{"id":41314,"date":"2015-09-17T11:25:58","date_gmt":"2015-09-17T16:25:58","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-legal\/contracts\/uncategorized\/shareholder-loan-contract-jiaozuo-wan-fang-power-co-ltd-and.html"},"modified":"2015-09-17T11:25:58","modified_gmt":"2015-09-17T16:25:58","slug":"shareholder-loan-contract-jiaozuo-wan-fang-power-co-ltd-and","status":"publish","type":"corporate_contracts","link":"https:\/\/corporate.findlaw.com\/contracts\/finance\/shareholder-loan-contract-jiaozuo-wan-fang-power-co-ltd-and.html","title":{"rendered":"Shareholder Loan Contract &#8211; Jiaozuo Wan Fang Power Co. Ltd. and AES China Power Holding Co. Ltd."},"content":{"rendered":"<pre>                            SHAREHOLDER LOAN CONTRACT\n\n     This SHAREHOLDER  LOAN CONTRACT (this  'Contract') is made and entered into\nas of April 26,  1996 by and  between  JIAOZUO  WAN FANG POWER  COMPANY  LIMITED\n('Borrower'),  a Sino-foreign cooperative joint venture enterprise organized and\nexisting  under the laws of the  People's  Republic of China  (Business  License\nnumber is 00037-1) with its registered  office in Jiaozuo City,  Henan Province,\nChina  (telephone  no:  391-329-3144)  and AES CHINA POWER HOLDING CO. (L), LTD.\n('Lender'),  a Labuan  company  wholly-owned  by AES China  Generating  Co. Ltd.\n(Company no: LL00460).\n\n1.   The Loans.\n     ---------\n\n     Subject to the terms and conditions of this Contract, Lender agrees to make\nto Borrower loans in an aggregate amount not to exceed US$ 68,584,000 (including\ninterest during construction as provided in Section 3 hereof) in accordance with\nthe Joint  Venture  Contract  dated as of March 27, 1996 between  Jiaozuo  Power\nPartners,  L.P. and Jiaozuo  Aluminum Mill (the 'Joint  Venture  Contract')  and\nbased on the exchange rate of US$ 1 to RMB 8.3, which loans will be divided into\nthe Tranche A Loans to be used mostly for the first unit in an aggregate  amount\nnot to exceed US$ 34,292,000  (the 'Tranche A Loans') and the Tranche B Loans to\nbe used  mostly for the  second  unit in an  aggregate  amount not to exceed US$\n34,292,000  (the  'Tranche  B  Loans';  each such  Tranche  A or  Tranche B Loan\nindividually  a 'Loan' and  collectively  the 'Loans') from time to time between\nApril 26,  1996 and July 1, 1998 (the  'Termination  Date').  The Loans shall be\nevidenced by a promissory note of Borrower, substantially in the form of Exhibit\nA (the  'Note').  Subject  to the  conditions  set forth in Section 6, each Loan\nshall be made (a) in accordance with the drawdown schedule attached as Exhibit B\nand (b) on a day on which banks are authorized to open for business in New York,\nNew York, the United States of America (a 'Banking Day').\n\n2.   Maturity.\n     --------\n\n     (a) Borrower shall repay the aggregate  outstanding principal amount of the\nLoans in accordance with the amortization schedule attached as Exhibit C. In any\nevent,  Borrower shall repay such Loans in full by July 1, 2006.  Borrower shall\ntake all necessary  actions to ensure that its cash on hand due to  depreciation\nmay be used to repay the principal of the Loans and shall so use such  available\ncash.\n\n     (b)  Borrower  shall have the right to prepay the Loans at any time or from\ntime to time. Each of such optional  prepayments  shall be in an amount not less\nthan US$ 5 million  and shall be made with at least  six  months  prior  written\nnotice to Lender.  A Loan prepaid may not be reborrowed.  The prepayments of the\nLoans  will be  applied  in  inverse  order of  maturity  to the then  remaining\ninstallments of principal to become due as set forth in Exhibit C.\n\n3.   Interest and Fees.\n     -----------------\n\n                                      -1-\n\n\n[***  Filed  separately  with the  Commission  pursuant  to a  request  for\nconfidential treatment.]\n\n     (a)  Borrower  shall pay interest on the Loan(s)  outstanding  from time to\ntime at the rate of 11% per annum.  Interest  on the Loans  shall be computed on\nthe basis of the actual  number of days elapsed in a year of 360 days.  Interest\non the Tranche A Loans shall accrue until the Unit One Commercial Operation Date\n(as defined in the Power  Purchase and Sale Contract  dated as of April 26, 1996\nbetween  Borrower and the Henan Electric Power  Corporation (the 'Power Purchase\nand Sale Contract')) and be added to principal.  Interest on the Tranche B Loans\nshall accrue  until the Unit Two  Commercial  Operation  Date (as defined in the\nPower  Purchase  Agreement) and be added to principal.  Interest  payments shall\nbegin after the Unit One Commercial  Operation Date in the case of the Tranche A\nLoans  and  after  the Unit  Two  Commercial  Operation  Date in the case of the\nTranche B Loans.  Interest payments shall be payable quarterly in arrears on the\nfirst day of each January, April, July and October starting from the second such\ndate to occur after the Unit One  Commercial  Operation  Date in the case of the\nTranche A Loans and after the Unit Two Commercial  Operation Date in the case of\nthe  Tranche B Loans and on final  maturity  of the Loans  (each  such  date,  a\n'Payment Date'). Lender shall calculate and notify Borrower of the actual amount\nof each interest payment 15 days prior to each Payment Date.