ex10_4.htm


    
      

    

    Exhibit
10.4

     

    
      Amended
and Restated Base Contract for Sale and Purchase of Natural Gas

        

      This Base
Contract is entered into as of the following date:  
July 7, 2005  and is amended and restated effective October 22,
2008.  The parties to this Base Contract are the
following:

       

      
        
          
            
              
                
                  
                    	
                            CALPINE ENERGY SERVICES,
    L.P.

                          	
                            and

                          	
                            ROSETTA RESOURCES OPERATING
      LP successor in interest to Rosetta
      Resources California, LLC

                          
	 	 	 
	
                            717 Texas Avenue, Suite 1000, Houston, Texas
      77002

                          	
                             
      

                          	
                            717 Texas Avenue, Suite 2800, Houston,
      Texas  77002

                          
	
                            Duns
      Number:

                          	
                            16-966-8212

                          	 
      	
                            Duns
      Number:

                          	
                            63-101-7545

                          
	
                            Contract
      Number:

                          	 
      	 
      	
                            Contract
      Number:

                          	 
      
	
                            U.S.
      Federal Tax ID Number:  

                          	
                            77-0526913

                          	 
      	
                            U.S.
      Federal Tax ID Number:  

                          	
                            71-0882453

                          


                  

                

              

            

          

        

      

      


      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                	
                                        Notices:

                                      	 
      	 
      	 
      	
                                         
      

                                      	 
      	 
      	 
      	 
      
	
                                        717 Texas Avenue, Suite 1000, Houston,
      Texas  77002

                                      	 
      	
                                        Rosetta Resources Operating
    LP

                                      
	
                                        Attn:

                                      	
                                        Contract Administration

                                      	 
      	
                                        Attn:

                                      	
                                        Marketing Department

                                      
	
                                        Phone: 
      

                                      	
                                        (713) 830-8845

                                      	
                                        Fax: 
      

                                      	
                                        (713) 830-8751

                                      	 
      	
                                        Phone: 
      

                                      	
                                        713-335-4000

                                      	
                                        Fax: 
      

                                      	
                                        713-335-4197

                                      
	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
                                        Confirmations:

                                      	 
      	
                                        Confirmations
      and Notices:

                                      
	
                                        717 Texas Avenue, Suite 1000, Houston, Texas
      77002

                                      	 
      	
                                        CPSLP, Agent, 717 Texas Ave., Ste 1000, Houston,
      TX  77002

                                      
	
                                        Attn:

                                      	
                                        Gas Confirmations

                                      	 
      	
                                        Attn:

                                      	
                                        Gas Confirmations

                                      
	
                                        Phone: 
      

                                      	
                                        (713) 830-8723

                                      	
                                        Fax: 
      

                                      	
                                        (713) 830-8868

                                      	 
      	
                                        Phone: 
      

                                      	
                                        713-830-8333

                                      	
                                        Fax: 
      

                                      	
                                        713-830-8868

                                      
	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
                                        Invoices and
      Payments:

                                      	 
      	
                                        c/o

                                      	 
      	 
      	 
      
	
                                        717 Texas Avenue, Suite 1000, Houston, Texas
      77002

                                      	 
      	
                                        CPSLP, Agent, 717 Texas Ave., Ste 1000, Houston,
      TX  77002

                                      
	
                                        Attn:

                                      	
                                        Fuels Accounting

                                      	 
      	
                                        Attn:

                                      	
                                        Fuels Accounting

                                      
	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
                                        Phone: 
      

                                      	
                                        (713) 830-2000

                                      	
                                        Fax: 
      

                                      	
                                        (713) 830-8749

                                      	 
      	
                                        Phone: 
      

                                      	
                                        713-830-2000

                                      	
                                        Fax: 
      

                                      	
                                        713-830-8749

                                      


                              

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

      


      
        
          
            
              	
                      Wire Transfer or ACH Numbers
      (if applicable):

                    	
                       
      

                    	 
      	 
      
	
                      BANK:

                    	
                      Union Bank of California, Oakland,
      CA

                    	 
      	
                      BANK:

                    	
                      Amegy Bank of Texas

                    
	
                      ABA:

                    	
                      122-000-496

                    	 
      	
                      ABA:

                    	
                      113011258

                    
	
                      ACCT:

                    	
                      187-003-1951

                    	 
      	
                      ACCT:

                    	
                      51581694

                    
	
                      Other
      Details:

                    	 
      	 
      	
                      Other
      Details:

                    	 
      


            

          

        

      

      


      This Base
Contract incorporates by reference for all purposes the General Terms and
Conditions for Sale and Purchase of Natural Gas published by the North American
Energy Standards Board.  The parties hereby agree to the following
provisions offered in said General Terms and Conditions.  In the event
the parties fail to check a box, the specified default provision shall
apply.  Select only one box from
each section:

      


      
        
          
            
              
                
                  	
                          Section
      1.2

                          Transaction
      Procedure

                        	
                          ■      Oral
      (default)

                               Written

                        	
                          Section
      7.2

                          Payment
      Date

                        	
                          ■
            25th Day of Month
      following Month of delivery (default)

                                _____
      Day of Month following Month of delivery

                        
	
                          Section
      2.5

                          Confirm
      Deadline

                        	
                          ■ 
          2 Business Days after receipt (default)

                           
          _____ Business Days after receipt

                        	
                          Section
      7.2

                          Method
      of Payment

                        	
                          ■
            Wire transfer (default)

                                Automated
      Clearinghouse Credit (ACH)

                                Check

                        
	
                          Section
      2.6

                          Confirming
      Party

                        	
                          ■      Seller
      (default)

                                Buyer

                                __________________________

                        	
                          Section
      7.7

                          Netting

                        	
                          ■
            Netting applies (default)

                                Netting
      does not apply

                        
	
                          Section
      3.2

                          Performance
      Obligation

                        	
                          ■      Cover
      Standard (default)

                               Spot
      Price Standard

                        	
                          Section
      10.3.1

                          Early
      Termination Damages

                        	
                          ■
            Early Termination Damages Apply (default)

                                Early
      Termination Damages Do Not
      Apply

                        
	
                          Note:
      The following Spot Price Publication applies to both of the immediately
      preceding.

                        	
                          Section
      10.3.2

                          Other
      Agreement Setoffs

                        	
                                Other
      Agreement Setoffs Apply (default)

                          ■
            Other Agreement Setoffs Do Not
      Apply

                        
	
                          Section
      2.26

                          Spot
      Price Publication

                        	
                          ■      Gas
      Daily Midpoint (default)

                                __________________________

                        	
                          Section
      14.5

                          Choice
      Of Law

                        	
                           

                                       
       
      Texas                    

                        
	
                          Section
      6

                          Taxes

                        	
                          ■      Buyer
      Pays At and After Delivery Point (default)

                            
        Seller Pays
      Before and At Delivery Point

                        	
                          Section
      14.10

                          Confidentiality

                        	
                          ■
            Confidentiality applies (default)

                                Confidentiality
      does not apply

                        
	
                          ■ Special Provisions
      Number of sheets attached: 5

                          
      Addendum(s):___________________________________________________________________________________________

                        


                

              

            

          

        

      

       

      IN
WITNESS WHEREOF, the parties hereto have executed this Base Contract in
duplicate.

       

      
        
          
            
              
                
                  
                    	
                            CALPINE ENERGY SERVICES, L.P. (Buyer or Party
      “A”)

                          	 
      	
                             ROSETTA RESOURCES OPERATING LP
      (Seller or Party
      “B”)

                          	 
      
	
                            Party
      Name

                          	 
      	
                            by
      its general partner Rosetta Resources Operating GP, LLC

                          	 
      
	 
      	 
      	 
      	
                            Party
      Name

                          	 
      
	
                            By

                          	
                             /s/ Larry Leverett

                          	 
      	
                            By

                          	
                             /s/ Michael J. Rosinski

                          	 
      
	
                            Name: 
      

                          	
                             Larry
      Leverett

                          	 
      	
                            Name: 
      

                          	
                             Michael
      J. Rosinski

                          	 
      
	
                            Title:

                          	
                             Vice
      President

                          	 
      	
                            Title:

                          	
                            EVP,
      CFO and Treasurer

                          	 
      


                  

                

              

            

          

        

      

    

     

    
      
        	
                Copyright
      © 2002 North American Energy Standards Board, Inc.

              	 
      	
                NAESB
      Standard 6.3.1

              
	
                All
      Rights Reserved

              	 
      	
                April
      19, 2002

              


      

    

    


    
      
        
           


        

        
          Page 1 of
10

          
            

          

        

        
           


        

      

    

    


    General
Terms and Conditions

    Base
Contract for Sale and Purchase of Natural Gas

    


    SECTION
1.    PURPOSE AND
PROCEDURES

     

    1.1.           These
General Terms and Conditions are intended to facilitate purchase and sale
transactions of Gas on a Firm or Interruptible basis.  "Buyer" refers
to the party receiving Gas and "Seller" refers to the party delivering
Gas.  The entire agreement between the parties shall be the Contract
as defined in Section 2.7.

    
      
        
           

          
            	
                    The
      parties have selected either the “Oral Transaction Procedure” or the
      “Written Transaction Procedure” as indicated on the Base
      Contract.

                  
	
                    Oral
      Transaction Procedure:

                  
	
                    1.2.           The
      parties will use the following Transaction Confirmation
      procedure.  Any Gas purchase and sale transaction may be
      effectuated in an EDI transmission or telephone conversation with the
      offer and acceptance constituting the agreement of the
      parties.  The parties shall be legally bound from the time they
      so agree to transaction terms and may each rely thereon.  Any
      such transaction shall be considered a “writing” and to have been
      “signed”.  Notwithstanding the foregoing sentence, the parties
      agree that Confirming Party shall, and the other party may, confirm a
      telephonic transaction by sending the other party a Transaction
      Confirmation by facsimile, EDI or mutually agreeable electronic means
      within three Business Days of a transaction covered by this Section 1.2
      (Oral Transaction Procedure) provided that the failure to send a
      Transaction Confirmation shall not invalidate the oral agreement of the
      parties.  Confirming Party adopts its confirming letterhead, or
      the like, as its signature on any Transaction Confirmation as the
      identification and authentication of Confirming Party.  If the
      Transaction Confirmation contains any provisions other than those relating
      to the commercial terms of the transaction (i.e., price, quantity,
      performance obligation, delivery point, period of delivery and/or
      transportation conditions), which modify or supplement the Base Contract
      or General Terms and Conditions of this Contract (e.g., arbitration or
      additional representations and warranties), such provisions shall not be
      deemed to be accepted pursuant to Section 1.3 but must be expressly agreed
      to by both parties; provided that the foregoing shall not invalidate any
      transaction agreed to by the parties.

                  
	
                    Written
      Transaction Procedure:

                  
	
                    1.2.           The
      parties will use the following Transaction Confirmation
      procedure.  Should the parties come to an agreement regarding a
      Gas purchase and sale transaction for a particular Delivery Period, the
      Confirming Party shall, and the other party may, record that agreement on
      a Transaction Confirmation and communicate such Transaction Confirmation
      by facsimile, EDI or mutually agreeable electronic means, to the other
      party by the close of the Business Day following the date of
      agreement.  The parties acknowledge that their agreement will
      not be binding until the exchange of nonconflicting Transaction
      Confirmations or the passage of the Confirm Deadline without objection
      from the receiving party, as provided in Section
  1.3.

                  


          

        

      

    

     

    1.3.           If
a sending party's Transaction Confirmation is materially different from the
receiving party's understanding of the agreement referred to in Section 1.2,
such receiving party shall notify the sending party via facsimile, EDI or
mutually agreeable electronic means by the Confirm Deadline, unless such
receiving party has previously sent a Transaction Confirmation to the sending
party.  The failure of the receiving party to so notify the sending
party in writing by the Confirm Deadline constitutes the receiving party's
agreement to the terms of the transaction described in the sending party's
Transaction Confirmation.  If there are any material differences
between timely sent Transaction Confirmations governing the same transaction,
then neither Transaction Confirmation shall be binding until or unless such
differences are resolved including the use of any evidence that clearly resolves
the differences in the Transaction Confirmations.  In the event of a
conflict among the terms of (i) a binding Transaction Confirmation pursuant
to Section 1.2, (ii) the oral agreement of the parties which may be evidenced by
a recorded conversation, where the parties have selected the Oral Transaction
Procedure of the Base Contract, (iii) the Base Contract, and
(iv) these General Terms and Conditions, the terms of the documents shall
govern in the priority listed in this sentence.

     

    1.4.           The parties agree that each party may
electronically record all telephone conversations with respect to this Contract
between their respective employees, without any special or further notice to the
other party.  Each party shall obtain any necessary consent of its
agents and employees to such recording.  Where the parties have selected the
Oral Transaction Procedure in Section 1.2 of the Base Contract, the parties agree not to contest the
validity or enforceability of telephonic recordings entered into in accordance
with the requirements of this Base Contract.  However, nothing herein
shall be construed as a waiver of any objection to the admissibility of such
evidence.

     

    SECTION
2.    DEFINITIONS

     

    The terms
set forth below shall have the meaning ascribed to them below.  Other
terms are also defined elsewhere in the Contract and shall have the meanings
ascribed to them herein.

     

    2.1.           “Alternative
Damages” shall mean such damages, expressed in dollars or dollars per MMBtu, as
the parties shall agree upon in the Transaction Confirmation, in the event
either Seller or Buyer fails to perform a Firm obligation to deliver Gas in the
case of Seller or to receive Gas in the case of Buyer.

     

    2.2.           "Base
Contract" shall mean a contract executed by the parties that incorporates these
General Terms and Conditions by reference; that specifies the agreed selections
of provisions contained herein; and that sets forth other information required
herein and any Special Provisions and addendum(s) as identified on page
one.

     

    2.3.           "British
thermal unit" or "Btu" shall mean the International BTU, which is also called
the Btu (IT).

     

    
      
        	
                Copyright
      © 2002 North American Energy Standards Board, Inc.

              	 
      	
                NAESB
      Standard 6.3.1

              
	
                All
      Rights Reserved

              	 
      	
                April
      19, 2002

              


      
  


    
      
        
           


        

        
          Page 2 of
10

          
            

          

        

        
           


        

      

    

    


    2.4.           "Business
Day" shall mean any day except Saturday, Sunday or Federal Reserve Bank
holidays.

     

    2.5.           "Confirm
Deadline" shall mean 5:00 p.m. in the receiving party's time zone on the second
Business Day following the Day a Transaction Confirmation is received or, if
applicable, on the Business Day agreed to by the parties in the Base Contract;
provided, if the Transaction Confirmation is time stamped after 5:00 p.m. in the
receiving party's time zone, it shall be deemed received at the opening of the
next Business Day.

     

    2.6.           "Confirming
Party" shall mean the party designated in the Base Contract to prepare and
forward Transaction Confirmations to the other party.

