Exhibit 10.38


 





 


 


 


 


 


 


 


 


 


 


ANTURIE BETEILIGUNGSVERWALTUNGS GmbH


 


KAZAKHMYS POWER B.V.


 


KAZAKHMYS PLC


 


 


 


 


 


 


 


 










AGREEMENT


 


for the sale and purchase of
100% of the issued share 


capital of AES Kazakhstan
Holdings BV, AES 


Ekibastuz Holdings BV and
Emerging Energy 


Investments &
Holdings BV






 


 


 


 


 


5 February 2008


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


















CONTENTS


 


	
  Clause

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  
	
  1.

  	
   

  	
  SALE AND PURCHASE

  	
  3

  
	
  2.

  	
   

  	
  PRICE

  	
  4

  
	
  3.

  	
   

  	
  CONDITIONS TO CLOSING

  	
  5

  
	
  4.

  	
   

  	
  CLOSING

  	
  7

  
	
  5.

  	
   

  	
  INDEMNITY IN RESPECT OF
  CONSENTS

  	
  8

  
	
  6.

  	
   

  	
  SELLER GROUP
  REORGANISATION

  	
  8

  
	
  7.

  	
   

  	
  SELLER WARRANTIES

  	
  9

  
	
  8.

  	
   

  	
  PURCHASER WARRANTIES

  	
  13

  
	
  9.

  	
   

  	
  CONDUCT OF PURCHASER
  CLAIMS

  	
  13

  
	
  10.

  	
   

  	
  CHANGES OF NAME

  	
  14

  
	
  11.

  	
   

  	
  INTRA-GROUP SERVICES

  	
  15

  
	
  12.

  	
   

  	
  NO RIGHTS OF RESCISSION OR
  TERMINATION

  	
  15

  
	
  13.

  	
   

  	
  PAYMENTS

  	
  15

  
	
  14.

  	
   

  	
  INTER-COMPANY DEBT

  	
  16

  
	
  15.

  	
   

  	
  ANNOUNCEMENTS

  	
  16

  
	
  16.

  	
   

  	
  CONFIDENTIALITY

  	
  16

  
	
  17.

  	
   

  	
  NON-SOLICITATION

  	
  18

  
	
  18.

  	
   

  	
  ASSIGNMENT

  	
  18

  
	
  19.

  	
   

  	
  FURTHER ASSURANCES

  	
  18

  
	
  20.

  	
   

  	
  COSTS

  	
  19

  
	
  21.

  	
   

  	
  NOTICES

  	
  19

  
	
  22.

  	
   

  	
  CONFLICT WITH OTHER
  AGREEMENTS

  	
  19

  
	
  23.

  	
   

  	
  WHOLE AGREEMENT

  	
  20

  
	
  24.

  	
   

  	
  RIGHT OF SET-OFF

  	
  20

  
	
  25.

  	
   

  	
  GUARANTEE

  	
  21

  
	
  26.

  	
   

  	
  WAIVERS, RIGHTS AND
  REMEDIES

  	
  21

  
	
  27.

  	
   

  	
  COUNTERPARTS

  	
  21

  
	
  28.

  	
   

  	
  VARIATIONS

  	
  22

  
	
  29.

  	
   

  	
  INVALIDITY

  	
  22

  
	
  30.

  	
   

  	
  NO THIRD PARTY ENFORCEMENT
  RIGHTS

  	
  22

  
	
  31.

  	
   

  	
  GOVERNING LAW AND
  JURISDICTION

  	
  22

  
	
  SCHEDULE 1   TARGET COMPANIES

  	
  23

  
	
  SCHEDULE 2   LIMITATIONS ON LIABILITY

  	
  25

  
	
  SCHEDULE 3   PURCHASER WARRANTIES

  	
  29

  
	
  SCHEDULE 4   CLOSING ARRANGEMENTS

  	
  31

  
	
  SCHEDULE 5   GENERAL DISCLOSURES

  	
  34

  
	
  SCHEDULE 6   AES COMPLIANCE TERMS AND
  CONDITIONS

  	
  36

  
	
  SCHEDULE 7   EARNOUT CONSIDERATION

  	
  38

  
	
  SCHEDULE 8   INTER COMPANY DEBT

  	
  49

  
	
  SCHEDULE 9   POST-CLOSING FINANCIAL
  ADJUSTMENTS

  	
  50

  
	
  SCHEDULE 10   PRICE ALLOCATION

  	
  55

  
	
  SCHEDULE 11   AVAILABLE CAPACITY

  	
  56

  
	
  SCHEDULE 12   DEFINITIONS AND INTERPRETATION

  	
  57

  



 


 


 


2














AGREEMENT


 


dated
5 February 2008


 


PARTIES:


 


1.                                       ANTURIE BETEILIGUNGSVERWALTUNGS
GmbH of 1010 Vienna, Dr Karl
Lueger-Ring 12, Austria (the Seller);


 


2.                                       KAZAKHMYS POWER B.V. of Prins Bernhardplein 200,
1097 JB Amsterdam, The Netherlands (the Purchaser); and


 


3.                                       KAZAKHMYS PLC of 6th and 7th
Floor, Cardinal Place, 100 Victoria Street, London SW1E 5JL (the Parent Company)


 


(together the parties).


 


The Parent Company enters into this
Agreement solely in its capacity of a guarantor under clause 25 of this
Agreement and by execution of this Agreement shall not have or be deemed to
have any obligations or liabilities under this Agreement other than expressly
stipulated in clause 25 of this Agreement.


 


Words and expressions used in this
Agreement shall be interpreted in accordance with Schedule 10.


 


WHEREAS:


 


(A)          The Purchaser has agreed to purchase
all the issued share capital of AES Kazakhstan Holdings BV, AES Ekibastuz
Holdings BV and Emerging Energy Investments & Holdings BV, which
together hold (indirectly or directly) certain interests of The AES Corporation
(AES) in the Target Companies (as
defined below and as listed in Schedule 1 of this
Agreement) including AES Ekibastuz LLP, the operator of the AES Ekibastuz power
plant in Kazakhstan and Maikuben West LLP, the owner of the Maikuben West coal
mine in Kazakhstan, from the Seller, which is an indirectly owned subsidiary of
AES, for the consideration and upon the terms and subject to the conditions set
out in this Agreement.


 


(B)           The parties have agreed a total consideration
in respect of the Shares being sold of up to $1,525,000,000. Such total
consideration is subject to (i) certain post-closing financial adjustments
in respect of cash and external debt and certain other line items as is
described further below in Schedule 9; (ii) such performance discounts as may
be applicable in respect of the Earnout Consideration of up to $320,000,000, as
further set out in Schedule
7 and (iii) otherwise as provided herein or in
the Management Agreement.


 


 


IT IS AGREED:


 


 


1.      SALE AND PURCHASE


 


1.1           The Seller shall sell, with full
title guarantee, and the Purchaser shall purchase, the Shares on the terms set
out in this Agreement.


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


3

















 


1.2           The Shares shall be sold free of all
Encumbrances with all rights attaching to them at Closing including the right
to receive all distributions and dividends declared, paid or made in respect of
the Shares after Closing.


 


1.3           The Seller covenants with the
Purchaser that it has the right to sell and transfer to the Purchaser the full
legal and beneficial interest in the Shares on the terms set out in this
Agreement.


 


2.      PRICE


 


2.1           The initial price for the Shares (the
Initial Price)
shall be the amount which results from taking $1,150,000,000 (one billion one
hundred fifty million US dollars) and:


 


(a)                                  subtracting the amount of the
External Debt of the Group Companies as shown in the 30 September 2007
Accounts as set out in Part C of Exhibit 2;


 


(b)                                 adding the amount of Cash of
the Group Companies as shown in the 30 September 2007 Accounts as set out
in Part B of Exhibit 2;


 


(c)                                  subtracting the amount of the
difference between the External Debt as at the Closing Date as agreed between
the Seller and the Purchaser (the Estimated External Debt) and the External
Debt as shown in the 30 September 2007 Accounts if the former is more than
the latter (or adding the amount of such difference if the former is less than
the latter); and


 


(d)                                 adding the amount of the
difference between the Cash as at the Closing Date as agreed between the Seller
and the Purchaser (the Estimated
Cash) and the Cash as shown in the 30 September 2007
Accounts if the former is more than the latter (or subtracting the amount of
such difference if the former is less than the latter).


 


The Seller shall provide the Purchaser with
its calculation in good faith of the amounts of the Estimated External Debt,
the Estimated Cash and the amounts to be paid under Schedule
8
(together with supporting documentation, such documentation to include the most
recent (prior to Closing) monthly management accounts of the relevant Group
Companies) no later than 7 Business Days prior to Closing. The Calculation of
the Initial Price shall be in the form set out in Exhibit 4. The Seller
and the Purchaser shall seek to agree the Calculation of the Initial Price in
good faith prior to Closing. However, if no such agreement has been reached by
no later than 3 Business Days prior to the Closing Date, the amounts shown in
the most recent (prior to Closing) monthly management accounts of the relevant
Group Companies shall be used to determine the Estimated External Debt and the
Estimated Cash for the purposes of clause 2.1(c) and (d) and the amounts to be paid under Schedule
8.


 


2.2           At Closing, the Purchaser shall pay
to the Seller the Initial Price as calculated in accordance with Clause 2.1
above, subject to Clause 2.3 below.


 


2.3           At Closing the Parties shall make the
payments contemplated by paragraph 2 of Schedule 8 in relation to
net Inter-Company Debt. Any payment made by the Purchaser to the Seller
pursuant to paragraph 2 of Schedule 8 will reduce the Initial Price payable at
Closing on a dollar-for-dollar basis (and any payment made by the Seller to the
Purchaser pursuant to paragraph 2 of Schedule 8 will increase the Initial Price
payable at Closing on a dollar-for-dollar basis).


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


4

















 


2.4           The Final Price shall be calculated
after Closing on the basis set out in Schedule 9.  Any payments required to be made under the
Financial Adjustments shall be treated as adjusting the Initial Price, thus
resulting after such adjustment in the Final Price.


 


2.5           Notwithstanding anything to the
contrary in this Agreement, no payments shall be made under the Financial
Adjustments in the event that such payments would not exceed in aggregate the
sum of $2,000,000 (provided that, if such payments would exceed $2,000,000, the
whole amount of such payments shall be made and not merely the excess).


 


2.6           The Purchaser shall pay to the
Seller, by way of fixed deferred consideration (the Fixed
Deferred Consideration), the amount of US$30 million to be paid
as follows:-


 


(a)                                  US$2.5 million on the Closing
Date;


 


(b)                                 US$2.5 million on the later of
1 April 2008 and the Closing Date (in addition to the amount payable under
sub-clause (a));


 


(c)                                  US$2.5 million on each of 1 July 2008
and 1 October 2008;


 


(d)                                 US$2.5 million on each of 1
January, 1 April, 1 July and 1 October 2009; and


 


(e)                                  US$2.5 million on each of 1 January,
1 April, 1 July and 1 October 2010,


 


subject in each case to any provision of
the Management Agreement.


 


2.7           The provisions of Schedule 7 shall apply in respect of the Earnout Consideration (which the
Purchaser shall be obliged to pay in accordance with the provisions of Schedule 7) and the Total Consideration for the Shares shall consist of the
aggregate of the Final Price, the Fixed Deferred Consideration and the total
amount of Earnout Consideration paid by the Purchaser to the Seller.


 


2.8           The Total Consideration shall, to the
extent applicable, be adopted for all tax reporting purposes. The allocation of
the Total Consideration in relation to the Ekibastuz power plant and the
Maikuben mine is attached at Schedule 10.


 


3.      CONDITIONS TO
CLOSING


 


3.1           Closing shall be conditional on each
of the following Conditions having been satisfied:


 


(a)                                  all statutory, regulatory and
other consents, licences or authorisations of any Governmental Entity in
Kazakhstan required in connection with the Proposed Transactions (including the
execution and implementation of the Management Agreement) and the
Reorganisation (other than in relation to the step contemplated at point (i) on
page 7 of Exhibit 5) having been obtained (subject to no condition or
subject only to any such conditions that shall be reasonably acceptable to both
parties), including without limitation:


 


(i)             waivers by the Republic of Kazakhstan of
any pre-emptive rights it may have in relation to the transfer of any direct or
indirect interest in Maikuben West LLP and AES Ekibastuz LLP (or a letter or
letters from the authorised body indicating that no pre-emptive right under
Kazakh law is applicable to such transfers);


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


5

















 


(ii)          approvals of the Competition Protection
Agency of the Republic of Kazakhstan;


 


(iii)       such consents of the government of
Kazakhstan as are required in respect of the transfer of any direct or indirect
interest in AES Ekibastuz LLP; and


 


(iv)      such natural monopoly approvals as are
required;


 


(b)                                 completion in full of the
Reorganisation in accordance with Exhibit 5 (other than, to the extent the
relevant approval has not been obtained, the step contemplated at point (i) on
page 7 of Exhibit 5); and


 


(c)                                  the Management Agreement
having been entered into and being in full force and effect (subject to Closing
occurring under this Agreement).


 


3.2           The Purchaser shall, at its own cost
and subject to the due performance by the Seller of its obligations under
clause 3.3 below, use its best endeavours to ensure that the Condition in
clause 3.1(a) is fulfilled as soon as reasonably practicable after the
date of this Agreement.  The Purchaser
shall have primary responsibility for the process of obtaining all consents,
approvals or actions of any Governmental Entity in Kazakhstan which are
required in order to satisfy that Condition and confirms that it is taking all
steps necessary for that purpose (including making appropriate submissions,
notifications and filings, in consultation with the Seller and on its
behalf).  The Purchaser shall for this
purpose:


 


(a)                                  promptly notify the Seller
(and provide copies or, in the case of non-written communications, details) of
any communications with any such Governmental Entity relating to any such
consent, approval or action;


 


(b)                                 regularly review with the
Seller the progress of any notifications or filings with a view to obtaining
clearance from any Governmental Entity at the earliest reasonable opportunity;
and


 


(c)                                  provide the Seller with draft
submissions, notifications and filings in English or Russian at least three
Business Days prior to their submission and consider in good faith any
reasonable modifications proposed by the Seller.


 


3.3           The Seller shall:


 


(a)                                  promptly provide the Purchaser
with any necessary information and documents reasonably required for the
purpose of making any submissions, notifications and filings to any
Governmental Entity in Kazakhstan, as well as such necessary assistance as the
Purchaser may reasonably require (subject to the allocation of primary
responsibility set out in clause 3.2 above); and


 


(b)                                 promptly notify the Purchaser
(and provide copies or, in the case of non-written communications, details) of
any communication received from any such Governmental Entity relating to any
such consent, approval or action and shall not take any action in relation to
any Governmental Entity in Kazakhstan without prior consultation with the
Purchaser (to the extent practicable and lawfully permissible and save as is
reasonably required to protect the Seller’s interests).


 


3.4           Subject to the due performance by the
Purchaser of its obligations under clauses 3.2 above and 6.1  below and to all consents or approvals contemplated by such clauses
having been obtained, the Seller shall, at its own cost, use its best
endeavours to ensure that the Condition in clause 3.1(b)
is fulfilled as soon as reasonably practicable after such consents and
approvals have been obtained.


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


6

















 


3.5           The Conditions may only be waived by
the written agreement of the Seller and the Purchaser.


 


3.6           The Seller and the Purchaser
shall each notify the other promptly upon becoming aware that any Condition has
been fulfilled.  The first Business Day
in London on or by which all the Conditions have been fulfilled (or waived in
accordance with clause 3.5) is the Unconditional Date.


 


3.7           If:


 


(a)                                  Closing has not occurred on or
before 11 April 2008; or


 


(b)                                 any Governmental Entity has
rejected, such decision being in full legal force and subject to no further
right of appeal, any application for the granting of any statutory, regulatory
or other consent, licence or authorisation set out in clause 3.1(a)
above or has made, such decision being in full legal force and subject to no
further right of appeal, such grant subject to conditions that the Purchaser or
the Seller in its reasonably held view considers unacceptable,


 


then this Agreement (other than the
Surviving Provisions) shall automatically terminate unless the parties agree
otherwise in writing.  In such event,
neither party (nor any of its Affiliates) shall have any claim under this
Agreement of any nature whatsoever against the other party (or any of its
Affiliates) except in respect of any rights and liabilities which have accrued
before termination or under any of the Surviving Provisions.


 


3.8           The Purchaser acknowledges that AES
Ekibastuz LLP, AES Maikuben LLP and Maikuben West LLP are entering into the
Management Agreement in the context of the Proposed Transactions as a whole and
waives for itself and on their behalf with effect from Closing any right to
challenge the entry into the Management Agreement by such persons, whether on
the basis of alleged non-independence, coercion or otherwise.


 


4.      CLOSING


 


4.1           Closing shall take place at the
Amsterdam offices of the Seller’s lawyers on the tenth Business Day after the
Unconditional Date (or at such other place, at such other time and/or on such
other date as the Seller and the Purchaser may agree in writing) (the Closing Date).


 


4.2           Until Closing the provisions of Part A
of Schedule 4 shall apply.


 


4.3           At Closing each of the Seller and the
Purchaser shall deliver or perform (or ensure that there is delivered or
performed) all those documents, items and actions respectively listed in
relation to that party or any of its Affiliates in Schedule
4.


