Exhibit 10.29
FIRM GAS PURCHASE AND SALE AGREEMENT
between
CAMDEN COGEN, L.P.
and
TEXACO NATURAL GAS INC
TABLE OF CONTENTS
Page
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TABLE OF CONTENTS..................................................... i
ARTICLE 1: DEFINITIONS.......................................... 1
ARTICLE 2: QUANTITIES........................................... 5
ARTICLE 3: NOMINATIONS.......................................... 5
ARTICLE 4: PRICE................................................ 6
ARTICLE 5: RESERVATION CHARGES AND SUBSTITUTE FUELS............. 12
ARTICLE 6: PAYMENT.............................................. 14
ARTICLE 7: TAXES................................................ 16
ARTICLE 8: POINT(S) OF DELIVERY................................. 17
ARTICLE 9: PRESSURE............................................. 18
ARTICLE 10: MEASUREMENT.......................................... 18
ARTICLE 11: QUALITY.............................................. 18
ARTICLE 12: TRANSPORTATION AND IMBALANCE CHARGES................. 18
ARTICLE 13: TERM................................................. 20
ARTICLE 14: FORCE MAJEURE........................................ 20
ARTICLE 15: NOTICE............................................... 22
ARTICLE 16: LAWS, ORDERS & REGULATIONS........................... 24
ARTICLE 17: APPLICABLE LAW....................................... 24
ARTICLE 18: WAIVER............................................... 25
ARTICLE 19: TITLE................................................ 25
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ARTICLE 20: ASSIGNMENT........................................... 26
ARTICLE 21: ARBITRATION.......................................... 27
ARTICLE 22: DEFAULT.............................................. 28
ARTICLE 23: GENERAL.............................................. 30
ARTICLE 24: CONFIDENTIALITY...................................... 31
EXHIBIT A ............................................................ 33
EXHIBIT B ............................................................ 34
EXHIBIT C ............................................................ 35
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FIRM GAS PURCHASE AND SALE AGREEMENT
This AGREEMENT ("Agreement") is made and entered into this 1st day of July,
1997, by and between CAMDEN COGEN, L.P., a Delaware limited partnership,
hereinafter referred to as "Buyer," and TEXACO NATURAL GAS INC., a Delaware
corporation, hereinafter referred to as "Seller;"
WHEREAS, Buyer requires a supply of gas for use in Buyer's co-generation
facility in Camden, New Jersey; and
WHEREAS, Seller is willing to sell gas to Buyer on a firm basis to meet its
requirements.
NOW, THEREFORE, in consideration of the mutual covenants and agreements
herein contained, the parties do hereby covenant and agree as follows:
ARTICLE 1: DEFINITIONS
In addition to the terms "Buyer" and "Seller" which shall refer to the
parties identified above, or their duly designated agents or representatives,
the following terms shall have the specified meanings:
1.1 The term "Alternate Commodity Price" shall have the meaning set forth
in Section 4.3.
1.2 The term "Btu" shall mean the amount of heat required to raise the
temperature of one (1) pound avoirdupois pure water from fifty-eight and five-
tenths degrees (58.5 degrees) to fifty-nine and five-tenths degrees (59.5
degrees) Fahrenheit, as defined in the American Gas Association Gas Measurement
Manual and any subsequent revisions.
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1.3 The term "Cancellation Notice" shall mean the notice described in
Section 22.1.
1.4 The term "Commodity Price" shall have the meaning set forth in Section
4.2.
1.5 The term "Daily Contract Quantity" or "DCQ" shall mean ten thousand
(10,000) MMBtu per day, plus Transporter(s)' Market Area Fuel.
1.6 The term "day" shall mean a period of twenty-four (24) consecutive
hours, beginning and ending at the time specified in the receiving
Transporter(s)' tariff(s) at the Point of Delivery.
1.7 The term "Delivery Period" shall mean a period of five (5) consecutive
months beginning with the commencement of deliveries of gas hereunder.
1.8 The term "Facility" shall mean the co-generation facility owned and
operated by Buyer that is located in Camden, New Jersey.
1.9 The term "force majeure" shall have the meaning set forth in Section
14.2.
1.10 The term "Gas" or "gas" shall mean any mixture of hydrocarbons or of
hydrocarbons and non-combustible gases, in a gaseous state, consisting
essentially of methane and shall include casinghead gas produced with crude oil,
natural gas from gas xxxxx, coal-bed methane gas, synthetic gas, coal
gasification gas and residue gas resulting from processing any of the foregoing.
1.11 The term "lender" shall mean (i) any and all lenders (other than
Seller) providing the construction, interim, or long-term financing or
refinancing of the Facility
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(including a leveraged lease), and any trustee or agent acting on their behalf,
and (ii) any and all equity investors or limited partners providing any such
financing or refinancing of the Facility, and any trustee or agent acting on
their behalf. The current lenders are Bank of Tokyo (as agent for the Traunch A
lenders) and General Electric Capital Corporation and hereafter such entity as
is designated to Seller in writing by the entity then recognized as the lender
hereunder.
1.12 The term "Market Area Fuel" shall mean the volume of gas retained by
Transporter(s) as fuel for the transportation of gas from the Point(s) of
Delivery to the Point(s) of Redelivery.
1.13 The term "Market Price" shall have the meaning set forth in Section
4.3.
1.14 The term "Minimum Quantity" shall mean one hundred percent (100%) of
the product of the DCQ and the number of days in each month of the Delivery
Period, as reduced by circumstances of force majeure.
1.15 The term MMBtu" shall mean one million (1,000,000) Btus.
1.16 The term "month" shall mean the period commencing on the beginning
of the first day of a calendar month and ending on the beginning of the first
day of the succeeding calendar month.
1.17 The term "Nominated Quantity" shall have the meaning set forth in
Section 3.1.
1.18 The term "Nomination Notice" shall mean the notice described in
Section 3.1 and Exhibit A to this Agreement.
1.19 The term "NYMEX" shall mean the New York Mercantile Exchange.
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1.20 The term "NYMEX Forward Price" shall have the meaning set forth in
Section 4.7(b).
1.21 The term "NYMEX Price" shall have the meaning set forth in Section
4.7(a).
1.22 The term "Point(s) of Delivery" shall have the meaning set forth in
Article 8.
1.23 The term "Point(s) of Redelivery" shall mean the point or points on
Transporter(s)' pipeline system where gas is redelivered to or for the account
of Buyer or PSE&G on the PSE&G system in New Jersey.
1.24 The term "PPIA" or "Power Purchase and Interconnection Agreement"
shall mean the contract dated April 15, 1988, between Buyer and PSE&G, covering
the sale of electricity from the Facility, and any amendments thereto that have
been and may be made from time to time.
1.25 The term "PSE&G" shall mean Public Service Electric and Gas Company.
1.26 The term "Reservation Charge" shall have the meaning set forth in
Section 5.2.
1.27 The term "Reservation Rate" shall mean one and three-fourth cents
($0.0175) per MMBtu.
