INTERRUPTIBLE GAS SALES AGREEMENT
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INTERRUPTIBLB GAS SALES AGREBKBNT
GENERAL TERMS AIm CONDITIONS
NGC #91-11-543
AS OF TRIS 21st day of October, 1991, NATURAL GAS CLEARINGHOUSE
("Seller") and CITY OF CLEARWATER, a municipal corporation, of the
State of Florida ("Buyer") which may hereinafter be referred to
collectively as "Parties" or individually as "Party":
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WHEREAS, Buyer and Seller wish to enter into an Interruptible
agreement covering the sale, delivery and purchase of natural gas.
NOW, THEREFORE, in consideration of the premises and mutual
covenants set forth herein, the Parties agree as follows:
ARTICLE I.
DEFINITIONS
.l.t..l "Agreement" shall mean these General Terms and Conditions
and the Exhibit "A" hereto both of which have been completed and
executed by the Parties.
L.A "Interruptible, Interrupt or Interruption" shall mean
that Buyer has no obligation to purchase or take delivery of
natural gas that Buyer, for any reason, does not desire to purchase
from Seller, and that Seller has no obligation to sell or deliver
natural gas that Seller, for any reason, does not desire to sell to
Buyer. Neither Buyer nor Seller shall be liable to the other for
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not selling, deliverin or purchasing any natural gas pursuant to
this Agreement and fai to do so shall not constitute a breach
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shall mean the transporting pipeline
of this Agreement by e'ther Buyer or Seller.
downstream
.L.J. "Point(s) 0 Sale" shall mean the point(s) at which
natural gas is first elivered to the First Transporter, which
point(s) are designate in the Transportation Agreement(s) to be
executed by
and Buyer with respect to the
transportation of the n tural gas purchased.
ARTICLE II.
OUAHTITY
.L.l By executing Exhibit "A", Buyer shall have agreed to
maximum daily and month
Seller.
To permit Seller to schedule
quantities of natural gas that Buyer may
desire to purchase
delivery of natural
for Buyer in an orderly manner,
Buyer shall provide Se ler with oral notice of both daily and
monthly nominated quan ities provided by Buyer to the first
Transporter for all del'veries of natural gas and shall confirm
that notice by providi 9 Seller with a duplicate copy of the
completed gas nomination formes) used by Buyer to make nominations
to the first Transporter by no later than one (1) working day prior
to the date(s) requir d by the first Transporter for such
nominations.
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~ Buyer may de rease or Interrupt the nominated quantity
established pursuant 0 Paragraph 2.1, from time to time upon
twenty-four (24) hour otice to any Transporter and Seller, which
notice of decrease or I terruption of such nominated quantity may
be oral, but which noti e must be confirmed in writing. Buyer may
increase its nominated antity within the maximums on Exhibit "A"
from time to time upon (i) twenty-four (24) hour notice to any
Transporter and Seller, which notice of increase of such nominated
quantity initially be oral, and (ii) Seller's written
confirmation and approv of said increase in writing. Seller may
decrease or Interrupt s natural gas for any time and from
time to time upon twen (24) hour notice to Buyer, which
notice of decrease or In erruption of nominated quantity initially
may be oral, but which tice must be confirmed in writing. Buyer
and Seller may also y time request an increase or decrease in
the maximum daily monthly quantities, which proposed
increase or decrease sh effective only according to the
terms of a newly execut "A".
~ The Parties ag ee that if any penalties are imposed upon
a Party hereto by the tr nsporting pipeline(s), in accordance with
the provisions of applicable Federal Energy Regulatory
Commission approved tran portation tariff(s), as a result of other
Party's failure to deli er or accept an agreed upon, nominated
quantity or as a the other Party's failure to perform any
of its obligations hereun er, the failing Party shall, upon receipt
of an invoice from the n -failing Party reasonably detailing such
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penalties, reimburse tenon-failure Party the dollar amount of
such penalties (or th failing Party's portion thereof) within
thirty (30) days folIo ing receipt of said invoice.