 


4.4           If for any reason the Unconditional
Date has occurred and the provisions of Part B of Schedule 4 are not fully observed and performed as contemplated by this
Agreement, the Purchaser may elect (in addition and without prejudice to all
other rights or remedies available to it) not to complete the purchase of the
Shares or to fix a new time and date for Closing by, in either case, giving
notice to the Seller.  In particular, the
Purchaser shall not be obliged to complete the purchase of any of the Shares
unless the purchase of all the Shares is completed simultaneously in accordance
with this Agreement. If for any reason the 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


7

















 


Unconditional
Date has occurred and the provisions of Part
C of Schedule 4 are not fully observed and performed as contemplated by this
Agreement, the Seller may elect (in addition and without prejudice to all other
rights and remedies available to it) not to complete the sale of the Shares or
to fix a new time and date for Closing by, in either case, giving notice to the
Purchaser.  In particular, the Seller
shall not be obliged to complete the sale of any of the Shares unless the sale
of all the Shares is completed simultaneously in accordance with this
Agreement.


 


4.5           If the Purchaser elects or the Seller
elects (the party or parties making such election being the Non-Defaulting Party
for the purposes of this subclause) not to complete the purchase or sale of the
Shares under the preceding subclause:


 


(a)                                  except for the Surviving
Provisions, all the provisions of this Agreement shall lapse and cease to have
effect, provided that neither the lapsing of those provisions nor their ceasing
to have effect shall affect any accrued rights or liabilities of either party
in respect of damages for non-performance of any obligation under this
Agreement falling due for performance prior to such lapse and cessation; and


 


(b)                                 the other party shall
indemnify the Non-Defaulting Party against all reasonable costs, charges and
expenses incurred by it after 20 December 2007 in connection with the
negotiation, preparation and entering into of the Transaction Documents and in
discharging its obligations under any of them.


 


5.      INDEMNITY IN
RESPECT OF CONSENTS


 


5.1           The Purchaser shall indemnify the
Seller against any and all Costs suffered or incurred by the Seller and each of
its Affiliates to the extent that Closing occurs and any such Costs subsequently
arise or result in Kazakhstan as a result of any of the statutory, regulatory
and other consents, licences or authorisations of any Governmental Entity
contemplated by the Condition in clause 3.1(a) as well as by clause 6.1(a) below
not having been obtained (or, if obtained, being in any way insufficient or
defective) (other than in respect of any such Costs which relate to consents,
licences or authorisations required solely in connection with the step
contemplated at point (i) on page 7 of Exhibit 5).


 


5.2           The provisions of clause 5.1
above shall not apply to the extent that such Costs arise as a direct result of
any incorrect or otherwise defective written information or documents provided
by or on behalf of the Seller to the Purchaser for the purpose of obtaining
such consents, licences or authorisations (for the avoidance of doubt, such
information shall include the description of the Reorganisation contained in Exhibit 5).


 


 


6.      SELLER GROUP
REORGANISATION


 


6.1           The Purchaser acknowledges and agrees
that the Seller is restructuring its holding of the Group Companies and certain
other entities within the Seller Group pursuant to the Reorganisation and that:


 


(a)                                  the Purchaser shall use its
best endeavours, subject to the due performance by the Seller of its
obligations under clause clause 6.2 below,  to obtain all statutory, regulatory and other
consents, licences or authorisations of any Governmental Entity in Kazakhstan
required in connection with the Reorganisation (including making appropriate submissions,
notifications and filings) and whether or not such consents, licences or
authorisations, submissions, notifications and filings are the responsibility
of anyone other than the Purchaser including the Seller or any of its
Affiliates, other than in 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


8

















 


respect of any consents, licences and
authorisations required in connection with the step contemplated by point (i) on
page 7 of Exhibit 5, in relation to which the Purchaser shall use its
reasonable endeavours to achieve the same;


 


(b)                                 the Purchaser shall, to the
extent possible, make a composite application in respect of all steps
contemplated by the Reorganisation (including the step contemplated at point (i) on
page 7 of Exhibit 5);


 


(c)                                  the Purchaser shall not,
subject to the due performance by the Seller of its obligations under clause 6.2
below, object to or otherwise interfere with or delay the Reorganisation; and


 


(d)                                 the Purchaser shall take all
actions reasonably required by the Seller in connection with the
Reorganisation.


 


6.2           The Seller shall:


 


(a)                                  provide the Purchaser with any
necessary information, documents and assistance reasonably required for the
purpose of making any submissions, notifications and filings to any Governmental
Entity required in connection with the Reorganisation;


 


(b)                                 provide the Purchaser with
draft documents relating to implementation of any action under the
Reorganisation to be undertaken by a Group Company (as well as any draft
documents intended to transfer the Shares or assign the Inter-Company Debt) at
least three Business Days prior to taking such action and consider in good
faith any reasonable modifications proposed by the Purchaser which are required
to ensure compliance of such an action with Exhibit 5 and/or consistency
with any relevant  consent, licence or
authorisation or any application to obtain the same filed in accordance with
this Agreement provided that the Purchaser has fulfilled its obligation under clause
3.2(c) in relation to that application; and


 


(c)                                  regularly review with the
Purchaser the progress of the Reorganisation with a view to completing the
Reorganisation in accordance with Exhibit 5 as soon as reasonably
practicable after all necessary consents, licences or authorisations of a
Governmental Entity contemplated under clause 6.1(a) above have been obtained.


 


6.3           The Seller shall indemnify the
Purchaser in respect of any and all amounts of taxation (other than taxation
arising in Kazakhstan) incurred by any Group Company or the Purchaser as a
direct result of the Reorganisation to the extent that such amounts would not
have otherwise been incurred by them.


 


 


7.      SELLER
WARRANTIES


 


7.1           The Seller warrants to the Purchaser
as at the date of this Agreement in the terms of the Seller Warranties set out
in clause 7.2  below. The Seller
Warranties are given subject to the limitations set out in Schedule 2.


 


7.2           The Seller warrants to the Purchaser
in the terms of the Seller Warranties set out in this clause 7.2:


 


(a)                                  the Seller has obtained all
corporate authorisations (including, for the avoidance of doubt, all necessary
board and shareholder approvals) and all other governmental, statutory,
regulatory or other consents, licences or authorisations (except for any and 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


9

















 


all governmental, statutory, or regulatory
consents, licences or authorisations under Kazakh law and regulation) required
to empower it to enter into and perform its obligations under this Agreement
where failure to obtain them would adversely affect to a material extent its
ability to enter into or perform its obligations under this Agreement;


 


(b)                                 entry into and performance by
the Seller and AES London Holdings BV of this Agreement and/or any Transaction
Document to which it is a party will not (i) breach any provision of its
constitutional documents or (ii) result in a breach of any laws or
regulations in its jurisdiction of incorporation or of any order, decree or
judgment of any court or any governmental or regulatory authority in its
jurisdiction of incorporation, where (in either case) the breach would
adversely affect to a material extent its ability to enter into or perform its
obligations under this Agreement and/or any Transaction Document to which it is
a party;


 


(c)                                  each of the Seller, AES London
Holdings BV and each Group Company is validly incorporated, in existence and
duly registered under the laws of its jurisdiction of incorporation. Each Group
Company has full power under its constitutional documents to conduct its
business as at the date of this Agreement and each of the Non-Kazakh Group
Companies has full power under the relevant laws and regulations (other than
the laws and regulations of Kazakhstan) to conduct its business as conducted at
the date of this Agreement;


 


(d)                                 subject to any required
statutory, regulatory or other consents, licences or authorisations of any
Governmental Entity which are described in clause 3.1(a)
and clause 6.1(a) having been obtained, the
Seller is or will at Closing be entitled to transfer the Shares;


 


(e)                                  the Shares constitute the
whole of the issued and allotted share capital of the Companies, all the Shares
are free of any Encumbrances, fully paid or properly credited as fully paid and
the Seller is or will at Closing be the sole legal and beneficial owner of the
Shares;


 


(f)                                    so far as the Seller is aware,
in the 12 months prior to the date of this Agreement, each Target Company has
conducted its business (if any) and corporate affairs in all material respects
in accordance with its constitutional documents;


 


(g)                                 the Seller or another Group
Company is or will at Closing be the direct or indirect legal and beneficial
owner (solely or together with another Group Company) of the whole of the
issued and allotted share or charter capital of each Group Company, such shares
and charter capital being free from any Encumbrance (other than the pledge in
respect of the shares in Maikuben West LLP in favour of Bank Turan Alem), and
fully paid or properly credited as fully paid (other than the charter capital
of Argamak 2007 LLP, Maikuben Mine LLP, Maikuben Electric LLP and Maikuben Coal
LLP which is unpaid);


 


(h)                                 so far as the Seller is aware,
no person is entitled or has claimed to be entitled to require any Group Company
to issue any share or loan capital either now or at any future date whether
contingently or not;


 


(i)                                     no member of the Seller Group
or any Group Company has received any written notice that an order has been
made, petition presented or meeting convened for the winding up of the Seller
or any Group Company or for the appointment of any provisional liquidator;


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


10

















 


(j)                                     no member of the Seller Group
or any Group Company has received any written notice concerning the appointment
of a receiver (including any administrative receiver or the equivalent to a
receiver or administrative receiver in the relevant jurisdiction) in respect of
the whole or any material part of the property, assets and/or undertaking of
the Group Companies;


 


(k)                                  neither the Seller nor any
Group Company has made any voluntary arrangement with any of its creditors in
the 2 years prior to the date of this Agreement;


 


(l)                                     the Available Capacity of the
GRES-1 power plan operated by AES Ekibastuz LLP will be demonstrated, prior to
Closing, as being not less than 2250MW as demonstrated by the procedures set
forth in Schedule 11;


 


(m)                               so far as the Seller is aware,
the 30 September 2007 Accounts were properly prepared in all material
respects in accordance with the accounting policies and procedures of AES as at
30 September 2007. Such policies and procedures were consistent with US
GAAP applied for the purposes of producing consolidated financial statements
for AES and its subsidiaries at such date;


 


(n)                                 so far as the Seller is aware,
no Group Company has at any time in the last five (5) years deliberately
engaged in tax evasion in any material respect, in circumstances where it knew
that such evasion was unlawful (based upon its honestly held interpretation of
applicable tax law at such time);


 


(o)                                 no Group Company has any
outstanding liability to make any payment in respect of a tax liability imposed
by a Governmental Entity in the Netherlands, Ireland, United Kingdom or Cyprus;


 


(p)                                 no Group Company has or shall
become liable to make any payment in respect of a tax liability imposed by a
Governmental Entity in the Netherlands which is properly attributable to
another member of the Seller Group, as a result of being treated as part of a
fiscal unity with that other member for Dutch tax purposes;


 


(q)                                 no Group Company has or shall
have in the future any taxation liability 
in relation to the transfer prior to the Closing Date of the tax
residency of AES Suntree Power Limited from Ireland to the UK;


 


(r)                                    none of the Non-Kazakh Group
Companies has any material outstanding or potential liabilities or obligations
and AES Kazelectro NV, Electric Power Holdings VOF, AES Suntree Power Limited
and Kilcormac Trading Limited are dormant companies;


 


(s)                                  since 30 September 2007
each of the Target Companies has been operated in the ordinary course in all
material respects (to the extent permitted by applicable law and save in
respect of the voluntary tariff freeze agreed between the parties) and no dividend
or other distribution of profits or assets has been or agreed to be declared,
made or paid by any Group Company (other than to another Group Company);


 


(t)                                    so far as the Seller is aware,
there are no current or pending regulatory proceedings or claims in which a
Group Company is involved in respect of the termination of the lease of the ORU
sub-station to ORU Ekibastuz LLP;


 


(u)                                 so far as the Seller is aware,
no document to which a Group Company is a party that is material in the context
of the consolidated position of the Group Companies taken as a whole has been
deliberately and intentionally omitted from the Data Room with a 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


11

















 


view to concealing information (not
otherwise known or available to the Purchaser or any other member of the
Purchaser Group) from the Purchaser which if known would have a significant and
adverse impact on the value of the Group Companies (taken as a whole); and


 


(v)                                 the Seller has provided the
Purchaser with all of the relevant and material information of which the Seller
is aware as at the date of this Agreement in relation to:


 


(i)                             all current litigation,
arbitration or administrative proceedings which (if successful) are likely to
result in a cost, benefit or value to the Kazakh Business of $2,000,000 or more
in which the Group Companies are involved as parties and all such proceedings
which have been threatened in writing by or against a Group Company;


 


(ii)                          all licences of Intellectual
Property Rights granted to, and by any Group Company and which are material to
the Kazakh Business;


 


(iii)                       all the land, property and
equipment owned, leased, controlled, occupied or used by any Group Company or
in relation to which any Group Company has any right, interest or liability;


 


(iv)                      all current claims or
proceedings which (if successful) are likely to result in a cost, benefit or
value to the Kazakh Business of $2,000,000 or more pending against any Group
Company with respect to any breach of or liability under Environmental Laws
relating to the Kazakh Business and all written statutory complaints or
statutory notices received by a Group Company alleging or specifying any such
breach;


 


(v)                         all termination, retirement,
superannuation, provident, death or disability schemes for directors or
Employees provided by the Group Companies and the Kazakh Business; and


 


(vi)                      all constitutional documents
of each Group Company;


 


which, in the Seller’s opinion, are
material to the Kazakh Business, and to the Seller’s knowledge, such
information is accurate in all material respects.


 


7.3           In the event of a breach of the
warranty contained in clause 7.2(1) above, the Purchaser shall
only be entitled to compensation, damages or any other form of relief or remedy
if it gives the Seller written notice of an alleged breach and any actual
breach is not remedied or found to be unfounded within 30 days after the
date on which such notice is served on the Seller (which notice must be served
within 60 days of the Closing Date). If the breach is not remedied or found to
be unfounded within such 30-day period, the Seller shall be required to
increase the Available Capacity of the Business to not less than 2250MW within
180 days from the expiry of such 30-day period at its own cost (subject to the
limit on the Seller’s aggregate liability under this Agreement contained in
paragraph paragraph 3 of Schedule
2). If the
Seller fails to comply with this obligation, it shall indemnify the Purchaser
in full for all costs incurred by the Purchaser and the Group Companies as a
result of such breach and once paid, no adjustment shall be made to the EBITDA
for the purposes of calculating the Earnout Consideration in respect of any
such Costs incurred by any Group Company. Except as expressly provided, no other
remedy shall be available to the Purchaser in respect of the warranty contained
in clause 7.2(1) above.


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


12














8.      PURCHASER
WARRANTIES


 


The Purchaser warrants to the Seller as at
the date of this Agreement in the terms of the Purchaser Warranties set out in Schedule 3.


 


9.      CONDUCT OF
PURCHASER CLAIMS


 


9.1           If the Purchaser becomes aware after
the Closing Date of any claim or potential claim by a third party (a Third Party Claim),
or of any other matter or circumstance which might result in a Claim being
made, the Purchaser shall:


 


(a)                                  promptly (and in any event
within 20 Business Days of it becoming aware of it) give notice of the Third
Party Claim or other such matter or circumstance to the Seller;


 


(b)                                 provide (and shall ensure that
the members of the Purchaser Group provide) all reasonable information,
facilities and assistance that the Seller may reasonably require to investigate
the Third Party Claim;


 


(c)                                  not (and ensure that each
member of the Purchaser Group shall not) admit liability or make any agreement
or compromise in relation to the Third Party Claim without prior written
approval of the Seller (which shall not be unreasonably withheld or delayed);


 


(d)                                 (subject to the Purchaser or
the relevant member of the Purchaser Group being indemnified by the Seller
against all damages incurred as a result of, and reasonable out of pocket costs
and expenses incurred in respect of, the things set out in paragraphs (i) to
(iii) in relation to that Third Party Claim) ensure that it and each
member of the Purchaser Group shall:


 


(i)                     take such action as the Seller may
reasonably request to avoid, resist, dispute, appeal, compromise or defend the
Third Party Claim;


 


(ii)                  allow the Seller (if it elects to do so) to
take over the conduct of all proceedings and/or negotiations arising in
connection with the Third Party Claim; and


 


(iii)               provide such information and assistance as
the Seller may reasonably require in connection with the preparation for and
conduct of any proceedings and/or negotiations relating to the Third Party
Claim.


 


9.2           If the Seller takes over the conduct
of the Third Party Claim in accordance with clause 9.1(d)(ii):


 


(a)                                  the Seller shall consult with
the Purchaser on any matter which is or is likely to be material in relation to
that Third Party Claim and shall consider in good faith any reasonable
requirements of the Purchaser;


 


(b)                                 the Seller shall keep the
Purchaser promptly informed of the progress of that Third Party Claim and,
without prejudice to the generality of the foregoing, shall inform the
Purchaser in advance of any hearings in any proceedings in connection with that
Third Party Claim;


 


(c)                                  the Seller shall provide the
Purchaser with copies of all relevant documents, including all written
communications, correspondence and notes or other written records of telephone
conversations or meetings, which relate to that Third Party Claim; and


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


13

















 


d)                                     the Seller shall provide the
Purchaser with draft submissions, notifications and filings in English and
Russian at least three Business Days prior to their submission and consider in
good faith any reasonable modifications proposed by the Purchaser.


