Document:

agreement.htm

     

      Exhbit
10.3

    

     

     

    
      

    

     

    ANR Pipeline
Company

    717 Texas Street, Suite
2400

    Houston, Texas

    77002-2761

     

    
 

    
      	 
      	
              June
      9, 2008

            

    

    

    Northern
Border Pipeline Company

    13710 FNB
Parkway

    Omaha,
Nebraska 68154-5200

    Attention:  Ms.
Sharon Flanery

    

    
      	
              Re:
       

            	
              Interconnect
      Agreement

            
	 
      	
              Installation
      of Facilities

            
	 
      	
              ANR’s
      Line No. 1-100, M.P. 819+0.39

            
	 
      	
              ANR
      Contract:  ANRPMRRM5031

            
	 
      	
              Facility
      Request No.:  3038

            

    

    

    

    Ladies
and Gentlemen:

    

    This
letter constitutes the agreement between ANR PIPELINE COMPANY ("ANR") and
NORTHERN BORDER PIPELINE COMPANY ("Northern Border"), concerning a new point of
delivery at a proposed point of interconnection located on property owned by
Northern Border between ANR’s system, on ANR’s Line No. 1-100 at or near ANR's
M.P.819+0.39, and
Northern Border’s Des Plaines Interconnect Project pipeline facilities; NE 1⁄4 of
Section 3, Township 34 North, Range 9 East, in Will County, Illinois,which shall
occur in two (2) phases:

    
      	
              ·  

            	
              the
      “Preconstruction and Material Acquisition Phase” which shall consist of
      certain preliminary activities including preliminary design, detail
      design, engineering, environmental studies, cost estimating and
      preparation and submittal of regulatory filings required to obtain all
      necessary certificates, approvals and permits, and the acquisition of
      certain long lead-time materials;
and,

            

    

    
      	
              ·  

            	
              the
      “Construction Phase” which shall consist of the construction, installation
      and testing of facilities as well as post-construction compliance
      monitoring.

            

    

    Together,
the 2 phases shall be referred to herein as the “Project.”

    

    ANR and
Northern Border are each a “Party” and together are the “Parties” to this
Agreement.  Exhibit "A”, graphically representing the Parties’
equipment ownership and responsibilities under this Agreement, is attached
hereto and incorporated herein for all purposes.  In consideration of
the mutual covenants, promises and agreements herein contained, ANR and Northern
Border agree as follows:

    

    In order
to establish such point of delivery (commonly referred to as the “Des Plaines
Interconnect”), and in accordance with the provisions of this Interconnect
Agreement:

     

    
      
        
        

      

      
        38

        
          

        

      

      
        
        

      

    

    
      	
              1.

            	
              ANR's
      Responsibilities.

            

    

    

    ANR shall install

    
      	
              ·  

            	
              hot
      tap assembly, complete with riser piping to be no larger than 10-inch
      nominal pipe diameter, check valving to be above grade, an insulating
      flange at the end of the check valve and appurtenant facilities
      (hereinafter referred to collectively as “Tie-In
    Assembly”),

            

    

    
      	
              ·  

            	
              electronic
      gas measurement, radio antenna, and communications equipment ("ANR’s EGM")
      and building,

            

    

    
      	
              ·  

            	
              gas
      chromatograph,

            

    

    
      	
              ·  

            	
              moisture
      monitor,

            

    

    
      	
              ·  

            	
              over-pressure
      protection valve for protection of ANR’s Facilities (as defined
      herein),

            

    

    
      	
              ·  

            	
              valving,
      and

            

    

    
      	
              ·  

            	
              appurtenant
      facilities (all the above hereinafter referred to collectively as “ANR’s
      Facilities")

            

    

    
       

      
        	
                 
      

              	
                
                  ANR
      or its designee shall, as applicable, design, install, construct, inspect,
      test, operate, repair, replace, and maintain ANR’s Facilities, all in
      accordance with ANR’s specifications, and shall inspect facilities
      installed by Northern Border in accordance with mutually agreeable
      specifications, which mutually agreeable specifications shall, at a
      minimum, meet ANR’s specifications (the “Mutual Specifications”), and all
      the above activities shall be performed in accordance with sound and
      prudent natural gas industry practice, and in accordance with all laws,
      rules, regulations, orders and directives of any applicable authority
      having jurisdiction.  ANR shall own ANR’s Facilities at all
      times, and ANR’s Facilities shall be subject to ANR's sole discretion as
      to the standards and requirements of engineering, safety and method of
      use.  ANR shall maintain responsibility for the acquisition of
      any necessary permits for ANR’s Facilities.

                

              
	 	 
	 	This
      Agreement is not a contract for transportation service.  To the
      extent either Party desires such services, the requesting Party shall
      acquire such services pursuant to the transporting Party’s FERC Gas
      Tariff.
	 	 
	 	Neither
      Party shall be obligated to place its facilities in service, nor shall
      either Party be required to receive gas from, or deliver gas to, as
      applicable, the other Party, until the Parties have confirmed each Party’s
      facilities have been constructed and installed pursuant to this
      Agreement.
	 	 
	 	ANR
      shall provide Northern Border with advance notification of ANR’s intent to
      utilize a designee to perform the activities for which ANR is responsible
      hereunder, including providing all appropriate contact information for
      such designee.
	 	 
	 	ANR
      shall be responsible for providing any necessary over-pressure protection
      to protect ANR’s system.

      

       

      
        
          
          

        

        
          39

          
            

          

        

        
          
          

        

      

      
        	 	 
	 	In
      the event Northern Border elects to install the necessary radio tower for
      Northern Border’s EGM, as defined below, then ANR shall have the right to
      install, at Northern Border’s cost and expense, the necessary antenna for
      ANR’s EGM onto Northern Border’s radio tower.  In the event that
      (1) Northern Border’s radio tower is deemed by ANR to be inadequate for
      ANR’s use, or that (2) Northern Border does not elect to install a radio
      tower for Northern Border’s EGM, then ANR shall have the right to install,
      at Northern Border’s sole cost and expense, the necessary radio tower for
      ANR’s EGM. Should ANR install a radio tower or other communication
      structure, the location of ANR’s tower and any other communication
      structures or equipment shall be reviewed and approved by Northern Border
      prior to any construction.  In any case such equipment or
      structure shall not interfere with Northern Border’s operation and
      maintenance of these facilities.

      

       

    

    
      	
              2.  

            	
              Northern
      Border's
      Responsibilities.

            

    

    

    Northern
Border shall install

    
      	
              ·  

            	
              gas
      metering equipment

            

    

    
      	
              ·  

            	
              interconnect
      piping between the Tie-In Assembly and the gas metering
      equipment,

            

    

    
      	
              ·  

            	
              flow
      control and flow control override equipment (such flow control equipment,
      flow control override equipment, and gas metering equipment, all
      hereinafter referred to collectively as the “Nothern Border Meter
      Station”),

            

    

    
      	
              ·  

            	
              any
      necessary over-pressure protection
equipment,

            

    

    
      	
              ·  

            	
              cathodic
      protection equipment, and

            

    

    
      	
              ·  

            	
              appurtenant
      facilities (all the above hereinafter referred to collectively as
      “Northern Border’s Facilities”).

            

    

     

    
      	
            	
              
                
                  At
      its sole cost and expense, Northern Border or its designee shall, as
      applicable, design, install, construct, inspect, test, operate, repair,
      replace, remove and maintain Northern Border’s Facilities, except for
      the gas metering equipment and flow control override equipment, and shall,
      as applicable, design, install, construct, modify, test, repair, replace,
      remove and maintain the gas metering equipment and flow control override
      equipment, all in accordance with this Agreement, in accordance with the
      Mutual Specifications, in accordance with sound and prudent natural gas
      industry practice, and in accordance with all laws, rules, regulations,
      orders and directives of any applicable authority having
      jurisdiction.

                

              

            

    

     

    
      
        
        

      

      
        40

        
          

        

      

      
        
        

      

    

    
      	 	 
	 	
              Northern
      Border shall maintain responsibility for, on terms that do not adversely
      affect ANR, in its reasonable discretion, (i) the acquisition of all
      necessary rights-of-way and permits for, as applicable, the installation,
      operation, maintenance, and protection of Northern Border’s Facilities and
      for the site outside ANR’s right-of-way boundary upon which Northern
      Border’s Facilities, or any portion of ANR’s Facilities, will be located,
      which site will be located on property owned by Northern Border, at a
      mutually agreeable location adjacent to the west side of Youngs Road,
      which road is adjacent to the west boundary of ANR’s pipeline
      right-of-way, located in the NE 1⁄4 of Section 3, Township 34 North, Range 9
      East, Will County, Illinois, and (ii) the granting or assignment to ANR of
      all necessary rights-of-way, licenses, access rights, and permits on
      property that may be required for ANR’s Facilities.  Northern
      Border shall perform the necessary site preparations, maintenance, and
      improvements, including installation of site fencing, and if ANR deems it
      to be necessary as part of the original installation, both electrical
      (110-volt) and telephone service.  Northern Border shall
      maintain responsibility for all ongoing costs associated with such
      electrical and telephone service to the site.  The only portion
      of Northern Border’s Facilities that may encroach upon ANR’s right-of-way
      is Northern Border’s interconnect piping.  Northern Border shall
      only have access to ANR’s existing right-of-way for the purpose of
      accessing, installing and maintaining Northern Border’s interconnect
      piping and for any other purposes that do not conflict with the rights
      granted to ANR under the terms of ANR’s right of way
      agreement.  Northern Border acknowledges that ANR is not
      assigning any of ANR’s rights hereunder, and ANR retains any rights it may
      own.  Northern Border shall provide, if not already existing,
      and shall maintain an all-weather road to access Northern Border’s
      Facilities for performance of the obligations hereunder.  ANR
      shall have free and unrestricted use of such all-weather road at all times
      to access Northern Border’s Facilities.

