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2010-12-06-Resolutions 10-306_Natural Gas Purchase-Sale - Agr - US Energy Services
THE CITY OF WAUKEE,IOWA RESOLUTION 10-306 RESOLUTION APPROVING CONTRACT AGREEMENT BETWEEN U.S.ENERGY SERVICES,INC.AND THE CITY OF WAUKEE IN THE NAME AND BY THE AUTHORITY OF THE CITY OF WAUKEE,IOWA WHEREAS,the City of Waukee,Dallas County,State ofIowa,is a duly organized Municipal Organization;AND, WHEREAS,the City of Waukee operates a Natural Gas Utility used for obtaining and distributing natural gas for consumption by the citizens of the City;AND, WHEREAS,the City of Waukee has a need to obtain the Natural Gas commodity through suppliers such as U.S.Energy Services,Inc;AND, WHEREAS,U.S.Energy Services,Inc.has submitted aBase Contract for Sale and Purchase of Natural Gas to the City of Waukee;AND, WHEREAS,the contract attached as Exhibit A is submitted for consideration by the City Council and the City Council finds the same should be approved; BE IT THEREFORE RESOL YED by the City Council of the City of Waukee on this 6th day of December,2010,that the contract attached as Exhibit A,submitted by U.S.Energy Services, Inc.is hereby approved. Passed by the City Council of the City of Waukee,Iowa,and approved this the 6th day of December,2010. Attest: ROLL CALL VOTE Shane Blanchard Dan Dutcher Casey L.Harvey Darlene Stanton Mike Watts AYE X X X X X NAY ABSENT ABSTAIN EXHIBIT A Thls Base Contraot Is entered Into as of the following date: U.S,Enemy Services,Ing.. 605 N,Highway 169,Suite 1200 Plymouth,MN 55441 Base Contract for Safe and Purchase of Natural Gas November 1,2010,The parties to thle Balle Contrsot Sfe tho following: and Customar Name::;-;;;;C~I,,;,tyT.'03:':::W=e::,u~kee"i~=:co;;-;;===.Customer Address;230 Highway 6,Waykee,IA 50263.5004 Duns Number:048057301 Contract Number: U.S.Federal Tax ID Numbar:42.6006605 ~: Addre'"Ss~:~2~30~H~I;9~hW~a~y~6~,~w~a:U;ke~e~,~IA:;;50~2~6;3';5~00~4~==:Alln:t: Phone:515-987-4522 Fax:515-987-1845 Confirmations:ConfirmaUoQs; 605 N,Highway 169.Suite 120q'l?lwouth,MN:'~!i441 Addre;ss;:~2~30~~Hijg~h"~,a~y~6~,:w=a~u;ke~e~,;tA~50i2i6~3-i5~00~4~==Attn:Contraot8dmlnlstration .":....,Altn: Phone:763-544600 'Hliii:§63-548"160g;Phone;515-987-4522 Fax:515-987-1845.'.~..~., InvoIces end PaYments'.'::·.f __",_:.:<~,;~.,:InvoIces Bod Payments 605 N.Highway 169 Suite f200 f'ISim>iulh;j~W§5441 Address:230 Highway 6 WaUkee,IA 50263.5004Attn:Manager,Agenoy Accounting ."",-.Attn: Phone:IN,M3-4690 "...FllX:763-543,4605 Phone;515-98l-4522 Fax:5JkP87-1845 :~Ktr~;tr0QrAct1i®~st~J~~k'DJ~~~(e!:BANI<=;;;W"";'~'$llif",B",an-",k,-,l""ow",a",,,-":",.,,,,."""--'C""_~--_ ABA:'.,..··:mmOOll57 ::',ii:....ABA:073900Sm .,", ACCT:.,.....·..:<4ll620j67 ':Y":""./(CCT 290j8~'.-' otherQ~.\lI!l~~"N.me\,on:tWii\-U S.E!j;!li>lilSBrvicesMm,..otfJer Detail.:,r;l~me Qn Ac<l\m iillfMI-WauKea . This aa~~'lllo~1tOOtIn#&~k,by re'ererfd~lor I'll purpo~'ti\'.G,neraJ Terrrtiand condljj~n~fcr Sale ,,' bytheil!i&iJi?Anfertcan'E"~ill\{;iltandards ~9l!l;~.The paiil'&;li~iObYagree to fub followingJil'iMsionsoff Conditlahi<,1n:1fj.'evehtiIJj;':~il1tlesfullto Oliiillka box,lh,,'\i-Pe<i!ieddefaultpro\li~onshall aP'eN!Select 0 Qm e""'GOblin: Sec\t~fi:·iikQt~i1~f.UII)·"·',..secti~7,2'ii:25 d .,J 1I0wilfg:;iiii of Trans.cll'n:.'oWr(tfoo PaYn'i,n~D'te deliveT)i;(~et*j:iJJ)'.'.::.. Procedure ..,,'."'".::,.D.::~':R';Yi;61j~<lhth follow!ll!iiMonthof Sec(ltiif;2i6'.Ei ''2''eu.slirass Days affer'reoeipt (d"(~UIt).Sectlbfh7i'.l':X Wil., Confllm ·,,'5:1'i~\1Iii'BSSDays efter recelpt '...'.·:;y,p'aeyt~!,,~.ipt.:....f.•;s.·.,;..•,:.,.:.•••:,'.....D Autp""gliQy.•o:,eredil (ACH)DoacmM.·-~:._'.'.:,-"~'"X Che.ck.Z_.:::;::~;5~:.:':';·'.". Socl!tflfO,.X :Bu\'<ifPays At a'Wflj'!er DellvelYPoj(it Taxea-(de,fquJt}:.'-.".',.':".'...".,. 0,.'$0/[8bPa s eefo(e;'i!nd At Deliv./iA1.olht Secf(gh 14.10'),:CQnfide~~iill\Y',~fiPlies(dot~all):C.nllMnHally ,:G!.CQnfidentlallty,i:!.oesnot apPly" ap.·fto~al:-P·Nivlslol1i1·:Ntiftj~:orof sheots A J;¢lJed:Zero (~O~)' Ad-de~dum(s):None . IN WITNESS WHEREOF,the parties hereto have exeouted this Base Conlraot in duplioate. u.s.En~er~!ln/.?~CltyO~W"~~ By 6;L;::>cA-eN'~By 232 ....~ Name:Dan Schroeder N~~F.Pear Title:\/lee Preflident.Merchant Services Tftre:_::M,;a,-,y~o":,r;,'-';;~;-;;-_ Date~\Z [5.lID Date:_-,-1 "'2-/-1-'-0"'6,.,1""2"-0.....1 "'0 _ Copyright©2002 NOlth American Energy standards Board,lllc. AI/Rights Reservod NAESB Standard 6.3.1 April 19,2002 General Terms and Conditions Base Contract for Sale and Purchase of Natural Gas SECTION 1.PURPOSEANDl?ROCEDURES 1.1.These General Terms and ~·o~dl~.onsare intended to facilitate purchase and sale transactions of Gas on a FIrm or Interruptible basis."Buyer"refers to,lhecR~t\y receiving Gas and "Seller"refers to the party dellvaring Gas.The entire agreementbetweenthepartiesshallbetheContraQ!aS1l<iffriedin Section2.7. The parues have selected eIther lIie "dt~i;ti~nsacllon Procedure"or the "Written Transacllon Procedure"as Indicated on theBaseContract..... Oral Transaction Procedure:c,"•• 1.2.The parties will use the"fqlloi'ling Tr~tr~'i1otionConfirmation procedure.Any Gas purchase end sale transaction may be effectuated in an EDl transmlsslon;\inijlephojj~;ij\iliversation with the offer and acceptance constituting the agreement of the parties. The parties Shell be legally boun,d'fI'olitthe ti:riit'i\l1~Yso agree to trensactlon terms and may each rely thereon,Any such transaction shall be considered a "writing"aiitfto"i)ave',bej!l'(;~~rgned".Notwithstanding the foregoing sentence,the parties agree that Confirming Party shall,and the other party"niay;,col1fir)jj':a"'telephonlc transaction by sending the ether party a Transaation Confirmation by facsimile,EDI or mulually agreeablEi'ele6tl6hl"means within three Business Days of a transaction covered by this Ssclion 1.2 (Oral Transaction Proceduretprovlded that the failure \q.s,end a Transaction Confirmation shall notlnva.lidate the oral agreement of the parties.:~qljftrmingJ'l'\)il;l\ei~9Pls Its cgnfirming'rJ!tt:~tti.Ad,;Ql..t~~;Ijk~{'ff~'lts .si~n!l\ur~on.nt.:n;,:~n~~~6n'9of:jft[mation as the Identific,IUIM"and aut~enfietlllo'n of Conllj11)lngParty2,,\liln,a'Jransaciion Clfnfirmatio""gg~ntalnsany';pr!l'llaJqrr~other-than.those relating to the QCa\l1)hdrclal t~friis,6nhe tram;'lQlion (l.e.,prlo."ftqUantily,perfot!'nance objlgeiUon,dellv"iy;;poln\;'J)eliodlif(j~Ii~,eIY andlor transp:oI'MJ~n'oondiUbh$),,'iihich modiW;pt supplemef:jl'!h,a.Base Contreict or Gen~r~Jnerms an\l:C)6.5aJ9~hsof ltiis eentract (e.9., arbitrafionJiritdditiol\~l;iepresantationa:i\iil!warrantieis);iiii!ch provlslonsi~h.1I not bs:,§!iemed to b;'·;eiob.flte~puraua'riHQf.8ection1.3 but mueikl?:ei;eixpresSJt,.agreedto by bOlfi,parties;prOVided'that the foregoing shall,.:rj~llnvelidate ehY,·t!eirisaction,<\greedto by theparfies,.,'"...'