\n\n     (b) Borrower shall pay to Lender a guarantee fee of [***]% per annum on the\nLoan(s)  outstanding,  which shall be computed on the basis of the actual number\nof days elapsed in a year of 360 days. Such guarantee fee shall accrue until the\nUnit One  Commercial  Operation Date in the case of the Tranche A Loans or until\nthe Unit Two Commercial Operation Date in the case of the Tranche B Loans and be\nadded to the  principal of the Loans.  Payment of the  guarantee fee shall begin\nafter the Unit One Commercial  Operation Date in the case of the Tranche A Loans\nor after the Unit Two  Commercial  Operation  Date in the case of the  Tranche B\nLoans and shall be payable  quarterly  in arrears on each Payment  Date.  Lender\nshall  calculate and notify Borrower of the actual amount of each payment of the\nguarantee fee 15 days prior to each Payment Date.\n     \n     (c) If Borrower  fails to pay any sum payable under this Contract when due,\nBorrower  shall  from time to time on demand pay  interest  on such sum from and\nincluding  the due date to the date of actual  payment  (after as well as before\njudgment) at a per annum  interest  rate equal to [***]% above the interest rate\nspecified in Section 3(a).\n\n4.   Method of Payment.\n     -----------------\n\n     All sums,  including all  principal,  interest and fees,  payable to Lender\nshall be payable in US Dollars  not later than 10:00 a.m.  Beijing  time on each\nPayment  Date to the account of Lender in Hong Kong (no.  08611939) at Citibank,\nN.A.,  or such other  account  within or outside of China as Lender  notifies to\nBorrower.\n\n5.   Representations and Warranties.\n     ------------------------------\n\n                                      -2-\n\n\n\n     Borrower represents as of this date and the date each Loan is made that:\n\n     (a) Borrower is a Sino-foreign  cooperative  joint venture  enterprise duly\nestablished  and  existing  in good  standing  under  the  laws of the  People's\nRepublic of China;\n\n     (b) the execution,  delivery and performance of this Contract, the Note and\neach other  document  delivered in  connection  herewith or therewith are within\nBorrower's power,  have been duly authorized by all necessary legal action,  and\ndo not contravene any law or any contractual restriction binding on Borrower;\n\n     (c) this  Contract  is, and the Note and each other  document  delivered in\nconnection  herewith or therewith  when executed  will be, the legal,  valid and\nbinding obligations of Borrower, enforceable in accordance with their respective\nterms;\n\n     (d)  all  governmental  approvals  necessary  for  the  execution  of  this\nContract,  the Note and each other document delivered in connection  herewith or\ntherewith have been obtained and all  governmental  approvals  necessary for the\nperformance and enforceability hereof and thereof shall have been obtained prior\nto and shall be in full force and effect on the date of each drawdown hereunder;\n\n     (e) the obligations of Borrower  hereunder and under the Note and any other\ndocument  executed in connection  herewith or therewith  constitute  the direct,\nunconditional  and  general  obligations  of  Borrower  and  the  sum  of all of\nBorrower' other  indebtedness  does not exceed RMB five million except the loans\nprovided by other  shareholders  of Borrower in the amount of not  exceeding RMB\n243,963,000,  the  working  capital  loans  or the list of debts of over RMB one\nmillion each specified in Appendix D hereto;\n\n     (f) Borrower is not in default  under any  agreement or obligation to which\nit is a party or by which it may be bound; and\n\n     (g) no Event of Default (as hereinafter  defined),  and no event which with\nthe giving of notice or the passing of time, or both,  would constitute an Event\nof Default, has occurred and is continuing.\n\n6.   Conditions Precedent.\n     --------------------\n\n     The  obligation  of Lender to make each Loan  hereunder  is  subject to the\nfulfillment,  as  determined  solely  by  Lender,  of the  following  conditions\nprecedent  at  least  three  Banking  Days  prior to the  proposed  date of each\ndrawdown of such Loan (except as otherwise  indicated  below) and the  continued\nfulfillment of such conditions on the date of such drawdown:\n\n                                      -3-\n\n\n\n     (a) All documents,  licenses,  approvals and permits required in connection\nwith the  establishment of Borrower as a Sino-foreign  cooperative joint venture\nand the design, construction,  ownership,  operation and management of the Power\nPlant (as  defined  in the Power  Purchase  and Sale  Contract)  shall have been\nobtained and are in full force and effect;  without  limiting the  generality of\nthe foregoing,  such approvals shall include approval by the Ministry of Foreign\nTrade and  Economic  Cooperation  of China of the  Joint  Venture  Contract  and\nBorrower's  Articles of Association,  approval by the Henan  Provincial  Pricing\nBureau of the pricing  formula set forth in Appendix A to the Power Purchase and\nSale Contract,  approval by the relevant  government  department of the Land Use\nRights (as defined in the Joint  Venture  Contract),  approval  