1.28 The term "Spot Market Price" shall mean the arithmetic average of the
prices reported in the weekly and BI-weekly updates of the reference pricing
reports during the month of delivery for the reference points set forth in
Exhibit "B" hereto.
1.29 The term "TETCO" shall mean Texas Eastern Transmission Corporation.
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1.30 The term "Transporter(s)" shall mean any pipeline(s) transporting gas
sold hereunder to and from the Point(s) of Delivery and to the Point(s) of
Redelivery.
ARTICLE 2: QUANTITIES
2.1 Buyer shall purchase and receive and Seller shall sell and deliver the
Nominated Quantity at the Point(s) of Delivery, except to the extent excused
under the provisions of this Agreement.
2.2 If during the Delivery Period Buyer purchases and receives less than
the DCQ, except to the extent excused under the provisions of this Agreement or
due to Seller's unexcused failure to deliver, then Buyer shall pay Seller an
amount equal to the difference between the price payable hereunder and the then
effective applicable Spot Market Price of gas multiplied by the difference
between the Minimum Quantity and the quantity of gas purchased and received by
Buyer. Except as described in Articles 12, 14 and 22, this is the sole remedy
available to Seller for any failure by Buyer to purchase and receive gas.
ARTICLE 3: NOMINATIONS
3.1 On or before the day prior to which pipeline nominations are required
to be nominated by Buyer and Seller to the applicable pipeline company(s)
referenced herein, and subject to the provisions of Sections 3.2 and 3.3, Buyer
shall notify Seller in writing by providing a Nomination Notice, substantially
in the form attached hereto as Exhibit A, specifying the daily quantity of gas,
in MMBtus, up to the DCQ, that Buyer shall purchase and receive from Seller
during the next month (hereinafter the "Nominated Quantity"). In the
alternative, Buyer may specify a standing Nominated
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Quantity to be effective until changed in writing pursuant to the first sentence
of this section.
3.2 The parties recognize that fluctuations in the production and
transportation of gas can occur on a daily basis. Buyer and Seller will attempt
to receive and deliver gas on a uniform hourly basis. Notwithstanding anything
to the contrary herein, any revisions to the Nominated Quantity shall be
implemented in accordance with Transporter(s)' nomination procedures, unless a
waiver of such procedures is received by either Buyer or Seller.
3.3 Buyer and Seller shall be responsible for nominations to their
respective Transporters and the nominations in each case shall reflect the
Nominated Quantity.
3.4 If no Nominated Quantity is submitted by Buyer in accordance with
Section 3.1, the DCQ shall be the Nominated Quantity.
ARTICLE 4: PRICE
4.1 For all gas nominated by Buyer and delivered by Seller during a month,
Buyer shall pay the Commodity Price or the Alternate Commodity Price per MMBtu,
rounded to the nearest $0.001.
4.2 The term "Commodity Price" shall mean the price of gas for each month
which shall be mutually agreed upon by the parties and subsequently confirmed in
writing prior to the date Buyer's nomination notice to Seller is due for the
month of delivery. In the event that the parties fail to reach agreement as to
the Commodity Price, the Alternate Commodity Price determined in accordance with
Section 4.3 shall apply.
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4.3 The term "Alternate Commodity Price" shall mean the arithmetic average
of the prices reported in the referenced issue of the month of delivery for the
price references included in the "Market Price Index," set forth in Exhibit B.
The price references in the Market Price Index are intended to reflect the price
paid for gas delivered at the Point(s) of Delivery under spot contracts (the
"Market Price"). The price references in the "Backup Price Index" set forth in
Exhibit B are intended to serve as a substitute for the price references in the
Market Price Index in the event the latter price references are not available or
are "erroneous," as that term is defined in Section 4.5.
4.4 Either party may request that a price reference be added to or deleted
from the Market Price Index or Backup Price Index by providing written notice to
the other party. For a price reference to be added to the Market Price Index or
Backup Price Index, the price reference must reflect the Market Price and be
from an independent publication which is not controlled by a buyer, seller or
broker of gas. For a price reference to be deleted from the Market Price Index
or Backup Price Index, such price reference must no longer reflect the Market
Price. If within thirty (30) days after the date of notice by a party, the
parties are unable to agree to add or delete a price reference, then the party
seeking such addition or deletion may submit the issue to arbitration which
shall be conducted pursuant to Article 21. A price reference shall be added or
deleted effective the first day of the month after notice by the requesting
party and the price ultimately determined by negotiation or arbitration will be
given retroactive effect to take into account the period of negotiation or
arbitration with
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interest assessed at the rate provided in Section 6.3. Unless otherwise agreed
by the parties, in no event may either party request that a price reference be
added to or deleted from the Market Price Index or Backup Price Index more than
once during the Delivery Period.
4.5 If during any month a price reference included in the Market Price
Index is not published, the Market Price Index will exclude such price reference
from the Market Price Index for so long as such price reference is not
published and the price reference(s) from the Backup Price Index shall be
substituted for the excluded price reference. If the excluded price reference is
the only price reference in the Market Price Index and no price references in
the Backup Price Index are published, then Section 4.6 below shall apply. If an
erroneous price is published and the publisher confirms such error, then the
correct price, if available, shall be used. If the publisher does not confirm
such error or if the correct price is not available, then the price reference
containing such erroneous price shall not be included in the Market Price Index
or Backup Price Index for such month. For purposes of Sections 4.3 and 4.5, the
term "erroneous" price shall mean any price reference that varies by more than
four percent (4%) from the average of the other price references included in the
Market Price Index and Backup Price Index for such month.
4.6 If no Market Price Index and no Backup Price Index reference prices are
available or if, in the opinion of either party, there are no price references
which reasonably reflect the Market Price and the basis of such opinion is
provided in writing to the other party, then a new method to determine the
Alternate Commodity Price will
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be negotiated. If the parties are unable to agree within thirty (30) days after
notice by a party, then the matter of determining whether a basis exists to
invoke this provision and, if so, the determination of a new method to determine
the Alternate Commodity Price shall be submitted to arbitration pursuant to
Article 21. During a period of negotiation or arbitration, the last applicable
Commodity Price or Alternate Commodity Price shall remain in effect and shall be
adjusted at the conclusion of such negotiation or arbitration to give
retroactive effect to the result with interest assessed at the rate provided in
Section 6.3.
4.7 Alternatively, and in lieu of the price calculated pursuant to Sections
4.2 and 4.3 hereof, the parties may mutually agree to a NYMEX Price or NYMEX
Forward Price based on the NYMEX posting for the natural gas futures contract,
calculated as follows:
(a) On or before the business day prior to the NYMEX Settlement day,
Buyer may propose that the price under this Agreement for gas nominated by
Buyer for delivery in the applicable month be the NYMEX Price, plus or
minus the basis differentials that may be mutually agreed upon at the time
of Buyer's proposal. The NYMEX Price shall be the arithmetic average of the
NYMEX posting of the settlement price of the natural gas futures contract
for the last three trading days applicable to the month of delivery.