            
	 	 
	 	Northern
      Border shall grant or assign to ANR, at no cost to ANR, any necessary
      rights-of-way, licenses, access rights, and permits that may be required
      for ANR's Facilities constructed or installed hereunder on property
      which is controlled by Northern Border which rights-of-way, licenses,
      access rights and permits shall be coterminous with this Agreement. 
      ANR agrees to submit for Northern Border's review any permits associated
      with any portion of ANR's Facilities to be constructed on property
      controlled by Northern Border. 
	 	 
	 	
              Northern
      Border shall be responsible for providing any necessary pressure
      regulation to protect Northern Border’s system. 

            
	 	 
	 	
              Northern
      Border may elect to install its own electronic gas measurement equipment
      (“Northern Border EGM”) at the Meter Station.  The construction,
      installation, operation and maintenance of the Northern Border EGM
      equipment shall be at Northern Border’s sole cost, expense, and liability,
      in accordance with the Mutual Specifications, and shall comply with all
      applicable laws, rules, regulations, orders and directives of any
      applicable governmental or regulatory agencies.  Northern Border
      or its designee shall submit to ANR for approval such drawings and
      documentation as required by ANR to verify compliance with such
      specifications. Northern Border shall grant ANR access to the data
      derived from the Northern Border EGM, for remote diagnostic checks and
      verification.  Once installed, the Northern Border EGM shall
      become part of Northern Border’s Facilities
    hereunder. 

            
	 	 
	 	
              The
      Parties shall provide support for any regulatory authorization or
      permitting requirements necessary to support the activities hereunder at
      any duly authorized federal, state, or local governmental body or
      regulatory agency having jurisdiction including, but not limited to, all
      exhibits required by an application for FERC
      authorization. 

            
	 	 
	 	
              At
      Northern Border’s sole cost, expense, and liability, Northern Border shall
      maintain responsibility for any necessary separation
      equipment. 

            

    

     

    
      
        
        

      

      
        41

        
          

        

      

      
        
        

      

    

    
      	 	 
	 	
              At
      Northern Border's sole cost, expense and liability, Northern Border shall
      maintain responsibility for the installation, operation and maintenance of
      any necessary odorant equipment, supplying odorant chemicals, and for the
      injection of odorant at levels required by applicable regulatory
      authorities. 

            
	 	 
	 	
              Northern
      Border shall provide ANR with advance notification of Northern
      Border’s intent to utilize a designee to perform the activities for which
      Northern Border is responsible hereunder, including providing all
      appropriate contact information for such
designee. 

            
	 	 
	 	
              By
      execution of this Agreement, each Party warrants to the other Party that
      it will make no connections, modifications or significant repairs (i.e.,
      repairs interrupting gas flow or measurement) to its facilities (i.e.,
      ANR’s Facilities or Northern Border’s Facilities, as appropriate, as such
      terms are defined in this Agreement; hereinafter “Facilities”) at any time
      without the other Party’s prior review of all drawings of such proposed
      connections, modifications, or repairs.  Specifically, the Party
      proposing connections, modifications or significant repairs (hereafter the
      “Modifying Party”) agrees to:  1) advise the other Party (the
      “Non-Modifying Party”) of the full scope of all proposed work at least
      sixty (60) days in advance, unless a shorter time period is agreed to by
      the Parties; 2) execute, or cause the execution of, any agreements
      required by the Non-Modifying Party related to the connections,
      modifications or repairs, or addressing installation of any necessary gas
      measurement and EGM for all receipts into or deliveries from the Modifying
      Party’s Facilities; 3) coordinate any necessary inspections of the work to
      be performed; and, 4) if applicable, reimburse the Non-Modifying Party for
      any such inspections.  Subsequent to the execution of this
      Agreement, should connections, modifications or significant repairs come
      to exist on either Party’s Facilities in violation of this Agreement, then
      the Non-Modifying Party shall be entitled to recover any resulting damages
      from the Modifying Party and at any time, and without advance notice to
      the Modifying Party, the Non-Modifying Party may close and lock its
      Facilities, with such Facilities to remain locked until the Parties have
      made the necessary arrangements, including, but not limited to, execution
      of the necessary agreements and/or inspection of all new facilities or
      modifications or significant repairs necessary to ensure the existence and
      integrity of custody transfer measurement, and to comply with such
      standards as are reasonably required by the Non-Modifying Party, all at
      the Modifying Party’s sole cost, expense and
      liability. Notwithstanding the foregoing, in the event of an
      emergency, either Party may take such action with respect to its
      Facilities as such Party deems appropriate, provided such Party shall
      promptly advise the other Party of any actions taken by such Party in
      response to such emergency. 

            

    

     

    
      	
              3.01

            	
              Access
      and Inspection.  ANR retains the right to inspect
      Northern Border’s Facilities at all reasonable times to verify
      compliance with the Mutual Specifications.  Northern Border, or
      its designee, shall have the right of access to the work performed by ANR
      or its contractors and subcontractors for ANR’s Facilities hereunder,
      and ANR, or its designee, shall have the right of access to the work
      performed by Northern Border or its contractors and subcontractors for
      Northern Border’s Facilities hereunder, at all reasonable times, to
      inspect the work and verify compliance with the terms of this
      Agreement.  Each Party shall have the right to review the
      proposed design, engineering and construction details prepared by the
      other Party relative to the Project.  If, after any such review,
      a Party has not responded with any comments within thirty (30) business
      days after receipt of such drawings and specifications, such reviewing
      Party will be deemed not to have any comments based on such
      review.

            

    

    

    
      
        
        

      

      
        42

        
          

        

      

      
        
        

      

    

    
      	
              3.02

            	
              Data/Access.  ANR
      shall grant real-time access to the telemetered data from ANR’s
      EGM, gas chromatograph, and moisture monitor to Northern Border;
      provided, however, Northern Border’s access to such data shall be
      pursuant to terms of Exhibit “B”, attached hereto and incorporated
      herein.

            

    

    

    
      	
              4.

            	
              Cathodic
      Protection. Each Party or its designee shall be fully responsible
      for, as applicable, the operation and maintenance of its respective
      facilities, such operation and maintenance to include, without limitation,
      cathodic protection for its respective facilities.  ANR shall
      install an insulating set between ANR’s Facilities and Northern
      Border’s Facilities to isolate Northern Border's Facilities from ANR’s
      Facilities.  Each Party shall provide cathodic protection for,
      and the Parties agree to cooperate to resolve any issues relative to
      cathodic protection of, its respective
  facilities.

            

    

    

    
      	
              5.01

            	
              Operation,
      Maintenance, and
Measurement.

            

    

    

    Northern
Border or its designee shall maintain responsibility for the maintenance of the
gas metering equipment and flow control override equipment, and the operation
and maintenance of the interconnect piping facilities, flow control facilities,
the upstream pipeline facilities, and any over-pressure protection
equipment installed by Northern Border.  Northern Border shall
maintain responsibility for the costs associated with any replacement components
necessary for the continued normal and accurate functioning of the ultrasonic
meter, and ANR shall have the right to witness the installation and testing of
such replacement components.

    

    ANR shall
maintain responsibility for the operation and maintenance of ANR’s Facilities,
including any necessary over-pressure protection equipment installed by ANR, and
the operation of the gas metering equipment and flow control override equipment,
including but not limited to the volumetric determination and thermal (Btu)
analysis.  The Parties hereby agree to utilize ANR's electronic gas
measurement for volumetric determination and recognize that such calculations
and analyses shall be used for custody transfer measurement purposes. The
Parties recognize that the point of measurement shall continue to be the point
at which gas volume and thermal content determinations shall be made, and where
gas quality shall be determined and enforced.

    

    
      	
               
      

            	
              Each
      Party shall notify the other Party prior to changing the maximum allowable
      operating pressure of its system with sufficient advance notice such that
      the other Party shall have adequate time to implement any necessary
      changes to its over-pressure protection
  equipment.

            

    

    

    
      	
              5.02

            	
              Meter
      Station Testing.  ANR, or its designee, shall conduct
      periodic instrument inspection and tests of the Northern Border Meter
      Station and ANR EGM equipment for accuracy.  If requested by
      Northern Border, ANR or its designee shall give Northern Border reasonable
      notice, not less than forty-eight (48) hours, so that Northern Border may,
      at its own option and expense, have a representative present to witness
      such tests.

            

    

    

    
      
        
        

      

      
        43

        
          

        

      

      
        
        

      

    

    
      	
              5.03

            	
              Right
      to Install Check Electronic
      Gas Measurement.  Northern Border shall have the right of
      access to the gas metering equipment to install, operate, maintain and
      test the Northern Border EGM for real-time meter data information,
      including communication equipment, but exclusive of radio towers, for
      transmission of data to Northern Border, with twenty-four (24) hour prior
      notice to ANR before exercising such right of access.  Northern
      Border shall submit to ANR the necessary drawings and documentation for
      any facilities, including the Northern Border EGM, that will be installed
      on or connected to ANR’s Facilities.  If requested by ANR,
      the Northern Border EGM shall be configured to provide for transmission of
      data to ANR, and Northern Border shall assist ANR as necessary to
      effectuate such transfer of data.

            

    

    

    
      	
              5.04

            	
              Measurement
      Standards and Tests.  The gas shall be measured and tests
      for quality of gas shall be governed by the
  following:

            

    

    

    
      	
               
      

            	
              (a)

            	
              The
      volume shall be measured by multi-path ultrasonic meters installed and
      operated and computations made as prescribed in Transmission Measurement
      Committee Report No. 9 of the American Gas Association, as such report may
      be amended or revised from time to time.  Turbine meters may be
      used for the measurement of low flow and, if used, will be installed and
      operated and computations made as prescribed in Transmission Measurement
      Committee Report No. 7 of the American Gas Association, as such report may
      be amended or revised from time to time. All installations shall include
      the use of flange connections and straightening vanes, or by other
      measuring methods as may be mutually agreed to by the Parties (approval of
      such methods shall not be unreasonably withheld).  The design
      and construction of any such measurement facilities shall be in accordance
      with mutually agreeable
specifications.