by the  relevant\ngovernment  department  of the early  return of the  registered  capital  to the\nForeign Party (as defined in the Joint Venture Contract), issuance of Borrower's\nbusiness license,  approval regarding access to the foreign exchange  adjustment\ncenter or foreign exchange banks, and approvals referred to in Article 2.3(a) of\nthe Joint Venture Contract;\n\n     (b) All registered  capital and other loans required to be funded under the\nJoint  Venture  Contract  by any party as of such date shall have been funded in\nfull;\n\n     (c) Lender shall have received the Note,  duly executed by Borrower,  which\nshall be in full force and effect;\n\n     (d)  Lender  shall  have   received   satisfactory   evidence  of  the  due\nauthorization,  execution and delivery of this Contract, the Note and each other\ndocument delivered in connection herewith or therewith by Borrower;\n\n     (e)  Lender  shall  have  received  certified  copies  of all  governmental\napprovals and filings  required for the  execution,  delivery,  performance  and\nenforceability of this Contract,  the Note and each other document  delivered in\nconnection  herewith or  therewith  and such  approvals  and filings are in full\nforce and effect;\n\n     (f) Each of the representations and warranties set forth in Section 5 shall\nbe true and correct in all material respects;\n\n     (g) Borrower shall have performed in all material  respects its obligations\nrequired to be performed  under this Contract,  the Note and all other documents\ndelivered in connection herewith or therewith;\n\n     (h) All  contracts  referenced  in the  Joint  Venture  Contract  including\nwithout  limitation  all  Project  Contracts  (as  defined in the Joint  Venture\nContract)  and all other  material  contracts  required in  connection  with the\nconstruction of the Project (as defined in the Power Purchase and Sale Contract)\nshall have been  executed and  delivered by all parties  thereto and are in full\nforce and effect;\n\n                                      -4-\n\n\n\n     (i) Lender's independent  engineer or, at the request of Lender,  Borrower,\nshall have  certified  in a manner  satisfactory  to Lender that all  applicable\nconstruction milestones as set forth in Exhibit B have been met;\n\n     (j) Borrower shall have purchased the insurance policies required by Lender\nand such policies shall be in full force and effect;\n\n     (k) Borrower  shall have  received  from Jiaozuo  Aluminum Mill evidence in\nform and substance  satisfactory  to Lender that Chinese banks have committed to\nprovide Renminbi loans needed for the Project;\n\n     (l) Lender shall have  received a favorable  opinion of Zheng,  Liu, Yuan &amp; Zhou Law Office with respect to the  transactions  contemplated  hereby and such\nother approvals, opinions and documents as Lender may reasonably request; and\n\n     (m)  Fifteen  Banking  Days  prior  to each  requested  date of  borrowing,\nBorrower  shall  submit  an  application  for  borrowing  to  Lender in form and\nsubstance  reasonably  satisfactory to Lender. Each such application shall state\nthe requested  amount and date of the borrowing  which date shall not be earlier\nthan the  relevant  drawdown  date  specified  in  Exhibit B, shall be signed by\nBorrower and shall constitute a representation  and warranty by Borrower that it\nis in  compliance  with all the  conditions  precedent  set forth  herein  and a\nreaffirmation   as  of  the  requested   drawdown  date  of  all  of  Borrower's\nrepresentations and warranties contained herein.\n\n7.   Covenants.\n     ---------\n\n     (a) Borrower shall at all times (i) preserve and maintain in full force and\neffect its existence as a cooperative joint venture under the laws of China, its\nqualification  to do  business  in  Henan  Province,  China  and in  each  other\njurisdiction  in which the conduct of its business  requires such  qualification\nand (ii) obtain and maintain in full force and effect all governmental approvals\nrequired at any time in connection with the construction, maintenance, ownership\nor  operation  of the  Facility  (as  defined  in the  Power  Purchase  and Sale\nContract).\n     \n     (b)  Borrower  shall (i)  perform  and  observe  all of its  covenants  and\nagreements  contained in any Project Contract or any other document  relating to\nthe  Facility to which it is a party and (ii)  maintain in full force and effect\neach of those project documents.\n\n     (c)  Borrower  shall  comply,   and  shall  ensure  that  the  Facility  is\nconstructed and operated, with governmental requirements.\n\n     (d)  Borrower  shall  promptly  provide  to  Lender  copies  of  Borrower's\nconstruction,  operation and financial reports and other information relating to\nthe construction or operation of the Facility.\n\n                                      -5-\n\n\n\n     (e) Borrower shall promptly register the Loans (no later than 15 days after\nthe date hereof) with Jiaozuo foreign exchange control  departments and obtain a\nregistration certificate (the 'Registration Certificate').\n\n     (f) Borrower  shall use the proceeds of the Loans solely for the purpose of\nfinancing the  construction and start-up of the Facility and funding the working\ncapital for the operation of Borrower.