EXHIBIT 10(A)
Conformed Copy
MASTER AGREEMENT
between
GASCOR
and
ENERGY 21 PTY LTD
(ACN 079 089 213)
and
IKON ENERGY PTY LTD
(ACN 079 089 553)
and
KINETIK ENERGY PTY LTD
(ACN 079 089 188)
and
GAS RELEASE CO PTY LTD
(ACN 079 089 286)
XXXXX & MC.KENZIE
Solicitors
Xxxxx 00, Xxxxxx Xxxxx 00, XXX Xxxxxx
000 Xxxxxxx Xxxxxx 50 Bridge Street
MELBOURNE VIC 3000 XXXXXX XXX 0000
Tel: (00) 0000-0000 Tel: (00) 0000-0000
Fax: (00) 0000-0000 Fax: (00) 0000-0000
CONTENTS
CLAUSE
NUMBER HEADING PAGE
1. DEFINITIONS 3
2. BUYERS ANNUAL DEFICIENCY PAYMENTS AND BUYER'S MAKE-UP GAS 22
2.1 Buyer's Annual Deficiency Payments 22
2.2 Obligation to take Buyer's Make-up Gas in Subsequent Years 23
2.3 Obligations to Take Buyer's Make-up Gas at Seller's Direction 29
2.4 Payments in respect of Reduced Buyer's Accumulated Make-up Gas 33
2.5 Right to take Buyer's Accumulated Make-up Gas in Make-up Period 33
2.6 No obligation to make Payment for Buyer's Make-up Gas 35
3. ALLOCATION OF C MARKET QUANTITY AND D MARKET QUANTITY 36
3.1 Allocated Quantities and Reductions in Allocated Quantities 36
3.2 MAQ Adjustment 39
3.3 AQ in Final Contract Years 40
3.4 AQ Adjustment 42
3.5 MDQ for the final Contract Year 42
3.6 MDQ Adjustment 42
4. SELLERS' SALES 43
4.1 Determination of Sellers' Sales 43
4.2 Sellers' Sales Allocation Mechanisms 43
4.3 Allocation of Sellers Sales 45
4.4 Annual Adjustment for Sellers' Sales 46
4.5 Quarterly MDQ Adjustments 47
4.6 Intra-Quarter MDQ Adjustments 49
4.7 MDQ Repayments 50
5. RESERVES 50
5.1 Reserves Notices 50
5.2 Reserves Shortfall 50
5.3 Reserves Surplus 52
5.4 MDQ Adjustments 53
5.5 AQ Adjustment 54
5.6 MAQ Adjustment 55
6. RELEASE GAS PROGRAMME 56
6.1 Release Gas Option 56
6.2 Ecogen MDQ Reductions 59
6.3 Sale of Gas to RCo 60
7. NOMINATIONS, DELIVERIES AND QUANTITIES 60
7.1 Determination of Daily Delivered Quantities 60
i
7.2 Redetermination of Daily Delivered Quantities 62
7.3 Combined Nominations 63
7.4 MDQ 63
7.5 MAQ 65
7.6 AQ 66
7.7 Point of Delivery 66
7.8 Other Points of Delivery 66
7.9 Gas to be delivered in a single stream 67
7.10 Delivery rate 68
7.11 Delivery Pressure 68
7.12 Undelivered Quantities 68
7.13 Additional Nominations 69
8. CURTAILMENT AND EXTENDED FORCE MAJEURE 69
8.1 Order of Allocation 69
8.2 Cooperation on Curtailment 70
8.3 Buyer's Certificate 70
8.4 Extended Force Majeure 70
9. OFF SPECIFICATION GAS 70
10. THE EXPERT 71
10.1 Application of this Clause 71
10.2 Appointment 71
10.3 Qualification 72
10.4 Powers and Duties 72
10.5 Confidentiality 73
10.6 Removal of Expert 73
10.7 Referral to Expert Does Not Affect Obligations 73
10.8 Communications to be Copied to all Parties 73
11. DISPUTE RESOLUTION 73
11.1 Obligation to Seek Resolution 73
11.2 General Requirement 74
11.3 The Claim 75
11.4 The Response 75
11.5 The Reply 75
11.6 Amendments 75
11.7 The Panel 76
11.8 Panel's Jurisdiction 76
11.9 Discovery of Documents 76
11.10 Inspection 76
11.11 Directions 76
11.12 The Hearing 77