 


9.3           Nothing in subclause 9.1 shall:


 


(a)                                  (subject to clause 9.1(c)
above) require the Purchaser or any member of the Purchaser Group to do
anything or omit to do anything where such action or omission would, in the
reasonable opinion of the Purchaser, be prejudicial in any material respect to
the relationship of the Purchaser or of any member of the Purchaser Group with
any Governmental Entity in Kazakhstan; or


 


(b)                                 entitle the Seller to make, or
to request the Purchaser that it shall, or to procure that a member of the
Purchaser Group shall, make any admission of liability, agreement or compromise
in relation to that Third Party Claim without the prior written approval of the
Purchaser (which shall not be unreasonably withheld or delayed) unless such
admission, agreement or compromise provides for settlement or relief solely in
the form of monetary payment.


 


9.4           If the Seller takes over the conduct
of the Third Party Claim in accordance with subclause 9.1(d)(ii),
the Purchaser may give notice to the Seller that the Purchaser or the relevant
member of the Purchaser Group is taking over the conduct of all proceedings
and/or negotiations arising in connection with the Third Party Claim if in the
Purchaser’s reasonable opinion the conduct of the dispute, defence, compromise
or appeal of the Third Party Claim by the Seller has prejudiced or is likely to
prejudice in any material respect the relationship of the Purchaser or of any
member of the Purchaser Group with any Governmental Entity in Kazakhstan. If
the Purchaser takes over conduct in such manner, then (i) for the
avoidance of doubt, the provisions set out in clause 9.1(c)
shall continue to apply and (ii) the Purchaser shall conduct the defence
of the Third Party Claim diligently and without undue delay.


 


9.5           The Seller shall not be liable under
any Claim to the extent its liability has increased (or has not been reduced)
as a result of the operation of the provisions of subclause 9.3(a)
or 9.4. The provisions of paragraph 10 and 11 of Schedule 2 shall not be affected by the provisions of subclause 9.3(a)
or 9.4.


 


9.6           If the exercise by the Purchaser of
its rights under clause 9.3(a) or 9.4
would, in the reasonable opinion of the Seller, be prejudicial in any material
respect to the commercial interests of the Seller or any member of the Seller
Group, the Purchaser may only exercise such rights to the extent that it
delivers to the Seller an opinion (setting out the facts on which such opinion
is based) by an English Queen’s Counsel of more than 10 years call addressed to
the Purchaser and the Seller, to the effect that the course of action which the
Purchaser proposes to undertake is reasonable in all the circumstances. The
Purchaser may only exercise its rights under clause 9.3(a) and 9.4
in a manner consistent with the course of action described in any opinion which
it has so procured.


 


10.    CHANGES OF NAME


 


10.1         The Purchaser shall procure that:


 


(a)                                  as soon as reasonably
practicable after the Closing Date and in any event within ninety (90) days
afterwards, the name of any Group Company which consists of or incorporates the
word “AES” is changed to a name which does not include that word or any word
which, in the reasonable opinion of the Seller, is substantially or confusingly
similar;


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


14

















 


(b)                                 as soon as reasonably
practicable after the Closing Date and in any event within ninety (90) days
afterwards, the Group Companies shall cease to use or display any trade or
service name or mark, business name, logo or domain name used or held by any
member of the Seller Group or any mark, name or logo which, in the reasonable
opinion of the Seller, is substantially or confusingly similar to any of them.


 


10.2         The Seller shall, at the cost of the
Purchaser, provide the Purchaser with such necessary information, documents or
assistance as is reasonably required and requested for the purposes of this
clause 10.


 


11.    INTRA-GROUP
SERVICES


 


The Seller confirms and the Purchaser
acknowledges that all services currently provided by a member of the Seller
Group to a Group Company (including any group insurance coverage, the provision
of guarantees, audit and tax services and others currently provided) shall cease
to be so provided with effect from the Closing Date (save where the Seller uses
its powers of sub-contracting under the Management Agreement to continue the
provision of such services) and that the Purchaser shall (subject to the
express terms of the Management Agreement) be responsible for the provision of
such services from the Closing Date.


 


12.    NO RIGHTS OF
RESCISSION OR TERMINATION


 


Subject to clause 3.7
of this Agreement, the Purchaser shall not be entitled to rescind or terminate
this Agreement in any circumstances whatsoever (whether before or after
Closing).  This shall not exclude any
liability for (or remedy in respect of) any fraud or fraudulent
misrepresentation of a director, officer or senior manager of any member of the
Seller Group or any fraud, or fraudulent misrepresentation by the Seller in
connection with the disclosure of written documents or written information to
the Purchaser and its Representatives at any time prior to the execution of
this Agreement.


 


 


13.    PAYMENTS


 


13.1         Any payment to be made pursuant to this
Agreement by the Purchaser (or any member of the Purchaser Group) shall be made
to the Seller’s Bank Account.


 


13.2         Any payment to be made pursuant to this
Agreement by the Seller shall be made to the Purchaser’s Bank Account.


 


13.3         Payment under clause 13.1
and 13.2 shall be in immediately available funds by
electronic transfer on the due date for payment and shall (save where expressly
provided otherwise) be made in U.S. dollars. 
Receipt of the amount due shall be an effective discharge of the
relevant payment obligation.


 


13.4         If any sum due for payment in
accordance with this Agreement is not paid on the due date for payment, the
person in default shall pay Default Interest on that sum from but excluding the
due date to and including the date of actual payment calculated on a daily
basis.


 


13.5         Unless expressly stipulated in this
Agreement otherwise, any payments of Total Consideration made pursuant to this
Agreement (including any payment in respect of Earnout 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


15

















 


Consideration)
shall be made in full without set-off or counterclaim and not subject to any
condition and free and clear of and without deduction or withholding for or on
account of any tax, duties, charges, fees, deductions, or restrictions
whatsoever.


 


14.    INTER-COMPANY
DEBT


 


The provisions of Schedule 8 shall apply in respect of net Inter-Company Debt and the Parties will
comply with the obligations set out therein.


 


15.    ANNOUNCEMENTS


 


15.1         From the date of this Agreement until
12 months after the Closing Date, neither the Seller nor the Purchaser
(nor any of their respective Affiliates) shall make any announcement or issue
any circular (including the Class 2 circular to be issued by the Parent Company)
in connection with the existence or subject matter of this Agreement (or any
other Transaction Document) without the prior written approval of the other
(such approval not to be unreasonably withheld or delayed), except where the
content of the announcement or circular has previously been included in an
announcement made or circular issued in accordance with this clause 15.


 


15.2         The restriction in clause 15.1
shall not apply to the extent that the announcement or circular is required by
law, by any stock exchange or any regulatory or supervisory body or authority
of competent jurisdiction, whether or not the requirement has the force of
law.  If this exception applies, the
party making the announcement or issuing the circular shall use its reasonable
efforts to consult with the other party in advance as to its form, content and
timing.


 


16.    CONFIDENTIALITY


 


16.1         For the purposes of this clause 16:


 


(a)                                  Confidential Information means:


 


(i)             (in relation to the obligations of the
Purchaser) any information received or held by the Purchaser (or any of its
Representatives) relating to the Seller Group or, prior to Closing, any of the
Group Companies; or


 


(ii)          (in relation to the obligations of the
Seller) any information received or held by the Seller (or any of its
Representatives) relating to the Purchaser Group or, following Closing, any of
the Group Companies; and


 


(iii)       information relating to the provisions of,
and negotiations leading to, this Agreement and the other Transaction
Documents;


 


and includes written information and
information transferred or obtained orally, visually, electronically or by any
other means and any and all documents prepared by the Purchaser (or its
Representatives) which contain, reflect or are based upon, in whole or in part,
the Confidential Information; and


 


(b)                                 Representatives means, in relation to a party, its respective
Affiliates and the directors, officers, partners, employees, agents, advisers,
accountants, bankers and financing institutions, contractors, sub-contractors
and consultants of that party and/or of its respective Affiliates.


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


16

















 


16.2         Each of the Seller and the Purchaser
shall (and shall ensure that each of its Representatives shall) maintain Confidential
Information in confidence and not disclose Confidential Information to any
person except (i) as this clause 16 permits or (ii) as the
other party approves in writing.


 


16.3         Clause 16.2 and 16.4
shall not prevent disclosure by a party or its Representatives to the extent it
can demonstrate that:


 


(a)                                  disclosure is required by law
or by any stock exchange or any regulatory, governmental or antitrust body
(including any tax authority) having applicable jurisdiction (provided that the
disclosing party shall first inform the other party of its intention to
disclose such information and take into account the reasonable comments of the
other party);


 


(b)                                 disclosure is of Confidential
Information which was lawfully in the possession of that party or any of its
Representatives (in either case as evidenced by written records) without any
obligation of secrecy prior to its being received or held;


 


(c)                                  disclosure is of Confidential
Information which has previously become publicly available other than through
that party’s fault (or that of its Representatives); and


 


(d)                                 disclosure is required for the
purpose of any arbitral or judicial proceedings arising out of this Agreement
(or any other Transaction Document).


 


16.4         The Purchaser and the Sellers shall not
(and shall procure that their respective Representatives shall not) disclose to
any person the fact that the Confidential Information has been made available
to it or any terms, conditions or other facts with respect to the Proposed
Transactions including their status.


 


16.5         Each of the Seller and the Purchaser
undertakes that it (and its Affiliates) shall only disclose Confidential
Information to its Representatives if it is reasonably required for purposes
connected with this Agreement and only if the Representatives are informed of
the confidential nature of the Confidential Information.


 


16.6         If this Agreement terminates, the
Purchaser shall as soon as practicable on request by the Seller:


 


(a)                                  return to the Seller all
written documents and other materials relating to the Seller or to any Group
Company including any Confidential Information which the Seller (or its
Representatives) have provided to the Purchaser (or its Representatives)
without keeping any copies of them;


 


(b)                                 destroy all information or other
documents derived from such Confidential Information; and


 


(c)                                  expunge such Confidential
Information from any computer, word processor or other device,


 


provided that no such obligation shall
apply to the extent that any Representative may be required to retain any such
information or documents by any law, regulation or code of practice relating to
their professional conduct.


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


17

















 


17.    NON-SOLICITATION


 


Each of the Seller and the Purchaser shall
not (and shall ensure that each of its Affiliates shall not) prior to the
expiry of the term or, if earlier, termination of the Management Agreement:


 


(a)                                  solicit or cause to be
solicited the employment or service of any of the employees or directors of any
member of the Seller Group or any of the Group Companies (in the case of the
Purchaser) or any member of the Purchaser Group (in the case of the Seller) of
senior management level or above (provided that this shall not prevent the
Seller or an Affiliate from offering employment to the current general
directors of AES Ekibastuz LLP, AES Maikuben LLP or Maikuben West LLP during
the six-month period preceding the termination of the Management Agreement,
subject to (i) the Seller not procuring such employment through the offer
of enhanced terms and (ii) such persons not being relocated from the
Kazakh Business prior to the date one month after the termination of the
Management Agreement); or


 


(b)                                 solicit or cause to be
solicited the employment or service of any of the employees of any member of
the Seller Group or any of the Group Companies (in the case of the Purchaser)
or any member of the Purchaser Group (in the case of the Seller) below senior
management level unless they do so pursuant to a generalised advertisement not
specifically directed at such employees or at the instigation of the employee
without encouragement by the respective party.


 


18.    ASSIGNMENT


 


18.1         Except as provided in this clause 18
or unless the Seller and the Purchaser specifically agree in writing, no person
shall assign, transfer, charge or otherwise deal with all or any of its rights
under this Agreement nor grant, declare, create or dispose of any right or
interest in it.  Any purported assignment
in contravention of this clause 18 shall be void.


 


18.2         The benefit of the Seller Warranties
may be assigned (in whole or in part) by the Purchaser to any wholly owned and
controlled subsidiary of Kazakhmys plc for the time being which is the legal
and beneficial owner from time to time of any or all of the Shares as if it
were the Purchaser under this Agreement provided that before any such assignee
subsequently ceases to be a wholly owned subsidiary of Kazakhmys plc, the
Purchaser shall ensure that it shall re-assign that benefit to the Purchaser or
to another wholly owned subsidiary of Kazakhmys plc.


 


18.3         The benefit of the Earnout
Consideration may be assigned (in whole or in part) by the Seller to any member
of the Seller Group provided that before any such assignee subsequently ceases
to be a member of the Seller Group, the Seller shall ensure that it shall
re-assign that benefit to the Seller or to another member of the Seller Group.


 


18.4         If an assignment is made in accordance
with this clause 18, the assignor shall promptly
notify the other party and the liabilities of the members of one party’s Group
to the other party’s Group under this Agreement shall be no greater than such
liabilities would have been if the assignment had not occurred.


 


19.    FURTHER
ASSURANCES


 


Each of the Seller and the Purchaser shall
procure that its Affiliates comply with all obligations under this Agreement
which are expressed to apply to any such Affiliates.


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


18

















 


20.    COSTS


 


20.1         Subject to clause 20.2
and except as otherwise provided in this Agreement (or any other Transaction
Document), each of the Seller and the Purchaser shall be responsible for its
own costs, charges and other expenses (including those of its Affiliates)
incurred in connection with the Proposed Transactions.


 


20.2         The Purchaser or its Affiliates shall
bear all stamp duty, notarisation fees or other documentary transfer or
transaction duties, and all stamp duty reserve tax, stamp duty land tax and any
other transfer taxes (but excluding expressly any tax on actual profit or gains
payable by the Seller or any of its Affiliates under the laws of any
jurisdiction and any related interest or penalties) including in each case any
related interest or penalties arising as a result of this Agreement or of any
of the other Transaction Documents.


 


21.    NOTICES


 


21.1         Any notice in connection with this
Agreement shall be in writing in English and delivered by hand, fax, registered
post or courier using an internationally recognised courier company.  A notice shall be effective upon receipt and
shall be deemed to have been received (i) at the time of delivery, if
delivered by hand, registered post or courier or (ii) at the time of
transmission if delivered by fax provided that in either case, where delivery
occurs outside Working Hours, notice shall be deemed to have been received at
the start of Working Hours on the next following Business Day.


 


21.2         The addresses and fax numbers of the
parties for the purpose of clause 21.1 are:


 


	
  Seller

  	
  Address:

  	
  Fax:

  
	
  For the attention of: 

  

  The Directors

  	
  c/o AES Electric Ltd. 

  37-39 Kew Foot Road 

  Richmond, Surrey 

  TW9 2SS, United Kingdom

  	
  +44 (0) 20 8332 9078

  
	
   

  	
   

  	
   

  
	
  Purchaser

  	
  Address:

  	
  Fax:

  
	
  For the attention of: 

  

  Company Secretary 

  Kazakhmys PLC, 

  Mr. Robert Welch

  	
  Cardinal Place, 100 Victoria 

  Street, London SW1E 5JL

  	
  +44 (0) 207 901 7861

  



 


22.    CONFLICT WITH
OTHER AGREEMENTS


 


If there is any conflict between the terms
of this Agreement and any other agreement (including the agreement of
understanding between AES and the Parent Company dated 20 December 2007
which the parties agree is terminated with the execution and delivery of this
Agreement), this Agreement shall prevail (as between the parties to this
Agreement and as between any members of the Seller Group and any members of the
Purchaser Group) unless (i) such other agreement expressly states that it
overrides this Agreement in the relevant respect and (ii) the Seller and
the Purchaser are either also parties to that other agreement or otherwise
expressly agree in writing that such other agreement shall override this
Agreement in that respect.


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


19

















 


 


23.    WHOLE AGREEMENT


 


23.1         In this clause 23
the Relevant Parties
shall mean the Seller and the Purchaser, and each of them shall be a Relevant Party.


 


23.2         This Agreement and the other
Transaction Documents together set out the whole agreement between the Relevant
Parties in respect of the sale and purchase of the Shares and supersede any
prior agreement (whether oral or written) relating to the Proposed
Transactions.  It is agreed that:


 


(a)                                  no Relevant Party shall have
any claim or remedy in respect of any statement, representation, warranty or
undertaking made by or on behalf of the other Relevant Party (or any of its
Connected Persons) in relation to the Proposed Transactions which is not
expressly set out in this Agreement or any other Transaction Document;


 


(b)                                 any terms or conditions
implied by law in any jurisdiction in relation to the Proposed Transactions are
excluded to the fullest extent permitted by law or, if incapable of exclusion,
any right or remedies in relation to them are irrevocably waived;


 


(c)                                  the only right or remedy of a
Relevant Party in relation to any provision of this Agreement or any other
Transaction Document shall be for breach of this Agreement or the relevant
Transaction Document; and


 


(d)                                 except for any liability in
respect of a breach of this Agreement or any other Transaction Document, no
Relevant Party (or any of its Connected Persons) shall owe any duty of care or
have any liability in tort or otherwise to the other Relevant Party (or its
respective Connected Persons) in relation to the Proposed Transactions,


 


provided that this clause shall not exclude
any liability for (or remedy in respect of) fraudulent misrepresentation.  Each Relevant Party agrees to the terms of
this clause 23 on its own behalf and as
agent for each of its Connected Persons. 
For the purpose of this clause, Connected Persons means (in relation to a
Relevant Party) the officers, employees, agents and advisers of that Relevant
Party or any of its Affiliates.