            

    

    

    
      	
               
      

            	
              (b)

            	
              The
      unit of volume for purposes of measurement shall be one (1) cubic foot of
      gas at a temperature base of sixty degrees (60°) Fahrenheit and at a
      pressure base of fourteen and seventy-three hundredths (14.73) pounds per
      square inch absolute. The unit of energy shall be one (1)
      dekatherm.

            

    

    

    
      	
               
      

            	
              (c)

            	
              Computation
      of volumes shall be made using an on line gas flow computer ("GFC").
      Temperature, pressure and volumetric measurements shall be input to the
      GFC at least once per second. The computational method and averaging
      technique shall meet the minimum requirements of "Flow Measurement Using
      Electronic Metering Systems", Chapter 21 of the Manual of Petroleum
      Standards, published by the American Petroleum
  Institute.

            

    

    

    
      	
               
      

            	
              (d)

            	
              Gas
      analysis shall be determined using an on line gas chromatograph. Gas
      Density and compressibility shall be determined by the methods described
      in American Gas Association Transmission Measurement Committee Report No.
      8, "Compressibility Factors of Natural Gas and Other Related Hydrocarbon
      Gases", gross method, latest
revision.

            

    

    

    
      
        
        

      

      
        44

        
          

        

      

      
        
        

      

    

    
      	
               
      

            	
              (e)

            	
              The
      total heating value of the gas shall be computed from the same on-line
      chromatographic analysis.

            

    

    

    
      	
               
      

            	
              (f)

            	
              Either
      Party may, at its sole cost, perform special tests to determine sulphur,
      hydrogen sulfide, oxygen, carbon dioxide, and nitrogen content, which
      shall be made by approved standard methods in general use by the gas
      industry.

            

    

    

    
      	
               
      

            	
              (g)

            	
              All
      measuring and testing equipment, housing devices and materials shall be of
      standard manufacture, and shall, with all related equipment, appliances
      and buildings, be maintained by the Party responsible for measurement at
      such point.  Such Party agrees to operate the measurement
      equipment in a workmanlike and prudent manner. All measured volumes and
      energy totals shall be submitted by statement to the other party by the
      fifth working day of each month. The transmission of this data shall occur
      by electronic communication. Submission of statements on paper is
      acceptable until proper validation of electronic transmission has
      occurred.

            

    

    

    
      	
               
      

            	
              (h)

            	
              The
      accuracy of the measuring and testing equipment shall be verified in
      accordance with ANR Operations procedures and at other times upon request
      of a Party but not more often than twice each month.  Tests for
      quality of the gas may be made at the time of testing equipment or at
      other times.  Notice of the time and nature of each test shall
      be given by the Party responsible for measurement to the other Party
      sufficiently in advance to permit convenient arrangement for
      representatives of each to be present.  Upon advisement by the
      other Party of its intent to witness, such tests and adjustments shall be
      made in the presence of and observed by representatives of the
      Parties.  All tests shall be made by the operating Party except
      that a Party shall bear the expense of test made at its request if the
      inaccuracy found is two percent (2.0%) or
less.

            

    

    

    
      	
               
      

            	
              (i)

            	
              If
      at any time any of the measuring or testing equipment is found to be out
      of service or registering inaccurately in any percentage, it shall be
      adjusted at once to read accurately, within the limits prescribed by the
      manufacturer.  If such equipment is out of service, or
      inaccurate by an amount exceeding two percent (2.0%) at a reading
      corresponding to the average rate of flow for the period since the last
      preceding test, the previous readings of such equipment shall be
      disregarded for any period definitely known or agreed upon, or if not so
      known or agreed upon, for a period of one-half of the elapsed time since
      the last test.  The volume of gas delivered during such period
      shall be estimated by (a) using the data recorded by any check measuring
      equipment if installed and accurately registering or, (b) by correcting
      the error if the percentage of error is ascertainable by calibration,
      test, or mathematical calculation, or, if neither such method is feasible,
      (c) by estimating the quantity, or quality, received or delivered based
      upon deliveries under similar conditions during a period when the
      equipment was registering accurately.  The custody transfer
      volumes shall be corrected for measurement inaccuracies of two percent
      (2.0%) or greater.

            

    

    

    
      
        
        

      

      
        45

        
          

        

      

      
        
        

      

    

    
      	 	
              (j)  

            	
              The
      non-operator shall have the right, at its sole risk and expense, to
      inspect equipment installed, furnished, or utilized by the operator, and
      the charts and other measurement or testing data of the operator, at all
      times during business hours.  The reading and changing of charts
      shall be done by the operator.  All charts and all original test
      data and other similar records in a Party's possession shall be preserved
      for a period of at least five (5) years, or for such period of time as may
      be required by the Federal Energy Regulatory Commission or other body
      having jurisdiction.

            

    

    

    
      	
              5.05

            	
              Operational
      Balancing
      Agreement.  No later than the commencement of operations
      at the interconnection Project, the Parties hereto shall enter in an
      Operational Balancing Agreement (OBA), or modify the existing OBA between
      the Parties, to include this new point of interconnection.  If a
      new OBA agreement is executed, such OBA shall be in the form utilized by
      ANR under circumstances similar to those surrounding the
      Project.

            

    

    

    
      	
              5.06

            	
              Control
      and Possession.  Subject
      to the terms of ANR’s FERC Gas Tariff, ANR shall be deemed to be in
      control and possession of the gas hereunder while the gas is in any of
      ANR's facilities or facilities associated with off-system capacity held by
      ANR; otherwise Northern Border shall be in exclusive control and
      possession of its gas and responsible for such gas.  As between
      ANR and Northern Border, ANR shall have no responsibility with respect to
      any gas hereunder and Northern Border shall indemnify, defend, and hold
      ANR harmless, pursuant to Section 7.01 herein, against any losses,
      including, but not limited to, loss of gas, claims, liens, demands, and
      causes of action of every kind and character, without limitation, with
      respect to the control and possession of such gas except when such gas is
      in the control and possession of ANR, and except and to the extent of any
      such losses, claims, liens, demands, or causes of action related to or
      arising out of the negligence or willful misconduct of ANR.  The
      point of custody transfer is the insulating flange between ANR’s Tie-In
      Assembly and Northern Border’s
Facilities.

            

    

    

    
      	
              5.07

            	
              Check
      Measurement.  Northern Border shall have the right
      to install check measurement.  Such check measurement shall be
      of a type acceptable to both Parties and shall be installed in such a
      manner as to not interfere with the operation of the gas metering
      equipment.  In the event it is determined by both Parties
      that the gas metering equipment are measuring incorrectly,
      then the Parties agree to use said check measurement for determination of
      the custody transfer volumes until such time that the Parties mutually
      agree that the cause of any errors in measurement has been
      corrected.

            

    

     

    
      	
              5.08

            	
              Monthly
      Gas Volume Report.  ANR shall furnish Northern Border,
      within five (5) business days after the end of each month, gas volume
      statements showing total volumes and thermal content, expressed in British
      thermal units (Btus), pressures, temperatures and gravities of the gas
      delivered from ANR through ANR’s Facilities during the preceding
      month, and upon Northern Border’s request, ANR shall furnish copies of
      records or charts as support
documentation.

            

    

    
      	 	 
	
              5.09

            	
              Gas
      Quality.  Except as otherwise agreed upon, the quality of
      all gas delivered by ANR through ANR’s Facilities and received by Northern
      Border through Northern Border’s Facilities shall, at a minimum, conform
      to the specifications in ANR’s FERC Gas Tariff, as may be revised from
      time to time. Notwithstanding the foregoing, Northern Border shall have
      the right to refuse to accept any gas not meeting Northern Border’s FERC
      Gas Tariff.

            

    

    

    
      
        
        

      

      
        46

        
          

        

      

      
        
        

      

    

    
      	
              5.10

            	
              Inspection.  Each
      Party shall, at its sole risk and expense, have the right, but not the
      obligation, at all reasonable times during normal business hours to
      inspect the other Party’s respective facilities.  At these
      times, the inspecting Party agrees to meet all of the other Party’s safety
      standards and specifications, and its employees, contractors,
      subcontractors and representatives will wear the applicable personal
      safety equipment.  Unless otherwise agreed, the inspecting Party
      will provide forty-eight (48) hours advance notice of its desire to
      perform such inspection.

            

    

     

    
      
        	
                6.

              	
                Payment
      Provisions.

              

      

      

       (a)           Northern
Border shall pay ANR for all costs incurred by ANR for the Project as described
herein, including, but not limited to, all costs and expenses associated with,
as applicable, the design, installation, construction, inspection, and testing
of ANR’s Facilities, and the inspection of Northern Border’s Facilities,
including any overhead charges, gas losses, and liability as provided in Section
7 in its entirety and Section 10.03.  It is estimated that the costs
to be paid to ANR by Northern Border, inclusive of said overhead charges shall
be Five Hundred Ninety-Five Thousand Dollars ($595,000), but such estimate shall
not be construed as limiting payment by Northern Border.  Upon
execution of this Agreement by Northern Border, Northern Border shall pay ANR
such estimated amount in prepayments relating to each of the 2 phases of the
Project, as follows:

      

      (1)  ANR
estimates that the total costs ANR will incur to complete the Preconstruction
and Material Acquisition Phase, inclusive of overhead charges, shall be Four
Hundred Fifty-Three Thousand, Five Hundred Dollars ($453,500), but such estimate
shall not be construed as limiting payment by Northern Border.  Upon
execution of this Agreement and prior to the commencement of the Preconstruction
and Material Acquisition Phase, Northern Border shall pay ANR this estimated
amount.

      

      (2)  ANR
estimates that the total costs ANR will incur to complete the Construction
Phase, inclusive of overhead charges, shall be One Hundred Forty-One Thousand,
Five Hundred Dollars ($141,500), but such estimate shall not be construed as
limiting payment by Northern Border.  Unless mutually agreed
otherwise, ANR shall be under no obligation to commence the Construction Phase
until the Preconstruction and Material Acquisition Phase has been completed and
Northern Border has paid ANR this estimated amount.

      

      (3)  Such
payments will be made by wire transfer to an account designated by
ANR.