\n\n     (g) Borrower shall notify Lender immediately of the occurrence of any Event\nof  Default or of any event  which  would  become an Event of  Default  with the\npassage of time or giving of notice or both.\n\n     (h)  Borrower  shall  not,  without  the prior  written  consent of Lender,\nassign,  sell,  mortgage,  encumber or  otherwise  transfer  any interest in any\nassets of Borrower other than  transfers in the ordinary  course of its business\nthat would not have a materially  adverse effect on Borrower or the  performance\nof its obligations hereunder.\n\n     (i) Prior to any due date for any  repayment of the principal of and\/or the\npayment  of  interest  on the  Loans,  Borrower  shall (A) use the  Registration\nCertificate  and the notice  regarding such  repayment  and\/or payment to obtain\nfrom the registration  department a verification  and approval  certificate with\nrespect to such repayment  and\/or  payment;  and (B) use such  verification  and\napproval  certificate  and  the  Registration   Certificate  to  handle  matters\nregarding the  remittance  from the foreign debt account of the principal of and\ninterest on the Loans outside of China at the relevant bank.\n\n     (j) At the  beginning  of each  year,  Borrower  shall  submit to the local\nforeign exchange  administration a report stating the amount of foreign currency\npurchased in the  preceding  year for the purpose of repaying  the  principal of\nand\/  paying the  interest  on the Loans and a plan  regarding  the  purchase of\nforeign currency for the current year.\n\n8.   Events of Default.\n     -----------------\n\n     (a) Each of the following events and occurrences  shall constitute an Event\nof Default under this Contract:\n     \n          (i) any  representation  or warranty  of Borrower  proves to have been\n     untrue when made or renewed;\n\n          (ii)  Borrower  fails to repay when due any  principal  amounts of the\n     Loans,  or Borrower  fails to pay within three  Banking Days after the date\n     due  any  interest  or fee  payment,  due  pursuant  to the  terms  of this\n     Contract,  the Note or any  document  delivered in  connection  herewith or\n     therewith;\n\n          (iii)  Borrower  fails to perform or violates  any other  provision of\n     this Contract (including without limitation the covenants), the Note or any\n\n                                      -6-\n\n\n\n[*** Filed separately with the Commission pursuant to a request for Confidential\nTreatment.]\n\n\n     document  delivered in connection  herewith or therewith,  which  continues\n     unremedied for 30 days after notice thereof from Lender;\n\n          (iv) except as otherwise provided in clause (ii) above, Borrower fails\n     to pay when due any  indebtedness  for which it is liable,  contingently or\n     otherwise,  or any such  indebtedness  is  accelerated or is required to be\n     prepaid prior to the stated maturity thereof;\n\n          (v)  any  approval  or  permit   required  for  the   performance   or\n     enforceability of the obligations of Borrower under this Contract, the Note\n     or any other document delivered in connection herewith or therewith expires\n     or is not renewed upon  expiration  or is terminated or revoked or modified\n     in any material respect;\n\n          (vi) any approval or permit  required in  connection  with the Project\n     expires or is not renewed upon  expiration  or is  terminated or revoked or\n     modified in any material respect;  \n\n          (vii) any Project  Contract is materially  breached by a party thereto\n     or such contract ceases to be in full force and effect;\n     \n          (viii) Borrower becomes insolvent or unable to pay its debts when due,\n     or commits  any act of  bankruptcy  including  filing any  petition  in any\n     bankruptcy,  winding-up or  reorganization  proceeding,  or acknowledges in\n     writing its  insolvency  or  inability  to pay its debts,  or any  petition\n     relating to bankruptcy is filed with respect to it by its creditors; or\n\n          (ix) One or more  judgments  aggregating  at least  US$100,000 (or its\n     equivalent)  that is not covered by insurance is entered  against  Borrower\n     and is not satisfied, vacated or bonded pending appeal within 60 days after\n     entry.\n\n     (b) If an Event of Default shall occur and be continuing, Lender shall have\nno  further  obligation  to make Loans to  Borrower  and Lender may by notice to\nBorrower  declare all outstanding  Loans and accrued  interest thereon and other\namounts payable hereunder to be immediately due and payable,  whereupon all such\namounts shall become  forthwith due and payable  without demand or notice of any\nkind and  without  the  consent,  decree or  authorization  of any  governmental\nentity. In the event of an Event of Default, Lender shall also have the right to\nliquidate Borrower and its assets.\n\n9.   Intercreditor Arrangements.\n     --------------------------\n\n     Borrower and Lender each  acknowledge that Borrower has also entered into a\nloan contract with Jiaozuo Aluminum Mill for a loan amount up to RMB 243,963,000\n(the 'Other Loan Contract').  