ARTICLE III.
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L...l Exhibit "A" hall state the price for the natural gas
that is sold by Seller t Buyer. The price of natural gas includes
all charges and costs of compression, gathering, processing,
treating, liquefying 0 transporting the natural gas, or other
similar cost, and taxes (except taxes described in Paragraph 3.3),
which are incurred pri to the Point(s) of Sale. Seller shall
compress, gather, proce s, treat, liquefy or transport the natural
gas, or cause the same, as necessary to deliver the natural gas.
Buyer shall compensate Seller for all costs of compressing,
gathering, processing, reating, liquefying or transporting such
gas, or other similar allowed pursuant to Sl10 of the
Natural Gas Policy Act f 1978 (NGPA) or 18 C.F.R. SS270.202 and
271.1104 or as otherwis allowed by law, to the extent such costs
are incurred by Seller 0 by Seller's suppliers; provided however,
the price shall not exc ed the price stated on Exhibit "A". The
price shall remain in e fect until Buyer and Seller have agreed
upon a new price and hav executed a new Exhibit "A".
1..z.2. (a) "Regula ed Gas" means gas subject to a maximum
lawful price.
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(b) "Contract Price" means the price payable for gas
under this Agreement in the absence of any applicable maximum
lawful price.
(c) In the event that Seller delivers and Buyer purchases
Regulated Gas under this Agreement which is subject to a maximum
lawful price lower than the Contract Price, Buyer shall, to the
extent lawfully permitted, pay Seller for other gas delivered and
purchased hereunder a price (not to exceed any applicable maximum
lawful price) which is SUfficiently in excess of the Contract Price
to cause the weighted average price of gas delivered and purchased
hereunder to equal the Contract Price as nearly as practicable, but
the weighted average price of all gas delivered and purchased
hereunder shall never exceed the Contract Price.
~ Buyer warrants that the gas purchased hereunder is
purchased for resale and Buyer believes that no federal, state, or
local sales, use, consumption, or similar tax or franchise fee will
be levied at and after the Point(s) of Sale on any gas sold
hereunder. However Buyer is responsible for and hereby agrees to
pay all such taxes or charges arising out of or that may be levied
upon any gas sold under this Agreement. Buyer recognizes that
Seller is relying on Buyer's representation of exemption and Buyer
agrees to indemnify and hold harmless Seller from any and all
costs, charges and expenses of any nature incurred by Seller as a
result of Seller's reliance on Buyer's representation.
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ARTICLE IV.
UBH
~ This Agreement shall be effective as of the date written
herein above and shall remain in effect for one (1) month, and
month to month thereafter subject to the other provisions hereof,
and shall furthermore remain in effect until terminated by either
Party upon at least ten (10) days prior written notice given to the
other Party; such termination to be effective as of the first day
of the month following the month of the receipt of the termination
notice.
ARTICLB V.
POIH'1'S OF SALE: TITLE: RIGHTS OF POSSESSION
~ Title and right of possession to all natural gas
delivered and sold hereunder shall pass to Buyer at the Point(s) of
Sale.
Seller shall be deemed to be in exclusive control and
possession of the natural gas and shall be fully responsible for
and shall defend and indemnify Buyer, its successors and assigns,
against any damages or injury resulting from the transportation,
handling or use of or caused by the natural gas or the operation of
facilities used to deliver natural gas to the Point(s) of Sale.
Buyer shall be deemed to be in exclusive control and possession of
the natural gas and shall be fully responsible for and shall defend
and indemnify Seller, its successors and assigns, against any
damages or injury resulting from the transportation, handling or
use of or caused by the natural gas or the operation of facilities
used to receive natural gas after the Point(s) of Sale.
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ARTICLE VI.
TRANSPORTATION
~ Seller shall be responsible for arranging and paying for
all transportation of the natural gas to the Point(s) of Sale.
Buyer shall be responsible for arranging and paying for all
transportation of the natural gas from the Point(s) of Sale. Buyer
shall provide to Seller a copy of any transportation agreement(s)
entered into pursuant to this paragraph.