11.13 Confidentiality 77
11.14 Award 77
11.15 Costs 78
11.16 General 78
11.17 Inter-relationship with the Principal Contract 78
12. BUYER'S DEFAULT 79
ii
12.1 Default Notice 79
12.2 Cure Period 79
12.3 Remedies for Default 80
12.4 Damages and Consequential Loss 82
12.5 Indemnity 82
13. GASCOR'S DEFAULT 82
13.1 Default Notice 82
13.2 Cure Period 82
13.3 Remedies for Default 83
13.4 No right to terminate 83
13.5 Damages and Consequential Loss 83
13.6 Maximum Liability of Gascor 83
13.7 Mitigation of Loss 87
13.8 Payment of compensation received from Sellers 87
14. ASSIGNMENT 87
14.1 Interpretation 87
14.2 General Requirements 87
14.3 Consent 88
14.4 Change in control 89
14.5 Assignment by Gascor 89
14.6 Change of Control Exemption 90
15. CONFIDENTIALITY 90
15.1 General Obligation 90
15.2 Exceptions 90
15.3 Transport Exemption 92
15.4 General Exceptions 92
15.5 Other Permitted Disclosures 92
15.6 Restrictions Survive Termination 93
15.7 Paramount Confidentiality of Principal Contract and Buyer
Information 93
15.8 Confidentiality of Buyer Information 93
16. COMMUNICATIONS 94
16.1 Communications 94
16.2 Manner of Service 94
16.3 Service particulars 94
16.4 Timing of Service 95
17. SEVERANCE 96
17.1 General Case 96
17.2 Exemption Event 96
17.3 New Agreement 96
18. COMMENCEMENT AND TERMINATION 97
18.1 Commencement 97
18.2 Termination of Principal Contract 98
18.3 Termination of Agreement with each Buyer 98
iii
19. RELATIONSHIP BETWEEN EACH BUYER AND GASCOR 98
19.1 Separate agreement with Gascor and each Buyer 98
19.2 No agreement between each Buyer 98
19.3 No partnership and several liability 99
19.4 No release 99
20. GENERAL 99
20.1 Entire Agreement and operation of Schedules 99
20.2 Termination of agreement between Gascor and a Buyer 99
20.3 Allocation Discrepancies 100
20.4 Waivers 101
20.5 Variations 101
20.6 Further assurance 101
20.7 Exercise of rights 101
20.8 Counterparts 101
20.9 Governing law and jurisdiction 101
21. REFERENCES 102
21.1 Changes to a Reference 102
21.2 Meaning of "Reference" 102
22. INTERPRETATION 103
22.1 Quantities of Gas 103
22.2 Interpretation 103
22.3 This Agreement Prevails 104
SCHEDULE 1 105
Management of the Principal Contract 105
Part A 105
The Committee 105
1. ESTABLISHMENT OF COMMITTEE 105
2. CONSTITUTION OF THE COMMITTEE 105
3. QUORUM 106
4. CHAIRPERSON 107
5. DECISIONS AT MEETINGS 107
6. ALTERNATE MEMBERS 108
7. MEETINGS AND NOTICES 109
8. SECRETARY AND MINUTES 110
Management of the Principal Contract 111
1. ACTION GASCOR IS REQUIRED TO TAKE 111
2. INFORMATION AND REPORTING 112
iv
3. PERFORMANCE AUDITS 113
4. ALLOCATION AUDITS 114
5. OFF SPECIFICATION GAS AND CURTAILMENT 116
6. INSURANCE 117
7. SUSPENSION OF THE POWERS OF THE COMMITTEE IN THE EVENT OF AN
EMERGENCY 117
Part C 119
Matters Requiring the Unanimous Approval of the Committee 119
Part D 120
Rights and Discretions under the Principal Contract 120
Litigation involving the Principal Contract 126
1. INTERPRETATION 126
