Conformed Copy - L4200 - Xiaolangdi Multipurpose Project: Stage II - Project Agreement

Page 1 CONFORMED COPY LOAN NUMBER 4200 CHA Project Agreement (Xiaolangdi Multipurpose Project: Stage II) between INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT and YELLOW RIVER WATER AND HYDROPOWER DEVELOPMENT CORPORATION Dated September 11, 1997 LOAN NUMBER 4200 CHA PROJECT AGREEMENT AGREEMENT, dated September 11, 1997 between INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT (the Bank) and YELLOW RIVER WATER AND HYDROPOWER DEVELOPMENT CORPORATION (YRWHDC). WHEREAS: (A) by the Loan Agreement of even date herewith between People's Republic of China (the Borrower) and the Bank, the Bank has agreed to make available to the Borrower a loan in two currency tranches, one in dollars in an amount equal to two hundred thirty million dollars ($230,000,000), the other in Deutsche Mark in an amount equal to three hundred forty-six million five hundred thousand Deutsche Mark (DEM 346,500,000), on the terms and conditions set forth in the Loan Agreement, but only on condition that YRWHDC agree to undertake such obligations toward the Bank as are set forth in this Agreement; (B) by a subsidiary loan agreement to be entered into between the Borrower and YRWHDC, part of the proceeds of the loan provided for under the Loan Agreement will be relent to YRWHDC on the terms and conditions set forth in said Subsidiary Loan Agreement; and WHEREAS, YRWHDC, in consideration of the Bank's entering into the Loan Agreement with the Borrower, has agreed to undertake the obligations set forth in this Agreement; NOW THEREFORE, the parties hereto hereby agree as follows: Page 2 ARTICLE I Definitions Section 1.01. Unless the context otherwise requires, the several terms defined in the Loan Agreement and the General Conditions (as so defined) have the respective meanings therein set forth. ARTICLE II Execution of the Project Section 2.01. (a) YRWHDC declares its commitment to the objectives of the Project as set forth in Schedule 2 to the Loan Agreement, and, to this end, shall carry out Parts A through C of the Project with due diligence and efficiency and in conformity with appropriate financial, economic, engineering and public utility practices and sound health, safety and environmental standards acceptable to the Bank, and shall provide, or cause to be provided, promptly as needed, the funds, facilities, services and other resources required for the purpose. (b) Without limitation upon the provisions of paragraph (a) of this Section and except as the Bank and YRWHDC shall otherwise agree, YRWHDC shall carry out the actions set forth in the Implementation Program set forth in Schedule 2 to this Agreement in order to ensure the proper carrying out of Parts A through C of the Project and the achievement of the Project