..,,. SECtI0N2.DEFINITIONS The terilrs s ef'forth below 811';'11 have th~'m~aning ascrlbel!to th:em below.Other terms are also defined elsSWli'~reIn the Contract and shall have the meanings ascribed to them herein. 2.1."Alternative Damages"shall mean such damages,expressedin dollars or dollars per MMBtu,as the parties sh~1 agreeupon In the Transaction Confirmation,In the event either Seller or Buyer fals to perform a Firm obligation to deliver Gas In the case of Seller or to receive GasInthecaseofBuyer. Z.2."Base Contraof'shall mean a connect executedby the parties that lnccrporatesthese General Terms and Coodmonsby reference;that specifies the agreed selections of provisions contained herein;and that sets forth otherlnfonnation required herein and any Special Provisions andaddendum(s)as identlfiedon pago one. 2.3."Brtiishthermel unit'or "Btu"shall me",the IntemationalBTU.which ls eso c~led the Btu (IT). Copyright@2002 North American Energy Standards Board,Inc. All Rights Reserved Paga 2 of 10 NAESB Standard 6.3.1 April 19,2002 2.4."Business Day"shall mean any day except Saturday,Sunday or Federal Reserve Bank holldaye. 2.5."Confirm Deadline"shall mean 5:00 p.m.In the receiving party's time zone on tha second Business Day lollo"~ng the Dey a Transaotion Confirmation Is received or,If applicable,on the Business Day agreed to by the parties in the Base Contract;provided,il the Transaction Confirmation la time atamped after 5:00 p.m,In the receiving party'.time zone,It shall be deemed received at theopeningofthenextBusinessDay. 2.6."Confirming PErty"shall mean the ,'petty designated in the Base Contractto prepare and forward Transacfion Confirmallons to the otherparty.' 2.7."Contract"shall mean the leg~nyj~h.ding relationship established by (I)the Base Contract,(il)any and all binding Transaction Confirmations and (iii)where the partl~s h'!'i.v~:.elected the Oral Transaclion Procedure in Section 1,2 of the Base Conlracl,any and all transaotions thstthe parties have eritere~nhll:tthrough an EDI transmission or by teiephone,but that have not been conftrmed In abindingTransactlonConfirmation.'.",, 2.8."Contract Price"shall mean the,amOOliliexpressed in U.S.Dollars per MMBtu to be paid by Buyer to Seller for the purchase ofGasasagreedtobythepartiesIn:1>transectlon,.. 2.9."Contract Quantity"shentmeMithe qua6tiiY,of Gas to be delivered and taken as agreed to by the pertles In a transaction. 2.10."Cover Standard",as r,~iliJt$i1~o In 1l:~¥)j~\b.2,shall mean that If there Is an unexcused fellure to take or deliver any quantity of Ges pursuant to this Contrac!,'ifi.~iJHhep:ei:fQrmjhg party shall use commercielly reasonable efforts to (I)if Buyer lethe performing party,obtain Gas,(or an elternata'.fP"eli,lf elEi.(il:~~;IiY,'Buyer and replacement Gas Is not available),or (ii)if Ssller is the performing party, sell Gas,in either case,at a price reeeoD,i\blEi<fiifthe delivery or production erea,as applicable,consistent with:the amount of nolice provided by the nonperformlng party;the Immediacy of the Buyer's Gas consumption needs or Seller's Gas sales requIrements,as applicable:,tihe,quantities invol~ed;and the antlolpat.,d,l~nglb'oHallurs bY,liwnonperformlng party; 2.11."Credit SUPPofl,O!:iilgatIOn(S)"i;it~1I mean a~YAi?ilg~tlon(s)to prOVide or est~.I\)lilh credit sUj)pO(f(dr,o'ar on ~eh.iilf of,a party to this Ci>lltiEidi"such aEiAtHitevocable $fEir!~by letter :Of:creUlt,a margin :a~reement,}~,ji'repaymenf,"a;,a!iQlJrity InteresUn an asset,a performiinc,,'bond,gUar~ntY.or other gpifd:,;md suffidEirifs.curity of a continuing natCJi:!ii "'"" 2.12.-)_!~-~y'!I.s.hall·m·-ea~·~a~perlod of.~~4:::bonsecuti~e.:~~q~tslcoextensl~6 with a IId·~_Y·ii:asdefinei~y.i-tti~.:~ecelvlng-;TTans·porter in apartic(lI~H[allsaCtion.:·."-.'.,":_.:...._:.;"-'.,.: 2.13."Delivery perlorl';"hBII bethe ~ei;16d during Whjcha~lIverles are td.be made aSagr.od to bYihe:pa~l~s in attansactlon. 2.14."8EiIiVery Polllt(~)':shall mean;s~c.h poillt(S)a.'are agreed to by tfje parties In,~,transactiori.: 2.15.,';lObr":shall m'~ah'in aleclroni~:d~la Interch@g~o'pursuant to an~greemenl B~tered into bylfre'pallles,spaolJically relating to the cOflTmulllilation of'rralJ~aclion Conrrrii)a~ons under.thls·Contract.'.'.::'..:'.:' 2.16."e;R!,,~~h;;II~\ei1riJne purchas.~,:g-~Ie or eXCij~bge<i{naturel Gas:~~~he "PhYSIC;;~'~I~e~f'-.ii!~;;X~[\~h~e for JiJ1Y~Jo;;tiran.action Illvolving:,g:aii~f~tilre~:;~jjnlJ<,,-ots.EFP::~liall incorpQf;;j!ethe mealllngeht];jr1;lmedies oi'~Fltin",j,8r.q"1~6d;:lhat a:,r!lliY~s excuse for nonpeJfiiifiiMpe '(if ilB'Oblrlf~liolls to deliver or receive"Gas will be governl\~:'I1Y the rules ijfth"Jele"s:nt1\ll~res"~xollange reguiatedundertbe,CQh1mndl~.Eich~tige Act.',",.",' 2.17.;'Ami".ha.l,1:~Eiahtnat either ~~rtYmay Inteitiupt'ljs performantili:.Wl16b,Qnlabllity only tci:th'~·llxt~i1I-that sU~Ii:p.iformance is prevellte,d-fol',i'easooe:ofRdtce MajeureUi'ovlded,hOwevllr,:lhel during Fof&.-Majol.lre interruplioiJe,J!fe'plirfy invoklmrl'broe Mejeure may be,re~I1QJJslbrEfJOJll~X·h'nbalance.