 


24.    RIGHT OF SET-OFF


 


24.1         The Purchaser shall have the right to
set off any amounts due to it from the Seller in respect of a Claim against an
equal amount of Earnout Consideration which it would otherwise be obliged to
pay to the Seller, provided that the Purchaser has first delivered (or shall
deliver within 10 Business Days of such amount of Earnout Consideration
falling due) to the Seller an opinion by an English Queen’s Counsel of more
than 10 years call addressed to the Purchaser and the Seller to the effect that
in his or her opinion the Claim is more likely than not to be upheld by an
arbitral tribunal constituted under the rules of the LCIA and that the
quantum of such Claim is reasonable (an External Counsel Opinion).
Such an opinion shall set out the facts on which such an opinion is based. If
the Seller does not agree with the facts stated in such opinion, it may make
written representations to the issuer of the opinion, who shall consider such
representations and revise the opinion as necessary. For the avoidance of
doubt, the amount that the Purchaser may set off in such manner shall not
exceed 20% of the Final Price.


 


24.2         In the event that the Seller exercises
its right of termination pursuant to clause 8.1 of the Management Agreement or
the Parent Company exercises its right of termination pursuant to clause 8.2 of
the Management 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


20

















 


Agreement
prior to 31 January 2009, the Seller shall procure that a person
satisfying the criteria set out in clause 14.1 of the Management Agreement
provides a guarantee of the Seller’s financial obligations under this
Agreement. Such guarantee shall be limited to the amount paid to the Seller
pursuant to clause 8.1 of the Management Agreement (if the Seller exercises its
right of termination) or the amount that would have been paid to the Seller if
it had exercised its right of termination (if the Purchaser exercises its right
of termination) (but in any event shall not exceed 20% of the Final Price) and
shall expire on 31 January 2009 (or, if later, upon the settlement in full
by the Seller of the Claim) provided that the Claim is notified to the Seller
prior to 31 January 2009 and provided that the Purchaser has first
delivered (or shall deliver no later than 10 Business Days after such
termination of the Management Agreement) to the Seller an External Counsel
Opinion).


 


25.    GUARANTEE


 


25.1         In consideration of the Seller entering
into this Agreement, the Parent Company unconditionally and irrevocably
guarantees to the Seller and AES London Holdings BV as a continuing obligation
that the Purchaser will comply properly and punctually with its financial
obligations under this Agreement and its obligations (together, the Guaranteed Obligations) under
clauses 3.2, 6.1, 15, 16, 17 and 18 and each Transaction
Document.


 


25.2         The Parent Company’s liability under
clause 25.1 shall not be discharged or impaired by:


 


(a)                                  any amendment, variation or
assignment of this Agreement or any Transaction Document or any waiver of its
or their terms;


 


(b)                                 any release of, or granting of
time or other indulgence to, the Purchaser or any third party;


 


(c)                                  any winding up, dissolution,
reconstruction, legal limitation, incapacity or lack of corporate power or
authority or other circumstances affecting the Purchaser (or any act taken by
the Seller in relation to any such event); or


 


(d)                                 any other act, event, neglect
or omission (whether or not known to the Purchaser, the Seller or the Parent
Company) which would or might (but for this clause) operate to impair or
discharge the Parent Company’s liability or afford the Parent Company or the
Purchaser any legal or equitable defence;


 


25.3         In consideration of the Seller entering
into this Agreement, , the Parent Company, undertakes to perform as a primary
obligation the Guaranteed Obligations.


 


26.    WAIVERS, RIGHTS
AND REMEDIES


 


Except as expressly provided in this Agreement,
no failure or delay by either party in exercising any right or remedy relating
to this Agreement or any of the Transaction Documents shall affect or operate
as a waiver or variation of that right or remedy or preclude its exercise at
any subsequent time.  No single or
partial exercise of any such right or remedy shall preclude any further
exercise of it or the exercise of any other remedy.


 


27.    COUNTERPARTS


 


This Agreement may be executed in any
number of separate counterparts, each of which is an original but all of which
taken together shall constitute one and the same instrument.


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


21

















 


28.    VARIATIONS


 


No amendment of this Agreement (or of any
other Transaction Document) shall be valid unless it is in writing and duly
executed by or on behalf of all of the parties to it.


 


29.    INVALIDITY


 


Each of the provisions of this Agreement
and the other Transaction Documents is severable.  If any such provision is held to be or
becomes invalid or unenforceable in any respect under the law of any
jurisdiction, it shall have no effect in that respect and the parties shall use
all reasonable efforts to replace it in that respect with a valid and
enforceable substitute provision the effect of which is as close to its
intended effect as possible.


 


30.    NO THIRD PARTY
ENFORCEMENT RIGHTS


 


A person who is not a party to this
Agreement shall have no right under any statutory provision to enforce any of
its terms.


 


 


31.    GOVERNING LAW
AND JURISDICTION


 


31.1         This Agreement shall be governed by,
and interpreted in accordance with, English law.


 


31.2         In the event of any dispute,
controversy or claim arising out of or in connection with this Agreement,
including the breach, termination or invalidity of it (Dispute), either
party may serve formal written notice on the other party that a Dispute has
arisen (Notice of
Dispute).  The parties
shall use all reasonable efforts for a period of 30 calendar days from the date
on which the Notice of Dispute is served by one party on the other party (or
such longer period as may be agreed in writing between the parties) to resolve
the Dispute on an amicable basis.  If the
parties agree that a matter is capable of resolution by an independent expert,
such matter shall be referred to such independent expert (on such terms as the
parties may agree in writing) for resolution and, save in respect of any
manifest error, the decision of such expert shall be final and binding on the
parties.


 


31.3         If the parties are unable to resolve
the Dispute by amicable negotiation within the time period referred to in
clause 31.2, the Dispute shall be immediately referred to the Chief
Operating Officer of AES on behalf of the Seller and Andrei Tretyakov on behalf
of the Purchaser (or, in either case, such other executive officer of a similar
level as the Seller or, as the case may be, the Purchaser nominates in writing
to the other party) who shall attempt, for a period of seven days from the date
of such referral, to resolve the Dispute. 
In the event that such persons are unable to resolve the Dispute within
the stated time period (or such longer agreed period), the Dispute shall be
referred to arbitration in accordance with the remaining provisions of this
clause 31.


 


31.4         Subject to clauses 31.2
and 31.3, the Dispute shall be referred to and
finally resolved by arbitration at the London Court of International
Arbitration under the UNCITRAL Arbitration Rules by three arbitrators
appointed in accordance with those Rules.  The seat of arbitration shall be London,
England.  The language to be used in the
arbitral proceedings shall be English.


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


22














SCHEDULE 1


 


TARGET COMPANIES


 


The following entities shall be considered the Target
Companies (as shown in the chart on the following page)


 


 


 


 


 


 


 




	
   

  	
  Target
  Company

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  AES Maikuben
  LLP, Kazakhstan

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Maikuben
  West LLP, Kazakhstan

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  AES
  Ekibastuz LLP, Kazakhstan

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  AES Suntree
  Power Ltd., Ireland

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Kilcormac
  Trading Ltd., Cyprus

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Electric
  Power Holding VOF,

  Netherlands

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  AES Coal
  LLP, Kazakhstan

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Argamak 2007
  LLP, Kazakhstan

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Maikuben
  Mine LLP, Kazakhstan

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Maikuben
  Electric LLP, Kazakhstan

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Maikuben
  Coal LLP, Kazakhstan

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  AES
  Kazelectro NV, Netherlands

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  






 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


23

















 


 





 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


24














 


SCHEDULE 2


 


LIMITATIONS ON LIABILITY


 


1.             Time
Limits.  The Seller shall not be
liable for any Claim unless the Seller receives from the Purchaser written
notice (within 60 days of the Purchaser becoming aware of such Claim)
containing reasonably specific details of the Claim including, where reasonably
possible, the Purchaser’s estimate (on a without prejudice basis) of the amount
of the Claim no later than 31 January 2009.


 


	
  2.

  	
   

  	
  Thresholds
  for Claims.  The Seller shall not be
  liable for any single Claim:

   

  
	
   

  	
   

  	
   

  
	
  (a)

  	
   

  	
  unless the amount of the liability
  pursuant to that single Claim exceeds $2,000,000 (in which case the Purchaser
  shall be able to claim only for the excess over $2,000,000); and

  
	
   

  	
   

  	
   

  
	
  (b)

  	
   

  	
  unless the aggregate amount of the
  liability of the Seller for all Claims not excluded by sub-paragraph (a)
  exceeds $10,000,000 (in which case the Purchaser shall be entitled to claim
  the whole amount and not merely the excess).

  



 


If more than one Claim arises from, or is
caused by, the same or substantially the same matter, matters, circumstance or
circumstances and the aggregate amount of damages to which the Purchaser would
be entitled as a result of those Claims is equal to or exceeds the sum
specified in subparagraph (a) of this paragraph 2, sub-paragraph 2(a) shall
not apply to any of those Claims.


 


3.             Maximum
limit for all Claims.  The aggregate
amount of the liability of the Seller shall not exceed:


 


(i)          20%
of the Final Price in respect of all Claims (including any amounts of
expenditure incurred by the Seller pursuant to clause 7.3  above) other than any Claims in respect of a
breach of any Title Warranty; and


 


(ii)         100%
of the Final Price in respect of any Claims in respect of a breach of any Title
Warranty less all other Claims made up to the 20% limit in (i) above.


 


4.             Claim
to be withdrawn unless litigation commenced.  Any Claim shall (if it has not been
previously satisfied, settled or withdrawn) be deemed to have been withdrawn
6 months after the notice is given pursuant to paragraph 1 of this
Schedule or, in the case of a contingent liability, 6 months after that
liability becomes an actual liability, unless legal proceedings in respect of
it have been commenced by being both issued and served (unless the Claim arises
as a result of, or in connection with, a Third Party Claim and the Seller shall
have assumed the conduct of the Third Party Claim in accordance with Clause 7
of this Agreement).  No new Claim may be
made in respect of the facts, matters, events or circumstances giving rise to
any such withdrawn Claim.


 


5.             No
other Seller Warranties.  The
Purchaser acknowledges and agrees that no Seller Warranties are given in
relation to any matters except those set out in clause 7 of this
Agreement.


 


6.             Matters
disclosed.  The Seller shall not be
liable for any Claim for breach of the Warranties if and to the extent that the
fact, matter, event or circumstance giving rise to such Claim is disclosed by
this Agreement, any other Transaction Document, the General Disclosures as per Schedule
5, the Disclosure Letter, any document disclosed in the Data Room or any
disclosure through any discussions with the Seller or its Representatives.


 


 


25

















 


 


7.             Matters
taken into account in adjustments. 
The Seller shall not be liable for any Claim if and to the extent that
the fact, matter, event or circumstance giving rise to the Claim is provided
for or otherwise taken into account in the Closing Statement or any consequent
adjustment to the Initial Price.


 


8.             Seller
Awareness.  The Seller shall not be
liable for any Claim for breach of the Seller Warranties under this Agreement
if and to the extent that the Seller is not aware at the date of this Agreement
(i) of the fact, matter, event or circumstance which is the subject matter
of the Claim or (ii) that the fact, matter, event or circumstance could
reasonably be expected to amount to a Claim.


 


9.             Contingent
liabilities.  If any Claim is based
upon a liability which is contingent only, the Seller shall not be liable to
make any payment unless and until such contingent liability gives rise to an
obligation to make a payment (but the Purchaser has the right under
paragraph 1 of this Schedule 2 to give notice of that Claim before such
time and shall be entitled to exercise a right of set off in respect of such
Claim in accordance with the terms of clause 24).


 


10.           No
liability for Claims arising from acts or omissions of Purchaser.  The Seller shall not be liable for any Claim
to the extent that it would not have arisen but for, or has been increased or
not reduced as a result of, any voluntary act, omission or transaction carried
out:


 


	
  (a)

  	
   

  	
  after Closing by the Purchaser or any
  member of the Purchaser Group (or its respective directors, employees or
  agents or successors in title) outside the ordinary and usual course of
  business of a Group Company as at Closing; or

  
	
   

  	
   

  	
   

  
	
  (b)

  	
   

  	
  before Closing by any member of the
  Seller Group or any Group Company at the direction or request of the
  Purchaser or any member of the Purchaser Group.

  



 


11.           Purchaser’s
duty to mitigate.  The Purchaser
shall procure that all reasonable steps are taken to avoid or mitigate any loss
or damage which it may suffer in consequence of any breach by the Seller of the
terms of this Agreement or any fact, matter, event or circumstance likely to
give rise to a Claim.


 


12.           Insured
Claims.  The Seller shall not be
liable in respect of any Claim to the extent that the amount of such Claim is
covered by a policy of insurance or would have been so covered if the policies
of insurance effected by or for the benefit of the Group Companies had been
maintained after Closing on no less favourable terms than those existing at the
date of this Agreement.


 


13.           Recovery
from third party after payment from Seller. 
Where the Seller has made a payment to the Purchaser in relation to any
Claim (to the extent such payment does not comprise interest on late payment)
and the Purchaser or any member of the Purchaser Group is entitled to recover
(whether by insurance, payment, discount, credit, relief or otherwise) from a
third party a sum which indemnifies or compensates the Purchaser or any member
of the Purchaser Group (in whole or in part) in respect of the liability or
loss which is the subject of a Claim, the Purchaser or relevant member of the
Purchaser Group shall (i) promptly notify the Seller of the fact and
provide such information as the Seller may reasonably require (ii) take
all reasonable steps or proceedings as the Seller may require to enforce such
right and (iii) pay to the Seller as soon as practicable after receipt an
amount equal to any amount by which the total of (i) any such sum received
by the Purchaser from that third party and (ii) any 


 


 


26

















 


such payment
received by the Purchaser from the Seller exceeds the amount required to
compensate the Purchaser in full under this Agreement for the matter or
circumstance which gave rise to the relevant Claim (net of taxation and less
any reasonable costs of recovery).


 


14.           Net financial benefit.  The Seller shall not be liable to satisfy any
Claim to the extent of any corresponding saving by or net quantifiable
financial benefit to the Purchaser or any member of the Purchaser Group arising
from the matter(s) giving rise to such Claim, including the amount (if
any) by which any tax for which the Purchaser or any member of the Purchaser
Group would otherwise have been accountable or liable to be assessed is
actually reduced or extinguished as a result of the matter(s) giving rise
to the Claim.


 


15.           No liability for legislation or
changes in rates of tax.  The Seller
shall not be liable for any Claim if and to the extent it is attributable to or
the amount of such Claim is increased as a result of any (i) legislation
not in force at the date of this Agreement (ii) change of law (including
any enactment or introduction of any new law or any change in the
interpretation of, or any extension of or designations under, any existing law
or the repeal of any existing law or the alteration or termination (unless
replaced or no longer required under applicable law) of any relevant consent
from a Governmental Entity, regulation, directive, requirement or
administrative practice or (iii) change in the rates of taxation in force
at the date of this Agreement.


 


16.           No double recovery.  The Purchaser shall not be entitled to
recover damages or obtain payment, reimbursement, restitution or indemnity more
than once in respect of any one liability, loss, cost, shortfall, damage,
deficiency, breach or other set of circumstances which gives rise to more than
one Claim.


 


17.           Consequential loss.  Neither the Purchaser nor any member of the
Purchaser Group shall be entitled to claim for any punitive, special, indirect
or consequential loss or loss of profit or for any loss of goodwill or possible
business after Closing, whether actual or prospective.


 


18.           Purchaser’s knowledge.  The Seller shall not be liable for any Claim
for breach of the Seller Warranties if and to the extent that the Purchaser or
any of its Affiliates or Representatives is aware at the date of this Agreement
(i) of the fact, matter, event or circumstance which is the subject matter
of the Claim and (ii) that the fact, matter, event or circumstance could
reasonably be expected to likely amount to a Claim.


 


19.           Waiver of right of set-off.  Save as expressly provided in clause 24
of this Agreement, the Purchaser waives and relinquishes any right of set-off
or counterclaim, deduction or retention which the Purchaser might otherwise
have in respect of any Claim against or out of any payments which the Purchaser
may be obliged to make (or procure to be made) to the Seller pursuant to this
Agreement or otherwise.


 


20.           Seller to have opportunity to
remedy breaches.  Without prejudice
to the Purchaser’s right to make any set off under clause 24.1,
if a breach of the Seller Warranties is capable of remedy, the Purchaser shall
only be entitled to compensation if it gives the Seller written notice of the
breach and the breach is not remedied within 180 days after the date on
which such notice is served on the Seller. 
Without prejudice to its duty to mitigate any loss, the Purchaser shall
(or shall procure that any relevant member of the Purchaser Group shall)
provide all reasonable assistance to the Seller and/ or any of its Affiliates,
at their cost, to remedy any such breach.


 


21.           Application.  Nothing in this Schedule
2 shall
operate to limit the Seller’s liability in respect of any Claim which arises
(or to the extent it is increased) as a result of fraud or


 


 


27

















 


fraudulent
misrepresentation by a director, officer or senior manager of any member of the
Seller Group or any fraud or fraudulent misrepresentation by the Seller in
connection with the disclosure of written documents or written information to
the Purchaser and its Representatives at any time prior to the execution of
this Agreement).


 


22.           Disapplication of Limitations.   The limitations set out in paragraphs 6, 8 and 18 above shall not apply to any Claim in respect of a breach of Title
Warranty or to any Claim under clause 7.2(1).


 


 


 


 


 


 


 


 


 


 


 


 


 


28





















 


SCHEDULE 3


 


PURCHASER WARRANTIES


 


1.             The Purchaser is validly
incorporated, in existence and duly registered under the laws of its
jurisdiction and has full power to conduct its business as conducted at the
date of this Agreement.