2. PROCEEDINGS BROUGHT BY THE SELLERS AGAINST GASCOR 126
3. PROCEEDINGS BROUGHT BY GASCOR AGAINST THE SELLERS 129
Management Fees and Cost Recovery 132
1. DEFINITIONS 132
2. RECOVERY OF ROUTINE EXPENDITURE PRIOR TO 1 JANUARY 2002 135
3. RECOVERY OF ROUTINE EXPENDITURE ON OR AFTER 1 JANUARY 2002 135
3.1 Determination of Operating Budgets 135
3.2 Calculation and payment of management fee 136
3.3 Budget amendments 137
4. RESERVE FUND 137
5. RECOVERY OF EXPENDITURE ON OR AFTER 1 JANUARY 2002 WHERE GASCOR
REMAINS OWNED BY THE STATE 138
SCHEDULE 2 142
Allocation of Gascor's Delivered Quantity of Gas 142
1. PART 1 - GENERAL 142
2. PART 2 - SUB-ALLOCATION PRINCIPLES 143
3. PART 3 - UNDER DELIVERY WITH RESPECT TO DAILY AND LAST
NOMINATIONS 143
4. PART 4 - UNDER DELIVERIES WITH RESPECT TO LAST NOMINATIONS 144
5. PART 5 - OVER DELIVERIES WITH RESPECT TO LAST NOMINATIONS 146
6. PART 6 - NO UNDER OR OVER DELIERY 149
v
7. PART 7 - ALLOCATION IN THE EVENT OF A CURTAILMENT DAY 150
8. PART 8 - ALLOCATION FOR SELLERS' OWN USE 151
SCHEDULE 3 153
Ecogen MDQ Reduction and Maximum Annual Quantity 153
Part 1 - Ecogen MDQ Reduction 153
Part 2 - Ecogen Maximum Annual Quantity 154
SCHEDULE 4 155
AMQ 155
SCHEDULE 5 - SELLERS' SALES ALLOCATION MECHANISMS 162
1. INDEPENDENT ASSESSOR 162
2. DUTIES OF INDEPENDENT ASSESSOR 163
3. DISCLOSURE OF INFORMATION TO INDEPENDENT ASSESSOR 164
4. AUDIT RIGHTS 164
5. COST OF THE INDEPENDENT ASSESSOR APPOINTED UNDER THE
PRINCIPAL CONTRACT 165
vi
MASTER AGREEMENT
THIS AGREEMENT is made on the 23rd day of December, 1998.
BETWEEN
Gascor being a body corporate of that name established under the Gas Industry
Act 1994 (Vic) having its principal office at Xxxxx Xxxxx, 00 Xxxxxxx Xxxxxx,
Xxxxxxxxx, Xxx, 0000 ("GASCOR")
Energy 21 Pty Ltd (ACN 079 089 213) of 000 Xxxxxxxx Xxxxxx, Xxxxxxxxx, Xxx, 0000
Ikon Energy Pty Ltd (ACN 079 089 553) of Xxxxx 0, XXX Xxxxxx, 00 Xxxx Xxxx,
Xxxxxxxxx, Xxx, 0000
Kinetik Energy Pty Ltd (ACN 079 089 188) of Xxxxx 00, Xxxx Xxxxx, 00 Xxxx Xxxx,
Xxxxxxxxx, Xxx, 0000 (collectively the "RETAILERS" and each a "RETAILER")
AND
Gas Release Co Pty Ltd (ACN 079 089 286) of 00 Xxxxxxx Xxxxxx, Xxxxxxxxx, Xxx
0000 ("RCO").
RECITALS
A. By an agreement dated 20 November 1996 ("PRINCIPAL CONTRACT") between
Esso Australia Resources Ltd ARBN 000 444 860 ("ESSO"), BHP Petroleum
(Bass Strait) Pty Ltd ACN 004 228 004 ("BHP") and Gascor, Esso and BHP
agreed to supply and Gascor agreed to take quantities of gas upon the
terms and conditions set out in that agreement.
B. On or about the date of this Agreement, Gascor entered into an agency
agreement with each Retailer under which Gascor agreed to appoint that
Retailer as its exclusive agent, and that Retailer agreed to act as
Gascor's agent, to sell gas purchased by Gascor under the Principal
Contract, together with gas purchased by that Retailer from third
parties, to Gascor's customers in the area described in that
Retailer's retail licence.
