NATURAL GAS AGREEMENTS (035)
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INTERRUPTIBLE GAS SALES AGREEMENT
GENERAL TERMS AND CONDITIONS
AS OF THIS 6TH DAY OF NOVEMBER, 1991, BISHOP PIPELINE
CORPORATION, a TEXAS corporation ("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":
WIT N E SSE T H :
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 1.
DEFINITIONS
1.1 "Agreement" shall mean these General Terms and
Conditions and the Exhibit "An hereto both of which have been
completed and executed by the Parties.
1. 2 "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 not selling, delivering or purchasing any
natural gas pursuant to this Agreement and failure to do so shall
not constitute a breach of this Agreement by either Buyer or
Seller.
1.3 "Transporter" shall mean the transporting pipeline
downstream of the Point(s) of Sale.
1.4 npoint(s) of Sale" shall mean the point(s) at which
natural gas is first delivered to the first Transporter, which
point(s) are designated in the Transportation Agreement(s) to be
executed by such Transporter and Buyer with respect to the
transportation of the natural gas purchased.
ARTICLE II.
OUANTITY
2.l By executing Exhibit "A", Buyer shall have agreed to
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maximum daily and monthly quantities of natural gas that Buyer
may desire to purchase from Seller. To permit Seller to schedule
delivery of natural gas supplies for Buyer in an orderly manner,
Buyer shall provide Seller with oral notice of both daily and
monthly nominated quantities provided by Buyer to the first
Transporter for all deliveries of natural gas and shall confirm
that notice by providing 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) required by the first
Transporter for such nominations.
~ Buyer may decrease or Interrupt the nominated quantity
established pursuant to Paragraph 2.1, from time to time upon
twenty-four (24) hour notice to any Transporter and Seller, which
notice of decrease or Interruption of such nominated quantity may
be oral, but which notice must be confirmed in writing. Buyer
may increase its nominated quantity 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 may be oral, and (ii) Seller's
written confirmation and approval of said increase in writing.
Seller may decrease or Interrupt sales of natural gas for any
time and from time to time upon twenty-four (24) hour notice to
Buyer, which notice of decrease or Interruption of nominated
quantity initially may be oral, but which notice must be
confirmed in writing. Buyer and Seller may also at any time
request an increase or decrease in the maximum daily and/ or
monthly quantities, which proposed increase or decrease shall
become effective only according to the terms of a newly executed
Exhibit "A".
2. 3 The Parties agree that if any penal ties are imposed
upon a Party hereto by the transporting pipeline(s), in
accordance with the provisions of its applicable Federal Energy
Regulatory Commission approved transportation tariff (s), as a
result of other Party's failure to deliver or accept an agreed
upon, nominated quantity or as a result of the other Party's
failure to deliver or accept an agreed upon, nominated quantity
or as a result of the other Party's failure to perform any of its
obligations hereunder, the failing Party shall, upon receipt of
an invoice from the non-failing Party reasonably detailing such
penalties, reimburse the non-failure Party the dollar amount of
such penalties (or the failing Party's portion thereof) within
thirty (30) days following receipt of said invoice.
ARTICLE III.
PRICE OF NATURAL GAS
.J.......l Exhibit "A" shall state the price for the natural gas
that is sold by Seller to Buyer. The price of natural gas
includes all charges and costs of compression, gathering,
processing, treating, liquefying or transporting the natural gas,
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or other similar cost, and taxes (except taxes described in
Paragraph 3.3), which are incurred prior to the Point(s) of Sale.
Seller shall compress, gather, process, 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, treating, liquefying
or transporting such has, or other similar costs, as allowed
pursuant to {110 of the Natural Gas Policy Act of 1978 (NGPA) or
18 C.F.R. {270.202 and {271.1104 or as otherwise allowed by law,
to the extent such costs are incurred by Seller or by Seller's
suppliers; provided however, the price shall not exceed the price
stated on Exhibit "A". The price shall remain in effect until
Buyer and Seller have agreed upon a new price and have executed a
new Exhibit "A".