(;)h,',~iges as setf61')h I~Sectloll 4.3:related toljl~inlerruptI6i1::llfl~r1he,)\ominatliJl)lsmade to the Transporter:slJd untll'lllec-oliange In dellven,as end/or receipts'ls conflrmed;~y lhe Trell'Rorter.:o',."'",' 2.18.,"Gas"sheillme,an'ahY mi>clure:o.f'~YdrocarbonB::~lidMncombusti~J'e gases lIi;;.'l1aseous stat~cOlisl$tlllg prlmBrlIY:Qf methane. 2.19."lmlJalenceCh:at~lls"shall meAd';'aI1Y fses,Jl~nalfJ~,costs occharges (ir'f',Clj~h or in klliql'I3li,j~ssed by a Transporter for fall ure,loi'\ftlsjy the t(an~PQrtel's balanc-"''i\nd/or nomination :requir.m ent."'"' 2.20.,"rhftlrrUPtlbla";;ha)(mean that:~J1Mr party m~,.hl~llrrupllts perfoimance at a.dV,'iime for aI1Yf",~~'m;whethllr.ei~o'not,caused by an evEfnbofFoi'ce M'1l<j)Jtll,wlth no habll.lffi.~except suqhlnterrupting partY,may be resp~h$ible for anyhli,balallce Charge.'as·set forlh In Sectlo.n 4:3:related to:lts.lnt~truption after"the nominatibn,ls-made to the Tremsporter an"tH.intil the change:.ln-;deliveries:t\ndJor receipts is confirrtled lSyTransport¢r.....".._: 2.21.;'MM6tu"shalHJfllai1 one mJillon'Srltlsh therl11afo,hils,Which Is eq~ivalent to Cina-dekathenrr.,, 2.22.'j;MQ;)th"sh~II'riW~n the peM!l:beglnnlng ,~n:ihe first Day oLthe calenBar-month and~lldli1~"mmediatelyprlor to thecomm'llniieimllnt ofthll'rniit:,t',ay of ths n'eWCalendar month,' 2.23.I'Payment Date"shall mean a data,as indicated on the Ease Contract,on or before WhIch payment is due Seller for Gas received by Buyer in the preVious Month. 2.24."Receiving Transporter"shall mean the Transporter receiving Gas at a Delivery Point,or absent such receiving Transporter,the Transporter delivering Gas at a Delivery Point. 2.25."Scheduled Gas"shall mean the quantity of Gas confirmed by Transporter(s)for movement,transportation or management. 2.26."Spot Price"as referred to In Section 3.2 shall maan the price listed in the pUblication indicated on the Base Contract!under the listing applicable to the geographic location closest in proximity to the Delivery Point{s}for the relevant Day;prOVided,if there is no single price pUblished for such location for such DaYt but there Is pUblished a range of prices,then the Spot Price shall be the average CopyrIght ©2002 North American Energy Standards Board,Inc. All Rights Reserved Page 3 of 10 NAESB StBndard 6.3.1 April 19,2002 of such high and low prices.If no prloe or range of prices Is publlshed for such Day,then the Spot Prloe shall be the average of the following:(i)the price (determined as stated above)for the first Day for whloh a price or renge of prices Is publlehed that next precedes tho relevant Day;and (Ii)the price (determined as stated above)for the ffrot Day for whioh a price or range of prlces la publlshed thatnextfollowstherelevantDay. 2.27."Transaction Confirmation"shall.mean a dooument,similar to the form of Exhibit A,setting forth the terms of a transaotlonformedpursuanttoSection1foraparticujarDeliveryPeriod. 2.28."Termination Option"shall mean·1l1a,:oplionof either party to terminate a transactionIn the event that the other pffiy fails to perform a Firm obligation to deliver Gas in the oase.of 'SeIJeror to receive Gas In the case of Buyer for a designated number of days duringa period asspecifiedontheapplioableTransactionC.onfiml'iition. 2.29."Transporter(s)"sh<Jimean.:aJlGis/gathering or pipeline oompanies,or local distribution companies,acting In the capacity of a transporter,transportingGas for Seller or Buyerupstream or downstream,respectively,of the DellvelYPoint pursuantto a pE<lioulartransaction, SECTION 3.PERFORIii!ANCEbElGiGATION 3.1.Seller agrees to sell and:q.ellyl'!,and Bijyer agrees to receive and purchase,the C~n~act Quantity for a partioulartransaclion in accordanoe with the terms of the~ontrili\.SaiflS·:,andpurchases will be on a Rrm or Interruptiblebasis,as agreed to by the parties in atransaction.....:;r::.. The parties have selected elttiiiflij~'''co~v~iLs:!iihaerd''or the "Spat Price Standard"as Indicated on the Base Contraot. 3.2.The sale and exclusive remedy of the parties in the event of a bre.•ch of a Firm obligation to deliver or receive Gas shall be recovery "Hhe followlnS;;(ij'Jrr1ife event of a breech'bit;Selle",i,in'eny l!):aY(~);payment by Seileqo;'~.Qyef'hi·ahamQunt equal to the PosltiVol,til(fer.bce,IhinYiJ\jitween the:1?W"hase prioiljlaid'by Buyer ulilltfifg the COV'~[cSlandard;and;lh~\136ntractRrt~~,adjusted tor commerQlalineasonabl!!·dlfferences In:'If.Jij)sportatioh'~cO$~:to or from t1w·Delivery .-INlot(s),mUitlp.lled'lliq~e dlffefellbe.'belween ihe Conlrac~Qi:(aIiti.ty and'tli(>'9~.antity actu·~,ILVi,delivered:l'iYi~eJierfo!such [)~y(.):or (1i);IQ'lheevent cih,\]:i(eabl)by BUYer.~<m,ahyDay(s), paym@rjt'by,'lluyer to .Salletm the amounb,eqUaito the,poeltlve dlfference:ei!any,be,,"ean the Conl,eOl,,)?,tlce'andthe:prlce'recelved by Selieruilll~lhli1tiie Cov~r:S:filbdard for ttia:(rilSale of sucfi"($a.,adjusted fot:commercli;1fIi.reasonabl.:lli{f~afudes In lrjjn.port~tlon costs to or fromthe'Olllivery:P.6Jnf(~),multipll.d.}py the differimQe.between Ihe.G.onlraotQ(ta~!!ty and thagWllifU!l';aclually.taRen by Buyer for such Oay(~Y;~,or(iil)'in th~'..,event th<iLI1!.l;jyerhas u~ed::commercially feasonable1,.el/Orts to repJacif:.tl'i.e:Gas or·$.II';r has used commerd.Qy ..r;'.~son'abl"j'.e(fortsto selftne Gas to e:ANriFparly,and n:"such rep .e:~Wnent01''Iajd·I.~"~i7~lIable,ih:~h lh.sole and excluslv~·:re:m~dY·Ofth.·~pd(formlngpal'!l'·:~heil be any·un(avorabie dlfferM·c.betweeilJ"!heContracORtlo\l'and the ~RotPrlil.,sdjusted forsucn:tra'n~poi1ati6jl'tti·:the applloab!~·:DellvelY P6ii'\t,~Ji'JlIltlpliedby th.';difference,M!ween th":Q:ontfsi:l:QuantitY :imd'the quantity actually <leiliv.ete(j:by,Salierand recelved:bY.Buyer for:.~Qbh:Day(s).Imb~i~noe Charg"Ij'.hall not IjM.,oov~r'd undenliilrSectlon 3.2, but 8allet.a):Jdidf·Buy~,·~hall:1>erespcn'~Jbl;,for Imbal;'ilo~~.Charges,If anYJ::11~.provldedr~'$splion 4';3,~.tl\ii\.ibounl of,:~.uchunfavorable difference Shall ""p~yabl'$'r...va Buslne~i"'Days alter presentation of the pe)'fo'rJ)lingparly's:.Involc·e,'·Whlch:sliall set fi>rth1h·.'basis uponwhich.