Common use of Shipper’s Sole Dedication Clause in Contracts

Shipper’s Sole Dedication. (a) From time to time, subject to Section 2.2(b), Shipper may designate its interests in oil and/or gas leases, mineral interests and other similar interests within the Dedication Area that are not Joint Dedicated Properties as Sole Dedicated Properties. If Gatherer accepts such dedication (or is obligated to accept such designation pursuant to Section 2.2(b)), then subject to the provisions of Section 2.3 through Section 2.7 and Article 14, Shipper will be deemed to have (i) dedicated and committed to deliver to Gatherer under this Agreement, as and when produced, all of the Gas owned by Shipper thereafter produced during the Term from Sole Dedicated Properties and (ii) committed to deliver to Gatherer under this Agreement, as and when produced, all of Third Party Gas under the Control of Shipper that is thereafter produced during the Term from the lands covered by such Sole Dedicated Properties. (b) If Shipper wishes to dedicate to Gatherer hereunder its interests in oil and/or gas leases, mineral interests and other similar interests within the Dedication Area that are not Joint Dedicated Properties as Sole Dedicated Properties, then Shipper shall prepare in good faith and deliver to Gatherer a notice (a “Sole Dedication Notice”) setting forth (i) the oil and/or gas leases, mineral interests and other similar interests Shipper wishes to designate as Sole Dedicated Properties (the “Proposed Sole Dedicated Properties”), (ii) the general location of such Proposed Sole Dedicated Properties, (iii) a current production forecast for such Proposed Sole Dedicated Properties, including the date on which production from such Proposed Sole Dedicated Properties is anticipated to come online, and the locations of the planned xxxxx on such Proposed Sole Dedicated Properties, (iv) the proposed Gathering Services to be provided by Gatherer (the “Proposed Gathering Services”) and (v) proposed fees for such Services to be provided by Gatherer (collectively, the “Proposed Fee”). As soon as reasonably practicable, but in any event within 30 Days following receipt of a Sole Dedication Notice, Gatherer shall provide a written response to Shipper setting forth Gatherer’s election to accept or reject the dedication of such Proposed Sole Dedicated Properties; provided, however, if the Proposed Fee would provide Gatherer at least the Target Return with respect to the Proposed Gathering Services, then Gatherer shall be obligated to accept the dedication of such Proposed Sole Dedicated Properties and provide the Proposed Gathering Services with respect to the applicable Proposed Sole Dedicated Properties at the applicable Proposed Fee. If Gather elects to reject the dedication of such Proposed Sole Dedicated Properties for the Proposed Fee because the acceptance of such dedication would not provide Gatherer at least the Target Return, then Gatherer shall provide in such notice of rejection a calculation showing the anticipated return on the Subject Expenses Gatherer anticipates it would earn based on the Subject Expenses associated with the Proposed Gathering Services using the Proposed Gathering Fee and, within 30 Days following the receipt by Shipper of Gatherer’s rejection of the dedication of such Proposed Sole Dedicated Properties, Shipper may deliver a revised Sole Dedication Notice including a revised Proposed Fee. If such revised Proposed Fee would provide Gatherer at least the Target Return, then Gatherer shall be obligated to accept the dedication of such Proposed Sole Dedicated Properties and provide the Gathering Services set forth in the revised Sole Dedication Notice with respect to such Proposed Sole Dedicated Properties at the revised Proposed Fee. For the avoidance of doubt, Gatherer shall not be obligated to accept any dedication of Proposed Sole Dedicated Properties pursuant to this Section 2.2(b) if the provision of the Gathering Services set forth in a Sole Dedication Notice with respect to such Proposed Sole Dedicated Properties would materially and adversely impact the provision of Gathering Services with respect to the Joint Dedicated Production and/or the development of the Gathering System provided for in the then current Gathering System Plan.