 


2.             The Purchaser has obtained all
corporate authorisations (including, for the avoidance of doubt, all necessary
board and shareholder approvals) and has obtained or will have obtained at
Closing all other governmental, statutory, regulatory or other consents,
licences and authorisations required to empower it to enter into and perform
its obligations under this Agreement where failure to obtain them would
adversely affect to a material extent its ability to enter into and perform its
obligations under this Agreement.


 


3.             Entry into and performance by the
Purchaser and the Parent Company of this Agreement and/or any Transaction
Document to which it is a party will not (i) breach any provision of its
memorandum and articles of association, by-laws or equivalent constitutional
documents or (ii) result in a breach of any laws or regulations in its
jurisdiction of incorporation or of any order, decree or judgment of any court
or any governmental or regulatory authority, where (in either case) the breach
would adversely affect to a material extent its ability to enter into or
perform its obligations under this Agreement and/or any Transaction Document to
which it is a party.


 


4.             No member of the Purchaser Group
(other than an Affiliate which is not material in the context of the Purchaser
Group as a whole, does not hold a direct or indirect stake in the Purchaser and
is not a Subsidiary Undertaking of the Purchaser) is insolvent or bankrupt
under the laws of its jurisdiction of incorporation, unable to pay its debts as
they fall due or has proposed or is liable to any arrangement (whether by court
process or otherwise) under which its creditors (or any group of them) would
receive less than the amounts due to them. 
No member of the Purchaser Group has received or made any written
communication concerning any proceedings in relation to any compromise or arrangement
with creditors or any winding up, bankruptcy or insolvency proceedings
concerning and no member of the Purchaser Group is aware of any events that
have occurred which would justify such proceedings.  no member of the Purchaser Group has received
any written communication in respect of any steps taken to enforce any security
over any assets of any member of the Purchaser Group and no member of the
Purchaser Group is aware of any event that has occurred to give the right to
enforce such security.


 


5.             So far as the Purchaser or any
member of the Purchaser Group is aware, neither the Purchaser nor any of its
Affiliates is subject to any order, judgment, direction, investigation or other
proceedings by any Governmental Entity which will, or are likely to, prevent or
delay the Closing.


 


6.             The Purchaser has available cash or
available loan facilities which will at Closing provide in immediately
available funds the necessary cash resources to pay the Initial Price as
calculated under clause 2.1 of this Agreement and meet
its other obligations under this Agreement and, in the case of loan facilities,
they involve no material pre-conditions that would prevent the Purchaser from
satisfying all conditions of drawdown to such loan facilities at or prior to
Closing.


 


7.             Without prejudice to the Purchaser’s
rights under the Seller Warranties, the Purchaser acknowledges that it has such
knowledge and experience in financial and business matters and in the Kazakh
power and mining sectors that it is capable of evaluating the Proposed
Transactions and the merits and risks of an investment in the Shares.  The Purchaser further acknowledges that it
has received the Disclosure Letter.


 


29

















 


8.             Without prejudice to the
Purchaser’s rights under the Seller Warranties, the Purchaser acknowledges and
affirms that it has completed its own independent investigation, analysis and
evaluation of the Group Companies, that it has made all such reviews and
inspections of the business, assets, results of operations and condition (financial
or otherwise) of the Group Companies as it has deemed necessary or appropriate,
and that in making its decision to enter into this agreement and to consummate
the transactions contemplated hereby it has relied on its own independent
investigation, analysis, and evaluation of the Group Companies.


 


9.             The Purchaser is not aware of any
facts or circumstances which could reasonably be expected to result in a Claim
being made against the Seller or any misrepresentation by or on behalf of the
Seller in connection with the Proposed Transactions.


 


10.           The Purchaser shall, in entering into
and performing its obligations under this Agreement and/ or any Transaction
Document, comply with the AES Compliance Terms and Conditions (as set out in Schedule 6).


 


11.           For the avoidance of doubt and at the
request of the Seller, the Purchaser and the Parent Company confirm that they
do not benefit from sovereign immunity.


 


 


 


 


 


 


 


 


 


 


 


30





















 


SCHEDULE 4


 


CLOSING ARRANGEMENTS


 


Part A : Pre-Closing


 


1.             Access


 


Until Closing the Seller shall:


 


	
  (a)

  	
   

  	
  procure that the Purchaser and its
  Representatives are given reasonable access to the properties, assets and to
  the books and records of the Group Companies during normal business hours on
  any Business Day and on reasonable notice to the Seller; and

  
	
   

  	
   

  	
   

  
	
  (b)

  	
   

  	
  provide such information regarding the
  businesses and affairs of the Group Companies as the Purchaser may reasonably
  require,

  



 


provided that:


 


	
  (a)

  	
   

  	
  the provision of such information is not
  unduly disruptive to the operation of the Kazakh Business;

  
	
   

  	
   

  	
   

  
	
  (b)

  	
   

  	
  the provision of such access or
  information does not breach any applicable law or regulation; and

  
	
   

  	
   

  	
   

  
	
  (c)

  	
   

  	
  the Purchaser and its Representatives
  comply in full with AES security and safety procedures when accessing the
  properties of the Group Company.

  
	
   

  	
   

  	
   

  
	
  2.

  	
   

  	
  Conduct of business

  



 


Until Closing the Seller shall procure
that, except with the written consent of the Purchaser, each Group Company
shall be operated in the ordinary course in all material respects (to the
extent permitted by applicable law and save in respect of any Tariff Freeze
agreed between the parties), that no Group Company acts in a manner
inconsistent with the framework implied by the Management Agreement in any material
respect without the Seller consulting with the Purchaser (assuming the
Purchaser responds in an appropriate and timely manner) in respect of such
action (to the extent that it is lawful and practicable to do so) and that no
Group Company shall:


 


	
  (a)

  	
   

  	
  declare, make or pay any dividend or
  other distribution; or

  
	
   

  	
   

  	
   

  
	
  (b)

  	
   

  	
  create, issue, purchase or redeem any
  class of share or loan capital; or

  
	
   

  	
   

  	
   

  
	
  (c)

  	
   

  	
  form, other than as a part of the
  Reorganisation, any subsidiary or acquire shares in any company or participate
  in, or terminate any participation in, any partnership or joint venture; or

  
	
   

  	
   

  	
   

  
	
  (d)

  	
   

  	
  pass any resolution of its shareholders
  or any class of shareholders, whether in general meeting or otherwise (except
  (i) as required in connection with or for the purposes of the
  Reorganisation or (ii) with the prior consent of the Purchaser which
  shall not be unreasonably withheld or delayed);

  



 


 


31

















 


 


	
  (e)

  	
   

  	
  agree, conditionally or otherwise, to do
  any of the foregoing.

  



 


Part B  : Seller Obligations


 


At Closing, the Seller shall deliver or
ensure that there is delivered to the Purchaser (or made available to the
Purchaser’s reasonable satisfaction):


 


	
  (a)

  	
   

  	
  the share registers of the Companies
  showing the Seller’s ownership of the Shares;

  
	
   

  	
   

  	
   

  
	
  (b)

  	
   

  	
  an apostilled certificate of tax
  residence of the Seller; and

  
	
   

  	
   

  	
   

  
	
  (c)

  	
   

  	
  a duly executed notarial deed of transfer
  in respect of the Shares.

  



 


Part C : Purchaser
Obligations


 


At Closing, the Purchaser shall:


 


	
  (a)

  	
   

  	
  deliver (or ensure that there is
  delivered to the Seller) (to the extent not previously delivered) a copy of a
  resolution (certified by a duly appointed officer as true and correct) of the
  board or, as applicable, supervisory board of directors of the Purchaser and
  the Parent Company as appropriate (or, if required by the law of its
  jurisdiction or its articles of association, by-laws or equivalent
  constitutional documents, of its shareholders) authorising the execution of
  and the performance by the Purchaser and the Parent Company of its
  obligations under this Agreement and each of the Transaction Documents to be
  executed by it;

  
	
   

  	
   

  	
   

  
	
  (b)

  	
   

  	
  deliver duly executed copies of the power
  of attorney of the Parent and Owners required to be delivered pursuant to
  Clauses 3.15 and 3.16 of the Management Agreement;

  
	
   

  	
   

  	
   

  
	
  (c)

  	
   

  	
  pay to the Seller the Initial Price in
  accordance with clause 2.1; and

  
	
   

  	
   

  	
   

  
	
  (d)

  	
   

  	
  deliver a duly executed notarial deed of
  transfer in respect of the Shares.

  



 


Part D : Inter
Company Debt


 


At Closing,


 


	
  (a)

  	
   

  	
  the Seller shall procure the execution by
  AES London Holdings BV and the Purchaser shall execute any Transaction
  Documents as may be required in order to assign the Inter-Company Debt to the
  Purchaser, free of any Encumbrances;

  
	
   

  	
   

  	
   

  
	
  (b)

  	
   

  	
  the Seller and the Purchaser shall carry
  out their respective obligations under Schedule 8 (Inter-Company Debt)
  required to be performed at Closing.

  



 


 


 


 


32

















 


Part E : General


 


	
  1.

  	
   

  	
  The Seller and the Purchaser shall
  negotiate in good faith with a view to agreeing before the Closing Date the
  final form of any Transaction Document reasonably acceptable to all parties
  thereof which is not in Agreed Form at the date of this Agreement.

  
	
   

  	
   

  	
   

  
	
  2.

  	
   

  	
  All documents and items delivered at
  Closing pursuant to this Schedule 4 shall be held by the recipient to the
  order of the person delivering the same until such time as Closing shall be
  deemed to have taken place. Simultaneously with:

  
	
   

  	
   

  	
   

  
	
  (a)

  	
   

  	
  delivery of all documents and all items
  required to be delivered at Closing (or waiver of its delivery by the person
  entitled to receive the relevant document or item); and

  
	
   

  	
   

  	
   

  
	
  (b)

  	
   

  	
  receipt of an electronic funds transfer
  to the Seller’s Bank Account in immediately available funds of the Initial
  Price,

  



 


the documents and items delivered in
accordance with this Schedule shall cease to be held to the order of the person
delivering them and Closing shall be deemed to have taken place.


 


 


 


 


 


 


 


 


 


 


33

















 


SCHEDULE 5


 


GENERAL DISCLOSURES


 


	
  1.

  	
   

  	
  The Purchaser shall be deemed to have
  full knowledge of:

  
	
   

  	
   

  	
   

  
	
  (a)

  	
   

  	
  to the extent Fairly Disclosed, all
  matters contained in written correspondence, documents and other information
  delivered, sent or given to (or made available for inspection by) the
  Purchaser or any member of the Purchaser Group or any of its advisers by the
  Seller or any of its advisers, and any matter referred to in any of them;

  
	
   

  	
   

  	
   

  
	
  (b)

  	
   

  	
  all information contained on the files or
  any document, register or record maintained by the Registrar of Companies in
  Ireland, Cyprus, the Netherlands and Kazakhstan in relation to any Group
  Company and which the public may inspect as at 31 January 2008;

  
	
   

  	
   

  	
   

  
	
  (c)

  	
   

  	
  all information in relation to any Group
  Company which would be revealed by a search made on 31 January 2008
  at any court registry or registry of winding up searches in Ireland or the
  Netherlands;

  
	
   

  	
   

  	
   

  
	
  (d)

  	
   

  	
  all information in relation to any Group
  Company which would be revealed by an inspection or search as at 31
  January 2008 of any document, register or record which the public may
  inspect in Ireland, Cyprus, the Netherlands or Kazakhstan;

  
	
   

  	
   

  	
   

  
	
  (e)

  	
   

  	
  to the extent Fairly Disclosed, all
  information contained or referred to in the information memorandum sent to
  the Purchaser or any member of the Purchaser Group on
  4 December 2007;

  
	
   

  	
   

  	
   

  
	
  (f)

  	
   

  	
  all matters of which the Purchaser or any
  member of the Purchaser Group ought reasonably to be aware as affecting the
  business sectors within which the Group Companies operate and/or which are
  known generally by those operating within such business sectors;

  
	
   

  	
   

  	
   

  
	
  (g)

  	
   

  	
  any information which would be revealed
  by an inspection or search on 31 January 2008 of any document, register
  or record which the public may inspect and which is maintained by any
  registry of trade marks, patents, designs, domain
  names (where that information relates to any domain name that incorporates
  any trade mark that would be revealed upon an inspection or search of a trade
  marks registry in accordance with this paragraph 1(g) followed by one of
  the general top-level domains .com,
  .net, .info or .biz, or followed by a country code top-level domain) or other intellectual
  property in any jurisdiction, or information which is available to the public
  from any such registry;

  
	
   

  	
   

  	
   

  
	
  (h)

  	
   

  	
  without prejudice to the generality of
  any of the foregoing paragraphs, in relation to any and all of the
  Properties:

  



 


(i)          any
information which would be revealed by an inspection or search on 31 January 2008
of any document, register or record which the public may inspect and which are
maintained by, or information which is available to the public from, any land
registry and any register of local land charges in any jurisdiction; and


 


(ii)         all
matters which would be revealed by searches or enquiries carried out on
31 January 2008 at the relevant local authorities or any other body
or authority which a prudent purchaser of the Properties would make having
regard to the nature and use of the Properties; and


 


(iii)        any
matter which would be revealed by an inspection and/or survey by suitably
qualified technical consultants.


 


34














 


SCHEDULE 6


 


AES COMPLIANCE TERMS
AND CONDITIONS


 


In connection
with the sale and purchase agreement to which this Schedule forms a part (the Main Agreement), the Purchaser
hereby represents and warrants to and agrees with the Seller that, in respect
of the Proposed Transactions, the Purchaser shall be legally bound as follows:


 


1.             The Purchaser shall comply fully
with all applicable laws of the countries in which the Proposed Transactions
are conducted as well as the applicable anti-corruption, anti-money laundering,
anti-terrorism and economic sanction and anti-boycott laws of the United States
including without limitation, the United States Foreign Corrupt Practices Act
(the Applicable  Laws and
Regulations).


 


2.             The Purchaser represents and
warrants that it has not, and that it has no evidence of any kind that any of
its owners, controlling shareholders, directors, officers, employees or any
other person acting on its behalf (including, without limitation, any of its
Affiliates, contractors, subcontractors, consultants, representatives or
agents) has, either directly or indirectly:


 


(a)                                  Made a Prohibited
Payment, with respect to the Proposed Transactions, which is
defined to include any offer, gift, payment, promise to pay, or authorization
of the payment of any money or anything of value, directly or indirectly, to (i) any
officer or employee of a government (other than the U.S. government),
department (whether executive, legislative, judicial or administrative), agency
or instrumentality of such government, including a regional governmental body
or a government-owned business, or of a public international organization; (ii) any
person acting in an official capacity for or on behalf of such government,
department, agency, instrumentality, or public international organization; (iii) any
candidate for a political or government office or appointee to such office; or (iv) any
(other than U.S.) political party outside of the United States (each a Government
Official), including for the use or benefit of any other person
or entity, to the extent that one knows or has reasonable grounds for believing
that all or a portion of the money or thing of value which was given or is to
be given to such other person or entity, will be paid, offered, promised, given
or authorised to be paid by such other person or entity, directly or
indirectly, to a Government Official, for the purpose of either (i) influencing
any act or decision of the Government Official in his official capacity; (ii) inducing
the Government Official to do or omit to do any act in violation of his lawful
duty; (iii) securing any improper advantage; or (iv) inducing the
Government Official to use his influence with a non-U.S. government or
instrumentality thereof to affect or influence any act or decision of such
government or instrumentality, in order to assist in obtaining or retaining
business or in directing business to any party.


 


(b)                                 Engaged in a Prohibited Transaction with respect
to the Proposed Transactions which is defined to include:


 


	
  (i)

  	
   

  	
  receiving,
  transferring, transporting, retaining, using, structuring, diverting, or
  hiding the proceeds of any criminal activity whatsoever, including drug
  trafficking, fraud, and bribery of a Government Official;

  
	
   

  	
   

  	
   

  
	
  (ii)

  	
   

  	
  engaging or
  becoming involved in, financing, or supporting financially or otherwise,
  sponsoring, facilitating, or giving aid to any terrorist person, activity or
  organization; or

  



 


 


 


 


35

















 


	
  (iii)

  	
   

  	
  participating
  in any transaction or otherwise conducting business with a “designated
  person,” namely a person or entity that appears on any list issued by the
  United States or the United Nations with respect to money laundering,
  terrorism financing, drug trafficking, or economic or arms embargoes (a Designated Person).

  



 


3.             The Purchaser will not and shall
take all reasonable steps to ensure that none of its owners, controlling
shareholders, officers, employees and other persons working for it on the
Proposed Transactions (including, without limitation, its Affiliates,
contractors, subcontractors, consultants, representatives and agents), directly
or indirectly, make, promise or authorize the making, of a Prohibited Payment
or engage in a Prohibited Transaction with respect to the Proposed
Transactions.


 


4.             The Purchaser shall promptly report
to the Seller any Prohibited Payment or Prohibited Transaction of which it
obtains knowledge, or has reasonable grounds to believe occurred in respect of
the Proposed Transactions.


 


5.             The Purchaser agrees that, if the Seller
has any reasonable grounds to believe that a Prohibited Payment has been made,
promised or authorised, directly or indirectly, to a Government Official in
connection with the Proposed Transactions, or that a Prohibited Transaction has
taken place in connection with the Proposed Transactions, it shall cooperate in
good faith with the Seller in determining whether such a violation occurred by
engaging an independent third party to investigate the matter and to provide a
written report of its findings to the Seller and the Purchaser.