      

        
          	
                   

                	
                  (b)    Reconciliation.  As
      soon as practical after completion of the Project as described herein and
      following the final accounting for such Project, ANR shall render an
      invoice or a refund, as the case may be, for any variance between the
      payments and the total Project cost, including
  overheads.

                

        

      

       

      
        
          
          

        

        
          47

          
            

          

        

        
          
          

        

      

      
        	
                 

              	
                (c)    Remittance.  Northern
      Border shall make payment to ANR within fifteen (15) days from the date
      such invoice(s) is rendered.  If Northern Border fails to make
      timely payment of such invoice, ANR shall be entitled to collect the
      amount of such invoice, together with interest, at a rate equal to the
      lesser of one percent (1%) above the prime rate from time to time charged
      by JPMorgan Chase, or the maximum applicable non-usurious rate of
      interest.  Such interest shall accrue on unpaid amounts,
      including on unpaid interest, compounded daily, beginning on the payment
      due date of ANR's invoice to Northern Border, and shall terminate when
      such invoice is paid.

              

      

       

      
        	
                 

              	
                (d)    Early
      Termination.  In the event the Project described herein
      is terminated for any reason prior to completion of said Project, without
      limiting any other remedy available to ANR, Northern Border shall
      reimburse ANR for all related costs and expenses theretofore incurred, or
      committed to be incurred, prior to such discontinuance.  ANR
      agrees to make commercially reasonable efforts to mitigate the costs to be
      reimbursed by Northern Border including, but not limited to, seeking
      refunds from vendors for materials acquired for the project described
      herein and transferring materials (EGM excluded) acquired for the Project
      to Northern Border, if so requested by Northern
Border.

              

      

    

    
       

      
        	
                 

              	
                (e)    Right to
      Audit.   Northern Border shall have the right, upon
      thirty (30) days advance written notice, to examine, at any reasonable
      time, the books and records of ANR to the extent necessary to verify the
      accuracy of any statement or computation made under or pursuant to
      provisions hereunder.  Any such audits may be initiated at any
      time hereunder, but must be initiated not later than twenty-four (24)
      months after the date of Northern Border’s receipt from ANR of the invoice
      as referenced in Section 6(b) herein.

              

      

      
      

    

     

    
      	
              7.01

            	
              Northern
      Border's Indemnity.  Except as otherwise provided
      herein, Northern Border agrees to protect, defend, indemnify, and hold
      ANR, its affiliated companies and each of their directors, officers,
      employees, attorneys-in-fact, and agents, free and harmless from and
      against any and all losses, claims, liens, demands, and causes of action
      of every kind and character, including, but not limited to, the amounts of
      judgments, penalties, interest, court costs, investigation expenses and
      costs, and legal fees incurred by ANR, its affiliated companies and each
      of their directors, officers, employees, attorneys-in-fact, and agents, in
      defense of same arising in favor of any governmental agencies, third
      parties, contractors, or subcontractors, on account of taxes, claims,
      liens, debts, personal injuries, death or damages to property, and all
      other claims or demands of every character occurring or in anywise
      incident to, in connection with, or arising out of (i) Northern Border's or its
      contractor's or subcontractor's negligence, gross negligence, strict
      liability, or willful misconduct solely related to activities performed
      under this Agreement, or (ii) Northern Border’s breach of
      this Agreement.

            

    

    

    
      
        
        

      

      
        48

        
          

        

      

      
        
        

      

    

    
      	
              7.02

            	
              ANR's
      Indemnity.  Except as otherwise
      provided
      herein,
      ANR agrees to protect, defend,
      indemnify, and hold Northern Border, its partners and affiliated
      companies and each of their directors, officers,
      employees, attorneys-in-fact, and agents, free and harmless from
      and against any and all losses, claims, liens, demands, and causes of
      action of every kind and character, including, but not limited to, the
      amounts of judgments, penalties, interest, court costs, investigation
      expenses and costs, and legal fees incurred by Northern Border, its partners and affiliated
      companies and each of their directors, officers, employees,
      attorneys-in-fact, and agents, in defense of same
      arising in favor of any governmental agencies, third parties, contractors,
      or subcontractors,
      on account of taxes, claims, liens, debts, personal injuries, death or
      damages to property, and all other claims or demands of every character
      occurring or in anywise incident to, in connection
      with, or arising out of (i) ANR's or its contractor's or
      subcontractor's negligence, gross negligence, strict liability, or willful misconduct solely
      related to activities performed under this Agreement, or (ii) ANR’s breach of this
      Agreement.

            

    

     

    
      	
              7.03

            	
              Environmental
      Responsibility.  Northern Border and ANR agree
      that if either Party releases or has released any hazardous substance as
      that term is defined, from time to time, in the Federal Comprehensive
      Environmental Response, Compensation and Liability Act (CERCLA), petroleum
      or petroleum products, asbestos material as that term is defined in 40 CFR
      61.41, polychlorinated biphenyls (PCBs), or solid waste as that term is
      defined in the Federal Resource Conservation Recovery Act (RCRA), or in
      each case under any successor acts or regulatory authorities, onto or
      under real property owned by Northern Border or ANR or on which Northern
      Border or ANR has an easement (collectively a “Release”) that the Party
      causing or allowing the Release shall have the full responsibility for the
      remediation of any such Release.  Any such remediation shall be
      conducted in compliance with all environmental laws, including federal,
      state and local laws, rules, and regulations.  The Party causing
      or allowing the Release shall indemnify the other Party for any loss,
      injury, theft, damage to persons or property, fine, penalty, or compliance
      order caused to the other Party, its partners, parent or affiliated
      entities and each of their employees, officers,
      directors, agents, representatives, contractors and sub-contractors,
      relating to any such Release.  Northern Border and ANR agree
      that if either Party discovers such a Release or presence of such
      materials that it will immediately notify the other
      Party.

            

    

    

    
      	
              7.04

            	
              Warranty:  Each Party
      warrants that it has acquired all rights to its facilities, and agrees to
      indemnify and defend the other Party against any and all claims by any
      previous owner or other party claiming interest
      thereto.

            

    

    

    
      	
              7.05

            	
              Liens.   Each Party
      agrees to notify the other Party immediately of the filing of any claim or
      lien (including, without limitation, laborers', materialmen's, and
      mechanics' liens upon property of the other, and upon which the work
      performed hereunder is located) arising out of the services, labor, or
      material furnished by such Party or its contractors or subcontractors
      under this Agreement.  The Party against whose property such
      lien is filed may, upon receipt of notice of the filing of any such liens
      upon its property, require the other Party to provide a bond in an amount
      and with such sureties as may be approved by such affected Party,
      conditioned to indemnify and save harmless such affected Party from all
      such liens.  In the event the Party causing such lien fails or
      refuses to furnish such bond when so required, the Party against whose
      property the lien is filed shall have the right to pay any sums necessary
      to obtain the release of such liens and bill the costs to the non-affected
      Party.

            

    

    

    
      
        
        

      

      
        49

        
          

        

      

      
        
        

      

    

    
      	
              8.

            	
              Successors
      and Assigns.

            

    

    

    
      	
               
      

            	
              (a)  The
      rights and obligations contained in this Agreement shall not be assigned
      by either Party without the express written consent of the non-assigning
      Party being first obtained, which consent shall not be unreasonably
      withheld.  Notwithstanding the foregoing, either Party may
      assign this Agreement to any of its subsidiary or affiliated companies
      without first obtaining that consent.  Either Party also may,
      without the consent of the other Party, assign or pledge this Agreement
      and all rights and obligations hereunder under the provision of any
      mortgage, deed of trust, indenture, or other instrument it has executed or
      may execute hereafter as security for its
  indebtedness.

            

    

    

    
      	
               
      

            	
              (b)  This
      Agreement shall bind and inure to the benefit of any successors or assigns
      to the original Parties to this Agreement, but such assignment shall not
      relieve either Party of any obligations incurred prior to such assignment,
      nor shall any assignment be effective as to the non-assigning Party until
      the aforementioned written consent is granted and a copy of the fully
      executed instrument of assignment together with written notice of transfer
      is delivered to the non-assigning
Party.

            

    

    

    
      	
               
      

            	
              (c)  Within
      sixty (60) days of any assignment of this Agreement, the assigning Party
      must provide written notification of such assignment to the non-assigning
      Party, complete with signatures of both the assignor and the
      assignee.  The recognition date of any assignment for the
      purposes of this Agreement shall be the first day of the month following
      the latter of:  (i) the date written notification of assignment
      is delivered to the other Party or (ii) the date written consent is
      granted.

            

    

    

    
      	
              9.01

            	
              Insurance.

            

    

    

    In order
to protect each Party against liability for damage, loss, or expense arising
from damage to property or injury or death of any person or persons arising in
any way out of, in connection with or resulting from the work provided for
hereunder for which each Party is responsible and, without limiting any of the
Parties’ obligations or liabilities under this Agreement, each Party shall, at
its sole expense, during the conduct of the activities performed under this
Agreement, obtain and maintain or cause to be obtained and maintained in
reliable insurance companies mutually acceptable to ANR and Northern Border and
authorized to do business in the state or area in which the work is to be
performed hereunder, the minimum insurance coverages set forth in Exhibit "C",
annexed hereto and made a part of this Agreement for all purposes.

    

    
      
        
        

      

      
        50

        
          

        

      

      
        
        

      

    

    
      	
              10.01

            	
              Term
      and Termination.  This Agreement shall be effective on
      the date first written above and shall remain in full force and effect for
      so long as Northern Border’s Facilities are connected to ANR or until the
      final removal and/or abandonment of ANR’s Facilities or Northern Border’s
      Facilities is complete, unless terminated by either Party as provided
      herein.