Buyer's proposal shall designate the volume of gas for delivery in the
applicable month at the proposed price, up to the volume nominated in
accordance with Section 3.1 of this Agreement. Upon receipt of Buyer's
proposal, the parties shall confer by
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telephone as soon as possible and decide whether or not to use the NYMEX Price,
which decision shall ultimately be made by Buyer and Seller no later than 11:00
a.m. Central Time on the business day before the last trading day of the
applicable natural gas futures contract. In the event the parties agree to use
the NYMEX Price and agree on the basis differential, the parties' agreement
shall be set forth in a confirmation prepared by Buyer and transmitted by
telecopy to Seller. The parties' agreement shall be deemed conclusive upon
receipt of the confirmation (as evidenced by electronic confirmation of
transmission) unless Seller objects promptly in writing following receipt of the
confirmation. Either party shall have the right to withhold agreement on any
proposed price under this Section 4.7(a) at its sole discretion prior to
execution of the NYMEX transaction, in which case the price under this Agreement
will be calculated under Sections 4.2 or 4.3 hereof. If the parties are unable
to agree on the basis differentials or methodology for determining the basis,
the NYMEX Price shall be deemed to be rejected. In the event the parties agree
to use the NYMEX Price, the nominated volumes which are covered by the NYMEX
Price shall remain in effect during the applicable month and shall not be
reduced or increased pursuant to Sections 3.2 or 3.3 of this Agreement.
(b) In addition to the NYMEX Price, Buyer shall have the right to propose
that the NYMEX Forward Price, plus or minus the basis differentials that may be
mutually agreed upon at the time of Buyer's proposal, be the price to be paid
under this Agreement during any calendar months designated by
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Buyer. The NYMEX Forward Price shall be the NYMEX posting for the natural gas
futures contract applicable to the month or months selected by Buyer and
prevailing at the time Buyer's proposal is communicated to Seller by telephone
and confirmed by Seller. Buyer's proposal shall designate the volume of gas for
delivery during the designated months at the proposed price, up to the volume
that can be nominated in accordance with Section 3.1 of this Agreement. Upon
receipt of Buyer's proposal, the parties shall confer by telephone and decide
whether or not to use the NYMEX Forward Price, which decision shall be made no
later than 11:00 a.m. Central Time on the first business day following Seller's
receipt and confirmation of Buyer's request. In the event the parties agree to
use the NYMEX Forward Price and agree on the basis differential or methodology
for determining the basis, the parties' agreement shall be set forth in a
confirmation prepared by Buyer and transmitted by telecopy to Seller. The
parties' agreement shall be deemed conclusive upon receipt of the confirmation
(as evidenced by electronic confirmation of transmission) unless Seller objects
promptly in writing following receipt of the confirmation. Either party shall
have the right to withhold agreement on any proposed price under this Section
4.7(b) at its sole discretion prior to the execution of the NYMEX transaction,
in which case the price under this Agreement will be calculated under Sections
4.2 or 4.3 hereof. If the parties are unable to agree on the basis differentials
or methodology for determining the basis, the NYMEX Forward Price shall be
deemed to be rejected. Nothing in this subsection M shall be construed to
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prevent Buyer from proposing the NYMEX Forward Price in any designated
month if either of the parties had previously rejected the NYMEX Forward
Price for that month. In the event the parties agree to use the NYMEX
Forward Price, the nominated volumes which are covered by the NYMEX Forward
Price shall remain in effect during the designated months and shall not be
decreased or increased pursuant to Sections 3.2 or 3.3 of this Agreement.
In addition, should the parties agree to use the NYMEX Forward Price, the
selection of that option shall remain in effect during the months selected
by the parties unless the parties mutually agree to use a different pricing
option.
4.8. The parties agree once the NYMEX based pricing mechanism in section
4.7 herein is utilized, or if the Parties agree to a fixed price for a period of
longer than one month, the Parties will deliver and purchase the entire contract
volume, or pay cover costs as provided herein, even if a Party is affected by an
event of force majeure, or other situation excused by the contract.
ARTICLE 5: RESERVATION CHARGES AND SUBSTITUTE FUELS
5.1 If during any month, Seller sells and delivers less than one hundred
percent (100%), but greater than ninety percent (90%), of the Nominated Quantity
multiplied by the number of days in the month, except to the extent excused
under the provisions of this Agreement or due to Buyer's unexcused failure to
receive, then Buyer shall be relieved of its obligation to pay Seller the
Reservation Charge applicable to the volumes not made available and Seller shall
refund to Buyer any payments attributable to such volumes if already invoiced
and paid. If during any month Seller
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sells and delivers less than ninety percent (90%) of the Nominated Quantity
multiplied by the number of days in the month, except to the extent excused
under the provisions of this Agreement or due to Buyer's unexcused failure to
receive, then Buyer shall be relieved of its obligation to pay Seller the
Reservation Charge set forth in Section 5.2 for the entire month during which
such supply failure occurred. Under such circumstances in this Section 5.1,
Seller shall also reimburse Buyer its actual costs incurred for the purchase
and/or production and transportation of alternate supplies of fuel equal to the
undelivered volume, including but not limited to any imbalance carrying charges
and/or cash-out costs and penalties imposed by Transporter(s) and PSE&G, less
the costs that Buyer would have otherwise incurred for the purchase and
transportation of gas under this Agreement. Buyer shall use commercially
reasonable efforts to minimize its incremental actual costs for acquiring
alternate supplies of fuel. In the exercise of its commercially reasonable
efforts, Buyer shall exercise diligent good faith efforts to purchase least cost
substitute fuel, including purchasing gas under existing agreements with other
sellers which will enable Buyer to utilize its transportation rights used to
transport gas hereunder. Because of environmental restrictions on Buyer's use of
fuels other than gas at the Facility, Buyer shall have the sole discretion
whether to purchase gas or an alternate fuel as a substitute for gas not
delivered by Seller hereunder, even where gas is more expensive. Except as
described in Articles 12, 14 and 22, these are the sole and exclusive remedies
available to Buyer for any failure by Seller to deliver gas.
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5.2 Buyer shall pay Seller a monthly Reservation Charge in consideration
for Seller's maintaining the capability to deliver gas up to the DCQ, assuming
market and supply risks, and agreeing to reimburse Buyer for any amounts
pursuant to Section 5. 1. The Reservation Charge shall be the Reservation Rate
multiplied by the DCQ, multiplied by the number of days in such month. To
illustrate how the Reservation Charge would be calculated assume that the DCQ is
10,000 MMBtus per Day, at the Reservation Rate hereunder, the Reservation Charge
for the month of November would be: $5,250 (10,000 x $.0175 x 30).
