Common use of COS Calculation Framework Clause in Contracts

COS Calculation Framework. 2.1 Gatherer will perform a separate COS Calculation for each System resulting in a separate Gathering Fee for each System. All items of revenue and expense will be allocated to the appropriate System without duplication. Gatherer will use Historical Data whenever and wherever available. 2.2 Subject to the other provisions in this Exhibit 4.3, the COS Calculation for each System shall include: (a) a fifteen (15) year discounted cash flow analysis based on (i) Capital Expenditures, (ii) Total Revenues, (iii) Total Expenses, and (iv) Volume; (b) a targeted pre income tax rate of return on capital invested and, (c) the Terminal Value. The COS Calculation will include all known Historical Data plus Forecasted Data as described in Section 3.2 of this Exhibit 4.3. 2.3 Any cash flow prior to Time Zero shall be future valued at an interest rate equal to 1.5% per month and added to the sum of the discounted cash flows. If a System commences operations and begins receipt of Gas prior to a Gathering Fee being established utilizing the COS Calculation, Gatherer will reasonably determine the Gathering Fee to be used until the fee is redetermined using the COS Calculation effective on the next Redetermination Date.