NATURAL GAS AGREEMENTS (032)
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INTERRUPTIBLE GAS SALES CONTRACT
This Gas Sales Contract is entered into as of this lath day
of July, 1990, between citrus Industrial Sales Company, Inc., a
Delaware corporation ("Seller"), and city of Clearwater, a
Florida municipal corporation ("Buyer").
In consideration of the premises and of the mutual covenants
contained herein, the parties agree as follows:
I. Purchase Orders
1. I purchas.e Orders. The parties shall effect actual sales
and purchases of gas pursuant to the terms and conditions hereof
by exchange of a signed Purchase Order, in the form attached
hereto as Exhibit "A", via telecopy if available, otherwise via
express delivery service.
1.2 Purpose/Intent. The Purchase Orders hereunder shall be
exchanged for the purposes of expressing and confirming the
parties' periodic renegotiation and agreement as to new Contract
Period, Quantity, Delivery Point(s) and Price. It is intended
that such Purchase Orders shall become a part of this Contract,
that the terms set forth therein shall be binding as though set
forth in the body of this Contract, and that the sale and
purchase of gas pursuant to such Purchase Orders shall be
subj ect to all other terms and conditions set forth in this
Contract.
II. Contract Period
2.1 Contract Period. The Contract Period shall be a period
of time, not less than one (1) calendar month in duration, as
agreed to periodically by the parties and as specified in a
Purchase Order. The Quantity, Delivery Point(s) and Price terms
specified in a Purchase Order shall remain in effect throughout
the Contract Period specified in such Purchase Order.
III. Ouantitv
3.1 Ouantitv. Subject to the terms and conditions hereof,
Seller agrees to sell and deliver to Buyer and Buyer agrees to
purchase and accept at the Delivery Point (s) , on an
interruptible basis, such quantities of gas as may from time to
time be agreed upon and set forth in a Purchase Order. Nothing
herein or in any Purchase Order shall be construed to impose
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upon either party an obligation to sell and deliver or to
purchase and receive any minimum quantities of natural gas and
neither party shall be liable in damages or otherwise for any
interruption of the sale or purchase of natural gas pursuant
hereto for any reason whatsoever. However, if ei ther party
becomes aware of any circumstance, including but not limited to
an event of force majeure, which would prevent the delivery or
receipt of gas in accordance with the quantities nominated by
Buyer, such party shall inform the other by telephone as soon as
possible.
IV. Delivery Point
4.1 Delivery Point(s). Title to all gas delivered
hereunder shall pass to Buyer at the Delivery Point(s)
identified in a currently effective Purchase Order, which shall
be the point(s) at which gas is delivered for the account of
Buyer.
4.2 Transportation. In order to facilitate the sale and
delivery of gas by Seller to Buyer und~r this Contract at the
Delivery Point(s), Buyer agrees that this Contract shall
constitute Buyer's authorization for Seller to arrange
transportation of the gas to be sold hereunder to the Deliyery
point(s) on behalf of Buyer and Buyer's acknowledgment that
Buyer will derive a substantial benefit from such transpor-
tation; provided, however, that Seller shall contract for such
transportation in Seller's name and at Seller's expense and
Buyer shall have no liability whatsoever for any such
transportation arrangement upstream of the Del i very Point (s) .
Seller shall indemnify, save and hold Buyer and its directors,
officers, employees, agents, subsidiaries, affiliates,
successors and assignees free and harmless from all suits,
actions, debts, accounts, damages, costs, losses, liabilities
and expenses, including attorneys' fees, arising with respect to
such transportation arrangements.
V. Price
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5.1 Price. The Price paid by Buyer for gas delivered to
Buyer by Seller at the Delivery Point(s) shall be that specified
for the Contract Period in a currently effective Purchase Order.
VI. Initial and Subsequent Purchase Orders
6.1 Terms. Initially, and prior to the end of the Contract
Period under a currently effective Purchase Order, Seller may,
in its sole discretion, advise Buyer, via telecopy or telephone,
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of prices and quantities available on an interruptible basis for
the next Contract Period. Seller shall prepare a Purchase Order
on the form attached hereto as Exhibit "A" reflecting such new
Price term and the Quantity of gas agreed to by Seller and Buyer
for the specified new Contract Period. Upon the parties'
execution and exchange of such new Purchase Order, all terms
specified therein shall become effective and remain in effect
for the specified new Contract Period.
6.2 Suspension. This Contract shall be suspended during
any period of time for which a current Purchase Order is not in
effect.