ARTICLE 6: PAYMENT
6.1 Seller shall render an invoice on or before the fifteenth (15th) day
of each month setting forth the actual quantity of gas nominated by Buyer and
delivered by Seller hereunder during the preceding month, the Commodity Price,
Alternate Commodity Price, NYMEX Price or NYMEX Forward Price, the Reservation
Charge, any amounts due under Sections 2.2 and 12.2 and the total amount due. In
the event that the actual quantity delivered, the Alternate Commodity Price or
the Reservation Charge is not known at the time the invoice is rendered, an
estimated quantity, Alternate Commodity Price and Reservation Charge, based on
the best available information, shall be used. Buyer shall pay Seller for the
amount due by wire transfer with immediately available funds to Seller's account
in accordance with instructions contained in Seller's invoice. Payment shall be
due on or before the last day of such month. If PSE&G fails to pay Buyer under
the PPIA by the last day of the month, Buyer's obligation to pay Seller shall be
suspended from the last day of the month,
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until one (1) day following Buyer's receipt of PSE&G's payment, but, in such a
case, Buyer's obligation to pay Seller shall not be suspended past the third
business day of the following month. When the actual quantity, Alternate
Commodity Price or Reservation Charge becomes known and if an adjustment is
necessary, an invoice containing the adjustment for the difference between the
actual value and the estimated value will be rendered. Payment will be made in
subsequent months' payment cycles.
6.2 Buyer shall submit an invoice on or before the fifteenth 15th) day of
the month, if necessary, for any amount due pursuant to Sections 5.1 and 12.2.
Seller shall pay Buyer in accordance with instructions contained in Buyer's
invoice. Payment shall be due on or before the last day of such month.
6.3 Should either party fail to pay any amount not in dispute when due,
interest thereon shall accrue at the lesser of (i) the rate of one percent (1%)
above the prime commercial rate charged by Citibank, N.A., New York, New
York, compounded annually from the due date or (ii) the maximum lawful contract
rate permitted by applicable law, until the amount due and interest have been
paid in full. Such interest shall be in addition to any other rights and
remedies the owed party may have for the owing party's failure to pay any amount
not in dispute. Should the owing party dispute the amount invoiced, such party
shall pay the undisputed amount and notify the other party of any disputed
amount by the due date. Both parties will mutually resolve the disputed amount
in a timely manner with interest accruing from the original due date on any
disputed amount determined to be a valid amount due.
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Notwithstanding the foregoing or any other provision herein, if Buyer fails to
pay any amount within five (5) days after receiving written notice from Seller
that payment is delinquent, Seller may withhold deliveries and, should said
nonpayment continue for a period of thirty (30) days after such notice, subject
to the provisions of Article 22, Seller may terminate this Agreement upon
written notice.
6.4 Upon reasonable notice, each party shall have the right,at reasonable
times to have an independent public accounting firm examine the books, records,
and charts controlled by the other party to the extent necessary to verify the
accuracy of any statement, payment, charge, or computation made pursuant to this
Agreement. In the event an error is discovered in any statement, payment,
charge, or computation, the adjusted amount shall be due within thirty (30) days
of the determination thereof, provided that any statement, payment, charge, or
computation shall be final as to both parties unless objected to in writing
within twelve (12) months after payment has been made.
6.5 If either party pays any amount shown due and owing upon the invoice of
the other party, and such amount is subsequently determined by agreement,
arbitration or judgment of court not to have been due and owing when paid, the
payee will refund such amount to the paying party together with interest from
the date of payment to the date of refund at the interest rate set forth in
Section 6.3 hereof.
ARTICLE 7: TAXES
7.1 Seller shall pay, or cause to be paid, all taxes, assessments, fees or
other charges now and hereafter lawfully levied and imposed by federal, state,
or local
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authorities upon Seller with respect to the gas prior to delivery at the
Point(s) of Delivery. In the event Buyer is required to remit such taxes,
assessments, fees or charges, Seller shall reimburse Buyer for such amount.
Seller shall furnish Buyer with a copy of the exemption certificate in
situations in which exemption from any such imposition is claimed by Seller.
7.2 Buyer shall pay, or cause to be paid, all taxes, assessments, fees or
other charges (including, but not limited to, sales and value added taxes) now
and hereafter lawfully levied and imposed by federal, state, or local
authorities upon Buyer with respect to the gas at and subsequent to delivery at
the Point(s) of Delivery. In the event Seller is required to remit such taxes,
assessments, fees or charges, Buyer shall reimburse Seller for such amount.
Buyer shall furnish Seller with a copy of the exemption certificate in
situations in which exemption from any such imposition is claimed by Buyer.
ARTICLE 8: POINT(S) OF DELIVERY
The "Point(s) of Delivery" shall be the point(s) on Transporter(s)'
pipeline system(s) where gas is delivered by Seller to Transporter(s) for
Buyer's account, as specified in Exhibit C attached hereto and made a part
hereof. As between the parties hereto, title, risk of loss, and liabilities
associated with delivered gas shall pass to and vest in Buyer at the Point(s) of
Delivery. Changes in the Point(s) of Delivery shall require the mutual consent
of the parties.
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ARTICLE 9: PRESSURE
Seller shall deliver gas at the Point(s) of Delivery at a pressure
sufficient to effect delivery into the receiving Transporter(s)' facilities.
ARTICLE 10: MEASUREMENT
All measurement of gas delivered and sold hereunder shall be in accordance
with the provisions of the receiving Transporter(s)' tariff (s) at the Point(s)
of Delivery.
ARTICLE 11: QUALITY
The gas delivered and sold by Seller to Buyer at the Point(s) of Delivery
shall meet the quality specifications set forth in the receiving Transporter(s)'
tariff(s) at the Point(s) of Delivery. Buyer shall have the right to be
represented and to participate in all tests of gas delivered hereunder performed
by Seller, and to inspect any equipment used in such tests to determine the
nature of the quality of gas delivered hereunder. In the event the gas does not
meet such quality specifications, Buyer may refuse delivery of the gas. Seller's
delivery of gas refused by Buyer for failure to meet quality specifications
shall not constitute delivery for the purposes of Articles 2, 5 and 6. Buyer's
sole remedy for such failure of gas to meet quality specifications shall be to
refuse receipt of the gas and receive the remedy specified in Article 5.
ARTICLE 12: TRANSPORTATION AND IMBALANCE CHARGES
12.1 Transporter(s)' rules, guidelines, operational procedures and
policies, as may be changed from time to time, may define and set forth the
manner in which gas delivered and sold under this Agreement is transported.
Seller and Buyer agree to provide to the other, in as prompt a manner as
reasonable, all information necessary
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to permit scheduling pursuant to such requirements. Seller shall give Buyer the
highest ranking given to any other purchaser of Seller's gas in any priority
queue when nominating or allocating volumes to Transporter(s) for delivery to
Buyer under this Agreement.
12.2 Each party agrees to make all reasonable efforts to cooperate with the
other in operating under this Agreement to avoid pipeline imbalance charges,
cash-out costs and penalties. Buyer shall bear any under or over delivery
charges, cash-out costs and penalties assessed by Transporter(s) and PSE&G which
are caused by variances (including variances due to events of force majeure
declared by Buyer) in Buyer's receipts from the Nominated Quantity and Seller
shall bear any under or over delivery charges, cash-out costs and penalties
assessed by Transporter(s) and PSE&G which are caused by variances (including
variances due to events of force majeure declared by Seller) in Seller's
deliveries from the Nominated Quantity.