$\!OIH'j)1oWntw"s'C.r~glaled.··.. 3.2.'(h~:scle:and'.,*oidsive remed~'O.f:the parti,,;i:lh:the event of a8r~~';h'p(~Firmobllg~ttol\\o ..qeJiv.'r or r,*,elv~,;Gas shall be recovei{p/;,thil foll:OWlng~::(J};jnthe eve~l.of a breach~;by:Seneron any ~aY(s);P'';YrtI.ontby Sell.do,JjUi'''r'fn an al\lpunioequal 10 the <llffereiMe·b.elWee"'th·e.Corltraot QuantlW,;nd Ihe actUal,quantity dellveretl!by Seller;~nd receivedj,y;Bj,iy.~;'fpr suoh·,[).ay(s);multiplied by IhepQsitiVe diff~re.nce;Jf;any,obtain~a.'~jr sUblractfn~Hh,eContraol Prl~ii from the ¢ppt Prioe;or:(j.!);iji-tiieievent ofa,bi~Mh by Buyer on aniOay.(.),paYmenv:py'fJuyer to Saller In an amo.Unt,~qualto the diffe.'enoebeWle,iththe Conl(a:CtQM~htityand'th·e'actu.alquantity delive'e.d'~y .8eller andireeaived by Buy~r for suoh:lfay(s);.multiplloo ~y,llle positlli~illlfference,lf:ai,¥i \6blalned:!Jy,supt,actlng the applicable:SfJot Price frolj}'·the Contrapj"Prloe,Imbal:ahM'Charges shamnot be re~:9yered under,;tl}is;Sa~lIon 3.2;,tiuLSaller and/or Buyersh:aItb:e.respori$I\i]e:j6r Imbalanca&lharges,if.a:ny;'''.:provided In:Seclion 4.3,''1'0·0 amount'Qf'S~dh:u.iJfavorablll'diff.r,enceshall be paj(able flv.e Buslnes",:jj)ay~after pril~~nlation o{{:M,Perlormlng pa~y's involoe•.-WhIChshall set:!9rth'lI1e basi,,;qpohNihich such amoun"was~calculated........'........~.......~... 3.3.No.\Withstandlng·..Section 3.2,thiJ'partias may.agree to Alternative:Damages'ln:aTransaotion·¢Mflnnation.exBculed In wrilingbyboth.partJes.....:.... 3.4.In a<ldilion to.Sedlans 3.2 and:3,.3,the partl~:riI.y proVide for •Termination,Q'ption in a TransaGjioJjConfirrlJ$lIonexecuted In writlng.bybQtn parties,.'the Transactlori.~pnfirmaIIQn'odritaining the Tennination 0iWoij will deslgnlltiJ::lhs:length "oinohperformance 1riggering;the(Termim,itlan-qptlon and th~·p-l'ocedures-f9r-exercist3 thereof;h~o~damages.:for nonp.erjorniancfJ.will be.compensated,andhowllqul<latlon cosls wllHj·e calculate<l..·.. SECTION 4.TRANSPORTATION,NOMINATIONS,AND IMBALANCES 4.1.Seller shall have the sole respon~billty for transporling the Gas to the DellvelYPoln~s).Buyer shall have the sole responsibilltyforIransportingtheGasfromtheDelivelYPolnt!s), 4.2.The partes shell ooordinatetheir nomination activities,giving suffcient ~me to meet the deadlines of the affectedTrensporter(s).Each party shell give O,e olher party timely prior NoIIce,suflloJentto meel the reqUirementsof ali Transporter(s)Inv~ved In the transaotion,of the quantities of Gas to be dsllveroo ald purchased each Day.ShOUldeither party becomeaware that actuel deliveriesat the D~ivery Point(s)aregreater01'lesser than the ScheduiedGas,suChparty sh<Jlpromptlynotifythe otherperry. Copyrlght@2002 North American Energy Standards BQard,Inc, All Rights Rt:l50rvod Page 4 of 10 NAESB Standard 6.3.1 April 19,2002 4.3.The parties shall use commerclally reasoneda efforts to avoid Impos!lion 01 my Imbalance Charges.II Buyer or Seller receives an invoice from a Transporter that Intludae Imbalance Charges,the partles shall determine lhe v"ldty as well as the cause of such Imbalance Charges.lithe Imbalance Charges were Inourred as a result 01 Buyer's receipt 01 Cl\lantities01 Gas greater than or less than the Scheduled Gas, then Buyer shall pay for such Imbalance Charges or reimburse S"lerlor euch Imb~ance Charges paid by Seller.lIthe Imbalat1Ce Charges were incurred as a resu~01 Sell~s delivery of quantitles 01 Gas grealerthan or less tilan the Scheduled Gas,then Seller shall paylor such ImbalanceChargesorreimburseBuyerforsuchImbalanoeChargespaidbyBuyer. SECTION 5.QUALITY AND MEASUREMENT All Gas delivered by S"ler shall meet th;pr,*ure,qUality and heal content requrornents 01 the Receiving Transporter.The unit 01 quantity measurement lor purposes of this Confract sbiilH,e one MMBlu dry.Measurement of Gas quentities hereunder shall be In accordance \11ththeeetebllshedprocedures01theRecelvinfiTralj·sp.ili\er. SECTION 6.TAXES .:~." The parties have selected either "Buyer Pays At-and After Delivery Point"or "Sell.r Pays Before and At Delivery Point"as IndicatedontheBasecontract,. Buyer Pays At and After DeHvet'iJ',Mi; Seller shall payor cause to be pa!~:~Iii11i~es,I~tisdejiils,penalties,licenses or charges Imposed by any govemmenl aUlhority (Taxes")on or Wltl,respect to the Gas prior 10 Ih.e:)1\eilvery:POlbl(~):Buyer shall payor oause to be paid sll Taxes on or \11th respect to the Gas at the Delivery Point(s)and all.Taxes ~.r·lhij':bell!i~i1i.:Roinl(s).If a party is required 10 remit or pay Texes that are the other party's responsibility hereunder,the party responsible lor such Taxes shall promptly reimburse the other party lor such Taxes.Any party entitled 10 en exempuonfromany,s~ph..Jalies ~r"oharoes",hall·fuml.h the.oll:ter;oetlV·any necessarv documentalion thereol .. Seller Sh~li:ii~§·or caiJ~~:ia'ij~;pald all ~iiees,levlel!~p§l1a1tles,liOSflsesQ~charges iinl:tased by ani4ily},rhmenl authorilyrra<es")on or with resp~9Hb',lhe Ga""ffilrliithe Dellve,!y:f1oint(s)encj'~.i1:T!'Xesat the DeliV,eryPoin~s)'j:1:l9yer shall pay"ol'oaOile to bejJam:alITa<es on or with reiJpO!lt'tb:,th."a~..:.lla(the Dellv.;Yi,~oiht(s).I(,\(patty Is requlred;w remit or~R~Y'Taxes th'i\t,at~'th~other p~1tY'9responslbllity hereuncjo~;'!b~,party t'~~Q~j~le for sUch;!~es shall pi:ii.t1ip!l~relmburse th~:6ther p.r:wllgr;-such Taxes,'Aijy:p8rty entillecjJoen.e<emptlonfromahKSlIPliX-axes or.:cliliriliis shallllm\l~hlhe othero.alt\/'ariv.neoessary dQOumenlatIO(f:ljiereol.".SECTIO~1';SIGtiNG,PAYMgNT,ANDA!JbIT.......•. 7.1.:$~i.iJi::sliall iliiblci~;iiuyer for G,~:;J!ellvered an4;t.¢'lved In Ihe pr~eding M~d\lland for ariy~g;.iapplloabl.6I1erges,proViding supporlintl'dii.1ilJmeh!'llfon·awei>lable in bi.dYS!iYprecticefo.s\lWorlthe amounl@)erged.If U1e,actu"qual1\lly;d(lliver~d Is not lirioWlicbythe billing date,1iI11i~~:w.;U'b":prepil(6ij::~,,"edon th(cj(iiinity of Sc!j~dt.Tl.d Gas ..T~e iri~l).