Borrower represents that all loans under the Other\nLoan Contract  shall be made at an interest rate  (including  all fees and other\ncharges) of equal to or less than  [***]% per cent per annum,  and that the term\nof the Other Loan  Contract  shall be no shorter than eight\n\n                                      -7-\n\n\n\nyears.  The drawdown  schedules for the Loans and the loans under the Other Loan\nContract shall be determined by Borrower's  Board of Directors.  Any amounts due\nunder  this  Loan  Contract  and the Other  Loan  Contract  shall  rank in equal\npriority.  If Borrower has insufficient funds available to repay in full amounts\ndue under the Loan Contract and the Other Loan Contract,  such  available  funds\nshall  be  distributed  pro  rata on the  basis  of the  total  amount  of loans\noutstanding under this Contract and under the Other Loan Contract, provided that\nat the time of such  distribution  Loans due to Lender under this Contract shall\nbe computed on US Dollar cash basis and loans due to lender under the Other Loan\nContract shall be calculated on Renminbi cash basis.\n\n10.  Entire Agreement; Amendments.\n     ----------------------------\n\n     This Contract  constitutes the entire  agreement of the parties hereto with\nrespect to the subject matter hereof and may be amended only by an instrument in\nwriting signed by the parties hereto.\n\n11.  Indemnity.\n     ---------\n\n     (a) Borrower  shall pay all stamp duties in connection  with this Contract,\nthe Note and each other document delivered in connection  herewith and therewith\nand shall reimburse Lender for any other cost, loss or damage (including without\nlimitation any taxes  excluding taxes imposed on the net income of Lender by the\njurisdiction of its  registration  and other costs resulting from changes in law\nafter the date hereof) incurred by Lender in connection with any Loan (including\ninterest and fees), this Contract,  the Note or any other document  delivered in\nconnection  herewith or therewith.  The payment of such stamp duties by Borrower\nand the  reimbursement by Borrower of such other cost, loss or damage (including\ntaxes as stated  above)  shall be in addition to  Borrower's  obligation  to pay\ninterest as set forth in Sections 3 (a) and (c).\n\n     (b) Without  limiting the generality of clause (a) above, if Borrower shall\nbe obligated to withhold and pay any taxes required under the applicable laws of\nChina  or  under  any  agreement   between  China  and  any  country  which  has\njurisdiction  over Lender or Borrower,  the  interest  rate  hereunder  shall be\nautomatically and accordingly  increased and Borrower shall make such additional\ninterest  payment  so  that  the net  amounts  received  by  Lender  after  such\nwithholding shall equal the amounts which would have been received by Lender had\nno such withholding been made.\n\n     (c) The indemnity provisions of this Section 11 shall survive the repayment\nof the Loans and the termination of this Contract.\n\n12.  Notice.\n     ------\n\n     All notices  hereunder  shall be in writing and shall be either  personally\ndelivered,  or  transmitted  by  postage  prepaid  registered  air  mail,  or by\nfacsimile to the party addressed at the relevant address set forth above. Either\nparty may change its address by notice to the other.\n\n                                      -8-\n\n\n\n13.  Governing Law.\n     -------------\n\n     This Contract shall be governed by and  interpreted in accordance  with the\nlaws of England  without regard to its procedural  rules which would lead to the\nadoption of laws of other countries due to conflicts of laws.\n\n14.  Submission to Jurisdiction.\n     --------------------------\n\n     (a)  Borrower  hereby  irrevocably   consents  that  any  legal  action  or\nproceeding  against  it or  any  of  its  assets  with  respect  to  any  of the\nobligations  arising  under or relating to this  Contract  may be brought in any\nEnglish  court,  as Lender may elect,  and by  execution  and  delivery  of this\nContract,  Borrower hereby irrevocably submits to and accepts with regard to any\nsuch action or proceeding, for itself and in respect of its property,  generally\nand  unconditionally,  the  non-exclusive  jurisdiction of the aforesaid courts.\nBorrower hereby  irrevocably  designates,  appoints and empowers AES Electric in\nEngland (address:  Burleigh House, 17-19 Worple Way, Richard TW10 6AG, U.K.), as\nits agent to receive for and on its behalf  service of process in England in any\nlegal action or proceeding with respect to this Contract,  the Note or any other\ndocument delivered in connection herewith or therewith. The foregoing,  however,\nshall not limit the  rights  of  Lender  to serve  process  in any other  manner\npermitted  by law or to bring  any  legal  action  or  proceeding  or to  obtain\nexecution of judgment in any  jurisdiction,  including  without  limitation  the\nPeople's Republic of China.\n\n     (b)  Borrower  hereby  waives  any right it may have  under the laws of any\njurisdiction  to commence by  publication  any legal action or  proceeding  with\nrespect to this Contract, the Note or any other document delivered in connection\nherewith or therewith.