12.3 Seller shall be responsible for transportation to the Point(s) of
Delivery and payment of all transportation charges relating thereto. Buyer
shall be responsible for transportation from the Point(s) of Delivery and
payment of all transportation charges relating thereto. The parties recognize
that the gas purchased hereunder may be transported by Transporter(s) whose
transportation rates and related charges such as fuel reimbursement and take-or-
pay surcharges are subject to refund. The party which pays the Transporter(s)
for transportation of gas hereunder shall be entitled to retain any refunds
associated therewith.
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ARTICLE 13: TERM
This Agreement shall be effective from the date first set forth above and,
unless sooner terminated under the provisions of this Agreement, shall continue
for five (5) months from the commencement of deliveries of gas hereunder. The
commencement of deliveries of gas hereunder shall be November 1, 1997, unless
otherwise agreed by the parties. The term of this Agreement may be extended by
mutual agreement of the Parties.
ARTICLE 14: FORCE MAJEURE
14.1 If, by reason of force majeure either party is rendered unable, wholly
or in part, to carry out its obligations under this Agreement, and such party
provides written notice and full particulars of such event of force majeure as
soon as practicable after the occurrence thereof, the obligations of such
affected party shall be suspended to the extent and for the period of such event
of force majeure, except for the payment of monies in respect of obligations
that have accrued hereunder prior to such event of force majeure. The cause of
suspension other than strikes or lockouts shall be remedied so far as possible
with reasonable dispatch. Settlement of strikes and lockouts shall be wholly
within the discretion of the party having the difficulty.
14.2 The term "force majeure" shall mean any act or event which wholly or
partially prevents or delays the performance of obligations arising under this
Agreement if such act or event is not reasonably within the control of and not
caused by the fault or negligence of the party claiming force majeure and which
by the exercise of due diligence such party is unable to prevent or overcome,
including,
20
without limitation by the following enumeration: acts of God, the public enemy
or the elements; fire, accidents, breakdowns, shutdowns for purposes of
necessary repairs, maintenance, relocation or construction of facilities;
breakage, freezing or accidents to xxxxx, machinery or lines of pipe; the
necessity of making repairs or alterations to machinery or lines of pipe;
inability to obtain materials, supplies, permits, or labor to perform or comply
with any obligation or condition of this Agreement; any curtailment of firm gas
transportation service to, of electricity or steam purchases from, or of resale
service by PSE&G to, the Facility; strikes and any other industrial, civil or
public disturbances; any laws, orders, rules, regulations, acts, restraints of
any government or governmental body or authority, civil or military which have
the effect of prohibiting performance of a party's obligations. The term "force
majeure" shall also expressly include the imposition upon Seller or Buyer of any
gross receipts, franchise or other gas sales or consumption tax which Seller or
Buyer is not obligated to pay on the date of execution of this Agreement, which
tax Seller or Buyer determines has a material economic impact on its ability to
continue to sell or purchase gas at the prices or in the quantities set forth
herein.
14.3 Except as provided in Section 14.2, neither party may rely upon
changes in market conditions, curtailment of interruptible transportation, or
denial by a regulatory authority of the pass through of the cost of gas
purchased under this Agreement as events of force majeure. In the event of force
majeure that causes Seller to curtail its deliveries hereunder, Seller shall
treat Buyer on a pro rata basis with
21
Seller's other firm customers and shall give Buyer priority of service over all
interruptible customers.
14.4 In the event Buyer fails to take or Seller fails to make available,
due to a declared event of force majeure, at least fifty percent (50%) of the
aggregate DCQ for a period of sixty (60) consecutive days, then the non-
declaring party may terminate this Agreement upon written notice, provided that
such notice is given prior to the date the force majeure is remedied.
ARTICLE 15: NOTICE
Any notice, request, demand, statement, or xxxx provided for in this
Agreement shall be in writing and delivered by hand, mail, or telecopy. All such
written communications shall be effective upon receipt by the other party at the
address of the parties hereto as follows:
Buyer:
Notices & Statements
Camden Cogen, L.P.
c/o Cogen Technologies Camden, Inc.
Xxxxx 0000, 00xx Xxxxx
0000 Xxxxx Xxxxxx
Xxxxxxx, XX 00000
Attention: Vice President - Fuel Supply
Telephone No.: (000) 000-0000
Telecopy No.: (000) 000-0000
22
Seller:
Notices & Statements
Texaco Natural Gas Inc.
0000 Xxxxx Xx.
X. 0. Xxx 0000
Xxxxxxx, XX 00000-0000
Attention: Vice President, Long-Term Market Development
Telephone No.: (000) 000-0000
Telecopy No.: (000) 000-0000
Nomination Notices:
Texaco Natural Gas Inc.
0000 Xxxxx Xx.
P. 0. Xxx 0000
Xxxxxxx, XX 00000-0000
Attention: Xxxxxx Xxxxx
Telephone No.: (000) 000-0000
Telecopy No.: (000) 000-0000
Payment:
Texaco Natural Gas Inc.
P. 0. Xxx 000000
Xxxxxx, Xxxxx 00000-0000
Wire Transfer - Chemical Bank, New York, New York
Acct. No. 323040780
**ABA No. 000000000
(or as subsequently updated by information
on most recent invoice)
Either of the parties may designate a further or different address by giving
written notice to the other party.
23
ARTICLE 16: LAWS, ORDERS & REGULATIONS
This Agreement, and all terms and provisions contained herein, and the
respective obligations of the parties are subject to valid laws, orders, rules,
and regulations of duly constituted authorities having jurisdiction over Buyer,
Seller, Transporter(s) or PSE&G. In the event that any regulatory or government
body asserting jurisdiction over Transporter(s), PSE&G, Buyer or Seller
prohibits any of the transactions described in this Agreement or any
transportation or delivery agreement between Transporter(s), PSE&G, Seller
and/or Buyer covering the transportation and delivery of the gas sold hereunder,
or otherwise conditions such transactions in a form that is unacceptable in the
reasonable judgment of the party affected thereby, then either party hereto so
affected or prohibited may, by giving one (1) month prior written notice to the
other party, terminate this Agreement and each party shall be held harmless as a
result of such termination except for obligations which were incurred prior to
termination; provided, however, such termination shall be effective immediately
where required by law, rule or regulation.
ARTICLE 17: APPLICABLE LAW
THIS AGREEMENT SHALL BE GOVERNED BY AND INTERPRETED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF TEXAS WITHOUT REGARD TO ITS CONFLICT OF LAW PROVISIONS, AND
THE PARTIES HERETO STIPULATE THAT WITH RESPECT TO ANY AND ALL DISPUTES BETWEEN
THE PARTIES ARISING FROM OR RELATING TO THIS CONTRACT, EXCEPT DISPUTES SUBJECT
TO
24
RESOLUTION BY ARBITRATION, VENUE SHALL LIE IN THE FEDERAL OR STATE COURTS OF
HOUSTON, XXXXXX COUNTY, TEXAS.