~fldquantltywill thenb".:adJumed'ti>the aGlqak~antlty on the loIi<NIITfgMottm's'bIUlngor;aa,,?-oon 1hereaf!ll:':a.s aclu"deli\lOTY,lrnormationIS av~ITg!)le.."::..'"...''. 7.Z..e~j;,rshtlilrel)i~If:i~lImount dU<l-lIrtderSeclioq'?:-tihthe manner S#'iiA~~~!n the l3ase:Go.nti!¥VJtiin'J6ji3.\1~eIY,"'~lable funds,on cr before·lI.l~'.I8!i1fol'\!le.'PaW,iJ.!lOtDate cr 10 Days ~er lWe!ptof'the:lnyoll'e bY:('i'!l'I'!'i'provlded that·/Ph,e'PaYfllllnJDate,!s:not a BUsiness Day, paymeot<ls"Q(f(;on-lhe'lieX!,etlslness Dey..ldlloVlingthal.d81e.:ln:the event ahY'pil\!meros are due Buywtt.,reuhd¢ri payTnetiUo ..Buyer shall bemadeIn'i!i:<>ofQMCe'wit!l'll:ii"'Section7.2.,..'.. 7.3.Iwlli:e e~e:Ii~'PllYIn:ents becOl;;'.::.~ue purst(ilrltio·•.8ectlons 3.:L~r 3.3,tM::performlng'~.;'1'tY4rt~Y:·eubmlt'e~·lnvolce 10 the nonperfiinri,lnQ pa'o/"br,,,h·:ll.cceleraled'p,,ylnenl seUin.j{l(j'rlh.the basis uptin which tll •.;;nvoiced amoil.'it·was'Qalculaled ..Payment fromthenonp'e!'l'ilimlng:parl\1'WIiI:be due five;~~~lness Dai($,after.reoeipl 01 inV.drOll..'. 7.4.'.'1(tl'ielnvoI9.d:P~rty;in good fatn;.:di~"utes the amouillol any such Invoice or mY'Ri!ithereol,SUPh'ln~ti6~~party v.ill',paysuch amount as II c.gnQ$.IeS to be 'o(lIl'@LProvided,h)l'i\(~ver,If tha·l.fiVoiCed party asputes the amq\1tlt'due,it mustpibvide suppdtling'qoQumenletion acceptilti(il:iTiJIJdusliYwiotiiW.lo supporl:\bi\'amounl palq:·o~illsputed.in th"A"ent the 1tE>:lfli$are unable t,,:resOlve such d!Si'!J\e;..eltllsr pmtymaypurslie'a.~y remedy:~e1liible allaw or,ln:.;;qultyto enilJiCe.lts lights pursuanHo l!1isSeCji~!l,"..".....•:.. 7.5..',ifJlteJnvoiceq IiMY:I~lslo remitim_lull amount,p,~ilIiIeWhen due,interest on theili.r!illildporllon 'sbl>JtllSC.IJ.le from l!iad~e:due untll the date of'p'ayl'\lmt al a,i!rte'"Qual to the I~et-:.of (l)the1h~h;.f(OOtive prime ",I.01 Inleresr;lliiiiilshed und~t."'M,cin.Y:Rates'w,tM;Wall S1reetJournal;:pllistwo percentP.eri~t\num;or (ii):th'<l.'maximum·sppIiCilbielawftJllntereSt rate..:::.":..:.... 7.6 ..Ap>rly ahall:have·i!lIJ righ~al its,oWn expens~;ljponreasonable Notice and ltf"..~1inable tlm\iS,;tM,amlne and ..tl!idit·end to ob!'oIn copies of"!liNelevant poriloh'of the booksi/¢¢jJrds,and tejePllone recordlngs:Of1jhB other pM)/:onIY 10 1h.lixli1ntfeesonabfy ..ne\;eMary to verify the acou(~CY:of any statemehl,;charge,p"l'men!,or comPllfu!jon.lilede ~mQerth.;eonlract.This righlto.exaniiri.,:aOc:j~andto<lbtaln copies shell not be ava'liable witil respoolto propriata.y·lnfOlJl1ation nohJireclly rel'Nsnt 10:lI'aMOOtionsunder tilis Contract'A11'liivoices and billings shall be conclusively presumed tinal and accurate and al assodated claims for under-or overpayments shall be deemed waived unless such invoices or billings are obJooled tu in writlng,with adequate e<planation anel'or documentation,I"1fTin two years ~erthe Month of Gas delivery.All relroaclive adjuslmenls under Section 7 sholl be paid In M by the patty o\l1ng payment \I1thin 30 Days of Notlce and substantiation of such InacaTracy. 7.7.Unless the parties have elected on the Base Contract not to make this Section 7,7 applicable to this Contract,the parties shall net all undisputed amounts due and owing,and/or past due,arising under the Contract such that the party owIng the greater amount shall make a single payment of the net amount to the other party in accordance with Section 7;provided that no payment required to be made pursuant to the terms of any Credit Support Obligation or pursuant to Section 7.3 shall be SUbject to netting under this Sectlon.If the parties have executed a separate netting agreement,the terms and conditions therein shall prevail to the extent inconsistentherewith, Copyright ©2002 North American Energy Standards !3oard,Inc. All RIghl9 R03-orved .Page 5 of 10 NAESB Standard 6,3.1 Aprir HI,2002 SECTION 8.TITLE,WARRANTY,AND INDEMNITY 8.1..Unless otherwise spsclfically agreed,tiUe to the Gas shall pass from Sell.r to Buy.r at the Dellvsry Polnt(s).Sellsr shall have responsibility for and assume any liability v.ith respect to the Gas prior 10 11>1delivery 10 Buyer at the speolfled Delivery Point(s).Buyer shall have responsibility for and any liability with respect to aald Gas after Its delivery 10 Buysr at the Delivery Point(s). 8.2.Seller warrants thaI il will have th'e right to convey and will transfer good and merchantable tltle tc all Gas sold hereunder and delivered by It 10 Buyer,free and clear of ~llliens,encumbrances,and claims,EXCEPT AS PROVIDED IN THIS SECTION8.2 AND IN SECTION 14.8,ALL OTHER WARRANTIE.S,EXPRESS OR I MPlIED,INCLUDINGANY WARRANTY OF MERCHANTABllIlY OR OFFITNESSFORANYPARTICULARPURPb~~jARE DISCLAIMED. 8.3.Seller agrees to Indemnify BOyerjiJ1'lf'saveit harmless frcm alllcsses,liabilities or claims inclUding reasonable attorneys'fees and costs of court ("Claims"),from .MY lihd'i<i!l'persons,arising from or out of claims of title,personal Injury cr property damage from said Gas or other charges thereon Whlch:.~\iiio]ipefore mle passes to Buyer.Buyer agrees tc IndemnifySeller and save "hannless from all Clams,from any and all persons,'a~slng'fr6ii1:oI'outof claims regarding payment,personalinjury or property damagefrom ssid Gas or otherchargesthereonWhichattachatlertiliepsssestoBu~.~r, 8.4.Notv.ithstanclngthe othetnrQ9I6I~nscf thls;~~on a,as between Seller and Buyer,Seller 11111be liable for all Claimsto the extentthatsucharisetramthsfailureofGasdelll,e'rildby Seller·l6meetthe qJalily requirementsof Seclion5, SECTION 9.NOTICES 9.1.AI!Trans.action confirmailol"'~i iI)VQj~e~~~payments and other communications made pursuant to the Base Contract ("Notices")shall be made to the addresses specified in writing by the respective perties from time to time. 9.2.·AII.:.Notioes oroq~irecHiet.underl1)ay be·\;M,.fby:.flicslmM.:or mut~alry acceptable elaotrohic·.mesris,a naljonslly recognizedovernigfitcounerservlce,firstclass meil:6r,hand delivered,.:.'........ 9.3.Noitoe shalFbeglv.h when reQiltied on a BIf~ljjes$Day by the .