VII. Nominations
7.1 Prior to commencement of deliveries under a Purchase
order, Buyer agrees to provide Seller with its written
nomination of quantities it desires to purchase on every day of
the Contract period, which shall not exceed the Quantity set
forth in the Purchase Order. Buyer'S nomination shall remain in
effect for the effective Contract Period unless changed by
Buyer. If Florida Gas Transmission Company notifies Buyer of
revisions in Buyer's scheduled Interruptible Transportation
Service quantities, and such revisions affect the quantities
receivable by Buyer hereunder, Buyer shall promptly notify
Seller and revise its nominated quantity hereunder. All
nominations and changes in Buyer's nominations shall be made
within a sufficient time, but not less than 24-hours' prior
notice, to allow Seller to make its nominations to all
transporting pipelines in accordance with the nomination
requirements specified in the transporting pipelines' tariffs.
To facilitate Seller's load dispatching, Buyer shall use
reasonable diligence to advise Seller in advance of any
anticipated substantial change in gas requirements. Nominations
to Seller will be accepted at the telephone number set forth in
Paragraph 9.1, if promptly confirmed in writing.
7.2 Failure to deliver confirmed nominated quantities shall
render Seller "at fault" under paragraph G of Appendix A hereto,
and failure to receive confirmed nominated quantities shall
render Buyer "at fault" under paragraph G of Appendix A hereto.
VIII. Term
8.1 Term. The effective date of this Contract shall be the
date first written above. The term of this Contract shall
extend for a primary term of one (I) year from the date of
initial delivery hereunder, subject to notice of suspension or
termination by either party as provided herein, and shall
continue month to month thereafter unless cancelled by either
party upon thirty (30) days written notice to the other party.
No period of suspension of this Contract, whether pursuant to
Paragraph 6.2 above or otherwise, shall serve to extend the
primary term hereof.
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IX. Notices and pavrnent
9.1 Notices. Any notice, request, demand, statement or
invoice provided for in this Contract, or any notice which a
party may desire to give to the other, shall be in writing,
unless otherwise provided herein or otherwise mutually agreed by
the parties, and shall be considered as duly delivered as of the
date of transmittal if mailed by ordinary mail, telecopied,
wired or courier expressed to the other party at the following
address:
(a) Notices to Seller:
citrus Industrial Sales Company, Inc.
P.O. Box 1188
Houston, Texas 77251-1188
Attention: vice President and General Manager
Telecopy # (713) 853-1525
Telephone # (713) 853-7151
(b) Notices to Buyer:
City of Clearwater
P. O. Box 4749
Clearwater, FL 34618
Attention: Mr. Robert Bromback
Telecopy #(813)462-6636
Telephone #(813)462-6635
9.2 Pavrnents.
wire transfer for
location:
Payments to Seller shall be made by either
the account of Seller at the following
citrus Industrial Sales Company, Inc.
First City Texas - Houston
Account Number: 0011593595
ABA Number: 113000010
or by first class mail at the following location:
citrus Industrial Sales Company, Inc.
P. O. Box 1188
Houston, TX 77251-1188
Attention: Gas Accounting
9.3 Chanqes. Either party may change its address for
purposes of notice, or Seller may change the location specified
for payment by wire transfer or first class mail, by giving
notice to the other party.
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X. General Terms and Conditions
IO. I General Terms. Attached hereto as Appendix A are
General Terms and Conditions applicable to this Contract. In
the event of any conflict between the terms set out in the body
of this Contract and those set out in Appendix A, the terms in
the body of this Contract shall control.
IN WITNESS WHEREOF, the parties have duly executed this
Contract as of the day and year first above written.
BUYER
SELLER
CITY OF CLEARWATER CITRUS INDUSTRIAL SALES COMPANY, INC.
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EXHIBIT "A"
PURCHASE ORDER
Date:
This Purchase Order is made a part of and is subject to all
terms and conditions set forth in that certain Interruptible Gas
Sales Contract dated , by and between citrus
Industrial Sales Company, Inc. ("Seller") and City of Clearwater
("Buyer") .
Terms:
1. Contract Period:
2. Quantity:
3. Delivery Point(s):
Up to
MMBtujday
See attached.
4. Price:
$
jMMBtu dry
BUYER
SELLER
CITY OF CLEARWATER
CITRUS INDUSTRIAL SALES COMPANY, INC.
By:
By:
Title:
Title:
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APPENDIX A
A. DEFINITION OF TERMS
A.I BTU. British thermal unit. The quantity of heat
required to raise the temperature of one (I) pound
(avoirdupois) of water from fifty-eight and one-half
(58.5) degrees Fahrenheit to fifty-nine and one-half
(59.5) degrees Fahrenheit at a constant pressure of
14.73 PSIA.
A.2 MMBTU. One million (1,000,000) BTU's.