 


6.             The Purchaser has not and will not,
either directly or indirectly, share or promise to share its fees or any other
funds it receives from the Seller or in respect of the Proposed Transactions
with any Government Official.


 


7.             The Purchaser agrees that a
material breach of one or more of the covenants or representations of the
Purchaser in this Schedule shall be sufficient cause for the Seller, acting in
good faith, and not without reasonable prior written notice, to terminate the
Main Agreement and the Proposed Transactions, in whole or in part, and to
declare them null and void, in which case the Purchaser agrees that it shall be
liable for any damages or remedies available to the Seller under applicable
law.


 


8.             This Schedule shall be considered
to be an integral part of the Main Agreement (and shall be effective on the
same date as the Main Agreement).  In the
event of a conflict between this Schedule and the Main Agreement, this Schedule
shall prevail.


 


9.             All the provisions in this Schedule
are material and shall survive the termination of Main Agreement.


 


10.           The Purchaser shall not assign its
rights and responsibilities contained in this Schedule to a third party without
the prior written approval of the Seller.


 


 


 


36

















 


SCHEDULE 7



EARNOUT CONSIDERATION


 


 


Part A : Definitions relating to this
Schedule


 


1.1           For the purposes of this Agreement,
the following expressions shall have the following meanings:


 


Capex means the amount of capital expenditure
incurred in a given financial period, as determined in accordance with IFRS;


 


Change in Law has the meaning given to it in the
Management Agreement;


 


Earnout Consideration means
any of the First Earnout Consideration, the Second Earnout Consideration or the
Third Earnout Consideration;


 


Earnout Income Statements means the income statements
for the relevant Earnout Period prepared in Kazakh tenge and converted into US
dollars at the exchange rates set out in Part B below for the purposes of
calculating OP1, OP2 and OP3;


 


Earnout Period means any of the First Earnout Period, the
Second Earnout Period and the Third Earnout Period;


 


EBITDA means the consolidated profit before
interest (both receivable and payable), taxation, depreciation and amortisation
of the Group Companies, determined in accordance with IFRS and applying
accounting policies as set out in Part
E of this
Schedule, and as adjusted in accordance with Part
D of this
Schedule and in accordance with Clauses 3.3, 3.26B, 4.6, 4.14 and 13.5(b)(ii) of
the Management Agreement;


 


Expert has the meaning given to it in the
Management Agreement;


 


First Earnout Consideration means a maximum amount of
$105 million calculated in accordance with paragraph 2 of
Part B of this Schedule;


 


First Earnout Period means the twelve month period
from 1 January 2008 to 31 December 2008;


 


High Target means the minimum EBITDA required for the
maximum Earnout Consideration to be payable with respect to any Earnout Period;


 


OP1 means the EBITDA in US dollars for the
First Earnout Period (converted from Kazakh Tenge at the exchange rate set out
below);


 


OP2 means the EBITDA in US dollars for the
Second Earnout Period (converted from Kazakh Tenge at the exchange rate set out
below);


 


OP3 means the EBITDA in US dollars for the
Third Earnout Period (converted from Kazakh Tenge at the exchange rate set out
below);


 


Payment Date means in respect of each Earnout Period,
7 days after the date on which the Earnout Consideration for the relevant
Earnout Period shall be deemed to have been determined in accordance with Part C
of this Schedule (or, if earlier, the date on which payment in respect of such
Earnout Period is required in accordance with paragraphs 3 or 5 of Part F
below);


 


 


 


37

















 


Permitted
Tariffs has the meaning given to it in paragraph 4 of Part D;


 


Relevant Amount  means each of OP1, OP2 and OP3;


 


Relevant Period means the period commencing on the Closing
Date and ending on the final day of the Third Earnout Period or, if earlier,
the date on which the Management Agreement terminates;


 


Second Earnout Consideration means a maximum amount of
$105 million calculated in accordance with paragraph 3 of
Part B of this Schedule;


 


Second Earnout Period means the twelve month period
from 1 January 2009 to 31 December 2009;


 


Termination Payment has the meaning given to it in the
Management Agreement;


 


Three Year Period means the three year period from 1 January 2008
to 31 December 2010;


 


Third Earnout Consideration means a maximum amount of
$110 million calculated in accordance with paragraph 4 of
Part B of this Schedule (subject to the
adjustment set out in Part G of this Schedule);


 


Third Earnout Period means the twelve month period
from 1 January 2010 to 31 December 2010; and


 


Unit 8 means Unit 8 of the Ekibastuz power plant.


 


 


 


38

















 


Part B
: Calculation of Earnout Consideration


 


 


1.       GENERAL


 


1.1           OP1, OP2 and OP3 shall each be
determined in accordance with Part
C of this
Schedule.


 


1.2           The Earnout Consideration shall be
paid in U.S. dollars by transfer to the Seller’s Bank Account on the relevant
Payment Date subject to the terms of the Management Agreement.


 


2.       FIRST
EARNOUT CONSIDERATION


 


The First
Earnout Consideration shall be calculated on the following basis:


 


	
  OP1 (US$ million, converted from
  Kazakh

  tenge at the rate of 117.67 KZT: 1 USD)

  	
   

  	
  First
  Earnout Consideration (US$ million)

  
	
  100-120

  	
   

  	
  60+
  (23/20* (OP1-100))

  
	
  120-150

  	
   

  	
  83+
  (22/30* (OP1-120))

  
	
  150
  or more

  	
   

  	
  105

  



 


3.       SECOND
EARNOUT CONSIDERATION


 


The Second
Earnout Consideration shall be calculated on the following basis:


 


	
  OP2 (US$ million, converted from
  Kazakh

  tenge at the rate of 114.00 KZT: 1 USD)

  	
   

  	
  Second
  Earnout Consideration (US$ million)

  
	
  160-185

  	
   

  	
  60+
  (23/25* (OP2-160))

  
	
  185-220

  	
   

  	
  83+
  (22/35* (OP2-185))

  
	
  220
  or more

  	
   

  	
  105

  



 


 


 


39

















 


4.       THIRD
EARNOUT CONSIDERATION


 


The Third
Earnout Consideration shall be calculated on the following basis:


 


	
  OP3 (US$ million, converted from
  Kazakh

  tenge at the rate of 117.89 KZT: 1 USD)

  	
   

  	
  Third
  Earnout Consideration (US$ million)

  
	
  250-295

  	
   

  	
  60+
  (23/45* (OP3-250))

  
	
  295-355

  	
   

  	
  83+
  (27/60* (OP3-295))

  
	
  355
  or more

  	
   

  	
  110

  



 


5.       FUTURE
CONDUCT OF THE BUSINESS


 


The Seller and
the Purchaser agree that the business of the Company shall be conducted at all
times during the Relevant Period in accordance with the principles set out in Part F
of this Schedule.


 


6.       INTEREST


 


If any part of
the Earnout Consideration is not paid to the Seller on or by the respective
Payment Date, Default Interest shall accrue on a daily basis in accordance with
clause 12.4 of the Agreement.


 


 


 


40

















 


Part C : Determination of Earnout
Consideration


 


1.             The Relevant Amounts and the
consequent Earnout Consideration shall be calculated by the Group Companies (at
the direction and subject to the review of the parties) in accordance with Part C  and Part D
of this Schedule as soon as reasonably practicable following the end of the
relevant Earnout Period to which the Relevant Amount relates and in any event
within thirty (30) days thereof. 
The Earnout Income Statement and the calculation of the Relevant Amount
shall be prepared in accordance with Part
C, Part D
and Part E  of this Schedule, in the form and
including the items shown in Exhibit 6 to this Agreement.


 


2.             A written statement of the amount
of the Relevant Amount, together with details of its calculation, shall be
delivered to the parties upon completion of the calculation pursuant to paragraph 1  above, in the form of a certificate prepared by the Group Companies.
In the event that either party disputes the certified Relevant Amount, it shall
notify the other party in writing of the amount, nature and basis of such
dispute within thirty (30) days after delivery of the certificate to it.


 


3.             In the event that either party
provides written notice of a dispute in accordance with paragraph 2
above, the Purchaser and the Seller agree to negotiate in good faith to resolve
such dispute among themselves.  If the
Purchaser and the Seller are unable to resolve such dispute within twenty one
(21) days after delivery of the certificate to the parties, the dispute
shall immediately be submitted by either the Purchaser or the Seller to an
independent UK accounting firm (the Expert)
who shall either be agreed upon by the Purchaser and the Seller or, if no such
agreement is reached within five (5) days of the end of such twenty one
(21) day period, on the request of either the Purchaser or the Seller,
such Expert shall be appointed by the President of the Institute of Chartered
Accountants in England and Wales.  The
Expert shall not be a national of or reside in either Kazakhstan or the United
States.  The Expert shall determine and
deliver written notice of such determination to the Seller and Purchaser the
amount of the Relevant Amount within thirty (30) days from the date of his
appointment and, in doing so, shall act as an expert and not as an arbitrator.


 


4.             The Seller and the Purchaser shall
each have and the parties shall procure that the Expert has full access to the
books and records of the Group Companies as is reasonably necessary for each to
be able to review in detail the calculation of the Relevant Amount (together
with all supporting information relied on in making such calculation).


 


5.             The determination of the Relevant
Amount by the Expert shall (save in the case of manifest error) be final and
binding on the parties.  All
determinations by the Expert shall be in writing, shall be delivered to the
Seller and the Purchaser.  The fees and
expenses of the Expert shall be borne equally by the Seller and the Purchaser
or as the Expert shall otherwise determine.


 


6.             The Relevant Amount shall be deemed
to have been determined:


 


(a)                                  if the parties agree with the
calculation prepared by the Group Companies, on the day that they confirm such
agreement in writing;


 


(b)                                 if neither party provides
written notice of a dispute in accordance with paragraph 2
above, on the day thirty (30) days after the delivery of the certificate
prepared by the Group Companies;


 


 


 


41

















 


(c)                                  if the Seller and the
Purchaser disagree as to any matters, but resolve in writing their difference
or dispute prior to (or at any time during) the period of the appointment of
the Expert, on the day that they so agree in writing; or


 


(d)                                 on the date that the Expert
notifies the Seller and Purchaser of his determination.


 


 


 


42

















 


Part D : Adjustment to EBITDA


 


1.             In preparing a draft of the Earnout
Income Statement in accordance with Part C of this Schedule and the
calculation of the Relevant Amount the Group Companies shall make the following
adjustments.


 


2.             No account shall be taken of any
items that are exceptional or out of the ordinary course based on those items
actually incurred in the usual operation of the Group Companies in the 12
months preceding the date of this Agreement, and in particular (but without
prejudice to the generality of the foregoing) no account will be taken of the
following:


 


(a)                                  any management charges or
other payments (excluding the Manager Expenses) paid or payable to the Manager
(or any other member of the Seller Group) pursuant to the Management Agreement;


 


(b)                                 any costs incurred on behalf
of the Owners by the Parent without the approval of the Manager and any other
amounts excluded by the operation of clause 3.20(d)(iii) of the Management
Agreement;


 


(c)                                  any costs incurred in the
provision of training services and development activities pursuant to clause
3.12 of the Management Agreement;


 


(d)                                 the costs and expenses
contemplated by clause 3.20(d)(vi) of the Management Agreement;


 


(e)                                  the costs and expenses
contemplated by clause 9.3 and clause 3.20(g) of the Management Agreement;


 


(f)                                    any exceptional or
non-recurring items in accordance with IFRS (including but not limited to
redundancy or restructuring costs) and any amounts payable in respect of
litigation (or a settlement in respect thereof) other than as enforcement action
in relation to a money debt;


 


(g)                                 any one-time write-offs
(including in respect of inventory obsolescence);


 


(h)                                 any costs in respect of
insurance in excess of $2 million per annum and any other costs contemplated by
clause 3.29 of the Management Agreement;


 


(i)                                     any amounts resulting from
mark-to-market accounting of contracts held by the Group Companies; and


 


(j)                                     any fines, penalties, levies,
special taxes or other amounts payable to a Governmental Entity other than as a
direct result of any material breach of the Management Agreement by the Seller
or another member of the Seller Group.


 


3.             In the event that the revenues of
the Group Companies in an Earnout Period are lower than would otherwise have
been the case as a result of any voluntary Tariff Freeze adopted by any of the
Group Companies, the EBITDA for the Earnout Period shall be increased to the
amount which would have been obtained were it not for such Tariff Freeze. If
the parties cannot agree on the amount of such increase in respect of a particular
quarter within 30 days of the end of that quarter, this shall be referred to
the Expert for binding determination in accordance with the procedures set out
in clause 15.3 of the Management Agreement.


 


 


 


43

















 


4.             In calculating the amount by which
the revenues of the Group Companies in an Earnout Period were reduced as the
result of a voluntary Tariff Freeze, it shall be assumed that the following
tariffs (the Permitted Tariffs) would have
applied had it not been for such voluntary Tariff Freeze:


 


	
  2008

  	
  2.69 KZT / KWH

  
	
   

  	
   

  
	
  2009

  	
  3.45 KZT / KWH

  
	
   

  	
   

  
	
  2010

  	
  4.13 KZT / KWH

  



 


 


 


44






 










 


Part E :
Accounting Policies


 


1.                                       General Policies


 


The Earnout
Income Statements shall be prepared in accordance with IFRS.


 


 


 


 


 


 


 


45

















 


 


 


Part F :
Operation of the business during the Relevant Period


 


1.                                       The Purchaser agrees that through the
Relevant Period it will not (and shall procure that its Affiliates and the
Owners will not) take any action inconsistent with the terms of the Management
Agreement and will (and shall procure that its Affiliates and the Owners will)
act in accordance with the terms of the Management Agreement.


 


2.                                       In the event of termination of the
Management Agreement prior to 31 December 2010, the provisions of
clause 8 of the Management Agreement shall apply.


 


 


 


 


46

















 


Part G :
Capex Provisions


 


1.                                       The Third Earnout Consideration shall be
subject to the following adjustment in respect of Capex.


 


2.                                       In the event that the actual Capex in
respect of the Kazakh Business in respect of those items of capital expenditure
contemplated by the Capex Plan during the Three Year Period exceeds
$650 million, the Third Earnout Consideration shall be reduced by 50% of
the amount of such excess, provided that such reduction shall not exceed US$25 million.


 


3.                                       In the event that the actual Capex in
respect of the Kazakh Business in respect of those items of capital expenditure
contemplated by the Capex Plan during the Three Year Period is less than
$650 million, the Third Earnout Consideration shall be increased by 50% of
the amount of such shortfall, provided that such increase shall not exceed
US$25 million.


 


4.                                       Without prejudice to paragraph 3 above,
in the event that Unit 8 is not available for generation by
31 December 2010, the Third Earnout Consideration shall be reduced by
$25 million, provided that the aggregate reduction to the Third Earnout
Consideration resulting from the application of paragraph 2 above
and this paragraph 4 shall not in any event exceed US$25 million.


 


5.                                       For the purposes of this Part G,
capitalised interest shall not be treated as Capex.


 


 


47





















 


 


SCHEDULE 8



INTER COMPANY DEBT


 


New Inter-Company Trading Debt


 


1.                                       Save as stipulated otherwise in the
respective agreement, any Inter-Company Trading Debt which arises after Closing
during the term of the Management Agreement shall be paid within 30 days of it
so arising.


 


Payment at Closing in respect of
Inter-Company Debt


 


2.                                       In relation to Inter-Company Debt existing
at the Closing Date:


 


(a)                                  the Purchaser shall at Closing
pay to the Seller (for itself or, as the case may be, as agent for the members
of the Seller Group to which the relevant Inter-Company Payables are owed) an
amount in the applicable currency equal to each of the Inter-Company Payables
(if any) which are owed to any member of the Seller Group, in consideration of
the assignment to the Purchaser of the benefit of such Inter-Company Payables;
and


 


(b)                                 the Seller shall at Closing
(for itself or, as the case may be, as agent for each relevant member of the
Seller Group) pay to the Purchaser an amount in the applicable currency equal
to each of the Inter-Company Receivables (if any) of each Group Company which
are owed by any member of the Seller Group, in consideration of the assignment
to the Purchaser of the burden of such Inter-Company Receivables.


 


Withholding Tax in respect of Inter-Company
Debt


 


3.                                       The Purchaser shall not make any deduction
from the payment at Closing in respect of Inter-Company Payables referred to in
paragraph 2 above. However, if and when any applicable Kazakh withholding tax
falls due and is paid in respect of the interest which has accrued on such
Inter-Company Payables up to the Closing Date, the Purchaser may (subject to it
providing the Seller with proof of payment) deduct the amount of such
withholding tax from any payments which subsequently fall due to the Seller
under this Agreement, provided that the amount of any such deduction may not
exceed in aggregate 15% of the interest accrued up to the Closing Date in
respect of the Inter-Company Payable owed by AES Ekibastuz LLP to Global Energy
Holding CV and 10% of the interest accrued up to the Closing Date in respect of
all other Inter-Company Payables provided however that to the extent no further
Earnout Consideration remains payable under this Agreement, the Seller shall
pay any amounts payable to the Purchaser under this clause within 10 Business
Days of having been requested to make such a payment by the Purchaser.


