parts of this Agreement which are under
dispute.
|
| 7.6 |
The
Parties may negotiate and execute documents to supplement this Agreement.
Such supplemental agreements shall have the same force and effect
as this
Agreement.
|
| 7.7 |
This
Agreement and any of its supplemental agreements shall not be binding
upon
any Party unless signed and sealed by the
Parties.
|
| 7.8 |
There
are four originals of this agreement. Each party holds two
originals.
|
| Party A (Seal): Sealed | Party B (Seal): Sealed |
| Representative (Signature): | Representative (Signature): Signed |
|
Date: November
7, 2003
|
Date: November 7, 2003 |
6