\n\n     (c) Borrower  hereby  irrevocably  waives any objection which it may now or\nhereafter  have to the  laying of the venue of any  suit,  action or  proceeding\narising  out of or  relating to this  Contract,  the Note or any other  document\ndelivered in  connection  herewith or  therewith  in England and hereby  further\nirrevocably waives any claim that England is not a convenient forum for any such\nsuit, action or proceeding.\n\n15.  Arbitration.\n     -----------\n\n     (a) Notwithstanding Section 14, Lender may, in its sole discretion,  choose\nto submit any dispute  arising out of or in  connection  with this  Contract for\nbinding arbitration in Stockholm, Sweden under the auspices of the International\nChamber of Commerce in accordance with the Rules of Conciliation and Arbitration\nof the  International  Chamber  of  Commerce  as in  effect  on the date of this\nContract (except to the extent this Section 15 specifies different procedures in\nwhich  event  such  procedures  will  govern  the  arbitration  to the extent so\nspecified).  Lender may choose  arbitration  with  respect to any dispute at any\ntime either before or after any filing of any claim,  action or proceeding  with\nany court by either  party,  provided,  however,  that once Lender\n\n                                      -9-\n\n\n\nmakes  such  a  choice,  the  relevant  dispute  will  be  settled  finally  and\nexclusively  by  arbitration  irrespective  of (i) whether any claim,  action or\nproceeding has already been  commenced in any court,  (ii) the magnitude of such\ndispute or (iii) whether such dispute would otherwise be considered  justiciable\nor ripe for  resolution  by a court or  arbitral  tribunal.  In the event that a\nclaim,  action or proceeding  has already been  commenced in a court when Lender\nchooses to submit the relevant dispute for arbitration, both parties hereto will\nimmediately  discontinue  and withdraw the claim,  action or proceeding from the\ncourt so that the  dispute may be handled  exclusively  by  arbitration.  Once a\ndispute is submitted by Lender to arbitration, Borrower shall not have any right\nto file any claim,  action or proceeding in any court in respect of such dispute\nor any  matter  relating  to such  dispute  so that the  dispute  may be handled\nexclusively  by  arbitration.  Any  action by Lender to submit any  dispute  for\narbitration  shall  not  prevent  Lender  from  bringing  any  claim,  action or\nproceeding in any court with respect to any other  dispute.  Borrower  shall not\nhave any right to submit any dispute to  arbitration.  Any  settlement and award\nrendered  through  arbitration  proceeding  will be final and  binding  upon the\nparties  hereto if the decision is in writing and  contains a reasoned  analysis\nexplaining the arbitrators'  reasons for rendering the award.  This Contract and\nthe rights and  obligations  of the parties hereto will remain in full force and\neffect  pending  the award in such  arbitration  proceeding,  which  award  will\ndetermine whether and when termination of this Contract shall become effective.\n\n     (b) The arbitration will be conducted in English and Chinese.\n\n     (c) There will be three arbitrators.  Each party will select one arbitrator\nwithin 30 days after Lender  elects to commence  arbitration.  Such  arbitrators\nwill be freely  selected,  and the  parties  hereto will not be limited in their\nselection  to any  prescribed  list.  Within 30 days after the  selection of the\nlatter of the two arbitrators selected by the parties, the two arbitrators shall\nselect  the third  arbitrator;  if the two  arbitrators  do not select the third\nwithin  such  30  day  period,  the  arbitrating  body  will  select  the  third\narbitrator.  If a party does not  appoint an  arbitrator  who has  consented  to\nparticipate  within 30 days after the  selection  of the first  arbitrator,  the\nrelevant  appointment  will be made by the  arbitrating  body.  The costs of the\narbitration will be borne by the parties hereto as determined by the arbitration\ntribunal  taking  into  account  the  relative  merits of the  positions  of the\nparties.\n\n     (d) The  parties  hereto  agree  that the  arbitral  award may be  enforced\nagainst  the  parties  or their  assets  wherever  they may be found  and that a\njudgment upon the arbitral award may be entered in any court having jurisdiction\nthereof.  Accordingly,  the parties hereto  irrevocably agree that any action to\nenforce such  judgment may be  instituted  wherever  appropriate  and each party\nhereby irrevocably waives, to the fullest extent permitted by law, any objection\nwhich  it may  have  now  or  hereafter  to  the  laying  of  the  venue  or the\njurisdiction  or the convenience of the forum of any such action and irrevocably\nsubmits generally and  unconditionally  to the jurisdiction of any such court in\nany such action.\n\n                                      -10-\n\n\n\n16.  Banking Day Adjustment.\n     ----------------------\n\n     If the date on which a payment is due is not a Banking Day, such date shall\nbe changed to the next succeeding Banking Day (or to the first preceding Banking\nDay if the next succeeding Banking Day is in another calendar month).\n\n17.  Information.