ARTICLE VII.
QUALITY OF GAS
.L..l The natural gas sold hereunder shall conform to the
quality specifications set forth in the Transportation Agreement
governing the transportation of the natural gas by the Transporter,
as measured and/or calculated by the Transporter.
ARTICLE VIII.
BILLING AIm PAYMEH'1'
~ On or before the twelfth (12th) day of each month during
the term of this Agreement, Seller shall render a statement to
Buyer for the total volume of natural gas nominated or delivered to
Buyer during the preceding month. Buyer shall pay to Seller, on or
before the twentieth (20th) day of each month, the amount due on
Seller's statement. All such payments shall be made to Seller by
wire transfer directed to:
First Interstate Bank of Texas, N.A.
Houston, TX
ABA #113001064
Account #0407540897
Credit: Natural Gas Clearinghouse
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To the extent that supporting data is not available to Seller by
the twelfth (12th) day of each month, Seller may bill Buyer based
on nominated volumes, subject to reduction for any known periods
when nominated volumes were not delivered and subject to later
correction based on actual supporting data. If a statement is
rendered based on nominated volumes rather than actual deliveries,
Seller shall promptly render a corrected statement as soon as
possible after actual volumes are known.
~ Buyer and Seller shall have the right during normal
business hours to examine the books, records and charts of the
other Party to the extent necessary to verify any statement, charge
or computation made pursuant to this Agreement.
~ If Buyer fails to pay when due the amount of any
statement rendered by Seller, interest thereon shall accrue from
the due date until the date of payment, at the then current prime
rate of interest charged by Citibank, N.A. to its commercial and
industrial borrowers. This Paragraph 8. 3 shall not bar either
Party from asserting any other remedy it may have at law or in
equity.
~ If presentation of a statement by Seller is delayed after
the twelfth (12th) day of a month, then the time for payment shall
be extended correspondingly.
~ If Buyer finds within twenty-four (24) months after the
date of any statement rendered by Seller that it has been
overcharged and if Buyer pays and makes a claim within the twenty-
four months, the overcharge, if verified by Seller or otherwise
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ordered, shall be refunded within thirty (30) days with interest at
the then current prime rate of interest charged by Citibank, N.A.
to its best commercial and industrial borrowers. If Seller finds
within twenty-four (24) months after the date of any statement
rendered by it that there has been an undercharge in the amount
billed in such statement, it may submit a statement for such
undercharge to Buyer, and Buyer, upon verifying the same or
otherwise ordered, shall pay the undercharge to Seller within 30
days, with interest at the then current prime rate of interest
charged by Citibank, N.A. to its best commercial and industrial
borrowers.
ARTICLE IX.
REGULATION
~ This Agreement shall be subject to all valid applicable
and effective laws, orders, rules, regulations and directives of
all duly constituted Federal, State and local governmental
authorities having jurisdiction.
ARTICLE X.
WARRAH'1'IES OF TITLE
lQ.t..l Seller warrants title to the natural gas sold and
delivered to Buyer free and clear of all liens, encumbrances and
claims to the natural gas, for royal ties, or taxes, except as
provided in Paragraph 3.2. Seller shall indemnify Buyer and save
it harmless from suits, actions, debts, accounts, damages, costs,
losses and expenses arising from or out of this warranty.
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ARTICLE XI.
CREDIT WORTHINESS
1lLl Prior to the commencement of deliveries and sales of
natural gas under this Agreement, and from time to time thereafter
Buyer shall furnish Seller with credit information as may be
reasonably required to determine Buyer's credit worthiness. Buyer
may be required to furnish Seller with a satisfactory letter of
credit, guarantee or other good and sufficient security of a
continuing nature and in a satisfactory amount as determined by
Seller in its sole discretion.
ARTICLE XII.