A.3 Natural Gas (Gas). Refers to natural gas including
casinghead gas, gas from gas wells and residue gas
resulting from processing either casinghead gas or gas
well gas, or both.
A.4 PSIA. Pounds per square inch absolute.
A.5 PSIG. Pounds per square inch gauge.
B. TITLE. WARRANTIES. RISK OF LOSS AND INDEMNIFICATION
B.I Risk of loss for and title to gas being delivered to
Buyer by Seller shall pass from Seller to Buyer at the
Delivery Point(s). As between Seller and Buyer, Seller
shall be deemed to be in custody and control of the gas
sold and purchased hereunder until it has been
delivered for the account of Buyer at the Delivery
Point(s) and Buyer shall be deemed to be in custody and
control of such gas thereafter.
B.2 Seller hereby warrants title to all gas which is sold
by Seller to Buyer and delivered to the Delivery
Point(s) by Seller hereunder, and warrants that Seller
has the right to sell and deliver the same.
B.3 Buyer and Seller shall each indemnify the other from
any and all claims, actions, suits, proceedings, costs,
expenses, damages, and liabili ties, including
attorney's fees, arising out of or relating in any way
to the custody and control of the gas sold and
purchased under this Contract.
C. QUALITY AND OUANTITY MEASUREMENT
C.I All gas delivered by Seller shall be merchantable and
shall upon delivery conform to the quality
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specifications and heating value specifications of the
third party transporter(s) at the point where title
transfers to Buyer hereunder, as the same may be waived
from time to time by such third party transporter(s).
The specifications and heating value of the gas shall
be determined by a standard method in use by such third
party transporter(s).
C.2 The quantity of gas purchased from Seller by Buyer
shall be determined by measurement and/or allocation,
as applicable, by such third party transporter(s) at
the Delivery Point(s).
D. BILLING. PAYMENT AND FINANCIAL RESPONSIBILITY.
D.1 On or before the loth day of each calendar month,
Seller shall tender to Buyer an invoice for the total
payment due for gas made available to and taken by
Buyer at the Delivery Point (s) during the preceding
month. Buyer shall tender payment by wire transfer or
by first class mail to Seller at the location
designated in Section 9.2 within ten (IO) working days
following receipt by Buyer of a complete invoice.
D.2 Buyer shall notify Seller of any disputed amount of any
invoice, so that best efforts may be made to resolve
the dispute as quickly as possible and before the date
payment is due.
D.2.1 If Buyer, in good faith, shall dispute the
amount of any such statement or part thereof,
Buyer shall pay to Seller such amounts as it
concedes to be correct. If it is determined
that Buyer owes the disputed amount, Buyer will
pay Seller that amount with interest promptly
upon such determination.
D.2.2 Upon final resolution of any such dispute,
Seller shall provide Buyer with a complete and
mathematically accurate invoice, if applicable,
reflecting the agreement reached by Buyer and
Seller.
D.2.3 Buyer shall tender payment by wire transfer or
by first class mail to Seller, at Seller's
location designated in Section 9.2, wi thin ten
(IO) working days following Buyer I s receipt of
complete corrected invoices and supporting
documentation.
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D.3 All computations made with respect to price shall be
made to the nearest one-hundredth of one cent
($0.0001), with the invoice amount being rounded to the
nearest one (1) cent.
D.4 If either Seller or Buyer shall discover any error or
inaccuracy in Seller's statements, billings, payment,
calculations or determinations, then proper adjustment
and correction thereof shall be made as promptly as
practicable thereafter; provided, however, that if no
such errors or inaccuracies are identified by either
party and reported to the other party wi thin twelve
(12) months from the date of such statement, billing
payment, calculation, or determination, the same shall
be deemed conclusively to be correct. Prior period
adjustments caused by transporters' or producers'
volume statement reallocations shall be corrected
without interest assessments to either Seller or Buyer.
D.5 If Buyer fails to tender payment to Seller in
accordance with the terms of this Section D when such
payment is due, interest thereon shall accrue at the
effective interest rate as provided in IS C.F.R.
154. 67, et seer., from the due date until the date of
payment. Likewise, any refunds due hereunder to Buyer
from Seller, excepting prior period adj ustments
described in Section D.4, shall be with interest as so
computed.
D.6 In addition to any other remedy Seller may have, if
Buyer fails to tender payment to Seller in accordance
with the terms of this Section D when such payment is
due, Seller may suspend this Contract upon five (5)
days' written notice to Buyer. Buyer shall have the
right to have this Contract reinstated by paying the
full amount due, including interest, within ten (10)
days of the date this Contract was suspended by Seller.