ARTICLE 18: WAIVER
No waiver by either party of any one or more defaults in the performance of
any provision of this Agreement shall operate or be construed as a waiver of any
future default, whether of a like or a different character.
ARTICLE 19: TITLE
Seller warrants title to, or good right to sell, all gas delivered
hereunder by Seller, and that such gas is free from liens and adverse claims of
every kind. Seller will pay, or cause to be paid, all royalties and other sums
imposed on the production, gathering, or transportation of the gas prior to its
delivery by Seller to Buyer. Seller will indemnify and save Buyer harmless
against all loss, damage, and expense of every character on account of adverse
claims to the gas delivered by it or of royalties, payments or other charges
thereon applicable before delivery to Buyer. If any adverse claim of any
character is asserted with respect to Seller's right to deliver gas hereunder,
or with respect to Seller's right to receive payment for such gas, or if
Seller's title is questioned or involved in any action, then Buyer shall
immediately notify Seller of such adverse claim and then may withhold that
portion of sums due hereunder reasonably related to such claim until such claim
is finally determined or title is clear, or until such time as Seller furnishes
a corporate undertaking conditioned to save Buyer harmless from such claim.
25
ARTICLE 20: ASSIGNMENT
Either party may, without relieving itself of its obligations under this
Agreement, assign any of its rights hereunder to an entity with which it is
affiliated, but otherwise no assignment of this Agreement or any of the rights
or obligations hereunder shall be made unless there first shall have been
obtained the consent thereto in writing of the other party, which consent shall
not be unreasonably withheld. Any successor-in-interest of Buyer or Seller shall
be entitled to the rights and shall be subject to the obligations of its
predecessor-in-interest under this Agreement. It is agreed, however, that the
restrictions on assignment contained in this paragraph shall not in any way
prevent either party to this Agreement from pledging, mortgaging or assigning
its rights hereunder as security for its indebtedness. In connection with any
such pledge, mortgage or assignment by Buyer, Seller will execute an appropriate
consent to any such pledge, mortgage or assignment as reasonably requested by
Buyer's lender. Any such consent will acknowledge, in effect, that this
Agreement has been duly authorized and is valid and enforceable against Seller
and that this Agreement is in full force and effect; that Seller will not agree
to any amendment to this Agreement without the lender's approval in writing,
which approval shall not be unreasonably withheld by the lender; that Seller
will make all payments due to Buyer hereunder in accordance with the
instructions of the lender; that Seller will not terminate this Agreement by
reason of Buyer's default or by reason of force majeure, without giving the
lender notice of default and notice of termination and the same opportunity to
cure provided to Buyer under this Agreement (plus any longer period as may be
necessary,
26
not to exceed one (1) month, if the lender in good faith is endeavoring to
obtain possession of the Facility and pays Seller in accordance with the terms
of this Agreement during such period); that Seller will deliver to the lender a
copy of each notice of default and notice of termination at the same time that
such notice is delivered to Buyer; and that in the event the lender exercises
its rights under its loan documentation or partnership documentation with Buyer,
Seller will accept performance by the lender or any successor or assign thereof,
provided that the lender or any such successor or assign pays all sums then due
to Seller hereunder and is also otherwise in compliance with this Agreement.
ARTICLE 21: ARBITRATION
21.1 Any issue not resolved by agreement between the parties shall be
submitted to binding arbitration pursuant to the provisions of this Agreement.
The parties shall each appoint one (1) arbitrator and the two (2) arbitrators so
appointed will select a third arbitrator, all of such arbitrators to be
qualified by education, knowledge, and experience to resolve the dispute or
controversy. If either party fails to appoint an arbitrator within ten (10) days
after a request for such appointment is made by the other party in writing, or
if the two (2) appointed fail, within ten (10) days after the appointment of the
second, to agree on a third arbitrator, the arbitrator or arbitrators necessary
to complete a board of three (3) arbitrators will be appointed upon application
by either party therefor to the American Arbitration Association.
21.2 The jurisdiction of the arbitrators will be limited to the single
issue or issues referred to arbitration and the arbitration shall be conducted
pursuant to the
27
guidelines set forth by the American Arbitration Association; provided, however,
that should there be any conflict between such guidelines and the procedures set
forth in this Agreement, the terms of this Agreement shall control.
21.3 Within fifteen (15) days following selection of the third arbitrator,
each party shall furnish the arbitrators in writing its position and supporting
arguments regarding the issue or issues being arbitrated. The arbitrators may,
if they deem necessary, convene a hearing regarding the issue or issues being
arbitrated. All hearings shall be held at a location to be agreed upon among the
arbitrators in Houston, Xxxxxx County, Texas. Within thirty (30) days following
the later of the appointment of the third arbitrator or of the hearing, if one
is held, the arbitrators shall notify the parties in writing as to which of the
two (2) positions submitted with respect to the issue or issues in question is
most consistent with the intent of this Agreement. Such decision shall be
binding on the parties hereto until and unless changed in accordance with the
provisions of this Agreement.
21.4 Enforcement of the award may be entered in any court having
jurisdiction over the parties.
21.5 Each party will pay the expense of the arbitrator selected by or for
it, and its counsel, witnesses and employees. All other costs of arbitration
will be equally divided between the parties.
ARTICLE 22: DEFAULT
22.1 In the event either party fails to perform any of the material
covenants or obligations imposed upon it under and by virtue of this Agreement,
the party not in
28
default hereto, having first given thirty (30) days written notice to the party
in default stating specifically the nature of the default and declaring it to be
the intention of the party giving notice to cancel this Agreement (the
"Cancellation Notice"), may, at its option, cancel this Agreement in accordance
with this Article 22. If within said period of thirty (30) days the party in
default remedies or removes said default, including payment of sums due with
interest at the rate set forth in Section 6.3 hereof, or provides adequate
security to fully indemnify the party not in default for any and all direct
damages of such breach, including payment of sums due with interest at the rate
set forth in Section 6.3 hereof, then such Cancellation Notice shall be
withdrawn and this Agreement shall continue in full force and effect; provided,
however, that if the default is the failure to pay sums due hereunder, then the
party not in default shall have the right to suspend gas deliveries or takes, as
the case may be, after service of the Cancellation Notice.
22.2 If the party in default does not so remedy or remove the default or
does not provide adequate security to fully indemnify the party not in default
for any and all direct damages of such breach, and fails to represent that
further defaults shall not occur and that steps have been taken to avoid such a
recurrence, within said period of thirty (30) days, this Agreement, at the
option of the party not in default, shall be canceled upon written notice to the
defaulting party. Cancellation of this Agreement, pursuant to the provisions of
this Article 22, shall be without prejudice to any other rights and remedies the
party not in default has available to it. Further, such cancellation of this
Agreement or failure to cancel shall be without prejudice to the
29
right of Seller to collect any amounts then due Seller for gas delivered prior
to the time of cancellation.