~dressee.lf,,~e absence.ol,prqofof the actuel.recelpt date, the fo\lowln:g':ptesullJptipns:wlll apply.",'Notices sent'py'feci;lmlle shall b,e daemedvto-have been 're¢e1.~eg"uponlh.:Mnging party's receipt.of .!tS·JilbSimII~rn!lii.bine's confitm'iJjion of sljocess(ul Iransmlssl:o~'If the detan which.such;faoslmlle Is'r.bel~ild Is not a Business.l)aY:Or Is after flVe:p.m.on a StJ:§1.nessDay;:then such facslmlle:••hall be de.tll.d to have,bMI1·:(il6:.lved on:1he'nextfollowing Buslnes":DjiYi :Noti(j~·.by'oVernlghlmaff'olh,ourler shiil(:bs'diiemed 10 haye'been rece)\I\j'il on the n.Xf·B(i'IIi~ss Day.aftWtwes sent or such e,,"iafUma as is'o6rifltined by th'~Tecelvlng P~,'.N6t1oe via .rst:dass maIL.5li~il be consldotEid:delivered flvo,i3uslness DaysaftermallibQ."....'... SECTI:@~r1@.FINANCIAL RE~PONSIBiL:ITY >'.'.......•..''.'..-.-'.',-_.-. 10.1.Jr.,ellhOf:par!Y:~iX'!)'has reasonOffi~ground~'i'oi insecurity regardi!'gthe perf~ll1)ance oi:;ihY;~bilgation u~der'\h\s Contract (whether.gHio!'lhen'dual by the other,party ("Y")(Including,v.ilhQi,lt'lltnilation,th@'.'ocpu'i'rEir;~e'!lf·a mate(l,akdi:ange In the creditworthlness 'of Yj;)(':l1'Jaydemand,A~equate Assurance of Perfoimiiii.6~,"Adequate Assura,bire:cf.,PerformanO<i"shall meen sUfflcie~t.1iO!J~rily,inthe'fotm,amount and'for the ternj',rt\asohably.accepsa~f~1tilX,Includlfigj buth:Ot'lJmjte,noia'·sla~dby irrevocable letter of:cra(\l~a:prepiiy.lrleiit,a security 'Interest In·.!!h.assetor a perfQtifjai:iQ~'bond or guaran!t(incl,~iJlhg the·jssuer of any SUch ~~'.'.'. 10.2.IJlJh:a eveW(aM)j:lin "Event df.:QEifault")eltJi~i'~arty (the "Defa'Ol,tingParty"),or Its guer<Hii9ts,IWII(I)maka'''""asslgnmenl or .any g"Mtuf;,iirrangEii!ia\1()or the beneflt'0f credltoj'$i'.(IJ)'file a petltig~or othari,iiYsecomm.9¢.~i!,a\.\.lliqr!ze,or "gqulO$ce In the commahglilj'iehl ofa;ii,o:(ieEicting or oasEi:Wder any bahl!fuplcy or elmllar:.[:,wfor the ptotection of drijdlt6[s,g)"have &ijoh:piljltion filed or proceedlml'commElIi/ieQ'aQalhst it;(ilJ)ojhaiwise becciJj1e:'bilnkruptor insOlvent (hov.;WlIr,eVidenced):',(I'I}:b,il':unabl,dti.pEiy:lfsdebls as they faJ"cju~;(v)he,v~'<lte¢alver,provi$lQn~llIquldal6rrc:Ohsilrvator,cUslpGlan,trust;j~}ri!,other slmlfei'9ffl<;l~happolnt.~.'wllf1:respectto it or sWi;W~«.lIy all :'ofolts',?"se!s;(VI)'f~lIlp perform,f\nY o~ligation to the other paiW'\Yith respecMo.:anj"Credit Sll~port 'Obllgations relatlng:to:.thll Conti'EI6.t;,·(VII)'fail to giv'a Ailequate M~u'(atioe of Performanoe und~(S»ctlon 10;j''iilthin',4a hours.,butat·least one Busjne$S,~.ay.:ofa writt.~n··r~guestby tllii'.<ilher party;.·"".(ylin not have paid eny amoutij:aue the otherp~¥:hereuncjet'on,o'r before the second·:Bll~)ii..SSDaYJ¢lltiWlng written 'j\j6~riethal suol\:paymenl is dUB;tl;i,anthe othiit:p~j1y (the "NQn'~et~ulting Paltl)1>h""1 have the right,atllS'cSdlll electiort;..tiWilmediately.\'iilhhold ancl!ofsusilend deliverll'S or paympnfs:upon Notic~'a\1dIQt:tote"1)in.llttiand liqUidate the Ira.liso"eltons undetih.e'.'Gontract,lii··iiie msnne('provlded In Section 10.3,in 'a~dl#on to any'Md"."II.'other remed",,,evallable hereu~dEir.,'.,.::."..'.'.'.' 10.3 •.AI·:an·:EvenloHlataul1 has occurre,a and Is COfjiinulhg,lhe Non-D.EifaultlngPa'.itY':~hallhave'1hMI9ht"by Noticeti);jhe Defeultlng Party,:to'tleslg:nate a,Oay.;:firi.earlier thilO:tl\e Day SU61j·Ncitlceis ..giyen ahd,no leter lii~o~20 Daysa~ers(Jcl\:Notice.is.giY,an,as an early termln'atiohdiite (the "Early ,ermination'DiM')for thii'IIqUidatlon'aria termination pursuant to Section to·;·S:1'of..a1ltransacllons under the Contract,each a lITermlnated TransactIon".On the Early TenninaUon Date,all transactions wlll terminate)other than those transactions,jf any,that may not be liqUidated and terminated under applicable law or that are,In the reasonable opinion of the Non~ DefaUlting Party,commeroially Impracticable to liqUidate and terminate ("Exoluded Transactions"),which Excluded Transactions must be liqUidated and terminated as soon thereafter as is reasonably practicable,and upon termination shall be a Terminated Transaction and be valued consistent with Section 10.3.1 below.With respect to each ExclUded Transaction,Its actual termination date shall be theEarlyTerminationDateforpurposesofSection10,3.1. CoPyright@2002NorthAmerlcan Enargy Standards Board,Inc. All Rll:lhts RSIH'lrvod Page 6 of 10 NAESB Standard 6.3.1 April 19,2002 The parnes have selected either "Early Termination Damages Apply"or "Early Termination Damages Do Not Apply"asIndicatedontheBasecontract. EarIyTermlnallon Damaqes Apply: 10.3.1.As of Ihe Early Termination Date,the Non-Defaulting Party shall determine,in good failh and In a commerciallyreasonablemanner,(I)the amount owed (Whether or not then due)by each party with respect 10 all Gas delivered and receivedbetweenIhepartiesunderTerminatedTrartsacllonsandExcludedTransactionsonandbeforetheEarlyTerminationDateandallother appltcable charges relating to such deliveries and reoeipts (Including wllhout limitation any amounts owed under Section 3,2),for Which payment has not yet been made Qythe,p.rty:!hat owe.such payment under this Contract and {II}the Market Value,as defined below. of each Terminated Transection,The Npri,lDefaulling Party shall (x)Itquldate and accelerate each Terminated Transaction at Its Market Value,so that each amount .,,-qualJdotne difference between such Markst Value and the Contract Value,as defined below,of such Terminated Transactlon(s)sh,,1i be"dUa;t"the Buyer under the Terminated Transaction(s)If such Market Value exceeds the Contract Value and to Ihe Selier Ifthe cP·p'p'§!!.e;;t~the case;and (y)where appropriate,dlscounl each amount then due under clause (x)above to present value In a commercl'aliyreasonable manner as of the Early Termination Date (to take account of the periodbetweenthedateofliquidation.and the date 'on which suoh amount would have otherwise been due pursuant to the relevantTerminatedTransactions).:; For purposes of this Section 10i~3..