~ (a) "Regulated Gas" means gas subject to a maximum
lawful price.
(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 an
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.
3.3 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.
ARTICLE IV.
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4.1 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
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terminated by either Party upon at least then (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.
ARTICLE V.
POINTS OF SALE: TITLE: RIGHTS OF POSSESSION
5.1 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.
ARTICLE VI.
TRANSPORTATION
6.1 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
aqreement(s) entered into pursuant to this paragraph.
ARTICLE VII.
OUALITY
7.1 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 AND PAYMENT
8.1 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
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month, the amount due on Seller's statement. All such payments
shall be made to Seller by wire transfer directed to:
Bankers Trust company New York
ABA # 021001033
Credit Banque paribas New York
Account # 04202195
Further Credit Banque paribas Houston Agency
Account #2144-001545
Final Credit Bishop Pipeline corporation
Account #814400
To the extent that supporting data is not available to Seller by
the twelfth (12) 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.
8.2 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.
.!h.J. 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.
8.4 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.
8.5 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 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
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charged by Citibank, N.A. to its best commercial and industrial
borrowers.
ARTICLE IX.
REGULATION
9.1 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.
WARRANTIES OF TITLE
10.1 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 royalties, 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.
ARTICLE XI.
CREDIT WORTHINESS
11.1 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 a continuing nature and in a satisfactory
amount as determined by Seller in its sole discretion.
ARTICLE XII.
NOTICES
~ 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:
Bishop Pipeline Corporation
700 Milam, suite 500
Houston, Texas 77002
Attn: Contract Administration
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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 upon receipt. However, routine
communications, including monthly statements, shall be considered
as delivered when mailed, properly addressed, by either
registered or ordinary mail.
ARTICLE XIII.
TRANSFER AND ASSIGNMENT
13.1 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 written consent from the other party, not to be withheld
unreasonably. 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
14.1 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 default or
defaults, whether of a like or a different character.
ARTICLE XV.
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 modification, alterations, amendments, instruction
or interpretation of this Agreement and/or Exhibit "A" shall be
binding upon either Party unless executed in writing by the party
to be bound.
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ARTICLE XVI.
DAMAGES
l6.1 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 reasonable prudent care to discover
same, whichever occurs later. The claim shall set forth in full
the nature, character, cause, and amount of damage.
ARTICLE XVII.
17.1 THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS.
IN WITNESS WHEREOF, 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:
Bishop Pipeline Corporation
WITNESS:
TJ.tle:
W rSJ, &e-
FRW 0, ROC, JR.
VICE PRESIDENT, S.[ REGION
Buyer:
CITY OF CLEARWATER,
a municipal corporation of the
st te of Florida
W~ESS :
/y? J tv);1, ,{{ llurrrr )
TJ.tle: 0.:
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EXHIBIT "A"
DATED NOVEMBER 6, 1991 BETWEEN
BISHOP PIPELINE CORPORATION AS "SELLER"
AND CITY OF CLEARWATER AS "BUYER"
Pursuant to the terms of the Interruptible Gas Sales Agreement
dated November 6, 1991, this Exhibit "A" shall provide the
necessary specifications under which Buyer agrees to purchase and
Seller agrees to sell gas:
1. Maximum Daily Quantity (MMBtu):
2. Maximum Monthly Quantity (MMBtu):
\
3. Gas Price per MMBtu ($/MMBtu): $
4. Effective Period of Exhibit "A":
5. First Transporter:
6. Point(s) of Sale:
BUYER:
SELLER:
CIT
BISHOP PIPELIN~RPORATION
By: r7;te.::e m. ae
FRED O. ROE, JR.
\II~f PIlCSIBCNT, 3.E. ~~GION
("g
By:
Title:
Title:
Date:
Date: