THE MATURITY DATE OF THE
NOTES.
NOTWITHSTANDING THE FOREGOING, PARTY B WILL NOT REQUEST THAT PARTY A
ENTER INTO ANY TRANSACTION WITH A THIRD PARTY IN RESPECT OF ANY FINANCIALLY
SETTLED OPTION TRANSACTION.
(II)
UPON PARTY A'S EXECUTION OF A TRANSACTION
WITH A THIRD PARTY PURSUANT TO PART 7(E)(I) ABOVE, PARTY A AND PARTY B SHALL BE
DEEMED AUTOMATICALLY AND IMMEDIATELY TO HAVE ENTERED INTO A SLEEVE TRANSACTION
(AS DEFINED BELOW) HEREUNDER.
(III)
CONTRACT PRICE FOR SLEEVE TRANSACTIONS.
WITH RESPECT TO EACH TRANSACTION ENTERED INTO BY PARTY A WITH PARTY B THAT
SERVES AS A BACK-TO-BACK OFFSETTING HEDGE OF A PHYSICALLY SETTLED GAS
TRANSACTION OR A GAS SWAP ENTERED INTO BETWEEN PARTY A AND A THIRD PARTY
PURSUANT TO PART 7(E)(I) (EACH SUCH TRANSACTION BETWEEN PARTY A AND PARTY B, A
"SLEEVE TRANSACTION"), THE PER MMBTU CONTRACT PRICE PAYABLE TO PARTY B IN
RESPECT OF SUCH TRANSACTION SHALL BE EQUAL TO THE SUM OF THE FOLLOWING AMOUNTS:
(A)
THE RELEVANT PER MMBTU PRICE TO BE PAID BY
PARTY A TO SUCH THIRD PARTY PURSUANT TO THE TRANSACTION THAT CORRESPONDS TO SUCH
SLEEVE TRANSACTION (THE "BASE PRICE") PLUS THE APPLICABLE GAS ADDER; PLUS
(B)
THE TOTAL AMOUNT OF THE FOLLOWING COSTS AND
EXPENSES TO THE EXTENT INCURRED BY PARTY A IN RESPECT OF THE THIRD PARTY
TRANSACTION AND/OR IN RESPECT OF THE RELATED SLEEVE TRANSACTION DIVIDED BY THE
CONTRACT QUANTITY ASSOCIATED WITH EACH SUCH TRANSACTION: BROKERAGE COMMISSIONS,
INTEREST COSTS FOR REQUIRED CASH MARGIN, COSTS ASSOCIATED WITH OTHER FORMS OF
POSTED COLLATERAL
AND SIMILAR COSTS AND EXPENSES INCURRED BY PARTY A WITH
RESPECT TO THE THIRD PARTY TRANSACTION AND/OR THE RELATED SLEEVE TRANSACTION
MUTUALLY AGREED BY THE PARTIES.
(F)
GAS TRANSPORTATION AND STORAGE COSTS;
TAXES.
PARTY B
AGREES TO PAY ALL TRANSPORTATION AND STORAGE COSTS RELATING TO
GAS DELIVERED.
PARTY B SHALL PAY AND SHALL BE SOLELY RESPONSIBLE FOR ANY AND
ALL PERSONAL PROPERTY TAXES APPLICABLE TO ANY GAS HELD IN STORAGE BY PARTY A
PURSUANT TO THE TERMS OF THIS AGREEMENT.
(G)
FIRM BASIS.
UNLESS OTHERWISE SPECIFIED IN A
TRANSACTION, ALL PURCHASES AND SALES OF GAS MADE UNDER THIS AGREEMENT SHALL BE
MADE ON A FIRM BASIS.
28
(H)
CREDIT SUPPORT TO LDCS AND TRANSPORTERS.
PARTY A AGREES TO PROVIDE CREDIT SUPPORT ON BEHALF OF PARTY B TO MEET LDC AND
TRANSPORTER CREDIT REQUIREMENTS ON TERMS REASONABLY ACCEPTABLE TO PARTY A AND
RELATING TO THE TRANSACTIONS ENTERED INTO UNDER THIS AGREEMENT; PROVIDED,
HOWEVER, THAT PARTY A SHALL NOT BE OBLIGATED TO PROVIDE OR MAINTAIN ANY SUCH
CREDIT SUPPORT ON TERMS AND IN AMOUNTS THAT ARE UNSATISFACTORY TO PARTY A, AS
DETERMINED BY PARTY A IN ITS REASONABLE DISCRETION.
IN THE EVENT THAT PARTY A
DETERMINES THAT ANY TRANSPORTER'S OR LDC'S CREDIT SUPPORT REQUIREMENTS ARE, OR
HAVE BECOME, UNREASONABLE, PARTY A WILL COOPERATE WITH PARTY B IN AN ATTEMPT TO
AMEND THE CREDIT REQUIREMENTS OF THE APPLICABLE LDC OR TRANSPORTER.
TO THE
EXTENT THAT PARTY A PROVIDES CREDIT SUPPORT TO ANY LDC OR TRANSPORTER, PARTY B
SHALL (I) REIMBURSE PARTY A