NOTICES
l1.Ll Notices to Buyer under this Agreement shall be addressed
as follows:
city of Clearwater
400 N. Myrtle Avenue
Clearwater, Florida 34618
Notices to Seller shall be addressed as follows:
Natural Gas Clearinghouse
13430 Northwest Freeway, Suite 1200
Houston, TX 77040
Either Party may change its address under this Article, or
under the payment provisions of Article VIII, by written notice to
the other Party. Unless otherwise provided, all notices given by
one Party to the other shall be sent by registered mail, overnight
mail service or by telegraph or telecopy and shall be effective
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upon receipt. However, routine communications, including monthly
statements, shall be considered as delivered when mailed, properly
addressed, by either registered or ordinary mail.
ARTICLB XIII.
TRAIISFBR AIm A8SIG1IIDDJT
~ Any company that shall succeed by purchase, merger, or
consolidation to the properties, substantially, or in their
entirety, of either Party shall be entitled to the rights and shall
be sUbject to the obligations of its predecessor in title under
this Agreement. No assignment of this Agreement or of any rights
or obligations hereunder shall be made by either Party without the
written consent of the other Party, except that either Party may
assign this Agreement to a financially capable affiliate upon
written notice to the other Party. This Article XIII shall not
prevent either Party from pledging or mortgaging its rights
hereunder as security for its indebtedness. This Agreement shall
be binding upon and inure to the benefit of the respective
successors and assigns of the Parties.
ARTICLE XIV.
NON-WAIVER OF FUTURE DEFAULTS
~ No waiver by either Party of anyone or more defaults by
the other Party in the performance of this Agreement shall operate
or be construed as a waiver of any future defaul t or defaul ts,
whether of a like or of a different character.
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ARTICLED.
ENTIRE AGREEMENT
~ This Agreement constitutes the entire agreement between
Seller and Buyer for the sale and delivery and purchase of natural
gas. THIS AGREEMENT SUPERSEDES ALL PRIOR NEGOTIATIONS,
REPRESENTATIONS, CONTRACTS OR AGREEMENTS, EITHER WRITTEN OR ORAL,
REGARDING THE SUBJECT MATTER HEREOF. EXCEPT AS PROVIDED IN ARTICLE
VII AND ARTICLE X, THERE ARE NO OTHER WARRANTIES EXPRESSED OR
IMPLIED REGARDING THE PURCHASE AND SALE OF NATURAL GAS PROVIDED FOR
HEREIN. Except as provided in Article II, no modif ication,
al terations, amendments, instruction or interpretation of this
Agreement and/or Exhibit "An shall be binding upon either Party
unless executed in writing by the party to be bound.
ARTICLE XVI.
DAMAGES
~ Neither Party shall be liable for any damages for any
breach of this Agreement, unless a claim is presented in writing
within two (2) years after the alleged damages occurred, or within
two (2) years after the injured Party should have known of such
damage by exercise of reasonably prudent care to discover same,
whichever occurs later. The claim shall set forth in full the
nature, character, cause, and amount of the damage.
ARTICLE XVII.
~ THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS.
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IN WITNESS WHEREO~, the parties have caused these presents to
be executed by their proper officers duly authorized in that
behalf, as of the day and year first above written.
SELLER:
WITNESS:
NATURAL GAS CLEARINGHOUSE
By:
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By:
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V~ncent T. McConnell
Vice President
BUYER:
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CITY OF CLEARWATER,
a municipal corporation of the
Stat of Florida
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By:
Rita Garv y
Mayor-Commissione
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EXHIBIT "A"
PURCHASE ORDER
Date:
11-18-91
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 October 21, 1991, by and between Natural Gas
Clearinghouse (a Colorado General Partnership) ("Seller") and City
of Clearwater, ("Buyer").
Terms:
1- Contract Period:
2. Quantity:
3. Delivery Point(s):
4. Price:
BUYER:
CITY OF CLEARWATER
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Up to
MMBTU/day
See attached.
$ /MMBTU dry
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SELLER:
NATURAL GAS CLEARINGHOUSE
BY:~~
V1ncent . Mc onnell
vice President
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