D.7 If in the exercise of Seller's sole but good faith
judgment the financial responsibility of Buyer becomes
impaired or unsatisfactory to Seller, Seller shall have
the right to demand a letter of credit or other
demonstration of creditworthiness in form and substance
acceptable to Seller to be received by Seller within
thirty (30) days from the date Seller requests the same
from Buyer in writing. In the event such demonstration
of creditworthiness is not provided to Seller on a
timely basis, then Seller may terminate this Contract
upon five (5) days written notice to Buyer.
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E. TAXES
Seller shall payor cause to be paid all taxes lawfully
levied on Seller, or otherwise to be borne contractually by
Seller, and applicable to the gas delivered hereunder prior
to its delivery to Buyer at the Delivery Point(s). Buyer
shall pay all taxes lawfully levied on Buyer applicable to
such gas after delivery to Buyer or for the account of Buyer
at the Delivery Point(s).
F. COMPLIANCE WITH LAWS. REGULATIONS. CODES AND STANDARDS
Seller and Buyer. shall comply with all applicable laws,
rules, regulations, codes and standards of all federal,
state, local and municipal governmental agencies having
jurisdiction over the subject matter hereof or over
operation or maintenance of the facilities and equipment
used in carrying out the respective obligations of each
party under this Contract; provided, however, that in the
event any federal or state governmental agency, by final
rule, regulation or order, asserts jurisdiction over Seller
which materially adversely affects Seller's rights and
obligations under this Contract, then Seller may terminate
this Contract by giving thirty (30) days written notice to
Buyer.
G. PENALTY PAYMENTS
In the event either party is required, due to the fault of
the other party, to make penalty payments to a third-party
transporter(s), including, but not limited to, retention of
gas by such transporter(s), the party at fault shall
reimburse the other party for such penalty payments,
including the gas retained by such transporter(s).
H. PROPRIETARY INFORMATION
H.l The parties have a proprietary interest in this
Contract. Accordingly, the Contract shall not be
disclosed in whole or in part by either party, its
agents or employees to third parties without the prior
written consent of the other not to be unreasonably
withheld; provided, however, that nothing contained in
this Section H will be construed to prevent either
party from enforcing any rights created under this
Contract.
H.2 Notwithstanding Section H.I, the parties shall have the
right to disclose this Contract to any governmental or
regulatory authority having jurisdiction to require
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such disclosure, or to disclose this Contract as may be
required by. any public disclosure laws, including,
without limitation, the Florida Public Records Act,
Florida statutes Subsection ll~. In the event of any
disclosure pursuant to this paragraph, the disclosing
party shall make a good faith effort to notify the
other party prior to such disclosure, and shall exert
reasonable effort to secure confidential treatment of
this Contract.
I . NONWAIVER
No waiver by a party of anyone or more defaults by the
other party in the performance of any provision or
provisions of this Contract shall operate or be construed as
a waiver of any future default or defaults, whether of a
like or a different character.
J. EFFECT OF SECTION HEADINGS
Section headings appearing in this Contract are inserted for
convenience only, and shall not bia deemed to establish,
modify or affect the rights and obligations of the parties
to this Contract.
K. APPLICABLE STATE LAW
THE RIGHTS, OBLIGATIONS AND REMEDIES
SPECIFIED UNDER THIS CONTRACT SHALL
GOVERNED IN ALL RESPECTS BY THE LAWS OF
OF
BE
THE
THE PARTIES AS
INTERPRETED AND
STATE OF TEXAS.
L. ASSIGNMENT
L.l Neither this Contract, nor the duties to be performed
hereunder, nor monies to become due hereunder shall be
assigned, delegated or otherwise disposed of by either
Buyer or Seller without the prior written consent of
the other party, which consent shall not be
unreasonably withheld.
L.2 Notwithstanding Section L.I, either Buyer or Seller
shall have the right to assign all of its rights and
interests in this Contract to an affiliate of such
party; provided that such assignment shall not relieve
the assignor of any obligations under this Contract
without the prior written consent of such other party,
which consent shall not be reasonably withheld.
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L.3 No assignment of this Contract shall relieve Buyer or
Seller of any of its obligations hereunder until such
obligations have been assumed by the assignee. If the
Contract should be permitted to be assigned by either
Buyer or Seller, it shall be binding upon and shall
inure to the benefit of the permitted assignee.
M. COMPLETE AGREEMENT
This written Contract and any and all Purchase Orders
hereunder are intended as the final, complete and exclusive
statement of the terms of the agreement between the parties.
The parties agree that parol or extrinsic evidence may not
be used to vary or contradict the express terms of this
Contract. This Contract shall not be amended or modified,
and no waiver of any provision hereof shall be effective,
unless set forth in written instrument authorized and
executed with the same formality as this Contract.
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