     

    2.7.           "Contract"
shall mean the legally-binding relationship established by (i) the Base
Contract, (ii) any and all binding Transaction Confirmations and (iii) where the
parties have selected the Oral Transaction Procedure in Section 1.2 of the Base
Contract, any and all transactions that the parties have entered into through an
EDI transmission or by telephone, but that have not been confirmed in a binding
Transaction Confirmation.

     

    2.8.           "Contract
Price" shall mean the amount expressed in U.S. Dollars per MMBtu to be paid by
Buyer to Seller for the purchase of Gas as agreed to by the parties in a
transaction.

     

    2.9.           "Contract
Quantity" shall mean the quantity of Gas to be delivered and taken as agreed to
by the parties in a transaction.

     

    2.10.         "Cover
Standard", as referred to in Section 3.2, shall mean that if there is an
unexcused failure to take or deliver any quantity of Gas pursuant to this
Contract, then the performing party shall use commercially reasonable efforts to
(i) if Buyer is the performing party, obtain Gas, (or an alternate fuel if
elected by Buyer and replacement Gas is not available), or (ii) if Seller is the
performing party, sell Gas, in either case, at a price reasonable for the
delivery or production area, as applicable, consistent with:  the
amount of notice provided by the nonperforming party; the immediacy of the
Buyer's Gas consumption needs or Seller's Gas sales requirements, as applicable;
the quantities involved; and the anticipated length of failure by the
nonperforming party.

     

    2.11.         "Credit
Support Obligation(s)” shall mean any obligation(s) to provide or establish
credit support for, or on behalf of, a party to this Contract such as an
irrevocable standby letter of credit, a margin agreement, a prepayment, a
security interest in an asset, a performance bond, guaranty, or other good and
sufficient security of a continuing nature.

     

    2.12.         "Day"
shall mean a period of 24 consecutive hours, coextensive with a "day" as defined
by the Receiving Transporter in a particular transaction.

     

    2.13.         "Delivery
Period" shall be the period during which deliveries are to be made as agreed to
by the parties in a transaction.

     

    2.14.         "Delivery
Point(s)" shall mean such point(s) as are agreed to by the parties in a
transaction.

     

    2.15.         "EDI"
shall mean an electronic data interchange pursuant to an agreement entered into
by the parties, specifically relating to the communication of Transaction
Confirmations under this Contract.

     

    2.16.         "EFP"
shall mean the purchase, sale or exchange of natural Gas as the "physical" side
of an exchange for physical transaction involving gas futures
contracts.  EFP shall incorporate the meaning and remedies of "Firm",
provided that a party’s excuse for nonperformance of its obligations to deliver
or receive Gas will be governed by the rules of the relevant futures exchange
regulated under the Commodity Exchange Act.

     

    2.17.         "Firm"
shall mean that either party may interrupt its performance without liability
only to the extent that such performance is prevented for reasons of Force
Majeure; provided, however, that during Force Majeure interruptions, the party
invoking Force Majeure may be responsible for any Imbalance Charges as set forth
in Section 4.3 related to its interruption after the nomination is made to the
Transporter and until the change in deliveries and/or receipts is confirmed by
the Transporter.

     

    2.18.         "Gas"
shall mean any mixture of hydrocarbons and noncombustible gases in a gaseous
state consisting primarily of methane.

     

    2.19.         "Imbalance
Charges" shall mean any fees, penalties, costs or charges (in cash or in kind)
assessed by a Transporter for failure to satisfy the Transporter's balance
and/or nomination requirements.

     

    2.20.         "Interruptible"
shall mean that either party may interrupt its performance at any time for any
reason, whether or not caused by an event of Force Majeure, with no liability,
except such interrupting party may be responsible for any Imbalance Charges as
set forth in Section 4.3 related to its interruption after the nomination is
made to the Transporter and until the change in deliveries and/or receipts is
confirmed by Transporter.

     

    2.21.         "MMBtu"
shall mean one million British thermal units, which is equivalent to one
dekatherm.

     

    2.22.         "Month"
shall mean the period beginning on the first Day of the calendar month and
ending immediately prior to the commencement of the first Day of the next
calendar month.

     

    2.23.         "Payment
Date" shall mean a date, as indicated on the Base 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 mean 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 Day, but there is published a range of prices, then the Spot Price
shall be the average of such high and low prices.  If no price or
range of prices is published for such Day, then the Spot Price shall be the
average of the following: (i) the price (determined as stated above) for
the first Day for which a price or range of prices is published that next
precedes the relevant Day; and (ii) the price (determined as stated above)
for the first Day for which a price or range of prices is published that next
follows the relevant Day.

     

    
      
        	
                Copyright
      © 2002 North American Energy Standards Board, Inc.

              	 
      	
                NAESB
      Standard 6.3.1

              
	
                All
      Rights Reserved

              	 
      	
                April
      19, 2002

              


      

       

    

    
      
        
           


        

        
          Page 3 of
10

          
            

          

        

        
           


        

      

    

    


    2.27.         "Transaction
Confirmation" shall mean a document, similar to the form of Exhibit A, setting
forth the terms of a transaction formed pursuant to Section 1 for a particular
Delivery Period.

     

    2.28.         “Termination
Option” shall mean the option of either party to terminate a transaction in the
event that the other party fails to perform a Firm obligation to deliver Gas in
the case of Seller or to receive Gas in the case of Buyer for a designated
number of days during a period as specified on the applicable Transaction
Confirmation.

     

    2.29.         "Transporter(s)" shall mean all Gas gathering or
pipeline companies, or local distribution companies, acting in the capacity of a
transporter, transporting Gas for Seller or Buyer upstream or downstream,
respectively, of the Delivery Point pursuant to a particular
transaction.

     

    SECTION
3.    PERFORMANCE
OBLIGATION

     

    3.1.           Seller
agrees to sell and deliver, and Buyer agrees to receive and purchase, the
Contract Quantity for a particular transaction in accordance with the terms of
the Contract.  Sales and purchases will be on a Firm or Interruptible
basis, as agreed to by the parties in a transaction.

     

    
      
        
          
            	
                    The
      parties have selected either the “Cover Standard” or the “Spot Price
      Standard” as indicated on the Base Contract.

                  
	
                    Cover
      Standard:

                  
	
                    3.2.           The
      sole and exclusive remedy of the parties in the event of a breach of a
      Firm obligation to deliver or receive Gas shall be recovery of the
      following: (i) in the event of a breach by Seller on any Day(s), payment
      by Seller to Buyer in an amount equal to the positive difference, if any,
      between the purchase price paid by Buyer utilizing the Cover Standard and
      the Contract Price, adjusted for commercially reasonable differences in
      transportation costs to or from the Delivery Point(s), multiplied by the
      difference between the Contract Quantity and the quantity actually
      delivered by Seller for such Day(s); or (ii) in the event of a breach by
      Buyer on any Day(s), payment by Buyer to Seller in the amount equal to the
      positive difference, if any, between the Contract Price and the price
      received by Seller utilizing the Cover Standard for the resale of such
      Gas, adjusted for commercially reasonable differences in transportation
      costs to or from the Delivery Point(s), multiplied by the difference
      between the Contract Quantity and the quantity actually taken by Buyer for
      such Day(s); or (iii) in the event that Buyer has used commercially
      reasonable efforts to replace the Gas or Seller has used commercially
      reasonable efforts to sell the Gas to a third party, and no such
      replacement or sale is available, then the sole and exclusive remedy of
      the performing party shall be any unfavorable difference between the
      Contract Price and the Spot Price, adjusted for such transportation to the
      applicable Delivery Point, multiplied by the difference between the
      Contract Quantity and the quantity actually delivered by Seller and
      received by Buyer for such Day(s).  Imbalance Charges shall not
      be recovered under this Section 3.2, but Seller and/or Buyer shall be
      responsible for Imbalance Charges, if any, as provided in Section
      4.3.  The amount of such unfavorable difference shall be payable
      five Business Days after presentation of the performing party’s invoice,
      which shall set forth the basis upon which such amount was
      calculated.

                  
	
                    Spot
      Price Standard:

                  
	
                    3.2.           The
      sole and exclusive remedy of the parties in the event of a breach of a
      Firm obligation to deliver or receive Gas shall be recovery of the
      following: (i) in the event of a breach by Seller on any Day(s), payment
      by Seller to Buyer in an amount equal to the difference between the
      Contract Quantity and the actual quantity delivered by Seller and received
      by Buyer for such Day(s), multiplied by the positive difference, if any,
      obtained by subtracting the Contract Price from the Spot Price; or (ii) in
      the event of a breach by Buyer on any Day(s), payment by Buyer to Seller
      in an amount equal to the difference between the Contract Quantity and the
      actual quantity delivered by Seller and received by Buyer for such Day(s),
      multiplied by the positive difference, if any, obtained by subtracting the
      applicable Spot Price from the Contract Price.  Imbalance
      Charges shall not be recovered under this Section 3.2, but Seller and/or
      Buyer shall be responsible for Imbalance Charges, if any, as provided in
      Section 4.3.  The amount of such unfavorable difference shall be
      payable five Business Days after presentation of the performing party’s
      invoice, which shall set forth the basis upon which such amount was
      calculated.

                  


          

        

      

    

     

    3.3.           Notwithstanding
Section 3.2, the parties may agree to Alternative Damages in a Transaction
Confirmation executed in writing by both parties.

     

    3.4.           In
addition to Sections 3.2 and 3.3, the parties may provide for a Termination
Option in a Transaction Confirmation executed in writing by both
parties.  The Transaction Confirmation containing the Termination
Option will designate the length of nonperformance triggering the Termination
Option and the procedures for exercise thereof, how damages for nonperformance
will be compensated, and how liquidation costs will be calculated.

     

    SECTION
4.    TRANSPORTATION,
NOMINATIONS, AND IMBALANCES

     

    4.1.           Seller
shall have the sole responsibility for transporting the Gas to the Delivery
Point(s).  Buyer shall have the sole responsibility for transporting
the Gas from the Delivery Point(s).

     

    4.2.           The
parties shall coordinate their nomination activities, giving sufficient time to
meet the deadlines of the affected Transporter(s).  Each party shall
give the other party timely prior Notice, sufficient to meet the requirements of
all Transporter(s) involved in the transaction, of the quantities of Gas to be
delivered and purchased each Day.  Should either party become aware
that actual deliveries at the Delivery Point(s) are greater or lesser than the
Scheduled Gas, such party shall promptly notify the other party.

     

    
      
        	
                Copyright
      © 2002 North American Energy Standards Board, Inc.

              	 
      	
                NAESB
      Standard 6.3.1

              
	
                All
      Rights Reserved

              	 
      	
                April
      19, 2002

              


      
  


    
      
        
           


        

        
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    4.3.           The
parties shall use commercially reasonable efforts to avoid imposition of any
Imbalance Charges.  If Buyer or Seller receives an invoice from a
Transporter that includes Imbalance Charges, the parties shall determine the
validity as well as the cause of such Imbalance Charges.  If the
Imbalance Charges were incurred as a result of Buyer’s receipt of quantities of
Gas greater than or less than the Scheduled Gas, then Buyer shall pay for such
Imbalance Charges or reimburse Seller for such Imbalance Charges paid by
Seller.  If the Imbalance Charges were incurred as a result of
Seller’s delivery of quantities of Gas greater than or less than the Scheduled
Gas, then Seller shall pay for such Imbalance Charges or reimburse Buyer for
such Imbalance Charges paid by Buyer.

     

    SECTION
5.    QUALITY AND
MEASUREMENT

     

    All Gas
delivered by Seller shall meet the pressure, quality and heat content
requirements of the Receiving Transporter.  The unit of quantity
measurement for purposes of this Contract shall be one MMBtu
dry.  Measurement of Gas quantities hereunder shall be in accordance
with the established procedures of the Receiving Transporter.

     

    SECTION 6.    TAXES

     

    
      
        
          
            	
                    The
      parties have selected either “Buyer Pays At and After Delivery Point” or
      “Seller Pays Before and At Delivery Point” as indicated on the Base
      Contract.

                  
	
                    Buyer
      Pays At and After Delivery Point:

                  
	
                    Seller
      shall pay or cause to be paid all taxes, fees, levies, penalties, licenses
      or charges imposed by any government authority (“Taxes”) on or with
      respect to the Gas prior to the Delivery Point(s).  Buyer shall
      pay or cause to be paid all Taxes on or with respect to the Gas at the
      Delivery Point(s) and all Taxes after the Delivery Point(s).  If
      a party is required to remit or pay Taxes that are the other party’s
      responsibility hereunder, the party responsible for such Taxes shall
      promptly reimburse the other party for such Taxes.  Any party
      entitled to an exemption from any such Taxes or charges shall furnish the
      other party any necessary documentation thereof.

                  
	
                    Seller
      Pays Before and At Delivery Point:

                  
	
                    Seller
      shall pay or cause to be paid all taxes, fees, levies, penalties, licenses
      or charges imposed by any government authority (“Taxes”) on or with
      respect to the Gas prior to the Delivery Point(s) and all Taxes at the
      Delivery Point(s).  Buyer shall pay or cause to be paid all
      Taxes on or with respect to the Gas after the Delivery
      Point(s).  If a party is required to remit or pay Taxes that are
      the other party’s responsibility hereunder, the party responsible for such
      Taxes shall promptly reimburse the other party for such
      Taxes.  Any party entitled to an exemption from any such Taxes
      or charges shall furnish the other party any necessary documentation
      thereof.

                  


          

        

      

    

     

    SECTION
7.    BILLING, PAYMENT, AND
AUDIT

     

    7.1.           Seller
shall invoice Buyer for Gas delivered and received in the preceding Month and
for any other applicable charges, providing supporting documentation acceptable
in industry practice to support the amount charged.  If the actual
quantity delivered is not known by the billing date, billing will be prepared
based on the quantity of Scheduled Gas.  The invoiced quantity will
then be adjusted to the actual quantity on the following Month's billing or as
soon thereafter as actual delivery information is available.

     

    7.2.           Buyer
shall remit the amount due under Section 7.1 in the manner specified in the Base
Contract, in immediately available funds, on or before the later of the Payment
Date or 10 Days after receipt of the invoice by Buyer; provided that if the
Payment Date is not a Business Day, payment is due on the next Business Day
following that date.  In the event any payments are due Buyer
hereunder, payment to Buyer shall be made in accordance with this Section
7.2.

     

    7.3.           In
the event payments become due pursuant to Sections 3.2 or 3.3, the performing
party may submit an invoice to the nonperforming party for an accelerated
payment setting forth the basis upon which the invoiced amount was
calculated.  Payment from the nonperforming party will be due five
Business Days after receipt of invoice.

     

    7.4.           If
the invoiced party, in good faith, disputes the amount of any such invoice or
any part thereof, such invoiced party will pay such amount as it concedes to be
correct; provided, however, if the invoiced party disputes the amount due, it
must provide supporting documentation acceptable in industry practice to support
the amount paid or disputed.  In the event the parties are unable to
resolve such dispute, either party may pursue any remedy available at law or in
equity to enforce its rights pursuant to this Section.

     

    7.5.           If
the invoiced party fails to remit the full amount payable when due, interest on
the unpaid portion shall accrue from the date due until the date of payment at a
rate equal to the lower of (i) the then-effective prime rate of interest
published under "Money Rates" by The Wall Street Journal, plus two percent per
annum; or (ii) the maximum applicable lawful interest rate.

     

    7.6.           A
party shall have the right, at its own expense, upon reasonable Notice and at
reasonable times, to examine and audit and to obtain copies of the relevant
portion of the books, records, and telephone recordings of the other party only
to the extent reasonably necessary to verify the accuracy of any statement,
charge, payment, or computation made under the Contract.  This right
to examine, audit, and to obtain copies shall not be available with respect to
proprietary information not directly relevant to transactions under this
Contract.  All invoices and billings shall be conclusively presumed
final and accurate and all associated claims for under- or overpayments shall be
deemed waived unless such invoices or billings are objected to in writing, with
adequate explanation and/or documentation, within two years after the Month of
Gas delivery.  All retroactive adjustments under Section 7 shall be
paid in full by the party owing payment within 30 Days of Notice and
substantiation of such inaccuracy.

     

    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 Section.  If the parties
have executed a separate netting agreement, the terms and conditions therein
shall prevail to the extent inconsistent herewith.

     

    
      
        	
                Copyright
      © 2002 North American Energy Standards Board, Inc.

              	 
      	
                NAESB
      Standard 6.3.1

              
	
                All
      Rights Reserved

              	 
      	
                April
      19, 2002

              


      



    
      
        
           


        

        
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    SECTION
8.    TITLE, WARRANTY, AND
INDEMNITY

     

    8.1.           Unless
otherwise specifically agreed, title to the Gas shall pass from Seller to Buyer
at the Delivery Point(s).  Seller shall have responsibility for and
assume any liability with respect to the Gas prior to its delivery to Buyer at
the specified Delivery Point(s).  Buyer shall have responsibility for
and any liability with respect to said Gas after its delivery to Buyer at the
Delivery Point(s).

     

    8.2.           Seller
warrants that it will have the right to convey and will transfer good and
merchantable title to all Gas sold hereunder and delivered by it to Buyer, free
and clear of all liens, encumbrances, and claims.  EXCEPT AS PROVIDED
IN THIS SECTION 8.2 AND IN SECTION 14.8, ALL OTHER WARRANTIES, EXPRESS OR
IMPLIED, INCLUDING ANY WARRANTY OF MERCHANTABILITY OR OF FITNESS FOR ANY
PARTICULAR PURPOSE, ARE DISCLAIMED.

     

    8.3.           Seller
agrees to indemnify Buyer and save it harmless from all losses, liabilities or
claims including reasonable attorneys' fees and costs of court ("Claims"), from
any and all persons, arising from or out of claims of title, personal injury or
property damage from said Gas or other charges thereon which attach before title
passes to Buyer.  Buyer agrees to indemnify Seller and save it
harmless from all Claims, from any and all persons, arising from or out of
claims regarding payment, personal injury or property damage from said Gas or
other charges thereon which attach after title passes to Buyer.

     

    8.4.           Notwithstanding
the other provisions of this Section 8, as between Seller and Buyer, Seller will
be liable for all Claims to the extent that such arise from the failure of Gas
delivered by Seller to meet the quality requirements of Section 5.

     

    SECTION 9.    NOTICES

     

    9.1.           All
Transaction Confirmations, invoices, payments and other communications made
pursuant to the Base Contract ("Notices") shall be made to the addresses
specified in writing by the respective parties from time to time.

     

    9.2.           All
Notices required hereunder may be sent by facsimile or mutually acceptable
electronic means, a nationally recognized overnight courier service, first class
mail or hand delivered.

     

    9.3.           Notice
shall be given when received on a Business Day by the addressee.  In
the absence of proof of the actual receipt date, the following presumptions will
apply.  Notices sent by facsimile shall be deemed to have been
received upon the sending party's receipt of its facsimile machine's
confirmation of successful transmission.  If the day on which such
facsimile is received is not a Business Day or is after five p.m. on a Business
Day, then such facsimile shall be deemed to have been received on the next
following Business Day.  Notice by overnight mail or courier shall be
deemed to have been received on the next Business Day after it was sent or such
earlier time as is confirmed by the receiving party.  Notice via first
class mail shall be considered delivered five Business Days after
mailing.

     

    SECTION
10.    FINANCIAL
RESPONSIBILITY

     

    10.1.         If
either party (“X”) has reasonable grounds for insecurity regarding the
performance of any obligation under this Contract (whether or not then due) by
the other party (“Y”) (including, without limitation, the occurrence of a
material change in the creditworthiness of Y), X may demand Adequate Assurance
of Performance.  “Adequate Assurance of Performance” shall mean
sufficient security in the form, amount and for the term reasonably acceptable
to X, including, but not limited to, a standby irrevocable letter of credit, a
prepayment, a security interest in an asset or a performance bond or guaranty
(including the issuer of any such security).

     

    10.2.         In
the event (each an "Event of Default") either party (the "Defaulting Party") or
its guarantor shall: (i) make an assignment or any general arrangement for the
benefit of creditors; (ii) file a petition or otherwise commence, authorize, or
acquiesce in the commencement of a proceeding or case under any bankruptcy or
similar law for the protection of creditors or have such petition filed or
proceeding commenced against it; (iii) otherwise become bankrupt or insolvent
(however evidenced); (iv) be unable to pay its debts as they fall due; (v) have
a receiver, provisional liquidator, conservator, custodian, trustee or other
similar official appointed with respect to it or substantially all of its
assets; (vi) fail to perform any obligation to the other party with respect to
any Credit Support Obligations relating to the Contract; (vii) fail to give
Adequate Assurance of Performance under Section 10.1 within 48 hours but at
least one  Business Day of a written request by the other party; or
(viii) not have paid any amount due the other party hereunder on or before the
second Business Day following written Notice that such payment is due; then the
other party (the "Non-Defaulting Party") shall have the right, at its sole
election, to immediately withhold and/or suspend deliveries or payments upon
Notice and/or to terminate and liquidate the transactions under the Contract, in
the manner provided in Section 10.3, in addition to any and all other remedies
available hereunder.

     

    10.3.         If
an Event of Default has occurred and is continuing, the Non-Defaulting Party
shall have the right, by Notice to the Defaulting Party, to designate a Day, no
earlier than the Day such Notice is given and no later than 20 Days after such
Notice is given, as an early termination date (the “Early Termination Date”) for
the liquidation and termination pursuant to Section 10.3.1 of all transactions
under the Contract, each a “Terminated Transaction”.  On the Early
Termination Date, all transactions will terminate, other than those
transactions, if any, that may not be liquidated and terminated under applicable
law or that are, in the reasonable opinion of the Non-Defaulting Party,
commercially impracticable to liquidate and terminate (“Excluded 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 the
Early Termination Date for purposes of Section 10.3.1.

     

    
      
        	
                Copyright
      © 2002 North American Energy Standards Board, Inc.

              	 
      	
                NAESB
      Standard 6.3.1

              
	
                All
      Rights Reserved

              	 
      	
                April
      19, 2002

              


      
 


    
      
        
           


        

        
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                    The
      parties have selected either “Early Termination Damages Apply” or “Early
      Termination Damages Do Not Apply” as indicated on the Base
      Contract.

                  
	
                    Early
      Termination Damages Apply:

                  
	
                    10.3.1.    As
      of the Early Termination Date, the Non-Defaulting Party shall determine,
      in good faith and in a commercially reasonable manner, (i) the amount owed
      (whether or not then due) by each party with respect to all Gas delivered
      and received between the parties under Terminated Transactions and
      Excluded Transactions on and before the Early Termination Date and all
      other applicable charges relating to such deliveries and receipts
      (including without limitation any amounts owed under Section 3.2), for
      which payment has not yet been made by the party that owes such payment
      under this Contract and (ii) the Market Value, as defined below, of each
      Terminated Transaction.  The Non-Defaulting Party shall (x)
      liquidate and accelerate each Terminated Transaction at its Market Value,
      so that each amount equal to the difference between such Market Value and
      the Contract Value, as defined below, of such Terminated Transaction(s)
      shall be due to the Buyer under the Terminated Transaction(s) if such
      Market Value exceeds the Contract Value and to the Seller if the opposite
      is the case; and (y) where appropriate, discount each amount then due
      under clause (x) above to present value in a commercially reasonable
      manner as of the Early Termination Date (to take account of the period
      between the date of liquidation and the date on which such amount would
      have otherwise been due pursuant to the relevant Terminated
      Transactions).

                    For
      purposes of this Section 10.3.1, “Contract Value” means the amount of Gas
      remaining to be delivered or purchased under a transaction multiplied by
      the Contract Price, and “Market Value” means the amount of Gas remaining
      to be delivered or purchased under a transaction multiplied by the market
      price for a similar transaction at the Delivery Point determined by the
      Non-Defaulting Party in a commercially reasonable manner.  To
      ascertain the Market Value, the Non-Defaulting Party may consider, among
      other valuations, any or all of the settlement prices of NYMEX Gas futures
      contracts, quotations from leading dealers in energy swap contracts or
      physical gas trading markets, similar sales or purchases and any other
      bona fide third-party offers, all adjusted for the length of the term and
      differences in transportation costs.  A party shall not be
      required to enter into a replacement transaction(s) in order to determine
      the Market Value.  Any extension(s) of the term of a transaction
      to which parties are not bound as of the Early Termination Date (including
      but not limited to “evergreen provisions”) shall not be considered in
      determining Contract Values and Market Values.  For the
      avoidance of doubt, any option pursuant to which one party has the right
      to extend the term of a transaction shall be considered in determining
      Contract Values and Market Values.  The rate of interest used in
      calculating net present value shall be determined by the Non-Defaulting
      Party in a commercially reasonable manner.

                  
	
                    Early
      Termination Damages Do Not Apply:

                  
	
                    10.3.1.    As
      of the Early Termination Date, the Non-Defaulting Party shall determine,
      in good faith and in a commercially reasonable manner, the amount owed
      (whether or not then due) by each party with respect to all Gas delivered
      and received between the parties under Terminated Transactions and
      Excluded Transactions on and before the Early Termination Date and all
      other applicable charges relating to such deliveries and receipts
      (including without limitation any amounts owed under Section 3.2), for
      which payment has not yet been made by the party that owes such payment
      under this Contract.

                  
	
                    The
      parties have selected either “Other Agreement Setoffs Apply” or “Other
      Agreement Setoffs Do Not Apply” as indicated on the Base
      Contract.

                  
	
                    Other
      Agreement Setoffs Apply:

                  
	
                    10.3.2.    The
      Non-Defaulting Party shall net or aggregate, as appropriate, any and all
      amounts owing between the parties under Section 10.3.1, so that all such
      amounts are netted or aggregated to a single liquidated amount payable by
      one party to the other (the “Net Settlement Amount”).  At its
      sole option and without prior Notice to the Defaulting Party, the
      Non-Defaulting Party may setoff (i) any Net Settlement Amount owed to the
      Non-Defaulting Party against any margin or other collateral held by it in
      connection with any Credit Support Obligation relating to the Contract; or
      (ii) any Net Settlement Amount payable to the Defaulting Party against any
      amount(s) payable by the Defaulting Party to the Non-Defaulting Party
      under any other agreement or arrangement between the
    parties.

                  
	
                    Other
      Agreement Setoffs Do Not Apply:

                  
	
                    10.3.2.    The
      Non-Defaulting Party shall net or aggregate, as appropriate, any and all
      amounts owing between the parties under Section 10.3.1, so that all such
      amounts are netted or aggregated to a single liquidated amount payable by
      one party to the other (the “Net Settlement Amount”).  At its
      sole option and without prior Notice to the Defaulting Party, the
      Non-Defaulting Party may setoff any Net Settlement Amount owed to the
      Non-Defaulting Party against any margin or other collateral held by it in
      connection with any Credit Support Obligation relating to the
      Contract.

                  


          

        

      

    

     

    10.3.3.    If
any obligation that is to be included in any netting, aggregation or setoff
pursuant to Section 10.3.2 is unascertained, the Non-Defaulting Party may in
good faith estimate that obligation and net, aggregate or setoff, as applicable,
in respect of the estimate, subject to the Non-Defaulting Party accounting to
the Defaulting Party when the obligation is ascertained.  Any amount
not then due which is included in any netting, aggregation or setoff pursuant to
Section 10.3.2 shall be discounted to net present value in a commercially
reasonable manner determined by the Non-Defaulting Party.

     

    10.4.         As
soon as practicable after a liquidation, Notice shall be given by the
Non-Defaulting Party to the Defaulting Party of the Net Settlement Amount, and
whether the Net Settlement Amount is due to or due from the Non-Defaulting
Party.  The Notice shall include a written statement explaining in
reasonable detail the calculation of such amount, provided that failure to give
such Notice shall not affect the validity or enforceability of the liquidation
or give rise to any claim by the Defaulting Party against the Non-Defaulting
Party.  The Net Settlement Amount shall be paid by the close of
business on the second Business Day following such Notice, which date shall not
be earlier than the Early Termination Date.  Interest on any unpaid
portion of the Net Settlement Amount shall accrue from the date due until the
date of payment at a rate equal to the lower of (i) the then-effective
prime rate of interest published under "Money Rates" by The Wall Street Journal,
plus two percent per annum; or (ii) the maximum applicable lawful interest
rate.

     

    
      
        	
                Copyright
      © 2002 North American Energy Standards Board, Inc.

              	 
      	
                NAESB
      Standard 6.3.1

              
	
                All
      Rights Reserved

              	 
      	
                April
      19, 2002

              


      



    
      
        
           


        

        
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    10.5.         The
parties agree that the transactions hereunder constitute a "forward contract"
within the meaning of the United States Bankruptcy Code and that Buyer and
Seller are each "forward contract merchants" within the meaning of the United
States Bankruptcy Code.

     

    10.6.         The
Non-Defaulting Party's remedies under this Section 10 are the sole and exclusive
remedies of the Non-Defaulting Party with respect to the occurrence of any Early
Termination Date.  Each party reserves to itself all other rights,
setoffs, counterclaims and other defenses that it is or may be entitled to
arising from the Contract.

     

    10.7.         With
respect to this Section 10, if the parties have executed a separate netting
agreement with close-out netting provisions, the terms and conditions therein
shall prevail to the extent inconsistent herewith.

     

    SECTION
11.    FORCE
MAJEURE

     

    11.1.         Except
with regard to a party's obligation to make payment(s) due under Section 7,
Section 10.4, and Imbalance Charges under Section 4, neither party shall be
liable to the other for failure to perform a Firm obligation, to the extent such
failure was caused by Force Majeure.  The term "Force Majeure" as
employed herein means any cause not reasonably within the control of the party
claiming suspension, as further defined in Section 11.2.