            

    

    

    
      	
               
      

            	
              (a)

            	
              In
      the event either Party desires to disconnect its facilities from the
      other, the initiating party shall tender not less than sixty (60) days
      advance written notice to the other party of such intent, and shall
      indicate whether such facilities will be removed or left in place, and
      upon such disconnection of facilities, this Agreement shall terminate;
      or,

            

    

    

    
      	
               
      

            	
              (b)

            	
              ANR
      shall have the right to terminate this Agreement in the event Northern
      Border has failed to make timely payment of the estimated amount in
      accordance with the payment provisions herein, and/or Northern Border
      causes the proposed construction described herein to be delayed, such that
      the installation cannot reasonably be completed and fully operational
      within six (6) months of the date of this Agreement.  ANR shall
      also have the right to terminate this Agreement upon sixty (60) days
      advance written notice to Northern Border if gas has not flowed through
      ANR’s Facilities for the previous period of twelve (12) consecutive
      months, or if Northern Border or its designee has caused any part of
      Northern Border's Facilities to be disconnected or
  removed.

            

    

    

    
      	
               
      

            	
              (c)

            	
              Northern
      Border shall have the right to terminate this Agreement upon thirty (30)
      days advance written notice to ANR in accordance with Section 10.05
      herein.

            

    

    

    
      	
               
      

            	
              (d)

            	
              Solely
      for the purposes of determining any costs reimburseable to ANR pursuant to
      Section 6, this Agreement shall be deemed effective as of February 14,
      2008.

            

    

    

    
      	
              10.02

            	
              Each
      Party shall be responsible for all costs of abandonment and/or removal of
      its facilities. Any disconnection shall be in accordance with the
      requirements of any regulatory agency having
  jurisdiction.

            

    

    

    
      	
              10.03

            	
              The
      payment obligations and indemnification and environmental responsibility
      provisions hereof shall survive any termination of this Agreement relative
      to all losses, deaths, injuries, claims, billings, liens, demands, and
      causes of action of every kind and character, discovered or undiscovered,
      arising out of, in connection with, or as an incident to this
      Agreement.

            

    

    

    
      	
              10.04

            	
              Removal
      of Facilities.  Notwithstanding any termination of this
      Agreement, unless otherwise agreed to in writing, pursuant to all
      applicable laws, rules and regulations, Northern Border and ANR shall each
      remove all their respective facilities from inside the other Party’s
      right-of-way boundary or property within ninety (90) days of any
      termination of this Agreement.  In the event Northern Border has
      not removed or caused to be removed Northern Border’s facilities by the
      end of the specified time period, then ANR shall have the right, but not
      the obligation, to remove or cause to be removed any of Northern Border’s
      remaining facilities at Northern Border’s sole cost, risk, expense and
      liability.  In the event ANR has not removed or caused to be
      removed ANR’s facilities by the end of the specified time period, then
      Northern Border shall have the right, but not the obligation, to remove or
      cause to be removed any of ANR’s remaining facilities at ANR’s sole cost,
      risk, expense and liability.

            

    

    

    
      
        
        

      

      
        51

        
          

        

      

      
        
        

      

    

    
      	
              10.05

            	
              Requested
      In-Service Date:  ANR shall not guarantee or warrant any
      specific in-service date for ANR’s Facilities, but ANR agrees to make
      commercially reasonable efforts to meet Northern Border’s requested
      November 1, 2008 in-service date for ANR’s Facilities.  In the
      event that ANR fails to meet such requested in-service date, then (1)
      Northern Border’s sole remedy shall be the early termination of this
      Agreement pursuant to Section 10.01(c), provided that notice of such
      termination occurs prior to the beginning of any construction activities,
      and (2) under no circumstances shall ANR have any liability whatsoever
      with regard to such failure, whether in contract, tort, strict liability,
      or otherwise (including special, indirect, incidental, punitive or
      consequential damages and damages associated with lost profits or lost
      investment opportunities).

            

    

    

    
      	
              11.01

            	
              Notices.  Any
      notice, request, statements or other communications (“Notices”) regarding
      this Agreement may be transmitted by telephone or facsimile for
      expediency, and shall unless otherwise provided, be confirmed in writing
      transmitted by personal delivery or shall be deposited with the United
      States Postal Service, postage prepaid, and addressed as
      follows:

            

    

     

    
      	
              11.02

            	All Notices to be sent to ANR shall be addressed
  to:

    

     

    
      
        	
                For
      Operation, Maintenance and Measurement
    Matters:

              	 
      	 
      
	
                ANR
      PIPELINE COMPANY

              	 
      	 
      
	
                6650
      Sandy Bluff Road

              	 
      	 
      
	
                Sandwich,
      Illinois 60548

              	 
      	 
      
	 
      	
                Attention:  Mr.
      Craig Cornelius, Area Manager

              	 
      	 
      
	 
      	
                Phone:  (815)
      786-3422

              	
                FAX:  (815)
      786-3440

              
	 
      	 
      	 
      
	
                For
      Project Management and Construction Matters:

              	 
      	 
      
	
                ANR
      PIPELINE COMPANY

              	 
      	 
      
	
                P.O.
      Box 2446

              	 
      	 
      
	
                Houston,
      Texas 77252-2446

              	 
      	 
      
	 
      	
                Attention:  Mr.
      Larry Laughlin

              	 
      	 
      
	 
      	
                Phone:  (832)
      320-5380

              	
                FAX:  (832)
      320-6380

              	 
      
	 
      	 
      	 
      
	
                For
      Invoice Matters:

              	 
      	 
      
	
                ANR
      PIPELINE COMPANY

              	 
      	 
      
	
                P.O.
      Box 2446

              	 
      	 
      
	
                Houston,
      Texas 77252-2446

              	 
      	 
      
	 
      	
                Attention:  Property
      Accounting Department

              	 
      	 
      
	 
      	
                Phone:  (832)
      320-5446

              	 
      	 
      
	 
      	 
      	
                Re:

              	
                Interconnect
      Agreement No.:  ANRPMRRM5031

              
	 
      	 
      	 
      	
                Facility
      Request No.:  3027

              

      

       

      
        
          
          

        

        
          52

          
            

          

        

        
          
          

        

      

       

      
        	
                For All Other
      Matters:

              	 
      	 
      
	
                ANR
      PIPELINE COMPANY

              	 
      	 
      
	
                P.O.
      Box 2446

              	 
      	 
      
	
                Houston,
      Texas 77252-2446

              	 
      	 
      
	 
      	
                Attention:
      Business Development Facility Contracts

              	 
      
	 
      	
                Phone:  (800)
      320-5000

              	
                FAX:  (832)
      320-5555

              	 
      
	 
      	 
      	
                Re:

              	
                Interconnect
      Agreement No.:  ANRPMRRM5031

              
	 
      	 
      	 
      	
                Facility
      Request No.:  3027

              	 
      

      

      

      
        	
                11.03  

              	
                All
      Notices to be sent to Northern Border shall be addressed
    to:

              

      

      

      
        	
                Northern
      Border Pipeline Company

              	 
      	 
      
	
                13710
      FNB Parkway

              	 
      	 
      
	
                Omaha,
      Nebraska  68154-5200

              	 
      	 
      
	 
      	
                Attention:  Director
      of Operations

              	 
      	 
      
	 
      	
                Phone:  (402)
      492-7455

              	 
      	 
      
	 
      	
                FAX:  (402)
      492-7482

              	 
      	 
      

      

       

    

    
      	
              11.04

            	
              Either
      Party may change its address for Notice by giving prior written
      notice.

            

    

    

    
      	
              12.01

            	
              Force
      Majeure.  If by reason of force majeure any Party is
      unable, wholly or in part, to carry out its obligations under this
      Agreement, and if such Party gives notice and reasonably full particulars
      of such force majeure in writing, or by electronic communication, to the
      other Party within a reasonable time after the occurrence of the cause
      relied on, such Party in a force majeure situation, so far as and to the
      extent that it is affected by such force majeure, shall not be liable for
      failure of performance hereof during the continuance of any such inability
      so caused; provided, such cause shall be remedied with all reasonable
      dispatch; and provided further, such cause shall not relieve any Party
      from its obligation to make payments hereunder which were due prior to
      such force majeure.

            

    

    

    
      	
              12.02

            	
              Force
      Majeure Defined.  The term "force majeure" as employed
      herein shall mean acts of God, strikes, lockouts or other industrial
      disturbances, acts of a public enemy, wars, blockades, military action,
      insurrections, riots, epidemics, landslides, lightning, earthquakes,
      fires, storms or storm warnings, crevasses, floods and washouts; arrests
      and restraints of governments either federal or state, civil or military;
      any laws, rules, regulations or orders of the Federal Energy Regulatory
      Commission (“FERC”), or other governmental body having jurisdiction; civil
      or military disturbances; explosions; shutdowns for purposes of necessary
      repairs, relocations or construction of, breakage or accident to
      equipment, facilities or lines of pipe; the necessity for testing, as
      required by governmental authority or deemed necessary by a Party for safe
      operation, or making repairs or alterations to equipment, facilities or
      lines of pipe; freezing or failure of wells, equipment, facilities or
      lines of pipe; accidents, breakdowns and the inability of a Party to
      obtain necessary materials, supplies, permits or labor due to existing or
      future rules, regulations, orders, laws or proclamations of the
      governmental authorities (federal, state and local), including both civil
      and military, and any other causes, whether of the kind herein enumerated
      or otherwise, and whether caused or occasioned by or happening on account
      of the act or omission of a Party or some persons or concern not a party
      hereto, not within control of such Party, and which by the exercise of
      diligence such Party is unable to prevent or overcome.  It is
      understood and agreed that the settlement of strikes or lockouts shall be
      entirely within the discretion of such Party and that the above
      requirement that any force majeure shall be remedied with all reasonable
      dispatch, shall not require the settlement of strikes or lockouts by
      acceding to the demands of the opposing Party when such course is
      inadvisable in the discretion of such
Party.

            

    

    

    
      
        
        

      

      
        53

        
          

        

      

      
        
        

      

    

    
      	
              12.03

            	
              Limitations.  Such
      force majeure affecting the performance hereunder by either Party,
      however, shall not relieve such Party of liability in the event of such
      Party’s concurring negligence or failure to use due diligence to remedy
      the situation and to remove the cause in an adequate manner and with all
      reasonable dispatch, nor shall such causes or contingencies affecting such
      performance relieve a Party from its obligations to make payments as
      determined hereunder.

