URBAN GAS DEVELOPMENT AGREEMENT Party A: Committee of Shangzhuang, Luquan Country Party B: Beijing Zhong Ran Wei Ye Gas Co., Ltd. Date: August 07, 2003
[Stamp
Tax]
Party
A: Committee
of Shangzhuang, Luquan Country
Party
B: Beijing
Zhong Ran Wei Ye Gas Co., Ltd.
Date: August
07, 2003
Contract
SN:
Signatory
Location:
Party
A: Committee
of Shangzhuang, Luquan Country
Party
B: Beijing
Zhong Ran Wei Ye Gas Co., Ltd.
Chapter
I General
Principles
| 1.1 |
WHEREAS,
(i) the Committee of Shangzhuang, Luquan Country agrees to authorize
Party
B the exclusive right to develop, construct and operate the pipeline
gas
project in the urban area of Shangzhuang, Luquan Country (the
“Pipeline
Project”),
(ii) based on the Contact
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 Shangzhuang,
Luquan Country (the “Agreement”).
|
Chapter
II Parties
| 2.1 |
Construction
Bureau of Shangzhuang, Luquan Country (hereinafter referred to as
“Party
A”)
Legal
address:
Tel.: (0000)
0000000
|
| 2.2 |
Beijing
Zhong Ran Wei Ye Gas Co., Ltd. (hereinafter referred to as “Party
B”)
Legal
address: Caizhiguoji Xxxxxxxx Xx.
00 Xxxxxxxxxxxxxxxx Xxxxxx Xxxxxxx
Xxxxxxxx
Tel.:
(000) 00000000
|
Chapter
III Establishment
of the Company
| 3.1 |
Party
A, authorized by and on behalf of the Government of Shangzhuang,
Luquan
Country, agrees that Party B will be responsible for the Pipeline
Project
of Shangzhuang, Luquan Country and the total financing of the Pipeline
Project.
|
| 3.2 |
The
Company as a legal person under 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.
|
Chapter
IV Business
Scope
| 4.1 |
Business
Scope of the Company: within
the urban planned area of Shangzhuang, Luquan Country, 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.
|
2
Chapter
V Exclusive
Operating Right
| 5.1 |
Party
A authorizes Party B to execute the pipe natural gas project within
Shangzhuang, Luquan Country and guaranties that Party B has the exclusive
right to develop and construct the pipe gas project within Shangzhuang,
Luquan Country 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.
|
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 15,000 units with the total investment of approximately
RMB
50 million. The first stage of the Pipeline Project is to supply
for 3000
units (the “First Stage”). Party B agrees that it shall complete the First
Stage and start gas supply to the first customers within 6 months,
provided, that the actual number of the households is not lower than
1000.
Party B agrees that it shall construct and improve the pipeline network
in
stages according to users’ requests after the First Stage
completes.
|
| 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 Shangzhuang, Luquan Country
for
50 years and ensure the legality thereof; not to approve any new
pipe gas
project during such time; to guarantee that the pipeline networks
constructed by Party B in Shangzhuang, Luquan Country pursuant to
this
Agreement accept natural gas when the long natural gas pipeline reaches
Shangzhuang, Luquan Country, and the continual operation of the pipeline
network; not to authorize any other company to
operate;
|
| 6.2.2 |
to
guarantee that the initial residential installation fee shall be
no higher
than RMB 2,000/unit for a household and the residential gas price
shall be
RMB 2.2 per cubic meter. The initial residential installation fee
for
Shangzhuang villagers shall be RMB 1,800/unit for each household
and the
residential gas price shall be RMB 2.1 per cubic meter. The company
guarantees that the initial residential fee and the gas price for
Shangzhuang villagers shall be no higher than the price mentioned
above
and shall be adjusted according to the changing
market.
|
3
| 6.2.3 |
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 Shangzhuang, Luquan
Country.
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 or
exempted;
|
| 6.3 |
Party
A shall be responsible for assisting Party B in the following
matters:
|
| 6.3.1 |
the
procedures for land use, planning, fire protection and commencement
of
project construction;
|
| 6.3.2 |
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;
|
| 6.3.3 |
application
of all potentially available tax and administrative fee waivers and
deductions;
|
| 6.3.4 |
timely
provision of the municipal planning and relevant materials to Party
B upon
its request;
|
| 6.3.5 |
implementation
of warranties in appendices
to this Agreement.
|
| 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;
|
| 6.4.3 |
ensuring
the continuous and safe gas supply except in the case of force
majeure;
|
| 6.4.4 |
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;
|
| 6.4.5 |
guaranteeing
that the quality of gas supplied hereunder complies with the relevant
PRC
rules;
|
4
| 6.4.6 |
organizing
project inspection by the relevant parties upon completion of the
Pipeline
Project;
|
| 6.4.7 |
signing
specific gas supply contracts with the
customers.
|
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.
|
| 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.
|
5
| 7.8 |
There
are four originals of this agreement. Each party holds two
originals.
|
| Party A (Seal): Sealed | Party B (Seal): Sealed |
| Representative (Signature): Signed | Representative (Signature): Signed |
| Date: August 07, 2003 | Date: August 07, 2003 |
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