     

    11.2.         Force
Majeure shall include, but not be limited to, the following: (i) physical
events such as acts of God, landslides, lightning, earthquakes, fires, storms or
storm warnings, such as hurricanes, which result in evacuation of the affected
area, floods, washouts, explosions, breakage or accident or necessity of repairs
to machinery or equipment or lines of pipe; (ii) weather related events
affecting an entire geographic region, such as low temperatures which cause
freezing or failure of wells or lines of pipe; (iii) interruption and/or
curtailment of Firm transportation and/or storage by Transporters;
(iv) acts of others such as strikes, lockouts or other industrial
disturbances, riots, sabotage, insurrections or wars; and (v) governmental
actions such as necessity for compliance with any court order, law, statute,
ordinance, regulation, or policy having the effect of law promulgated by a
governmental authority having jurisdiction.  Seller and Buyer shall
make reasonable efforts to avoid the adverse impacts of a Force Majeure and to
resolve the event or occurrence once it has occurred in order to resume
performance.

     

    11.3.         Neither
party shall be entitled to the benefit of the provisions of Force Majeure to the
extent performance is affected by any or all of the following circumstances:
(i) the curtailment of interruptible or secondary Firm transportation
unless primary, in-path, Firm transportation is also curtailed; (ii) the party
claiming excuse failed to remedy the condition and to resume the performance of
such covenants or obligations with reasonable dispatch; or (iii) economic
hardship, to include, without limitation, Seller’s ability to sell Gas at a
higher or more advantageous price than the Contract Price, Buyer’s ability to
purchase Gas at a lower or more advantageous price than the Contract Price, or a
regulatory agency disallowing, in whole or in part, the pass through of costs
resulting from this Agreement; (iv) the loss of Buyer’s market(s) or Buyer’s
inability to use or resell Gas purchased hereunder, except, in either case, as
provided in Section 11.2; or (v) the loss or failure of Seller’s gas supply or
depletion of reserves, except, in either case, as provided in Section
11.2.  The party claiming Force Majeure shall not be excused from its
responsibility for Imbalance Charges.

     

    11.4.         Notwithstanding
anything to the contrary herein, the parties agree that the settlement of
strikes, lockouts or other industrial disturbances shall be within the sole
discretion of the party experiencing such disturbance.

     

    11.5.         The
party whose performance is prevented by Force Majeure must provide Notice to the
other party.  Initial Notice may be given orally; however, written
Notice with reasonably full particulars of the event or occurrence is required
as soon as reasonably possible.  Upon providing written Notice of
Force Majeure to the other party, the affected party will be relieved of its
obligation, from the onset of the Force Majeure event, to make or accept
delivery of Gas, as applicable, to the extent and for the duration of Force
Majeure, and neither party shall be deemed to have failed in such obligations to
the other during such occurrence or event.

     

    11.6.         Notwithstanding
Sections 11.2 and 11.3, the parties may agree to alternative Force Majeure
provisions in a Transaction Confirmation executed in writing by both
parties.

     

    SECTION 12.    TERM

     

    This
Contract may be terminated on 30 Day’s written Notice, but shall remain in
effect until the expiration of the latest Delivery Period of any
transaction(s).  The rights of either party pursuant to Section 7.6
and Section 10, the obligations to make payment hereunder, and the obligation of
either party to indemnify the other, pursuant hereto shall survive the
termination of the Base Contract or any transaction.

     

    SECTION
13.    LIMITATIONS

     

    FOR
BREACH OF ANY PROVISION FOR WHICH AN EXPRESS REMEDY OR MEASURE OF DAMAGES IS
PROVIDED, SUCH EXPRESS REMEDY OR MEASURE OF DAMAGES SHALL BE THE SOLE AND
EXCLUSIVE REMEDY.  A PARTY’S LIABILITY HEREUNDER SHALL BE LIMITED AS
SET FORTH IN SUCH PROVISION, AND ALL OTHER REMEDIES OR DAMAGES AT LAW OR IN
EQUITY ARE WAIVED.  IF NO REMEDY OR MEASURE OF DAMAGES IS EXPRESSLY
PROVIDED HEREIN OR IN A TRANSACTION, A PARTY’S LIABILITY SHALL BE LIMITED TO
DIRECT ACTUAL DAMAGES ONLY.  SUCH DIRECT ACTUAL DAMAGES SHALL BE THE
SOLE AND EXCLUSIVE REMEDY, AND ALL OTHER REMEDIES OR DAMAGES AT LAW OR IN EQUITY
ARE WAIVED.  UNLESS EXPRESSLY HEREIN PROVIDED, NEITHER PARTY SHALL BE
LIABLE FOR CONSEQUENTIAL, INCIDENTAL, PUNITIVE, EXEMPLARY OR INDIRECT DAMAGES,
LOST PROFITS OR OTHER BUSINESS INTERRUPTION DAMAGES, BY STATUTE, IN TORT OR
CONTRACT, UNDER ANY INDEMNITY PROVISION OR OTHERWISE.  IT IS THE
INTENT OF THE PARTIES THAT THE LIMITATIONS HEREIN IMPOSED ON REMEDIES AND THE
MEASURE OF DAMAGES BE WITHOUT REGARD TO THE CAUSE OR CAUSES RELATED THERETO,
INCLUDING THE NEGLIGENCE OF ANY PARTY, WHETHER SUCH NEGLIGENCE BE SOLE, JOINT OR
CONCURRENT, OR ACTIVE OR PASSIVE.  TO THE EXTENT ANY DAMAGES REQUIRED
TO BE PAID HEREUNDER ARE LIQUIDATED, THE PARTIES ACKNOWLEDGE THAT THE 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 OR LOSS.

     

    
      
        	
                Copyright
      © 2002 North American Energy Standards Board, Inc.

              	 
      	
                NAESB
      Standard 6.3.1

              
	
                All
      Rights Reserved

              	 
      	
                April
      19, 2002

              


      
 


    
      
        
           


        

        
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    SECTION
14.    MISCELLANEOUS

     

    14.1.         This
Contract shall be binding upon and inure to the benefit of the successors,
assigns, personal representatives, and heirs of the respective parties hereto,
and the covenants, conditions, rights and obligations of this Contract shall run
for the full term of this Contract.  No assignment of this Contract,
in whole or in part, will be made without the prior written consent of the
non-assigning party (and shall not relieve the assigning party from liability
hereunder), which consent will not be unreasonably withheld or delayed;
provided, either party may (i) transfer, sell, pledge, encumber, or assign this
Contract or the accounts, revenues, or proceeds hereof in connection with any
financing or other financial arrangements, or (ii) transfer its interest to any
parent or affiliate by assignment, merger or otherwise without the prior
approval of the other party.  Upon any such assignment, transfer and
assumption, the transferor shall remain principally liable for and shall not be
relieved of or discharged from any obligations hereunder.

     

    14.2.         If
any provision in this Contract is determined to be invalid, void or
unenforceable by any court having jurisdiction, such determination shall not
invalidate, void, or make unenforceable any other provision, agreement or
covenant of this Contract.

     

    14.3.         No
waiver of any breach of this Contract shall be held to be a waiver of any other
or subsequent breach.

     

    14.4.         This
Contract sets forth all understandings between the parties respecting each
transaction subject hereto, and any prior contracts, understandings and
representations, whether oral or written, relating to such transactions are
merged into and superseded by this Contract and any effective
transaction(s).  This Contract may be amended only by a writing
executed by both parties.

     

    14.5.         The
interpretation and performance of this Contract shall be governed by the laws of
the jurisdiction as indicated on the Base Contract, excluding, however, any
conflict of laws rule which would apply the law of another
jurisdiction.