            

    

    

    
      	
              13.01

            	
              Legal
      Fees.  If any legal action is brought by either of the
      Parties hereto, it is expressly agreed that the Party in whose favor final
      judgment shall be entered shall be entitled to recover from the other
      Party reasonable attorneys’ fees, court costs, and reasonable expenses
      incurred in enforcing this Agreement, in addition to any other relief that
      may be awarded.

            

    

    

    
      	
              13.02

            	
              Applicable
      Law and Venue.  This Agreement and the rights
      and duties of ANR and Northern Border shall be governed by and interpreted
      in accordance with the internal law, and not the law of conflicts, of the
      State of Texas.  The Parties hereby consent to the jurisdiction
      of any state or federal court located within Houston, Harris County, Texas
      and each Party waives any defense of forum non
      conveniens.

            

    

    

    
      	
              13.03

            	
              Governmental
      Laws and Regulations.

            

    

    

    
      	
               
      

            	
              (a)  This
      Agreement, all the terms and conditions contained herein, and all requests
      for capacity are subject to ANR's FERC Gas Tariff, as amended from time to
      time, and to all valid and applicable laws, orders, directives, rules, and
      regulations of duly constituted authorities having
      jurisdiction.

            

    

    

    
      	
               
      

            	
              (b)  This
      Agreement is conditioned upon the receipt and acceptance of all regulatory
      authorizations necessary for ANR to perform its obligations hereunder on
      terms acceptable to ANR in its sole discretion.  No construction
      or installation shall be commenced hereunder prior to the receipt and
      acceptance of such regulatory
authorizations.

            

    

    

    
      	
               
      

            	
              (c)  Nothing
      herein shall obligate ANR to file an application for a certificate of
      public convenience and necessity under Section 7(c) of the Natural Gas
      Act.

            

    

    

    
      	
              13.04

            	
              ANR
      Conditions Precedent.  ANR shall
      be under no obligation to commence or continue work hereunder, including
      any activity involving either the commitment or actual expenditure of
      funds by ANR that may be required to perform any work hereunder, until the
      following conditions have been met: (a) Northern Border has executed all
      necessary property related document(s) contemplated in this Agreement,
      including the acquisition of all rights-of-way, licenses, access rights
      and permits that may be required for Northern Border’s Facilities
      hereunder; (b) ANR has received payment of the estimated amounts pursuant
      to Section 6; (c) Northern Border has secured and/or granted any rights to
      ANR, at no cost to ANR, necessary for any ANR Facilities to be located on
      Northern Border’s Facilities and ANR shall have the right to review all
      such property-related documents prior to execution thereof; (d) ANR has
      received all federal, state and local governmental authorizations
      necessary for construction and operation of the facilities on terms
      satisfactory to ANR in ANR’s sole discretion; and (e) Northern Border has
      notified ANR in writing that all of Northern Border’ Conditions Precedent,
      set forth in Section 13.05 below, have been satisfied or
      waived.

            

    

    

    
      
        
        

      

      
        54

        
          

        

      

      
        
        

      

    

    
      	
              13.05

            	
              Northern
      Border Conditions Precedent.  Northern
      Border shall be under no obligation to commence or continue work
      hereunder, including any activity involving either the commitment or
      actual expenditure of funds by Northern Border that may be required to
      perform any work hereunder, until the following conditions have been met:
      (a) Northern Border has acquired all necessary rights-of-way, licenses,
      access rights and permits necessary for Northern Border’s Facilities
      hereunder; (b) Northern Border has received all federal, state and local
      governmental authorizations necessary for construction and operation of
      Northern Border’s Facilities on terms satisfactory to Northern Border in
      Northern Border’s sole discretion; and (c) ANR has notified Northern
      Border in writing that all of ANR’s Conditions Precedent, set forth in
      Section 13.04 above, have been satisfied or
  waived.

            

    

    

    
      	
              14.01

            	
              Captions.  The
      titles and captions to each of the various Sections in this Agreement are
      inserted only for convenience and for reference and shall not affect the
      construction or interpretation of this
  Agreement.

            

    

    

    
      	
              14.02

            	
              Severability.  If
      any of the terms and conditions of this Agreement are held by any court of
      competent jurisdiction to contravene, or to be invalid under, the laws of
      any political body having jurisdiction over this subject matter, such
      contravention or invalidity shall not invalidate this entire
      Agreement.  Instead, this Agreement shall be construed as
      reformed as to the extent necessary to render valid the particular
      provision or provisions held to be invalid, consistent with the original
      intent of that provision and the rights and obligations of the Parties
      shall be construed and enforced accordingly, and this Agreement shall
      remain in full force and effect as
reformed.

            

    

    

    
      	
              14.03

            	
              Waiver
      of Rights.  The respective rights and remedies of each
      Party to this Agreement are cumulative, and no exercise or enforcement by
      either Party of any right or remedy hereunder shall preclude the exercise
      or enforcement by such Party of any other right or remedy hereunder, or
      which such Party is entitled by law to enforce.  Each Party may
      waive any obligation of, or restriction upon, the other Party under this
      Agreement only in writing.  No failure, refusal, neglect, delay,
      waiver, forbearance, or omission of either Party to exercise any right
      under this Agreement or to insist upon full compliance by the other with
      its obligations hereunder shall constitute a waiver of any provision of
      this Agreement nor shall it impair the exercise of any such right or of
      any other right to which it is
entitled.

            

    

    
      	 	 
	
              14.04

            	
              Multiple
      Counterparts.  This Agreement may be executed in several
      counterparts, each of which shall be an original, and all of which, when
      taken together, shall constitute but one and the same
      Agreement.

            

    

    

    
      
        
        

      

      
        55

        
          

        

      

      
        
        

      

    

    
      	
              14.05

            	
              Incorporation
      of Exhibits.  Any Exhibit or Appendix attached to this
      Agreement is incorporated into this Agreement as fully as if stated within
      the body of this Agreement.  In the event of a conflict between
      this Agreement and any Exhibits or Appendices attached hereto, the terms
      of the Agreement shall override.

            

    

    

    
      	
              14.06

            	
              Drafting
      Party.  This
      Agreement expresses the mutual intent of the Parties to this
      Agreement.  Accordingly, the rule of construction against the
      drafting Party shall have no application to this
  Agreement.

            

    

    

    
      	
              14.07

            	
              Title.  Title
      to ANR’s Facilities shall be in ANR's name, and ANR’s Facilities shall be
      owned by ANR.  Title to Northern Border’s Facilities shall be in
      Northern Border's name, and Northern Border’s Facilities shall be owned by
      Northern Border.

            

    

    

    
      	
              14.08

            	
              Entire
      Agreement.  This Agreement, including any exhibits and
      any written amendments expressly made a part of this Agreement, states the
      entire understanding between the Parties concerning the subject matter of
      this Agreement, and supersedes all prior oral and written
      communications.  No amendment to this Agreement shall be
      effective unless it is in writing and signed by an authorized employee of
      each of the Parties hereto.

            

    

    

    
      	
              
                14.09
 
      

            	
              Limitation
      of Liability.  Northern Border is a general partnership
      formed under the laws of the State of Texas.  The claims under
      this Agreement of ANR and any other beneficiaries of this Agreement are
      limited to the assets of Northern Border, and any rights of ANR or any
      such beneficiaries to proceed against the partners of Northern Border
      individually are hereby expressly
waived.

            

    

    

    

    *           *           *

    

    

    

    
      
        
        

      

      
        56

        
          

        

      

      
        
        

      

    

     

    

    

    If the
foregoing correctly reflects your understanding of our agreement, please
evidence your acceptance in the space provided below and return both executed
originals to the attention of the undersigned.  The Agreement will
then be presented to ANR's management for acceptance and
execution.  This letter shall not constitute an offer by ANR, and
shall only become a contract after it is accepted by ANR upon execution by a ANR
Officer or duly appointed "Agent and Attorney-in-fact."  Upon
execution by ANR, a fully executed original will be returned for your
retention.  In the event the Agreement is not executed within ninety
(90) days after the date of submission to Northern Border, the terms and
conditions set forth herein shall become null and void.

     

    
      	 
      	
              Very
      truly yours,

               

            
	 
      	
              ANR
      PIPELINE COMPANY

               

            
	 
      	
              /s/ Don
      Sokol

            
	 
      	
              Don
      Sokol

            
	 
      	
              Senior
      Contract Analyst

            

    

    

    

    
      	
              AGREED
      TO AND ACCEPTED THIS 19th

            	
              AGREED
      TO AND ACCEPTED THIS 13th

            
	
              DAY
      OF June, 2008.

            	
              DAY
      OF June, 2008.

            
	 
      	 
      
	 	 
	ANR
      PIPELINE COMPANY 	NORTHERN
      BORDER PIPELINE COMPANY 
	 
      	
              By:

            	
              TransCanada
      Northern Border Inc., its Operator

            
	
              By:

            	
              /s/ Dean
      Ferguson

            	
              By:

            	
              /s/ Paul F.
      Miller

            
	
              Name:

            	
              Dean
      Ferguson

            	
              Name:

            	
              Paul
      F. Miller

            
	
              Title:

            	
              Vice
      President

            	
              Title:

            	
              Vice
      President and General Manager

            

    

    

    

    
      	
              By:

            	
              /s/  Gary C.
      Charette

            	
              By:

            	
              /s/ Patricia M.
      Wiederholt

            
	
              Name:

            	
              Gary
      C. Charette

            	
              Name:

            	
              Patricia
      M. Wiederholt

            
	
              Title:

            	
              VP
      Commercial Operations

            	
              Title:

            	
              Principal
      Financial Officer and Controller

            

    

     

    
      
        
          
             

          

           

        

        
          57

          
            

          

        

        
           

          
            (ELECTRONIC
COPY OF EXECUTABLE VERSION)

            

          

        

      

    

    

    
      
        
          

          EXHIBIT
'A'

          OWNERSHIP,
OPERATION & MAINTENANCE OF FACILITIES

           BETWEEN: NORTHERN
BORDER PIPELINE
COMPANY & ANR PIPELINE COMPANY

          ELECTRONIC
COPY OF EXECUTABLE VERSION

          INTERCONNECT
AGREEMENT

          DATE:
JUNE 9, 2008

          FACILITY
# 3038

          ANR
WILL OPERATE
MEASUREMENT FACILITIES
AND FLOW
CONTROL
OVERRIDE

          ANR
WILL INSTALL, OWN,

          OPERATE,
AND MAINTAIN

          *
ANR WILL INSTALL, OWN, OPERATE, AND MAINTAIN THE EGM
EQUIPMENT,
COMMUNICATIONS, CHROMATOGRAPH, AND
MOISTURE MONITOR.