-'(ContraOf·'Y!\.I~e"means the amount of Gas remaining to be delivered or purchased under a transactlon multiplied by the Co!itra!ltPrlca,:s.lrjf'Market Value"means the emount of Gas remaining to be delivered or purchased under a transaction multiplied bylh:a,rnllrkef,pi!(((\'Jor a similar transaction at the Delivery Point determined by the Non-Defaulting Party In a commerclaliy reasonable mariner,:··tiLlfScerlaln Ihe Market Valua,the Non-DefaUlting Party may consider,among othervaluations,any or all of the settlement prlces 01 NYMEX Gas futures contracts,quotatlons from leading dealers in energy swapcontractsorphyslca!.gasJradl.ng.markets,similar sal~s.or purehaeas and,.WlY other bona fide thlrd.party offers,all adjusted for the lengthoUtie,term andalll~relices in trati~portatioiiAo~t~:Apartyshell,:i(6Ibe re~uir:e.d to enier.intb:~:JiiiJlscernen!transactlon(s)in order to.:·date"J'lIne th:I;j··Marl<et Value.4!inY,extenslon s)'of the term of a:'transection-Ia,wh,ch parlles,areonot bound-as of the Early Termlnation·,Date (hioludiiJli',):>ut not IlrilJlii.d to "everg.r,eilri'piovlslons").I\all not be::'((iinsidered Irfca,MtiJiln!ng Coo1(aGi Values and MarkerVlll.(i:"~,For .tile will dance of (lp,ub:l,any opti;:;h;p:ursuanl to whlc!:i one party))'!"the Jighltci:,iixtilM:lhe lerm'9hLtransaction shall b,e.qo)'lSlilared t~;ele.irtJlning con~!Iv~'Values arid'Market Values.:rhe rate of Interest used Inj;ale~Iailng net present value shallbedeterml~¢tl'bv tha:.on,l"tafaultina Pa.':In a comm .•relaHy reasonableJnanner. Early tetlt\lmln'm Oanlalies 00 Not At>'oIV: 10.3:1':'"A$of tH·e.:Satiy Termin·~tl;m Date,mii;Nim'Defaulting i>'~rty shall qeitermine,ingooHijiih and ina coMmercially reason$l"':m:.nn~r,the,.am.ciunt owed ~wif~her or nof;th:<1h,due)by eachig~rty with resp~t to all G~s'd~nv'arad and,.,enaIY.d between Ihe P.rJi.!ls,Qn:dJl~TOrjtl!j'ral~d Transa<;tl~hs andEXcltr<!ed·.:rransactlon~;Qn and berere the EarlY'Eermlni!tion Dat •.•n·d all other applioabl.~,1ibafg!>s rala;tiilQ,to such delll-eries and recelilW(iiJcludlng wllhouflimltation ahY amounlsoWedurtder SectlM.3,2),for which p§y_me~~'ha:~ri6hv."t;ij ••nJnade bv the{peirtv that ow"ihiuchpavment unCi~fjhjs Contracle...........'. The P.rtJ~$·'h,ilvi,,:;;<iIMW'dellher "olli.r,Agre<lmenl,seiotts Apply"6fiiQl11erAgraemen(Selilfr~'Oo~Not ApPl'i"as Indlcaledonth9,E(ii~~jCo"traJ:I',.'.'... Olher.A~(!l'¢inenl:-S!iioiffi;APPIV::.".,. 10j,';\;The NarH:\ii.te"illing Partyii.hall net or aggregate,as epproptlillJiehy'and ell amouf)iBowing:batweeni1h.;-:pa'ties under SectiorF1.0,3.-1,sotl\eiball:;;ueh amounia"f~netted on~giiregated loa sii)llie IIquidat~d amount payable'bY,!.one party'to.1hsother (Ihe "Net S'eiW'em.entAmO,un!'),.At its sale oWon and witlj,juf.prior Notice to~lhe Defaul~l)g Party,lheNp.n'gef~Qltlng Party:lilay setoff (I) any Nm'll!itll..inent;Am~Urit"owed to tH·.·Non-Delaultir'!g:l'ar!y against a~y margin 0t'olher collateretbeld'!5Y'-lt In con\i.~ijon with any Credit SQpp6tt Oblrg~trQn:r.lating to ihe:eontract;0r,.-{Ii).any Net Setil'Mlent Amouhl'payable toJh.~'D.Ofaulting.Paiiy against any amollnt(~j payable by ·th.Defaulting Party to the Nori'lJefaulling Party under any.:o!her agree merit or,airangenii;hlMtween IheIparlles::.'........'..'... Olher"Agt<!.elflenl S~t6ffsiPb NotAooiv::·., 10 ..s.~,.The NQi1,Q.f~l'ltIng PartY:$h~1i net or ~~~r.g~e,as appropriate,any ~~~:all amount~~oYilngbetweenthkparties under SectionJO;B;1:,so IIl.tall'suoh amounts',are netted or:aggr~gated.to a slniJl,IIquldata.~:ah1ount pa~abt";~Y'one party.fg:fhe'other (the "Nel Settlemenl AmoUhq ...At 'Is sale opUon and wlthguf'Rflor Notice to tho DefaultiQ'g'J'Qrty,the NQ)H:lofaulling Perjy':l11eysetoff any Net Settlen\eri.l AmoUQt OWed to the NOh;P~faulting Pili:tY:agalnst any mar.gln or othe(,b6I1aIeral hellj'by ltiri 'connectlori:wilh any Credit SURPon QbJiaalion rela.tltilftothe ConIra¢k,•.........,'...... Page 7 of 10 NAESB Standard 6.3.1 Aprll 19,2002 Page 8 of 10 TO THE EXTENT ANY DAMAGES REQUIRED TO BE PAID HEREUNDER ARE LIQUIDATED,THE PARTIES ACKNOOLEDGE THAT TH[, DAMAGES ARE DIFFICULT OR IMPOSSIBLE TO DETERMINE,OR OTHERWISE OBTAINING AN ADEQUATE REMEDY IS INCONVENIENT AND THE DAMAGES CALCULATED HEREUNDER CONSTITUTE A REASONABLE APPROXIMATION OF THE HARM ORLOSS. SECTION 14.MISCELLANEOUS 14.1.This Contract shall be binding uponand Inure to the benefit 01 the successors,assigns,personal representatives,end heirs 01 the respective parties hereto,and the covanantS,~.conditions,rightS and obligations of this Contract shall run lor the full term 01 this Contrect.No assignmenl 01 this Contract,in whole or In plij,Nvili be made wilhout the prior written consent 01 Ihe non-assigning party (and shall not relieve the assigning party from lIabilily hereunder),WI11~hconsent will not be unreasonably wilhheld or delayed;provided,eilher psrty may (i)transler, sell.pledge,encumber,or assign thi~·:Cotiti'~ch?r ilia accounts.revenues,or proceeds hereof In connection with any financing or other financial anangemeols,or (Ii)transfer:rts InliltE\Sl'.loany parent or affiliate by assignment,merger or otherwise without the prior approval 01the other party.Upon any SUch assignment,tr<ifl.Sier.and assumption,the transferor shall reman principally liable lor and shall not be relieved ofordischargadIromanyobligalionshsreonder, 14.2.If any provision in this Contract!.s determiJied.to be invalid,void or unenforceable by any court haVing JUrisdiction,such determinationshallnollnvalldate,void,or make.unenforceable anYolher provislon,agreement or covenant oflhis Contrect. 14.3.No waiver 01 any breaclt'of'tiii~:bonlract~fi~ibbe held to be a waiver of any other or subsequent breach. 14.4.This Contract sets forth 'ai1.'ti·rid~rst~n~injj;l::G·etweanthe parties respactlng each transaction subject hereto,and eny prior contracts, understandings and representalions;'lI#eth~r:or~i"or written,relaling to such transactions are merged Into and superseded by Ihls Contract and any effective transactlon(s).This Contract may be amended only by a woting executed by both parties. 