\n     -----------\n\n     Borrower  shall  provide  Lender  with  such  information   concerning  the\ncondition and operation of Borrower,  financial or otherwise, as Lender may from\ntime to time request.\n\n18.  Waiver; Cumulative Rights.\n     -------------------------\n\n     The  failure or delay of Lender to require  performance  by Borrower of any\nprovisions of this Contract shall not affect its right to require performance of\nsuch provision  unless and until such  performance has been waived in writing by\nLender.  Each and every  right  granted to Lender  hereunder  or under any other\ndocument delivered in connection herewith, or allowed to it at law or in equity,\nshall be cumulative and may be exercised in part or in whole from time to time.\n\n19.  Assignment.\n     ----------\n\n     This Contract  shall be binding upon and shall be  enforceable  by Borrower\nand Lender and their  respective  successors  and assigns,  except that Borrower\nshall have no right to assign or transfer its rights or obligations hereunder.\n\n20.  Set-Off.\n     -------\n\n     Nothing herein contained shall limit the right of set-off, lender's lien or\ncounterclaim which may be available to Lender under applicable law.\n\n21.  Severability.\n     ------------\n\n     If any or more of the provisions  contained in this  Contract,  the Note or\nany other document delivered in connection herewith shall be invalid, illegal or\nunenforceable  in any respect under any applicable  law, the validity,  legality\nand enforceability of the remaining provisions contained herein or therein shall\nnot in any way be affected or impaired.\n\n22.  Counterparts.\n     ------------\n\n     This  Contract  may be signed in any  number of  counterparts.  Any  single\ncounterpart  or a set of  counterparts  signed,  in either case, by both parties\nhereto shall constitute a full and original contract for all purposes.\n\n23.  Language.\n     --------\n                                      -11-\n\n\n\n     This  Contract  shall be written and  executed in both  Chinese and English\nversions, each of which shall have equal force and effect.\n\n24.  Construction.\n     ------------\n\n     Unless otherwise stated, all references made in this Contract to 'Sections'\nand 'Exhibits' shall refer, respectively,  to Sections of, and Exhibits to, this\nContract. References herein to this Contract include the Exhibits hereto.\n\n25.  Effectiveness.\n     -------------\n\n     This Contract  shall become  effective upon the signing hereof and upon the\nregistration of the Loans with the State Administration of Exchange Control.\n     \n     IN WITNESS WHEREOF, the parties hereto, intending to be legally bound, have\ncaused  this  Contract  to be  executed  by  their  respective  duly  authorized\nsignatories as of the day and year first written above.\n\nBORROWER                                 JIAOZUO WAN FANG POWER COMPANY LIMITED\n- --------\n\n\n                                         By: \/s\/ [SIGNATURE ILLEGIBLE]\n                                             -----------------------------\n                                         Name:\n                                         Title:\n\n\nLENDER                                   AES CHINA POWER HOLDING CO. (L), LTD.\n- ------\n\n                                         By: \/s\/ Edwared C. Hall, III\n                                             -----------------------------\n                                         Name:\n                                         Title:\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n                                      -12-\n\n\n                                    EXHIBIT A\n\n                             Form of Promissory Note\n                             -----------------------\n\nUS$ _________________                                              Date:\n\n     FOR VALUE  RECEIVED,  Jiaozuo Wan Fang Power Company  Limited  ('Borrower')\nhereby  unconditionally  promises to pay to the order of AES China Power Holding\nCo. (L),  Ltd.  ('Lender')  at the account of Lender (no.  ________________)  at\n__________________________, the principal sum of [amount of Loans in words] (US$\n[_________])  or, if less,  the  unpaid  principal  of the Loans  made by Lender\npursuant to the Loan Contract dated as of [ ______ ] between Borrower and Lender\n(the 'Loan  Contract')  in the  amounts and at the times  specified  in the Loan\nContract.\n\n     Borrower  hereby  promises  also to pay  interest  on the unpaid  principal\namount of the Loans  from the date such  Loans are made  until paid at the rates\nand at the times provided in the Loan Contract.\n\n     All payments of principal and interest under this Note shall be paid in the\ncurrency and at the place specified in the Loan Contract.\n\n     If Borrower fails to pay any sum payable under this Note when due, Borrower\nshall from time to time on demand pay  interest  on such sum from and  including\nthe due date to the date of actual payment (after as well as before judgment) at\nthe rate provided in the Loan Contract.\n\n     If an Event of Default shall occur and be continuing,  the principal of and\naccrued  interest  on this Note may be  declared  to be due and  payable  in the\nmanner and with the effect provided in the Loan Contract.