 


 


48





















 


 


SCHEDULE 9



POST-CLOSING FINANCIAL ADJUSTMENTS


 


 


Part A :
Preliminary


 


1.                                       In preparing the Closing Statement:


 


(a)                                  the items and amounts to be
included in the calculation of External Debt and Cash for the purposes of the
Closing Statement shall be identified by applying the relevant definition in Schedule 12 (subject, where applicable, to the provisions of Part A of this
Schedule);


 


(b)                                 the amounts to be included in
the calculation of Reviewed Line Items Amount for the purposes of the Closing
Statement shall be the Total Reviewed Line Items Amounts and no others;


 


(c)                                  in applying each such
definition and the provisions of Part A of this Schedule and determining which
items and amounts are to be included in the Closing Statement, if and to the
extent that the treatment or characterisation of the relevant item or amount or
type or category of item or amount:


 


(i)                     is dealt with in the specific accounting
treatments set out in Part B of this Schedule (the Specific Accounting Treatments),
the relevant Specific Accounting Treatment(s) shall apply;


 


(ii)                  is not dealt with in the Specific
Accounting Treatments but is dealt with in the accounting principles, policies,
treatments, practices and categorisations used in the preparation of the
30 September 2007 Accounts (to the extent that such accounting
principles, policies, treatments, practices and categorisations are consistent
with US GAAP for the purposes of producing consolidated financial statements
for AES and its subsidiaries) (the Accounting Principles), the applicable
Accounting Principle(s), shall apply (including in relation to the exercise of
accounting discretion and judgement); and


 


(iii)               is not dealt with in either the Specific
Accounting Treatments or the Accounting Principles, US GAAP shall apply.


 


2.                                       For the purposes of calculating External
Debt or Cash for any Group Company any amounts which are to be included in any
such calculation which are expressed in a currency other than U.S. dollars
shall be converted into U.S. dollars at the Exchange Rate as at the Closing
Date.


 


 


49

















 


 


Part B :
Specific Accounting Treatments


 


1.                                       Information available for Closing Statement.  Information available up until the date on
which the Closing Statement is finally agreed or determined shall be taken into
account insofar as it provides evidence of the state of affairs of the Group
Companies at Closing.  The Closing
Statement will reflect the position of the Group Companies as at Closing and
will not take into account the effects of any post Closing reorganisations or,
in any way, the post Closing intentions or obligations of the Purchaser.


 


2.                                       No re-appraisal of asset values.  The Closing Statement shall not re appraise
the value of any of the assets of the Group Companies as a result of the change
in their ownership (or any changes in the business of the Group Companies since
Closing following such change in ownership) except only as specifically set out
in this Schedule.


 


3.                                       Consolidated treatment.   The Group Companies shall be treated as
members of a combined consolidated group so that any intragroup balances are
eliminated.


 


4.                                       Intercompany Debt.  Inter-Company Debt shall be recorded at its
face value plus interest accrued to Closing.


 


Part C :
Closing Statement


 


1.                                       The Seller shall (or shall procure that the
Seller’s accountants (or such other independent firm of chartered accountants
of international standing as the Seller shall determine) shall), after Closing
prepare a draft statement (the Closing Statement) showing the consolidated External
Debt, Cash, and Total Reviewed Line Items Amount.  The Closing Statement shall be in the form
set out in Part A of Exhibit 3 and incorporate separate statements in
the form set out in that Exhibit showing the calculation of the
consolidated Total Reviewed Line Items Amount. 
The Seller shall deliver the draft Closing Statement to the Purchaser
within 90 days after Closing.


 


2.                                       The Purchaser shall notify the Seller in
writing (an Objection
Notice) within 60 days after receipt whether or not it
accepts the draft Closing Statement for the purposes of this Agreement.  An Objection Notice shall set out in detail
the Purchaser’s reasons for such non acceptance and specify the adjustments
which, in the Purchaser’s opinion, should be made to the draft Closing
Statement in order for it to comply with the requirements of this
Agreement.  Except for the matters
specifically set out in the Objection Notice, the Purchaser shall be deemed to
have agreed the draft Closing Statement in full.


 


3.                                       If the Purchaser serves an Objection Notice
in accordance with paragraph 2, the Seller and the Purchaser shall use all
reasonable efforts to meet and discuss the objections of the Purchaser and to
agree the adjustments (if any) required to be made to the draft Closing
Statement, in each case within 15 days after receipt by the Seller of the
Objection Notice.


 


4.                                       If the Purchaser is satisfied with the
draft Closing Statement (either as originally submitted or after adjustments
agreed between the Seller and the Purchaser pursuant to paragraph 3 above)
or if the Purchaser fails to give a valid Objection Notice within the
15 day period referred to in paragraph 2 above, then the draft Closing
Statement (incorporating any agreed adjustments) shall constitute the Closing
Statement for the purposes of this Agreement.


 


 


50

















 


 


 


5.                                       If the Seller and the Purchaser do not
reach agreement within 15 days of receipt by the Seller of the Objection
Notice, then the matters in dispute may be referred (on the application of
either the Seller or the Purchaser) for determination by KPMG or, if that firm
is unable or unwilling to act, by such other independent firm of chartered
accountants of international standing as the Seller and the Purchaser shall
agree or, failing agreement, appointed by the President for the time being of
the Institute of Chartered Accountants in England and Wales (the Firm).  The Firm shall be requested to make its
decision within thirty (30) days (or such later date as the Seller, the
Purchaser and the Firm agree in writing) of confirmation and acknowledgement by
the Firm of its appointment.  The
following provisions shall apply once the Firm has been appointed:


 


(a)                                  the Seller and Purchaser shall
each prepare a written statement within 15 days of the Firm’s appointment
on the matters in dispute which (together with the relevant supporting
documents) shall be submitted to the Firm for determination and copied at the
same time to the other;


 


(b)                                 following delivery of their
respective submissions, the Purchaser and the Seller shall each have the
opportunity to comment once only on the other’s submission by written comment
delivered to the Firm not later than 10 days after receipt of the other’s
submission and, thereafter, neither the Seller nor the Purchaser shall be
entitled to make further statements or submissions except insofar as the Firm
so requests (in which case it shall, on each occasion, give the other party
(unless otherwise directed) 10 days to respond to any statements or
submission so made);


 


(c)                                  in giving its determination,
the Firm shall state what adjustments (if any) are necessary, solely for the
purposes of this Agreement, to the draft Closing Statement in respect of the
matters in dispute in order to comply with the requirements of this Agreement
and to determine finally the Closing Statement;


 


(d)                                 the Firm shall act as an
expert (and not as an arbitrator) in making its determination which shall, in
the absence of manifest error, be final and binding on the parties and, without
prejudice to any other rights which they may respectively have under this
Agreement, the parties expressly waive, to the extent permitted by law, any
rights of recourse they may otherwise have to challenge it.


 


6.                                       The Seller and the Purchaser shall each be
responsible for their own costs in connection with the preparation, review and
agreement or determination of the Closing Statement.  The fees and expenses of the Firm shall be
borne equally between the Seller and the Purchaser or in such other proportions
as the Firm shall determine.


 


7.                                       To enable the Seller to meet its
obligations under this Schedule 9, the Purchaser shall provide to the Seller
and the Seller’s accountants full access to the books and records, employees
and premises of the Group Companies and, where relevant, such access as the
Seller may reasonably require of the Purchaser for the period from the Closing
Date to the date that the draft Closing Statement is agreed or determined.  If the Purchaser serves an Objection Notice,
it shall ensure that the Seller and the Seller’s accountants shall be given
reasonable access to the Purchaser’s and the Purchaser’s accountants’ working
papers relating to the adjustments proposed in the Objection Notice and any other
submissions by or on behalf of the Purchaser in relation to the Closing
Statement.  The Purchaser shall
co-operate fully with the Seller and shall permit the Seller and/or the
Seller’s accountants to take copies (including electronic copies) of the relevant
books and records and shall provide all assistance reasonably requested by the
Seller to facilitate the preparation of the Closing Statement.


 


 


51

















 


 


8.                                       When the Closing Statement has been agreed
or determined in accordance with the preceding paragraphs, then the amounts
shown in the Closing Statement as the consolidated External Debt, Cash and
Total Reviewed Line Items Amount for the Group Companies shall be final and
binding for the purposes of this Agreement.


 


Part D :
Financial Adjustments


 


1.                                       When the Closing Statement has been finally
agreed or determined in accordance with this Schedule 9, the following
adjustments shall be made to the Initial Price.


 


Total Reviewed Line Items Amount


 


2.                                       In relation to the Total Reviewed Line
Items Amount:


 


(a)                                  if the consolidated Total
Reviewed Line Items Amount of all Group Companies is greater than the Total
Estimated Reviewed Line Items Amount, then the Purchaser shall pay an amount
equal to the difference to the Seller; or


 


(b)                                 if the consolidated Total
Reviewed Line Items Amount of all Group Companies is less than the Total
Estimated Reviewed Line Items Amount, then the Seller shall pay an amount equal
to the difference to the Purchaser.


 


For these
purposes all line items relating to asset accounts shall be taken as positive
amounts and all line items relating to liabilities accounts shall be taken as
negative amounts.


 


Inter-Company Debt


 


3.                                       In relation to Inter-Company Payables:


 


(a)                                  if the aggregate amount of
Inter-Company Payables as at the Closing Date is less than the amount paid by
the Purchaser at Closing in accordance with Schedule 8, paragraph 1(a), then
the amount equal to the difference shall be deemed to increase the Final Price
and deemed to decrease the amount paid by the Purchaser in relation to the
Inter-Company Payables; or


 


(b)                                 if the aggregate amount of
Inter-Company Payables as at the Closing Date is greater than the amount paid
by the Purchaser at Closing in accordance with Schedule 8, paragraph 1(a), then
the amount equal to the difference shall be deemed to decrease the Final Price
and deemed to increase the amount paid by the Purchaser in relation to the
Inter-Company Payables.


 


4.                                       In relation to Inter-Company Receivables:


 


(a)                                  if the aggregate amount of
Inter-Company Receivables as at the Closing Date is less than the amount paid
by the Seller at Closing in accordance with Schedule 8, paragraph 1(b), then
the amount equal to the difference shall be deemed to decrease the Final Price
and deemed to decrease the amount paid to the Purchaser in relation to the
Inter-Company Receivables


 


(b)                                 if the aggregate amount of
Inter-Company Receivables as at the Closing Date is greater than the amount
paid by the Seller at Closing in accordance with Schedule 8, paragraph 1(b),
then the amount equal to the difference shall be deemed to increase the Final
Price and deemed to increase the amount paid to the Purchaser in relation to
the Inter-Company Receivables.


 


 


52

















 


 


5.                                       For the avoidance of doubt, no actual cash
payments shall be made by either party in respect of any deemed adjustments
made pursuant to clause 3 and 4 of this Part D.


 


External Debt


 


6.                                       In relation to External Debt:


 


(a)                                  if the consolidated External
Debt of all Group Companies as at the Closing Date is less than the Estimated
External Debt, then the Purchaser shall pay an amount equal to the difference
to the Seller; or


 


(b)                                 if the consolidated External
Debt of all Group Companies as at the Closing Date is greater than the
Estimated External Debt, then the Seller shall pay an amount equal to the
difference to the Purchaser.


 


Cash


 


7.                                       In relation to Cash:


 


(a)                                  if the consolidated Cash of
all Group Companies as at the Closing Date is greater than the Estimated Cash,
then the Purchaser shall pay an amount equal to the difference to the Seller;
or


 


(b)                                 if the consolidated Cash of
all Group Companies as at the Closing Date is less than the Estimated Cash,
then the Seller shall pay an amount equal to the difference to the Purchaser.


 


8.                                       For the purposes of clause 2.4 and this Schedule
9, the consolidated Cash of all Group Companies as at the Closing Date shall be
deemed to be increased by the amount expended by the Group Companies on
maintenance Capex between the date of this Agreement and the Closing Date,
provided that the amount of such deemed increase shall not exceed
US$2 million.  The amount of such
maintenance Capex (up to such $2 million limit) shall be taken into account in
determining the Capex in respect of the Kazakh Business for the purposes of Part
G of Schedule 7.


 


General


 


9.                                       Any payment required to be made pursuant to
any of paragraphs 2 to 7 inclusive of this Part D shall be paid by
the Seller or the Purchaser (as the case may be) together with an amount equal
to interest on such payment at the Default Rate for the period from (but
excluding) the Closing Date to (and including) the due date for payment
pursuant to the relevant clause, calculated on a daily basis.


 


10.                                 The Seller and Purchaser agree that, once
the Closing Statement has been agreed or determined in accordance with the
provisions of Part C of this Schedule 9, the sums which each is respectively
obliged to pay pursuant to this Part D shall be aggregated and set off against
each other.  Whichever of the Seller or
Purchaser is then left with any payment obligation under this Part D shall
make the applicable payment(s) within 5 Business Days of the date on which
the Closing Statement is agreed or so determined.  Any such payment shall be made in accordance
with the provisions of clause 13.1 or 13.2 of this Agreement, as the case
may be.


 


 


 


53

















 


SCHEDULE 10



PRICE ALLOCATION


 


1.                                       The Initial Price payable for the Shares
under this Agreement shall be deemed to be allocated between the Ekibastuz
GRES-1 assets and the Maikuben mine assets as follows:


 


(a)                                  USD 1,040,000,000 shall
be deemed payable in relation to the purchase of the Ekibastuz GRES-1 assets;
and


 


(b)                                 USD 110,000,000 shall be
deemed payable in relation to the purchase of the Maikuben mine assets.


 


2.                                       Any adjustments made under clause 2.1 of
this Agreement or under Schedule 9 and any payments of Earnout Consideration to
be paid under Schedule 7 shall be deemed to be allocated between the Ekibastuz
GRES-1 assets and the Maikuben mine assets in the same proportion as set out in
paragraph 1 of this Schedule 10 above.


 


 


 


 


54














SCHEDULE 11


 


AVAILABLE CAPACITY


 


The Available Capacity of the GRES 1 power plant operated by AES
Ekibastuz LLP (the Power Station) will be demonstrated as being not
less than 2250 MW in the following manner:


 


1.                                      In the period between the signing of this Agreement
and Closing each of the five operating units of the Power Station will be
separately run under test conditions typically used by the Power Station for a
period of at least one hour so as to determine and record that unit’s available
capacity at the time. The results of the power generated during that test
period will be recorded in the Power Station’s generation report (the generation report) and certified
extract of such reports will be made available to the Purchaser.


 


2.                                      Once the generation tests have been run on
all of the five operating units in 1 above the Seller shall provide the
Purchaser with a complete report showing the available capacity of each unit
demonstrated by the Generation Report and the aggregate available capacity of
each unit demonstrated by the Generation Report; and


 


3.                                      If the aggregate available capacity shown
in 2 above is less than 2250 MW the Seller will provide the Purchaser with the
reasons for such shortfall and the procedures being undertaken to remedy such a
shortfall prior to closing. If the aggregate available capacity in
paragraph 2 above is 2250 MW or more the warranty in clause 7.2(1) will be
considered satisfied.