ARTICLE 23: GENERAL
23.1 The headings contained in this Agreement are for reference purposes
only and shall not affect the meaning or interpretation of this Agreement.
23.2 Any modification, revision or amendment of this Agreement made
subsequent to its execution shall be valid and effective only if and when made
in writing and duly executed by the parties hereto.
23.3 This Agreement and any Exhibit hereto shall constitute a single
agreement, superseding all prior agreements or undertakings between the parties
on the subject matter hereof. This Agreement contains the entire agreement of
the parties and, except as stated herein, there are no promises, agreements,
warranties, obligations, assurances or conditions precedent or otherwise
affecting it.
23.4 By executing this Agreement, each of the individuals so executing
warrants that (i) the individual has all necessary corporate power and authority
to enter into and execute this Agreement and (ii) this Agreement constitutes the
valid and binding obligation of the party on whose behalf it is executed,
enforceable in accordance with its terms, subject to applicable bankruptcy and
insolvency laws.
23.5 The parties shall execute such additional documents and shall cause
such additional action to be taken as may be required, or, in the reasonable
judgment of any party, as may be necessary or desirable, to effect or evidence
the provisions of this Agreement and the transactions contemplated hereby.
30
23.6 The parties acknowledge that each provision to this Agreement
constitutes their joint work product.
23.7 In no event shall either party be liable to the other for punitive,
special, incidental, indirect, consequential, or other similar damages whether
such damages are claimed under breach of warranty, breach of contract, tort of
any other theory or cause of action at law or in equity.
ARTICLE 24: CONFIDENTIALITY
24.1 The terms of this Agreement and information disclosed pursuant to this
Agreement, including but not limited to the price paid for gas, shall be kept
confidential by Seller and Buyer, (a) except to the extent any information must
be disclosed to (i) Transporter(s) and PSE&G for the purpose of effectuating
transportation and resale of the gas sold and purchased under this Agreement,
(ii) PSE&G for the purpose of complying with the PPIA and (iii) Buyer's lender
and (b) except as required by law, regulation or request of governmental
authority.
31
IN WITNESS WHEREOF, by execution in duplicate originals, the parties hereto
have caused this Agreement to be effective as of the day and year first above
written.
"BUYER" "SELLER"
CAMDEN COGEN, L.P. TEXACO NATURAL GAS INC.
By: Cogen Technologies Camden GP By: /s/ Xxxxx X. Xxxxxxx
Limited Partnership, a Delaware --------------------------------
limited partnership, its general Name: Xxxxx X. Xxxxxxx
partner Title: Attorney-in-Fact
Date: 8-14-97
By: Cogen Technologies Camden, Inc., a
Texas corporation, its general partner
By: /s/ W. Xxxxx Xxxxxx
---------------------------------
W. Xxxxx Xxxxxx
Vice President - Fuel Supply
Date: August 1, 1997
32
EXHIBIT A
Attached to and made a part of that Firm Gas Purchase and Sale Agreement
effective July 1,1997, by and between CAMDEN COGEN, L.P., as Buyer, and TEXACO
NATURAL GAS INC., as Seller.
NOMINATION NOTICE
Date:
----------------
Texaco Natural Gas Inc.
0000 Xxxxx Xxxxxx
Xxxxxxx, XX 00000-0000
Attention:
-----------------------
Reference: Firm Gas Purchase and Sale Agreement
Dated: July 1, 1997
Buyer: Camden Cogen, L.P.
Seller: Texaco Natural Gas Inc.
Point of Delivery: Xxxx/Carthage to Tetco/Kosi
____Contract No.: ___________________________
Gentlemen:
Pursuant to Section 3.1 of the subject Agreement, Camden Cogen, L.P., hereby
nominates the following:
Month of Delivery:
Nominated Quantity:
Very truly yours,
------------------------------
W. Xxxxx Xxxxxx
Vice President - Fuel Supply
33
EXHIBIT B
Attached to and made a part of that Firm Gas Purchase and Sale Agreement
effective July 1, 1997, by and between CAMDEN COGEN, L.P., as Buyer, and TEXACO
NATURAL GAS INC., as Seller.
MARKET PRICE INDEX
(XXXX/CARTHAGE)
Publication* Table Row Column
Inside FERC' Gas Prices of Spot Gas Texas Eastern Index
Market Report (first Delivered to Pipelines Transmission Corp.
report in applicable (per MMBtu dry) East Texas
month)
Natural Gas Week Spot Prices on Texas Eastern Bid Week
(first report in Interstate Pipeline Transmission Corp.; (current
applicable month) Systems Delivered to East Texas month)
Pipeline ($/MMBtu)
BACKUP PRICE INDEX
(XXXX/CARTHAGE)
Publication* Table Row Column
Natural Gas Spot Gas Prices; Region-East Texas; Contract
Intelligence - Weekly Delivered To Texas Eastern Index
Gas Price Index Pipelines; (30 Day (Current
Supply Transactions)) Month)
34
EXHIBIT C
Attached to and made a part of that Firm Gas Purchase and Sale Agreement
effective July 1, 1997, by and between CAMDEN COGEN, L.P., as Buyer, and TEXACO
NATURAL GAS INC., as Seller.
POINT(S) OF DELIVERY
The Point(s) of Delivery shall be:
A. The existing Point of Delivery to Xxxx Gateway Pipeline at the tailgate of
the Union Pacific Resources Carthage Gas Processing Plant in Panola County,
Texas
35
STATE OF TEXAS )
) SS.
COUNTY OF XXXXXX )
On this 1st day of August, 1997, before me, Xxx X. Xxxxx, the undersigned
officer, personally appeared, W. Xxxxx Xxxxxx known to me to be the person whose
name is subscribed to the within instrument and acknowledged that Cogen
Technologies Camden, Inc., as General Partner of Cogen Technologies Camden GP
Limited Partnership, in turn acting as General Partner of Camden Cogen, L.P.,
executed the same for the purpose therein contained.
In witness whereof I hereunto set my hand and official seal.
[NOTARY PUBLIC SEAL APPEARS HERE] /s/ XXX X. XXXXX
----------------------------
Notary Public in and for the
State of Texas
STATE OF TEXAS )
) SS.
COUNTY OF XXXXXX)
On this 14th day of August 1997, before me, Xxxxxx Xxxxxxxx, the
undersigned officer, personally appeared, Xxxxx Xxxxxxx, known to me to be the
person whose name is subscribed to the within instrument and acknowledged that
Texaco Natural Gas Inc. executed the same for the purpose therein contained.
In witness whereof I hereunto set my hand and official seal.
[NOTARY PUBLIC SEAL APPEARS HERE] /s/ XXXXXX XXXXXXXX
----------------------------
Notary Public in and for the
State of Texas
36
GUARANTY AGREEMENT
THIS AGREEMENT, shall be effective July 1, 1997, by and between TEXACO
EXPLORATION AND PRODUCTION INC., (hereinafter referred to as "Guarantor") and
CAMDEN COGEN, L.P., (hereinafter referred to as "Cogen").