\n\n     Borrower hereby waives presentment,  demand,  protest or notice of any kind\nin connection with this Note.\n\n     Terms not otherwise defined in this Note have the same meaning herein as in\nthe Loan Contract.\n\n     This Note shall be governed by and  interpreted in accordance with the laws\nof  England  without  regard to its  procedural  rules  which  would lead to the\nadoption of laws of other  countries  due to conflicts  of laws.\n\n                                             JIAOZUO WAN FANG POWER\n                                             COMPANY LIMITED\n\n\n\n                                             By:  ________________________\n                                             Name:\n                                             Title:\n\n                                      -1-\n\n\n\n                                    EXHIBIT B\n\n\n                                Drawdown Schedule\n\n               [To be determined by Borrower's Board of Directors]\n\n\nDate                   Amount                        Construction Milestone\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n                                      -1-\n\n\n                                    EXHIBIT C\n\n\n                              AMORTIZATION SCHEDULE\n\n\n<font size=\"2\">                TRANCHE A                                 TRANCHE B\n- -------------------------------------      -------------------------------------\n\nNUMBER   DATE          PAYMENT AMOUNT\n 1       1-Jan-98      70% of 1997 DEPRECUAITON \n                                                                          \n                      PAYMENT                                            PAYMENT\n                      AMOUNT                                              AMOUNT\n                      (PERCENT                                       (PERCENT OF\n                      OF PRINCIPAL                                     PRINCIPAL\n                      OUTSTANDING                                    OUTSTANDING\nNUMBER  DATE          AS OF 2-JAN-98)      NUMBER  DATE        AS OF UNIT 2 COD)\n2      1-Apr-98          0.21%\n3      1-Jul-98          0.23%             1       1-Jul-98                0.23%\n4      1-Oct-98          0.26%             2       1-Oct-98                0.26%\n5      1-Jan-99          0.30%             3       1-Jan-99                0.30%\n6      1-Apr-99          0.34%             4       1-Apr-99                0.34%\n7      1-Jul-99          0.38%             5       1-Jul-99                0.38%\n8      1-Oct-99          0.43%             6       1-Oct-99                0.43%\n9      1-Jan-00          0.49%             7       1-Jan-00                0.49%\n10     1-Apr-00          0.55%             8       1-Apr-00                0.55%\n11     1-Jul-00          0.62%             9       1-Jul-00                0.62%\n12     1-Oct-00          0.70%             10      1-Oct-00                0.70%\n13     1-Jan-01          0.79%             11      1-Jan-01                0.80%\n14     1-Apr-01          0.90%             12      1-Apr-01                0.90%\n15     1-Jul-01          1.01%             13      1-Jul-01                1.02%\n16     1-Oct-01          1.15%             14      1-Oct-01                1.15%\n17     1-Jan-02          1.30%             15      1-Jan-02                1.30%\n18     1-Apr-02          1.46%             16      1-Apr-02                1.47%\n19     1-Jul-02          1.65%             17      1-Jul-02                1.66%\n20     1-Oct-02          1.87%             18      1-Oct-02                1.87%\n21     1-Jan-03          2.11%             19      1-Jan-03                2.12%\n22     1-Apr-03          2.39%             20      1-Apr-03                2.39%\n23     1-Jul-03          2.70%             21      1-Ju1-03                2.70%\n24     1-Oct-03          3.05%             22      1-Oct-03                3.05%\n25     1-Jan-04          3.44%             23      1-Jan-04                3.45%\n26     1-Apr-04          3.89%             24      1-Apr-04                3.90%\n27     1-Jul-04          4.40%             25      1-Jul-04                4.41%\n28     1-Oct-04          4.97%             26      1-Oct-04                4.98%\n29     1-Jan-05          5.61%             27      1-Jan-05                5.63%\n30     1-Apr-05          6.34%             28      1-Apr-05                6.36%\n31     1-Jul-05          7.17%             29      1-Jul-05                7.18%\n32     1-Oct-05          8.10%             30      1-Oct-05                8.12%\n33     1-Jan-06          9.15%             31      1-Jan-06                9.17%\n34     1-Apr-06         10.34%             32      1-Apr-06               10.36%\n35     1-Jul-06         11.69%             33      1-Jul-06               11.71%\n                        ------                                            ------\n\n\n\n    Total              100.00%                 Total                     100.00%\n\n\n\n\n\n\n<\/font>                                    EXHIBIT D\n\n\n              LIST OF BORROWER'S DEBTS OF OVER RMB ONE MILLION EACH\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n                                      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