     

    14.6.         This
Contract and all provisions herein will be subject to all applicable and valid
statutes, rules, orders and regulations of any governmental authority having
jurisdiction over the parties, their facilities, or Gas supply, this Contract or
transaction or any provisions thereof.

     

    14.7.         There
is no third party beneficiary to this Contract.

     

    14.8.         Each
party to this Contract represents and warrants that it has full and complete
authority to enter into and perform this Contract.  Each person who
executes this Contract on behalf of either party represents and warrants that it
has full and complete authority to do so and that such party will be bound
thereby.

     

    14.9.         The
headings and subheadings contained in this Contract are used solely for
convenience and do not constitute a part of this Contract between the parties
and shall not be used to construe or interpret the provisions of this
Contract.

     

    14.10.       Unless
the parties have elected on the Base Contract not to make this Section 14.10
applicable to this Contract, neither party shall disclose directly or indirectly
without the prior written consent of the other party the terms of any
transaction to a third party (other than the employees, lenders, royalty owners,
counsel, accountants and other agents of the party, or prospective purchasers of
all or substantially all of a party’s assets or of any rights under this
Contract, provided such persons shall have agreed to keep such terms
confidential) except (i) in order to comply with any applicable law, order,
regulation, or exchange rule, (ii) to the extent necessary for the enforcement
of this Contract , (iii) to the extent necessary to implement any transaction,
or (iv) to the extent such information is delivered to such third party for the
sole purpose of calculating a published index.  Each party shall
notify the other party of any proceeding of which it is aware which may result
in disclosure of the terms of any transaction (other than as permitted
hereunder) and use reasonable efforts to prevent or limit the
disclosure.  The existence of this Contract is not subject to this
confidentiality obligation.  Subject to Section 13, the parties shall
be entitled to all remedies available at law or in equity to enforce, or seek
relief in connection with this confidentiality obligation.  The terms
of any transaction hereunder shall be kept confidential by the parties hereto
for one year from the expiration of the transaction.

     

    In the
event that disclosure is required by a governmental body or applicable law, the
party subject to such requirement may disclose the material terms of this
Contract to the extent so required, but shall promptly notify the other party,
prior to disclosure, and shall cooperate (consistent with the disclosing party’s
legal obligations) with the other party’s efforts to obtain protective orders or
similar restraints with respect to such disclosure at the expense of the other
party.

     

    14.11        The
parties may agree to dispute resolution procedures in Special Provisions
attached to the Base Contract or in a Transaction Confirmation executed in
writing by both parties.

     
  

     

     


    
      
        	
                
                  DISCLAIMER:  The
      purposes of this Contract are to facilitate trade, avoid misunderstandings
      and make more definite the terms of contracts of purchase and sale of
      natural gas.  Further, NAESB does not mandate the use of this
      Contract by any party.  NAESB DISCLAIMS AND EXCLUDES,
      AND 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 THIS CONTRACT OR ANY
      PART THEREOF, INCLUDING ANY AND ALL IMPLIED WARRANTIES OR CONDITIONS OF
      TITLE, NON-INFRINGEMENT, MERCHANTABILITY, OR FITNESS OR SUITABILITY FOR
      ANY PARTICULAR PURPOSE (WHETHER OR NOT NAESB KNOWS, HAS REASON TO KNOW,
      HAS BEEN ADVISED, OR IS OTHERWISE IN FACT AWARE OF ANY SUCH PURPOSE),
      WHETHER ALLEGED TO ARISE BY LAW, BY REASON OF CUSTOM OR USAGE IN THE
      TRADE, OR BY COURSE OF DEALING.  EACH USER OF THIS CONTRACT ALSO
      AGREES THAT UNDER NO CIRCUMSTANCES WILL NAESB BE LIABLE FOR ANY DIRECT,
      SPECIAL, INCIDENTAL, EXEMPLARY, PUNITIVE OR CONSEQUENTIAL DAMAGES ARISING
      OUT OF ANY USE OF THIS
CONTRACT.

                

              


      

         

        
          	
                  Copyright
      © 2002 North American Energy Standards Board, Inc.

                	 
      	
                  NAESB
      Standard 6.3.1

                
	
                  All
      Rights Reserved

                	 
      	
                  April
      19, 2002

                


        

         

      

    

    
      
        
           


        

        
          Page 9 of
10

          
            

          

        

        
           


        

      

    

     

    
      
        
          	 	
                  TRANSACTION
      CONFIRMATION

                	
                  EXHIBIT
      A

                
	 	
                  FOR
      IMMEDIATE DELIVERY

                	 
      


        

      
  

    


    
      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  
                                    	
                                            Letterhead/Logo

                                          	
                                             
      

                                          	
                                              

                                            Date:
      ____________________________, _____ 

                                            Transaction
      Confirmation #: _______________

                                              

                                          
	
                                            This
      Transaction Confirmation is subject to the Base Contract between Seller
      and Buyer dated  ______________________.  The terms of this
      Transaction Confirmation are binding unless disputed in writing within 2
      Business Days of receipt unless otherwise specified in the Base
      Contract.

                                          


                                  

                                

                              

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

    

    
      
        	
                SELLER:

              	 
      	 
      	
                BUYER:

              	 
      	 
	 
      	 
      	 
      	
                 
      

              	 
      	 
	
                Attn:

              	 
      	 
      	
                Attn:

              	 
      	 
	
                Phone:

              	 
      	 
      	
                Phone:

              	 
      	 
	
                Fax:

              	 
      	 
      	
                Fax:

              	 
      	 
	
                Base
      Contract No.

              	 
      	 
      	
                Base
      Contract No.

              	 
      	 
	
                Transporter:

              	 
      	 
      	
                Transporter:

              	 
      	 
	
                Transporter
      Contract Number:   

              	 
      	 
      	
                Transporter
      Contract Number:   

              	 
      	 
	 	 	 	 	 	 


      

      
        
          
            
              	
                      Contract
      Price:  $            /MMBtu
      or ___________________________________________

                    
	
                      Delivery
      Period:  Begin:                        ,
      ___                             End:
                         ,
      ___  

                    
	
                      Performance Obligation and
      Contract Quantity:  (Select One)

                       

                    
	
                      Firm
      (Fixed Quantity):

                                   
      MMBtus/day

                      o EFP

                    	
                      Firm
      (Variable Quantity):

                                   
      MMBtus/day Minimum

                                   
      MMBtus/day Maximum

                      subject
      to Section 4.2. at election of

                      o Buyer
      or o
      Seller

                       

                    	
                      Interruptible:

                      Up
      to              MMBtus/day

                    
	
                      Delivery Point(s):
      ________________________

                      (If
      a pooling point is used, list a specific geographic and pipeline
      location):

                    
	
                      Special
      Conditions:

                       

                       

                       

                       

                    


            

          

        

      

      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  
                                    
                                      
                                        
                                          
                                            
                                              	
                                                      Seller:  
      

                                                    	 
      	 
      	
                                                      Buyer:  
      

                                                    	 
      	 
	
                                                      By:

                                                    	 
      	 
      	
                                                      By:

                                                    	 
      	 
	
                                                      Title:

                                                    	 
      	 
      	
                                                      Title:

                                                    	 
      	 
	
                                                      Date:

                                                    	 
      	 
      	
                                                      Date:

                                                    	 
      	 


                                            

                                          

                                        

                                      

                                    

                                  

                                

                              

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

    

        

       
  

      
        	
                Copyright
      © 2002 North American Energy Standards Board, Inc.

              	 
      	
                NAESB
      Standard 6.3.1

              
	
                All
      Rights Reserved

              	 
      	
                April
      19, 2002

              


      

    

     

    Page 10 of
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