14.5..lhe'lnterpreti;ltioh:and·,performance 01 IhWColitraet shallebe:'gOVerned by the laws 01 tl\ejunsdi!;lidn'as Indicated on the BaseContraofexcluding,hoviever,.any conflict of'laws rule 1I>1l16h,:Wouldapply theli;\W of anothetej(,,"sdlctlon:.'.'.' 14.6.ThriContra4~rt(!'cali provisIOlj~"':ereln Will ~e:s~bject 10 ail appJ[table and ,\;~11'~statutes,rules iorders arid regulalions 01 any governmartfaJ.<ililhority,tii/VI!igjurlsdictlon.,oyerthe partioo;.1fiefr facililles,or Ges supply,this Contract or tren~a<:tl6n'or any provlslons thereof 14.7.'fh~r.ls no thlril'~ariy beneftclaiYto;thls Contra6t .. 14.8.EacltPsrty to.l!iis •.contract rep(~~nts and walrary\s'that it has fuiF~nd compl~tliiluthority bahj~.lniciand peiiortnthis Contract. Each PllfSOllV/hO.exac!ii_ejlijhl"Contract'lin'behalf 01 ellfier-patiy representsand warrantS:tfjat It has full:';nd.coh1plate aulhorlly to do so andtl1alsuch'Pal:\y'VilIi betio:und.1hereby..,:'...'......., 14.9.rb~Ji;;'din9in,rii:fsubheadingS'o:Qnlalned in,ihi.Contract are U~ed soleiy 10"'~iJnvenlence ancidon~t consUMe g.part 01 thia Contract;betWaen'th·;pAti!liS:and shall nli(b:.used to cdlistnj.or interpret the'prpvlsions o(.\l1ls Contract;",' 14.1 Q.Unl~the p~iJli.i·'have elacted~n'fhe Base Cpnlia-clootlo make'liji~.~actlon 14.J.o"apPlioablijtoful.contraGiinelth~rpalty shall disC\ose"llra¢!ly orlndl(e¢~Y'without the·prlQr written CQJjsent of the olher p",'l{jh~terms of"any1ran~~ctiQM(til,third pa'W'(olher than ti,e emploY~!lS;IEind.l)l,ro)la!ty;~\'Iners,counsii!;aooountari.ls';aild olh~ragents Qnh'~'ilarty,or proSp~vEi'i1UrcJ)~itrS·of,sli'or~ubstantially ell of a partykass~jB of'ofahlUJghis under this .Contract,PJ'QvJd.d':SUolrlli\i'Sons~1J'.~I;'lliivaagreed 10'k~~il;:~ucl)'term:S''conffdenllal)BJ<cept(I)In ordsr to wmpiy Wlt!i,any:appllcable law,'ord~r,regulaIl6n;'.orBJ<change rule".'(lIlitQAjif~xlent necessary'lor·II),.,ohlorcem<mt-ollhis Contract. (iii)to lh.',e#ii<1t n!lCi~o/,ip implemenl:~I!Y trensactl.dn,'pr (IV)to the exl.EiiltS(iCh:·(nlqrmaiion Is'dellvered'Io,Eiuch thlrd,patlf lor tho sole purpos~',Wo.al"ulating,aplll)jl~hed index;,"',,~ch party sli"l·notify the other pijrty 01 any,prOceedingo!:'whi4h,)ns:awarewb(chlllay resull In disclosqre"'Of.the terms~:Qr€1tly:1ransaction-(Q!J1er than a¢~pern:titted hereundet)and use~.r~asonable 6lfortSj~..pr:6Vent or.!imlt.theHlisclosure. The exi61enc~'ol 1h1.Ccmtrl:\Cl,lsnot subj<iGtli>Ihls contii;leilti~iitYobligation."~ubjact to s!iiiBon 13,the p'atjlWllh"'l be antilleQ.lo·ail remedies avaiiaBle·aldalV or ilT,e~~ilYlo,enforce,or'~~~'Eikrelief in ciin,nectipn with this qtinfidentiali!Wp.b!igation.Th'~:t~rl11ll'ofanytral),sMllon'hereundershallb,e k.pliConfidantial'b)l,th~parties hSl:ti!,"lor one ye~rlrcir!(the explratlon;blthe trans\lOtibn.,...' In theavejjt:~lat dis<;lbs0t&As required PYa~ovemmaiitlil':pody or appllcaj,l~law,tile'paf\Y sUbJact t&'sl!oh:re:qulrement:rnay,dlsciose the malerial·tem;:s',ol thl.'CiI,nti'ilCt to Ihe exfuf1\'so requlrikl{but,~hall promptiy.cnotify the <\l!IiJ'r:party,pnorto·~isclqsure,an,Moall.cooperate (consisi~nrwil~ti,e dlscliislng,party's iag~f;bbligalion.)witl1the olher party's:$folls to oblaln'wotactlva ordeis,pr similar rastral.nts.with respecttosuohciiscibsureatlliee~pen.e 01the oiher,party,.'....:.:..., 14.11 TnA-:parties::~~~y>~greGto dj.sp·~te resolutirl-n ,procedures In .S·pecial ProYI~:Ons attached--to·thtl Bas~·._,eontr-act or in aTransactibll·.Confirmatiori·e~ecuted In wrlHng by both Ratti....'...'... OISCLP,.iM!;~::tho purp9.~~'~QhisContract arOo·ihcillkrta trad.&,;ayoJd rhl5unqa~~~ndi~_a~~~o~m£\ke rilO-rj)'deflnKo lh~!~(.iti#1#~pW§;Cls_~rfAlf.Q~asaand sille of noturnl gM,-Furthar,NAI::BB1foe6-not mandatliftlle Uso of this COrilract-by-anypnttY;-··NAI:Sg,OISCl;.A1MS AND eXCL.:UD'ES,-'-ANO-ANY-USER OF THIS CONTRACT ACKNOWLEDGES AND AGREES TO NAESB'S DISCLAIMER OF,ANY AND ALL WARRANTIES,coNDITIONS OR REPRESENTATIONS, EXPRESS OR IMPLIED,ORAL OR WRITTEN,WITH RESPECT TO lHlS OONTRACTORANY PART THEREOF,INCLUDING ANY AND ALL IMPLIED WARRANTIES OR CONDiTIONS OF TITLE,NON.fNFRINGEMENT,MERCHANTASIUlY,OR FJlNEsS OR SU1TABIUiY FOR ANY PARTICULAR PURPOSE (WHE::THE::ROR NOT NAESe KNOWS,HAS REASON TO KNOW,HAS BEEN ADVISED,OR IS OtHERWISE IN FACT AWARE OF ANY SUCH PURPOSE),WH~HER ALLEGED TO ARISE I3Y LAW,BY ReASON or:CUSTOM OR USAOli IN THe TRADE,OR BY COURSe OF DEALING.EACH USER OF THiS CONTRACT ALSO AGREES THAT UNDER NO ClRCUMSTANCES WlLL NAESB BE UABLE FOR ANY DIRECT,SPECIAL,INCIDENTAl, EXEMPLARY,PUNITIVE OR CONSEQUENTIAL DAMAGES ARISING OUT OF ANY USE OF THiS CONTRACT. --.:.: Copyrlght@2002 NOJth Amorlcan Enarov Standards Board,Inc. AU Rights Roserved Page 9 of 10 NAESB Sltmdard 6.3.1 April 19,2002 TRANSACTION CONFIRMATION FOR IMMEDIATE DELIVERY EXHIBITA Date:,--Transaction Confirmation #: This Transacllon Confirmation is sUbJectta.lhe Base Conlract between Seller and Buyer dated ,The terms of Ihls Transacnon Confirmation areJilllding unless disputed in writing wilhln 2 Business Days of recelpl unless otherwisespecifiedintheBaseContract, SELLER:BUYER: Attn:Attn:Phone:Phone:Fax:Fax:Base Contract No.Bese Contract No.Transporter:Transporter:T ran~pQr:ter Contr:aGt-N.'ul.t1b~r:.,',..'rranspo~er.eonlract Number:, ,,'.'' Conll'aqlf>rlce:$--.-:-:.:.Ji\1MBlu or . ...,. Deliver;'Peilbd:Bogin::..,l:~End:.--.{•...'."'.'. perforiilatiC;obIl9~ffQiF~nd Contrac~Quantlly:(S~leclOne) FIrm(FIX'!<liQuan tliy):~lrm(Vartable Quahltlyj::I(ltilrruptlble:--"-':MIi!Sliis/day ----,;MMBtus/daY'~Jnimum lJpto~MMBIusidayIJEW~MMBtus/day,M""imum gU~j.;;tto Section 4,:L!ltielection of D:8Uy),r,or0 Selier·.. Oelly~rYPolnt($):...,•.' (if a pooling,point IS(Jse-d,Ii$ta specifio:gbographlCandpipeline IDeation): SpeclilH::ondlllons: Selier:Buyer:. By:By: Title:TWe: Date:Dale: 'COPyrlght@2oo2 North American EOlilrgy Standards Board,tnc, All Rlghts Reserved NAESB Standard a.3.1 April 19,2002Page10of10