WITNESSETH:
WHEREAS, Cogen and Texaco Natural Gas Inc. (hereinafter referred to as
"TNGI"), a wholly-owned subsidiary of Guarantor, contemporaneously herewith are
entering into a Firm Gas Purchase and Sale Agreement effective July 1, 1997, as
amended from time to time (the "Agreement"), pursuant to which Cogen will
purchase from TNGI natural gas for a co-generation facility (the "Facility")
located in Camden, New Jersey, in the quantities and upon the terms and
conditions that are set forth in the Agreement; and
WHEREAS, Cogen desires assurances that Guarantor will be responsible for
obligations of TNGI set forth in the Agreement in the event TNGI does not
satisfy such obligations; and
WHEREAS, Guarantor desires that the Agreement be executed and, therefore,
desires to give such assurances.
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained and other valuable consideration, the adequacy and receipt of
which are hereby acknowledged, Guarantor and Cogen hereby agree as follows:
1. Guarantor hereby irrevocably and unconditionally guarantees to Cogen the
full, prompt and complete performance of the obligations of TNGI set forth in,
and subject to the terms of, the Agreement read and taken as a whole, subject to
all
conditions, excuses, and releases or limitations of liability contained therein,
(including, but not limited to, the limitations of damages to Buyer's cost of
Cover). If TNGI fails to perform any of its obligations then due under the
Agreement, Guarantor shall cause TNGI or another of its subsidiaries or
affiliates to perform said obligation in accordance with the terms of the
Agreement. Without limiting the generality of the foregoing, the Guarantor
agrees that the occurrence of anyone or more of the following shall not affect
the liability of the Guarantor hereunder: (a) at any time or from time to time,
without notice to the Guarantor, the time for any performance of or compliance
with any of the obligations of TNGI set forth in the Agreement or such
obligations shall be extended, or such performance or compliance shall be
waived, (b) any of the acts mentioned in any of the provisions of the Agreement
shall be done or omitted or (c) any right under the Agreement shall be waived.
The Guarantor hereby expressly waives diligence, presentment, demand of
payment, protest and all notices whatsoever, and any requirement that Cogen or
any lender (as defined in the Agreement) exhaust any right, power or remedy or
proceed against TNGI under the Agreement.
Nothing in this Guaranty should be taken to imply TEPI has either: a.)
dedicated any of its specific lands, leases, reserves, or interests in the same
to the performance of the Contract, or b.) agreed to a specific performance
responsibility implying a greater overall obligation than agreed to by TNG I
under the Contract, taken as a whole.
2. This Guaranty Agreement shall be assignable to the lenders as defined in
the Agreement under the same terms and conditions set forth in the Agreement.
Any other assignment shall not be permitted, in whole or in part, except with
the consent
2
of the other party, which consent shall not be unreasonably withheld. This
Guaranty Agreement shall be binding upon the parties hereto and their permitted
successors and assigns.
3. This Guaranty Agreement is for the sole and exclusive benefit of the
parties hereto and any permitted successors and assigns. Nothing expressed or
implied herein is intended to benefit any other person, firm or corporation not
a party hereto. None of such other persons shall have any legal or equitable
right, remedy or claim under this Guaranty Agreement or under any provisions
hereof.
4. Notwithstanding anything contained herein, if any claim or demand is
made against Guarantor pursuant to this Guaranty Agreement, Guarantor shall be
subject to all rights, set-offs, counterclaims and defenses to which TNGI may be
entitled, except for defenses arising out of bankruptcy, insolvency, liquidation
or dissolution of TNGL
5. This Guaranty Agreement shall remain in full force and effect until the
termination of all obligations under the Agreement.
6. Guarantor agrees to indemnify Cogen from and against any and all claims
of every nature arising from the obligations of TNGI under the Agreement,
including but not limited to damages suffered by Cogen as a result of TNGI's
non-performance, incomplete performance or other default of TNGI under the
Agreement, provided, however, notwithstanding any provisions to the contrary
herein, that Guarantor's liability hereunder shall be equal to (and neither less
than nor greater than) that of TNGI under the express terms of the Agreement,
including any modifications thereof.
3
7. No delays on the part of Cogen in the exercise of any right or remedy
shall operate as a waiver thereof, and no single or partial exercise by Cogen of
any right or remedy shall preclude other or further exercise thereof or the
exercise of any right or remedy. No actions of Cogen permitted hereunder shall
in any way impair or affect this Guaranty Agreement.
8. WHEREVER POSSIBLE, EACH PROVISION OF THIS GUARANTY AGREEMENT SHALL BE
INTERPRETED IN SUCH MANNER TO BE EFFECTIVE AND VALID UNDER TEXAS LAW; BUT IF ANY
PROVISIONS OF THIS GUARANTY AGREEMENT SHALL BE PROHIBITED OR INVALID UNDER SUCH
LAW, SUCH PROVISION SHALL BE INEFFECTIVE TO THE EXTENT OF SUCH PROHIBITION OR
INVALIDITY WITHOUT INVALIDATING THE REMAINDER OF SUCH PROVISION OR THE REMAINING
PROVISIONS OF THIS GUARANTY AGREEMENT.
9. The Guarantor represents and warrants as follows:
(a) The Guarantor is a corporation duly organized, validly existing
and in good standing under the laws of its jurisdiction of incorporation.
(b) The execution, delivery and performance by the Guarantor of this
Guaranty Agreement are within the Guarantor's corporate powers, have been
duly authorized by all necessary corporate action, and do not contravene
(i) the Guarantor's certificate of incorporation or by-laws or (ii) any
law, rule, regulation or order, or any restriction contained in any
material agreement or instrument, binding on or affecting the Guarantor.
(c) No authorization or approval or other action by, and no notice to
or filing with, any governmental authority or regulatory body is required
for the
4
due execution, delivery and performance by the Guarantor of this Agreement,
except such as have been duly obtained or made and force and effect.
(d) This Guaranty Agreement is a legal, valid and binding o the
Guarantor enforceable against the Guarantor in accordance with its terms
except as enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting the
enforcement of creditors' rights generally and by general equitable
principles enforcement is sought by proceeding in equity or at law).
(e) The Guarantor owns, directly or indirectly, all the issued
outstanding capital stock of TNGI.
IN WITNESS WHEREOF, this instrument is executed as of the day an above
written.
TEXACO EXPLORATION AND CAMDEN COGEN, L.P.
AND PRODUCTION INC.
(GUARANTOR) By: Cogen Technologies Camden GP
Limited Partnership, a Delaware
By: /s/ SIGNATURE APPEARS HERE limited partnership, its general
-------------------------- partner
Its: Director
By: Cogen Technologies
Camden, Inc., a Texas corporation,
its general partner
By: /s/ W. XXXXX XXXXXX
--------------------------------
W. Xxxxx Xxxxxx
Vice President
Date: August 1, 1997
5