          INTERCONNECT
PIPING

          TIE-IN
ASSEMBLY

          NORTHERN
BORDER

          TO INSTALL,
OWN, OPERATE, AND MAINTAIN

          NORTHERN
BORDER

          TO
INSTALL,OWN, AND MAINTAIN

          OPP

          FLOW

        

      

       

    

    
      
        
        

      

      
        58

        
          

        

      

      
        
        

      

    

     

    EXHIBIT B

    

    INSTALLATION
OF ELECTRONIC MONITORING EQUIPMENT

    

    

     Attached to and made a part of
the Interconnect Agreement, dated June 9, 2008, by and between ANR PIPELINE
COMPANY ("ANR"), and NORTHERN BORDER PIPELINE COMPANY ("Northern Border"), all
hereinafter sometimes referred to individually as a "Party" and collectively as
the "Parties":

    

    Pursuant
to the terms of the Interconnect Agreement (the “Agreement”) referenced
hereinabove, Northern Border requests access to the gas flow computer (“GFC”),
moisture monitor, and gas chromatograph (“ANR’s Equipment”) located at the
proposed Northern Border gas measurement facility (referred to hereinafter as
the “Meter Station”), in order to install, operate and maintain electronic data
gathering equipment to interface with ANR's Equipment for the purpose of
obtaining access to real-time electronic measurement and gas quality information
on a continuous basis.  ANR is willing to make specific operating data
available to Northern Border at the Meter Station, and to allow the installation
of such electronic data gathering equipment, subject to the following terms and
conditions:

    

    Installation
of Equipment.  Northern Border, at its sole risk, cost and
expense, may install or cause to be installed electronic data interfaces as ANR,
in its sole discretion, deems reasonable and necessary, at locations mutually
agreed upon by ANR and Northern Border.  Northern Border shall supply
isolation devices acceptable to ANR, which provide surge protection between
Northern Border's and ANR's Equipment.  ANR will terminate all cabling
in ANR’s Equipment as necessary.

    

    Data
Access.  Northern Border shall have access to the available
chromatographic and gas quality data, control data and signals from ANR’s
Equipment for the purpose of acquiring digital data, analog and/or pulse
signals.  Northern Border shall only have access to such electronic
measurement data in a format established by ANR, which will not interfere with
the operation of the Meter Station. Northern Border
recognizes that the data acquired from ANR’s Equipment is “raw” data, subject to
further refinement, correction or interruption due to maintenance, repair or
other activities by ANR, or due to events of force majeure.  ANR shall
have no obligation to advise Northern Border of any such interruptions, or to
verify the integrity of such data, whether or not resulting from activities
performed by ANR.

    

    Title To
Property.  Northern Border shall retain title to electronic
equipment and appurtenant connection facilities installed by Northern Border and
Northern Border shall operate and maintain its facilities.  Title to
ANR’s Equipment shall be in ANR's name and said facilities shall be owned,
operated and maintained by ANR.

    

    Right of
Access.  Northern Border, at its sole risk, cost, and expense,
shall have the right of access to ANR’s Equipment at all reasonable times upon
twenty-four (24) hours prior notice in order to install, inspect, calibrate,
maintain or remove its facilities pursuant to this Exhibit “B”, if performed
without unreasonable interference to ANR's facilities and operations and without
harm to the general appearance and condition of ANR's
Equipment.  Northern Border relinquishes this right of access if it
fails to act reasonably or causes harm to ANR's Equipment.

    

    
      
        
        

      

      
        59

        
          

        

      

      
        
        

      

    

    Notifications
Prior to Commencement of Work.  Prior to the commencement by
Northern Border of the installation or removal of electronic monitoring
equipment at the Meter Station, Northern Border shall give notice to Mr. Tim
Ross, ANR’s Principal Measurement Specialist, at telephone number (708)
342-4728, or such other contact as specified from time to time by ANR, in order
that ANR may have a representative present to witness the installation or
removal of such equipment and to coordinate the activities, as well as any
subsequent operations and maintenance activities so that such activities do not
interfere with the operation of ANR's facilities.

    

    ANR's Right
to Disconnect Equipment.  ANR reserves the right to disconnect
immediately Northern Border's electronic equipment without prior notice if at
any time the equipment interferes with or adversely affects ANR's ability to
perform effective measurement, or in any way interferes with ANR's
operations.  In the event that it is necessary for ANR to disconnect
Northern Border’s electronic equipment, ANR agrees to notify Northern Border of
said disconnection, prior to or as soon as possible thereafter, and to
coordinate with Northern Border the timely reconnection of the equipment
following correction of the problem by Northern Border to ANR's
satisfaction.

    

    Modification
and/or Removal of Facilities.  Northern Border may remove the
facilities it has installed at any time, at Northern Border's sole risk, cost
and expense, after giving reasonable prior notice to ANR, so long as such
removal does not interfere with ANR's facilities and
operations.  Notwithstanding any provision contained herein to the
contrary, should ANR construct new facilities, move, modify or remove existing
facilities in a manner as to conflict with Northern Border's facilities, remove
its facilities to a new site, sell, assign, abandon or otherwise dispose of its
facilities covered under this Agreement, or if for any reason the installation
or operation of Northern Border's equipment hereunder is objectionable to or in
any way interferes with or adversely affects the operations of ANR, then
Northern Border shall promptly move, remove or change the installation,
operation or maintenance of the subject equipment at Northern Border's sole
risk, cost and expense in a manner acceptable to ANR.

    

    "As
Installed" Drawings.  As quickly as possible following the
in-service date for the Project, Northern Border will furnish to ANR for
its files an "as installed" set of drawings covering the electronic
equipment installed by Northern Border, and in any event, Northern Border
will endeavor to furnish such drawings within ninety (90) days following the
installation of such equipment.

    

    Term and
Termination.  Except as provided in the paragraph below
entitled “Failure to Comply”, the rights extended pursuant to this Exhibit “B”
shall terminate upon the removal by ANR or Northern Border of Northern Border's
equipment from the Meter Station; however, the indemnification provisions hereof
shall survive such termination relative to all losses, deaths, injuries, claims,
billings, liens, demands and causes of action of every kind and character,
discovered or undiscovered, arising out of, in connection with, or as an
incident to this Exhibit “B”.

    

    Failure
to Comply.  In the event ANR determines that Northern Border
has failed to comply with any of the terms of this Exhibit “B”, ANR will provide
Northern Border with reasonable notice to correct such
failure.  Absent Northern Border's expeditious correction of such
failure,  ANR will have the right to immediately terminate Northern
Border’s rights to connect to ANR’s Equipment or to access data as provided
hereunder and, upon not less than twenty-four (24) hours notice, to remove
Northern Border's facilities at Northern Border's sole risk, cost, and expense
and without any liability to ANR; provided, however, nothing herein shall
restrict ANR’s rights to take immediate action, as ANR deems necessary, to
protect its personnel, its equipment and/or the public, which action may include
but shall not be limited to shut-down, disconnection, or removal of any of
Northern Border’s facilities installed hereunder.

    

    
      
        
        

      

      
        60

        
          

        

      

      
        
        

      

    

    Limitation
of Liability.  ANR shall not be liable or responsible to
Northern Border or Northern Border's agents or transferees for any fines or
levies by any regulatory agencies or in any action or claim for consequential,
indirect or special damages, loss of use, loss of profits or loss of product as
a result of Northern Border's or Northern Border's agents' or transferees' use
of output data made available under this Exhibit “B”.

    

    Indemnity.
Northern Border agrees to protect, indemnify, defend, and hold ANR, its
divisions, subsidiary and affiliated companies free and harmless from and
against any and all losses, deaths, injuries, claims, liens, demands, and causes
of action of every kind and character, including, but not limited to, the
amounts of judgments, penalties, interest, court costs, investigation expenses
and costs, and legal fees incurred by ANR, its divisions, subsidiary and
affiliated companies, in defense of same arising in favor of any governmental
agencies, third parties, contractors or subcontractors, on account of taxes,
claims, liens, debts, personal injuries, death or damage to property, and all
other claims or demands of every character occurring or in anywise incident to,
in connection with, or arising out of Northern Border's, its contractors',
subcontractors', agents', or transferees' use of the electronic measurement data
made available under this Exhibit “B”.

    

    

    

    *     *     *

    

    
      
        
          
            

            

             

          

           

        

        
          61

          
            

          

        

        
           

          
            (ELECTRONIC
COPY OF EXECUTABLE VERSION)

            

          

        

      

    

    

    EXHIBIT
“C”

    

    MINIMUM
INSURANCE COVERAGES

    

    PROJECT:

    WILL
COUNTY, ILLINOIS

    

    

    Attached to and made a part of the
Interconnect Agreement, dated June 9, 2008, by and between ANR PIPELINE COMPANY,
and NORTHERN BORDER PIPELINE COMPANY, each a “Party” and together are the
“Parties”, covering the construction, ownership, operation and maintenance of
the Will County, Illinois connection.

    

    
      	
              A.

            	
              Each
      Party shall at its own expense, obtain and maintain, or cause to be
      obtained and maintained, insurance as provided below from reliable
      insurance companies authorized to do business in the state or area in
      which the activities performed by either Party under the Interconnect
      Agreement (the “Work”) are to be performed.  Such insurance
      shall be in force at the time the Work is commenced and shall remain in
      force until the Work is determined to be complete by the Party performing
      the Work, unless a later date is specified
  below:

            

    

    

      
        	
                 
      

              	
                1.