C. On or about the date of this Agreement, Gascor entered into a
sub-sales agreement with each Retailer for the sale by Gascor and
purchase by that Retailer of gas, being gas which Gascor is entitled
to purchase from Esso and BHP under the Principal Contract, to enable
that Retailer to satisfy its own customers' requirements for gas.
D. It is intended that Gascor will also enter into a sub-sales agreement
with RCo for the sale by Gascor and the purchase by RCo of gas, being
gas which Gascor is entitled to purchase from Esso and BHP under the
Principal Contract, to enable RCo to sell gas to Generation Victoria
(currently trading as Ecogen Energy) ("ECOGEN"), a statutory
corporation established under the Electricity Industry Xxx 0000.
E. This Agreement and the agency agreements and the sub-sales agreements
referred to in Recitals B and C replace the interim agency agreements
which were entered into between Gascor and the Retailers on 11
December 1997 and the interim gas sales agreement which was entered
into between Gascor and Energy 21 Pty Ltd on that date. The terms upon
which such interim agency agreements and interim gas sales agreement
terminate are contained in transition agreements entered into by
Gascor and the Retailers on or about the date of this Agreement.
F. On or about the date of this Agreement, Gascor entered into a deed of
guarantee and indemnity with each Retailer's Related Distribution
Companies (as defined in this Agreement) under which the Related
Distribution Companies agreed to guarantee their related Retailer's
financial obligations under this Agreement and the relevant agency
agreement and sub-sales agreement referred to in Recitals B and C.
G. On or about the date of this Agreement, Gascor entered into a deed of
confidentiality with each Retailer under which Gascor agreed to make
available confidential information relating to the Principal Contract
to that Retailer, including a copy of the Principal Contract, on the
terms and conditions set out in that deed.
H. It is intended that, in addition to selling gas to Ecogen, RCo will
operate a gas release programme pursuant to which RCo will purchase
gas from Gascor on substantially the same terms (other than in respect
of Sellers' Sales (as defined in this Agreement)) as the Retailers and
make such gas available for purchase by third parties. This Agreement
sets out the terms and conditions upon which Gascor may elect to
reduce the quantities of gas available to the Retailers under their
respective agency agreements and sub-sales agreements (as referred to
in Recitals B and C) and make such gas available to RCo.
I. [THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH HAS BEEN
OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.] It is intended by Gascor, the Retailers and RCo that each
Retailer and RCo should severally make an annual deficiency payment to
Gascor if in a year that Retailer or RCo (as the case may be) takes
delivery from Gascor of less than a specific annual minimum quantity
of gas and, in that year, the Retailers and RCo take delivery from
Gascor of a quantity of gas which in aggregate is less than the annual
minimum quantity for that year specified in the Principal Contract.
J. The terms and conditions upon which each Retailer and RCo severally
agrees to make such annual deficiency payments to Gascor are set out
in this Agreement.
K. This Agreement also sets out the basis upon which quantities under the
Principal Contract will be allocated between the Retailer and RCo in
certain circumstances and the rights and obligations of Gascor, the
Retailers and RCo relating to the operation of the Principal Contract.
2
OPERATIVE PROVISIONS
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1. DEFINITIONS
--------------------------------------------------------------------------------
In this Agreement unless the context otherwise requires:
"ACCUMULATED MAKE-UP GAS REDUCTION PERIOD" means the period during which Gas
delivered to Gascor under the Principal Contract is deemed to be Gascor's
Make-up Gas under Clause 4.10(a) of the Principal Contract.
"ACT" means the Gas Industry Xxx 0000 (Vic).
"ADJUSTED FINAL YEAR AQ" means, in relation to a Retailer, if either:
(a) Clause 20.5(b)(iii) of the Principal Contract operates to extend the
Contract Period; or
(b) the Principal Contract is terminated pursuant to Clause 20.7, 23 or 29
of the Principal Contract,
the quantity calculated in accordance with the following formula:
[THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH HAS BEEN
OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.]