 


 


 


 


55

















 


SCHEDULE 12



DEFINITIONS AND INTERPRETATION


 


1.                                       Definitions.  In
this Agreement (including the Schedules), the following words and expressions
shall have the following meanings:


 


30 September 2007 Accounts means the unaudited combined
balance sheet of the Group Companies and the unaudited combined profit and loss
account of the Group Companies, in each case as at 30 September 2007 and
prepared in accordance with US GAAP for the purposes of producing consolidated
financial statements for AES and its subsidiaries, together with any notes,
reports, statements or documents included in or annexed or attached to them, as
contained in Part A of Exhibit 2;


 


AES Business Plan means the business plan contained in Exhibit 1
to this Agreement, as revised from time to time in accordance with the terms of
the Management Agreement;


 


AES
Compliance Terms and Conditions means the AES compliance terms and
conditions set out in Schedule 6;


 


Affiliate means, in relation to any party, any
Subsidiary Undertaking or Parent Undertaking of that party and any Subsidiary
Undertaking of any such Parent Undertaking, in each case from time to time;


 


Agreed Form means, in relation to a document, the form
of that document as initialled on the date of this Agreement for the purpose of
identification by or on behalf of the Seller and the Purchaser (in each case
with such amendments as may be agreed in writing by or on behalf of the Seller
and the Purchaser);


 


Available Capacity means capacity that is available from a
unit as determined by the procedures set forth in Schedule 11;


 


Base
Case Payout means US$83 million in respect of each Earnout
Period;


 


Business Day means a day other than a Saturday or Sunday
or public holiday in England and Wales and the Republic of Kazakhstan on which
banks are open in London and Almaty for general commercial business;


 


Calculation
of the Initial Price has the meaning given in clause 2.1;


 


Cash  means, in relation to each Group Company, the
aggregate of its cash (whether in hand or credited to any account with any
banking, financial, acceptance credit, lending or other similar institution or
organisation) and its cash equivalents (including short-term investments such
as certificates of deposit, as illustrated in Part B of Exhibit 2),
including all interest accrued thereon, as at Closing;


 


Claim means any claim under or for breach of this Agreement
(other than a claim for non-payment of any payment required to be made under
the Financial Adjustments), Schedule 8, or clause 9.1(d), including any claim
for breach of the Seller Warranties or in respect of an indemnity given by the
Seller;


 


Closing means completion of the sale and purchase of the
Shares in accordance with the provisions of this Agreement;


 


 


56

















 


Closing Date has the meaning given in clause 4.1;


 


Closing Statement has the meaning given in Schedule 9;


 


Companies means AES Kazakhstan Holdings BV, AES
Ekibastuz Holdings BV and Emerging Energy Investments & Holdings BV;


 


Conditions mean the conditions to Closing set out in
clause 3.1;


 


Confidential Information has the meaning given in
clause 16.1;


 


Connected
Persons has the meaning given in clause 23;


 


Costs means losses, damages, costs (including
reasonable legal costs) and expenses (including taxation), in each case of any
nature whatsoever;


 


Data Room means the data room comprising the
documents and other information relating to the Kazakh Business made available
by the Seller via the Project Harp datasite hosted by Merrill Corporation that
are recorded on the CDs and/or DVDs initialled by or on behalf of the Sellers
and the Purchaser and certified as accurate by Merrill Corporation;


 


Default Interest means interest at LIBOR plus three (3) per
cent;


 


Disclosure Letter means the letter from the Seller to the
Purchaser executed and delivered immediately before the signing of this
Agreement;


 


Dispute has the meaning given to it
in clause 31.2;


 


Earnout Consideration has the meaning given to it
in Schedule 7;


 


Employees
means
the employees of the Group Companies immediately prior to Closing, excluding
any employees of AES or any Affiliate of AES who are seconded to any Group
Companies;


 


Encumbrance means any encumbrances
including any mortgage, pledge, charge, lien, deposit or assignment by way of
security, bill of sale, option or right of pre-emption, entitlement to
beneficial ownership (including usufruct and similar entitlements), any
provisional or executional attachment and any interest or right held, or claim
that could be raised, by a third party;


 


Environment means all or any of the
following media, namely air (including the air within buildings or other
natural or man-made structures above or below ground), water (including surface
waters, underground waters, groundwater, and water within any natural or
man-made structure), land (including land under water, surface land and
sub-surface land), flora, fauna and ecosystems;


 


Environmental Consents means any material permit, licence,
authorisation, approval or consent required under Environmental Laws for or in
connection with the carrying on of the Kazakh Business or the use of, or any
activities or operations carried out at, any Property;


 


Environmental Laws means all international, European Union,
national, state, federal, regional or local laws (including common law, statute
law, civil and criminal law) which are in force and binding at the date of this
Agreement, to the extent that they relate to Environmental Matters;


 


 


57

















 


Environmental Matters means all matters relating to
the pollution or protection of the Environment;


 


Estimated Cash has the meaning given to it in Clause 2.1;


 


Estimated External Debt has the meaning given to it
in Clause 2.1;


 


Estimated Reviewed Line Item Amount means the amount of any line
item set out in Part B of Exhibit 3 (and no others) in relation to
each Target Company as shown in 30 September 2007 Accounts;


 


Exchange Rate means, with respect to a particular
currency for a particular day, the spot rate of exchange (the closing
mid-point) for that currency into dollars on such date as published in the
London edition of the Financial Times first published thereafter or, where no
such rate is published in respect of that currency for such date, the rate
quoted by Barclays Bank plc as at the close of business in London on such date;


 


External
Counsel Opinion  has
the meaning given to it in clause 24.1 of the Agreement;


 


External Debt means, in relation to each Group Company,
the aggregate of the Financial Debt owed by that Group Company as at Closing
(together with any accrued interest) to any banking, financial, acceptance
credit, lending or other similar institution or organisation which, in each
case, is not a member of the Seller Group; for the avoidance of doubt, neither
Inter-Company Payables (and any interest thereon) nor any items to be treated
as creditors in the Total Reviewed Line Items Amount constitute External Debt;


 


Fairly
Disclosed means in relation to any matter disclosure which is fair in the context
of the other disclosures in respect of that matter taken as a whole;


 


Final Price means the Initial Price adjusted in
accordance with the Financial Adjustments;


 


Financial Adjustments means any adjustment(s) required in
accordance with Part D of Schedule 9;


 


Financial Debt means borrowings and indebtedness in the
nature of borrowing (including but not limited to by way of acceptance credits,
third party borrowings, non-recourse finance, liabilities under finance leases,
hire purchase arrangements, factored debts, discounting or similar facilities,
loan stocks, bonds, debentures, notes, overdrafts or any other similar
arrangements the purpose of which is to raise money) owed to any banking,
financial, acceptance credit, lending or other similar institution or
organisation;


 


Force Majeure has the meaning ascribed to it in the Management
Agreement;


 


Governmental Entity means any supra-national, national, state,
municipal or local government (including any subdivision, court, administrative
agency or commission or other authority thereof) or any quasi-governmental or
private body exercising any regulatory, taxing, importing or other governmental
or quasi-governmental authority, including the European Union;


 


Group
Companies means the Companies and the Target Companies and a Group Company mean
any of them;


 


Guaranteed Obligations has the meaning given to it in
clause 25.1;


 


 


58

















 


IFRS means the body of pronouncements issued by
the International Accounting Standards Board (IASB), including International Financial
Reporting Standards and interpretations approved by IASB, International
Accounting Standards and Standing Interpretations Committee interpretations
approved by the predecessor International Accounting Standards Committee;


 


Initial Price means the cash price payable
on Closing under clause 2.1;


 


Intellectual
Property Rights means patents, trade marks, service marks, logos,
trade names, internet domain names, copyright (including rights in computer
software) and moral rights, database rights, semi-conductor topography rights,
utility models, rights in designs, rights in get-up, rights in inventions,
rights in know-how and other intellectual property rights, in each case whether
registered or unregistered, and all rights or forms of protection having
equivalent or similar effect anywhere in the world and registered includes
registrations and applications for registration;


 


Inter-Company Debt means any Inter-Company Payables and any
Inter-Company Receivables (including but not limited to those items and amounts
set out in Part D of Exhibit 2);


 


Inter-Company Payables means, in relation to each Group Company,
any amounts owed as at Closing by that Group Company to any member of the
Seller Group (including in respect of inter-company charges), together with
accrued interest, if any, up to the date of Closing on the terms of the
applicable debt;


 


Inter-Company Receivables means, in relation to each Group Company,
any amounts owed as at Closing to that Group Company by any member of the
Seller Group (including in respect of inter-company charges) together with
accrued interest, if any, up to the date of Closing on the terms of the
applicable debt;


 


Inter-Company Trading Debt means all amounts owed,
outstanding or accrued in the ordinary course of trading, including any VAT
arising on such amounts, as between any member of the Seller Group and any
Group Company in respect of inter-company trading activity and the provision of
services, facilities and benefits between them;


 


Kazakh Business means the business carried on by the Group
Companies in Kazakhstan;


 


Liabilities means all liabilities, duties and
obligations of every description, whether deriving from contract, common law,
statute or otherwise, whether present or future, actual or contingent or
ascertained or unascertained and whether owed or incurred severally or jointly
or as principal or surety;


 


LIBOR means the display rate per annum of the offered
quotation for deposits in dollars for a period of one month which appears on
the appropriate page of the Reuters Screen (or such other page as the
parties may agree) at or about 11.00 a.m. London time on the date on which
payment of the sum under this Agreement was due but not paid;


 


Low
Case Payout  means US$60
million in respect of each Earnout Period;


 


Management Agreement means a management agreement between AES
Ekibastuz LLP, AES Maikuben LLP, Maikuben West LLP, the Manager and the
Purchaser of even date herewith in the agreed form;


 


Manager has the meaning given to it in the
Management Agreement;


 


 


59

















 


Management Expenses has the meaning given to it in the
Management Agreement;


 


Non-Kazakh
Group Companies means the Companies, AES Suntree Power Ltd., Kilcormac
Trading Ltd and Electric Power Holding VOF;


 


Notice
of Dispute has the meaning given in clause 31.2;


 


Owners has the meaning given to it in the
Management Agreement;


 


Parent has the meaning given to it in the
Management Agreement;


 


Parent Undertaking has the meaning ascribed to it in the
definition of Subsidiary Undertaking below;


 


Properties
means
the freehold and leasehold interests of the Group Companies;


 


Proposed Transactions means the transactions contemplated by the
Transaction Documents;


 


Purchaser’s Bank Account means the Purchaser’s bank account details
of which are advised by the Purchaser to the Seller in writing no later than 10
Business Days before Closing;


 


Purchaser Group means the Purchaser and its Affiliates
from time to time;


 


Purchaser’s Warranties means the
warranties given by the Purchaser pursuant to Schedule 3;


 


Reorganisation means the reorganisation of the Seller’s holding of the Group
Companies, as such reorganisation is specified in Exhibit 5;


 


Representatives has the meaning given in clause 16.1;


 


Reviewed Line Item Amount means the amount of any line item set out
in Part B of Exhibit 3 (and no others) in relation to each Target
Company as shown in the reviewed accounts for 30 September 2007;


 


Seller Group means the Seller and its Affiliates from
time to time but excluding the Group Companies;


 


Seller’s Bank Account means the Seller’s bank account details of
which are advised by the Seller to the Purchaser in writing no later than 10
Business Days before Closing;


 


Seller Warranties means the warranties given by the Seller
pursuant to clause 7;


 


Shares means all the issued share capital of each of the
Companies;


 


Subsidiary Undertaking means, in relation to an
undertaking (the Parent Undertaking), any
other undertaking in which the Parent Undertaking (or persons acting on its or
their behalf) for the time being directly or indirectly holds or controls
either:


 


(a)                                  a majority of the voting rights exercisable
at general meetings of the members of that undertaking on all, or substantially
all, matters; or


 


(b)                                 the right to appoint or remove directors
having a majority of the voting rights exercisable at meetings of the board of
directors of that undertaking on all, or substantially all, matters,


 


 


 


60

















 


and any undertaking which is a Subsidiary
Undertaking of another undertaking shall also be a Subsidiary Undertaking of
any further undertaking of which that other is a Subsidiary Undertaking;


 


Surviving Provisions means clauses 15 (Announcements), 16
(Confidentiality), 17 (Non-Solicitation), 18
(Assignment), 20 (Costs), 21
(Notices), 22 (Conflict with other Agreements), 23
(Whole Agreement), 24 (Waivers, Rights and
Remedies), 28 (Variations), 29 (Invalidity), 30
(No Third Party Enforcement Rights), 31 (Governing law and
Jurisdiction) and Schedule 10 (Definitions and
Interpretation);


 


Target Companies means the companies which are listed in Schedule
1 and Target Company
means any of them;


 


Tariff
Freeze means (i) a reduction in tariffs for the sale of electricity
and/or the sale price of coal (either of general or specific application)
and/or (ii) the imposition of a levy, or surcharge or other cost or the
increase of existing costs in each case following a non-binding request from
any Government Entity which the Parent requires or requests the Manager to
implement pursuant to clause 3.26B of the Management Agreement.


 


tax  or taxation  includes, without limitation, (a) taxes
on gross or net income, profits and gains, and (b) all other taxes,
levies, duties, imposts, charges and withholdings of any nature, including any
excise, property, value added, sales, use, occupation, transfer, franchise and
payroll taxes and any national insurance or social security contributions, and
any payment whatsoever which the relevant person may be or become bound to make
to any person as a result of the discharge by that person of any tax which the
relevant person has failed to discharge, together with all penalties, charges
and interest relating to any of the foregoing or to any late or incorrect
return in respect of any of them, and regardless of whether such taxes, levies,
duties, imposts, charges, withholdings, penalties and interest are chargeable
directly or primarily against or attributable directly or primarily to the
relevant person or any other person and of whether any amount in respect of
them is recoverable from any other person;


 


Title Warranties means the warranties set out in clauses 7.2(a),
(insofar as it relates to corporate authorisations), 7.2(b)(i), 7.2(e) and 7.2(g)
above and Title Warranty
means any of them;


 


Total Consideration has the meaning given to it in clause 2.7;


 


Total
Estimated Reviewed Line Items Amount means the aggregate amount of each of the
line items set out in Part B of Exhibit 3 (and no others) in relation
to each Target Company as shown in the reviewed accounts for 30 September 2007;


 


Total
Estimated Reviewed Line Items Amount means $24,625,386;


 


Transaction Documents means this Agreement, the Disclosure
Letter, the Management Agreement and any other documents in Agreed Form;


 


Unconditional Date  has the meaning given in clause 3.6;


 


undertaking  means a body corporate,
corporation or partnership or an unincorporated association carrying on trade
or a business with or without a view to profit. 
In relation to an undertaking which is not a company, expressions in
this Agreement appropriate to companies are to be construed as references to
the corresponding persons, officers, documents or organs (as the case may be)
appropriate to undertakings of that description;


 


 


61

















 


US
GAAP
means the generally accepted accounting principles and practices applicable in
the United States of America; and


 


Working Hours means 9.30 a.m. to 5.30 p.m. in
the relevant location on a Business Day.


 


2.                                       Interpretation.  In this Agreement, unless the context
otherwise requires:


 


(a)                                  references to a person include any individual, firm, body
corporate (wherever incorporated), government, state or agency of a state or
any joint venture, association, partnership, works council or employee
representative body (whether or not having separate legal personality);


 


(b)                                 headings do not affect the interpretation
of this Agreement; the singular shall include the plural and vice versa; and
references to one gender include all genders;


 


(c)                                  references to any English legal term or
concept shall, in respect of any jurisdiction other than England, be construed
as references to the term or concept which most nearly corresponds to it in
that jurisdiction;


 


(d)                                 references to U.S. dollars or dollars or $
are references to the lawful currency from time to time of the United States of
America;


 


(e)                                  for the purposes of applying a reference to
a monetary sum expressed in dollars, an amount in a different currency shall,
unless otherwise expressly provided in this Agreement, be deemed to be an
amount in dollars translated at the Exchange Rate at the relevant date (which
in relation to a Claim, shall be the date of the receipt of notice of that
Claim under Schedule 2);


 


(f)                                    any statement in this Agreement qualified
by the expression so far
as the Seller is aware or to the best of the Seller’s knowledge or any
similar expression shall be deemed only to be made on the basis of the actual
knowledge, at the date of this Agreement, of the following persons and in each
case in respect only of the clauses identified below against their respective
names and shall carry no requirement to make enquiries of any other person:


 


	
  Name

  	
   

  	
  Clauses

  
	
  Igor Sergeev

  	
   

  	
  7.2 (f)

  
	
   

  	
   

  	
   

  
	
  Igor Sergeev

  	
   

  	
  7.2 (h)

  
	
   

  	
   

  	
   

  
	
  Fernando Gonzalez

  	
   

  	
  7.2 (m)

  
	
   

  	
   

  	
   

  
	
  Fernando Gonzalez / Igor Sergeev

  	
   

  	
  7.2 (n)

  
	
   

  	
   

  	
   

  
	
  Igor Sergeev / Mike
  Jonagan

  	
   

  	
  7.2 (t)

  
	
   

  	
   

  	
   

  
	
  Igor Sergeev

  	
   

  	
  7.2 (u)

  
	
   

  	
   

  	
   

  
	
  Igor Sergeev

  	
   

  	
  7.2 (v)

  
	
   

  	
   

  	
   

  
	
  Igor Sergeev/Mike Jonagan

  	
   

  	
  Schedule 2 paragraph 8

  



 


 


62

















 


(g)                                 any phrase introduced by the terms including, include, in particular or any
similar expression shall be construed as illustrative and shall not limit the
sense of the words preceding those terms; and


 


(h)                                 any reference in this Agreement to a time
of day shall refer to London time unless stated otherwise.


 


3.                                       Enactments. 
Except as otherwise expressly provided in this Agreement, any express
reference to an enactment (which includes any legislation in any jurisdiction)
includes references to (i) that enactment as amended, consolidated or re-enacted
by or under any other enactment before or after the date of this Agreement; (ii) any
enactment which that enactment re-enacts (with or without modification); and (iii) any
subordinate legislation (including regulations) made (before or after the date
of this Agreement) under that enactment, as amended, consolidated or re-enacted
as described in (i) or (ii) above, except to the extent that any of
the matters referred to in (i) to (iii) occurs after the date of this
Agreement and increases or alters the liability of the Seller or the Purchaser
(or any person on whose behalf it is acting as agent pursuant to this
Agreement) under this Agreement.


 


4.                                       Schedules. 
The Schedules comprise schedules to this Agreement and form part of this
Agreement.


 


5.                                       Inconsistencies.  Where there is any inconsistency between the
definitions set out in this Schedule and the definitions set out in any clause
or any other Schedule, then, for the purposes of construing such clause or
Schedule, the definitions set out in such clause or Schedule shall prevail.


 


 


 


63

















 


SIGNATURE


 


This Agreement is signed by duly authorised representatives of the
parties:


 


	
  SIGNED

  	
  )

  	
  SIGNATURE:

  	
   

  
	
  for and on behalf of

  	
  )

  	
   

  	
   

  
	
  ANTURIE
  BETEILIGUNGSVERWALTUNGS

  	
  )

  	
  NAME:

  	
  FERNANDO O.

  
	
  GmbH

  	
  )

  	
   

  	
  GONZALEZ

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SIGNED

  	
  )

  	
  SIGNATURE:

  	
   

  
	
  for and on behalf of

  	
  )

  	
   

  	
   

  
	
  KAZAKHMYS POWER B.V.

  	
  )

  	
  NAME:

  	
  OLEG NOVACHUK

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SIGNED

  	
  )

  	
  SIGNATURE:

  	
   

  
	
  for and on behalf of

  	
  )

  	
   

  	
   

  
	
  KAZAKHMYS PLC

  	
  )

  	
  NAME:

  	
  OLEG NOVACHUK

  



 


 


 


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