              	
                Workers’ Compensation
      Insurance:  Workers’ Compensation insurance, including
      Occupational Disease coverage, as required by state laws, including
      Employers’ Liability insurance for all employees of either Party in the
      amount of $1,000,000 per
      accident.  Such insurance shall provide coverage in the
      states in which the Work is performed, and the state in which the Parties
      are domiciled.

              

      

      

      
        	
                 
      

              	
                2.

              	
                General Liability
      Insurance:  Commercial General Liability insurance
      covering all operations by or on behalf of either Party against claims for
      personal injury (including bodily injury and death) and property damage
      (including loss of use).  Such insurance shall provide coverage
      for:

              

      

    

    
      	 	 	 
	
               
      

            	
              a)

            	
              Premises
      and Operations;

            

    

    

    
      	
               
      

            	
              b)

            	
              Products
      and Completed Operations ;

            

    

    

    
      	
               
      

            	
              c)

            	
              Contractual
      Liability;

            

    

    

    
      	
               
      

            	
              d)

            	
              Broad
      Form Property Damage (including Completed
  Operations);

            

    

    

    
      	
               
      

            	
              e)

            	
              Explosion
      (X), Collapse (C) and Underground Hazards (U); including XCU coverage
      under both Premises/Operations and Contractual
  Liability;

            

    

    

    
      	
               
      

            	
              f)

            	
              Personal
      Injury Liability (with deletion of the exclusion for liability assumed
      under contract);

            

    

    

    
      	
               
      

            	
              g)

            	
              Hostile
      Fire Pollution Liability;

            

    

    

    
      
        
          
             

          

           

        

        
          62

          
            

          

        

        
           

          
            (ELECTRONIC
COPY OF EXECUTABLE VERSION)

            

          

        

      

    

    

    

    
      	
               
      

            	
              h)

            	
              Independent
      Contractor’s Liability;

            

    

    with a
minimum limit per
occurrence of $1,000,000
for bodily injury, personal injury and property damage
combined.  The aggregate limits, if any, shall apply separately to
each annual policy period.

    

    
      	
               
      

            	
              3.

            	
              Automobile Liability
      Insurance:  Automobile Liability insurance against claims
      of personal injury (including bodily injury and death) and property damage
      covering all owned, leased, non-owned, and hired, vehicles used in the
      performance of the Work, with a $1,000,000 minimum limit per accident for bodily
      injury and property damage combined and containing appropriate No-Fault
      insurance provision wherever
applicable.

            

    

    

    
      	
               
      

            	
              4.

            	
              Excess
      Insurance:  Excess Liability or Umbrella insurance
      covering claims in excess of the underlying liability insurances described
      in the foregoing subsections 1, 2, and 3, with a $10,000,000 minimum limit per
      occurrence, provided that the aggregate limits of liability, if
      any, shall apply separately to each annual policy
  period.

            

    

    

    
      	
               
      

            	
              The
      amounts of insurance required in the foregoing subsections 1, 2, and 3 and
      this subsection 4 may be satisfied by the Party purchasing coverage in the
      amounts specified or by any combination thereof, so long as the total
      amount of insurance meets the requirements specified above.  In
      addition, either Party may meet its insurance requirements (including
      deductibles with respect to such policies) through assumption of risk or
      self-insurance.

            

    

    

    
      	
              B.

            	
              Endorsements:

            

    

    

    
      	
               
      

            	
              1.

            	
              All
      insurance policies to be maintained by each Party shall provide for a
      Waiver of
      Subrogation Endorsement, effectively waiving a Party’s right of
      subrigation with respect to the other
Party.

            

    

    

    
      	
               
      

            	
              2.

            	
              All
      insurance policies, except Workers’ Compensation, to be maintained by each
      Party shall:

            

    

    

    
      	
               
      

            	
              a)

            	
              Provide
      a Severability of Interests or Cross Liability
  Clause;

            

    

    

    
      	
               
      

            	
              b)

            	
              Provide
      that the insurance shall be primary and not excess to or contributing with
      any insurance or self-insurance maintained by the other
    Party.

            

    

    

    
      	
               
      

            	
              c)

            	
              Name
      the other Party, their officers and agents as Additional
      Insureds.

            

    

    

    
      	
              C.

            	
              Within
      thirty (30) days of the effective date of this agreement valid
      Certificates of Insurance evidencing that satisfactory coverage of the
      types and limits set forth above in paragraphs A and B, shall be furnished
      by each Party to the other Party.  Such Certificates shall be in
      a form reasonably acceptable to the other Party and shall contain
      provisions that no cancellations in the policies shall become effective
      except upon 30-days
      written notice to the other Party; provided, however, that no such
      cancellation in any policy shall relieve the other Party of its obligation
      to maintain coverages in accordance with paragraphs A and B
      above.

            

    

    

    
      	
              D.

            	
              In
      no event shall the amount or scope of the insurance required by this
      section, place any limitation on the liability assumed by a Party
      elsewhere in this contract.

            

    

    

    

    
      
        
          
             

          

           

        

        
          63

          
            

          

        

        
           

          
            (ELECTRONIC
COPY OF EXECUTABLE VERSION)

            

          

        

      

    

    

    
      	
               
      

            	
              Irrespective
      of the requirements as to insurance to be carried by the Parties as
      provided herein, insolvency, bankruptcy, or failure of any insurance
      company to pay all claims accruing, shall not be held to relieve either
      Party of any of its obligations.

            

    

    

    
      	
              E.

            	
              The
      insured Party shall use reasonable efforts to require all of its
      subcontractors to provide the foregoing coverage, as well as any other
      coverage the insured Party may consider necessary.  All
      subcontractor policies shall comply with the waiver of subrogation and
      additional insured requirements above.  Any deficiency in the
      coverage, policy limits, or endorsements of said subcontractors will be
      the sole responsibility of the insured
Party.

            

    

    

    
      *     *     *ex10_1.htm

    Exhibit
10.1

     

     

    ACKNOWLEDGEMENT
OF COMMITMENT INCREASE

     

    May 15,
2008

    
This
Acknowledgement of Commitment Increase (this "Acknowledgement"),
is made pursuant to the Credit Agreement, dated as of November 21, 2006 (as
amended and as the same may from time to time be further amended, restated or
otherwise modified, the ("Credit Agreement"), among
The Davey Tree Expert Company ("Borrower"), the
lending institutions named therein ("Banks"), and KeyBank National Association,
as administrative agent for the Banks ("Agent"). Capitalized terms used in this
Acknowledgement and not otherwise defined herein shall be defined as set forth
in the Credit Agreement.

     

    In
furtherance of Section 2.05(d) of the Credit Agreement, Borrower has requested
that the Total Commitment Amount be increased by $12,000,000.00 so that that
Total Revolving Commitment Amount equals $152,000,000.00, with the effective
date of such increase being May 15, 2008 (the "Effective Date").
Borrower and the Increasing Lender signatory hereto acknowledge that, subject to
the satisfaction of the conditions to effectiveness set forth below, on the
Effective Date, the Increasing Lender's Revolving Commitment Amount shall be
increased such that the Revolving Commitment Amount of each Bank is as set forth
on Schedule I
hereto which Schedule
1 amends, restates and replaces Schedule I to the
Credit Agreement.

     

    This
Acknowledgement will not become effective until the Effective Date occurs
and:

     

    (1) Borrower
shall have delivered to Agent a copy of Borrower's duly adopted corporate
resolutions, in form and substance satisfactory to Agent, that authorize the
requested $12,000,000.00 increase in the Total Commitment Amount, which
resolutions shall be certified by the Secretary of Borrower as being true,
correct, complete and in full force and effect;

     

    (2) Borrower
shall have executed and delivered to each Increasing Lender a replacement
Revolving Note; and

     

    (3) Borrower,
Agent and each Increasing Lender shall have executed this
Acknowledgement.

    

     

    [Signature
pages follow.]

     

     

    
      
        
        

      

      
        Page 1 of
3

        
          

        

      

      
        
        

      

    

     

    IN
WITNESS WHEREOF, the parties hereto have caused this Acknowledgement to be
executed and delivered by their respective officers thereunto duly authorized as
of the date first above written.

    

    

    THE DAVEY
TREE EXPERT COMPANY

    

    By: /s/ Joseph R.
Paul                                      

    Name:  Joseph
R. Paul

    Title:  Treasurer

    

    

    KEYBANK
NATIONAL ASSOCIATION

    as
Administrative Agent Lender

    

    By: /s/ Christopher I.
Williams                        

    Name:  Christopher
I. Williams

    Title:  Vice
President

    

    

    WELLS
FARGO BANK, NATIONAL

    ASSOCIATION,
as Increasing Lender

    

    By:  /s/Andrew T.
Cavallari                                 

    Name:  Andrew
T. Cavallari

    Title:  Vice
President.

     

     

     

    
      
        
        

      

      
        Page 2 of
3

        
          

        

      

      
        
        

      

    

     

    Schedule
1

    Banks
and Commitments

    

    

    

    
      	
              BANKING
      INSTITUTIONS

            	
              COMMITMENT
      PERCENTAGE

            	
              REVOLVING
      CREDIT AGREEMENT AMOUNT

            	
              TERM
      LOAN COMMITMENT

            
	 
      	 
      	 
      	 
      
	
              KeyBank
      National Association

            	
              34.461156578%

            	
              $52,380,958.00

            	
              $2,619,042.00

            
	
              National
      City Bank

            	
              23.809523684%

            	
              $36,190,476.00

            	
              $1,809,524.00

            
	
              FirstMerit
      Bank, N.A.

            	
              15.664157894%

            	
              $23,809,520.00

            	
              $1,190,480.00

            
	
              Wells
      Fargo Bank, National Association

            	
              26.065161842%

            	
              $39,619,046.00

            	
              $1,380,954.00

            
	
              Total
      Percentage

              Total
      Commitment Amount

            	
              100%

            	
              $152,000,000.00

            	
              $7,000,000.00

            

    

     

     

    
      
        
        

      

      
        Page 3 of
3

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00145-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00145-of-00352.parquet"}]]