Where:
A is the quantity of Gas taken by that Retailer during that
part of [THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION
WHICH HAS BEEN OMITTED, BUT FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.] Contract Year which
corresponds to the period covered by [THIS PARAGRAPH
CONTAINS CONFIDENTIAL INFORMATION WHICH HAS BEEN OMITTED,
BUT FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.] Contract Year (except that the quantity of Gas
treated as taken for the purposes of this calculation will
be adjusted to take account equitably of any Days which were
not Performance Days);
B is the total quantity of Gas taken by that Retailer during
[THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH HAS
BEEN OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.] Contract Year (except that the
quantity of Gas treated as taken for the purposes of this
calculation will be adjusted to take account equitably by
any Days which were not Performance Days); and
C is the prevailing AQ of that Retailer for [THIS PARAGRAPH
CONTAINS CONFIDENTIAL INFORMATION WHICH HAS BEEN OMITTED,
BUT FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.] Contract Year.
"ADJUSTMENT DAY" is defined in Clause 3.6.
3
"AGENCY AGREEMENT" means, in relation to a Retailer, the agreement entered into
in August 1998 between Gascor and that Retailer pursuant to which Gascor has
agreed to appoint that Retailer as its exclusive agent to sell gas to Gascor
Customers (as defined in that agreement) in the Agency Area (as defined in that
agreement).
"ALLOCATED QUANTITY" means:
(a) in relation to a Retailer, the aggregate amount, expressed in GJ, of
the remaining C Market Quantity and D Market Quantity at the start of
the Allocation Day allocated to that Retailer in accordance with
Clause 3.1(a) as adjusted from time to time in accordance with Clause
3; and
(b) in relation to RCo:
(i) if the Allocation Day occurs prior to[THIS PARAGRAPH
CONTAINS CONFIDENTIAL INFORMATION WHICH HAS BEEN OMITTED,
BUT FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.], the maximum quantity of Gas, expressed in GJ,
which RCo is entitled to take under its Sub-sales Agreement
in the period commencing at the start of the Allocation Day
and ending the end of the Release Gas Period; or
(ii) if the Allocation Day occurs[THIS PARAGRAPH CONTAINS
CONFIDENTIAL INFORMATION WHICH HAS BEEN OMITTED, BUT FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.],
[THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH HAS
BEEN OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.].
"ALLOCATION AUDITOR" is defined in paragraph 4(a) of Part B of Schedule 1.
"ALLOCATION DAY" means the first Day of the Gas Month following the Gas Month in
which the aggregate amount of the C Market Quantity and the D Market Quantity
under the Principal Contract is reduced to a quantity equal to or less than
[THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH HAS BEEN OMITTED, BUT
FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.]% of Gascor's
prevailing AQ.
"ALLOCATION PERIOD" means the period commencing at the start of the Allocation
Day and ending at the end of the Contract Period.
"AMQ" is defined in Schedule 4.
"ANNUAL DEFICIENCY PAYMENT" is defined in the Principal Contract.
"ANNUAL EXCESS" means, in relation to a Buyer, in respect of a Contract Year,
the amount (if any), expressed in GJ, by which the aggregate quantities of Gas
(including the aggregate quantity of Buyer's Make-up Gas taken by that Buyer in
that Contract Year as a result of Clause 2.3):
(a) delivered to that Buyer in that Contract Year under its Sub-sales
Agreement; and
4
(b) in the case of a Retailer, delivered to that Retailer in that Contract
Year under its Agency Agreement,
exceeds that Buyer's AMQ for that Contract Year.
"ANNUAL MDQ AMOUNT" means, in relation to a Retailer, the amount of the variable
"AP" in Clause 6.7(a) of that Retailer's Agency Agreement and paragraph (a) of
Part 1 of Schedule 1 to that Retailer's Sub-sales Agreement.
"ANNUAL MINIMUM QUANTITY" is defined in the Principal Contract.
"ANNUAL SHORTFALL" means, in relation to a Buyer, in respect of a Contract Year,
the amount (if any), expressed in GJ, by which the aggregate quantities of Gas
(including the aggregate quantity of Buyer's Make-up Gas taken by that Buyer in
that Contract Year as a result of Clause 2.3):
(a) delivered to that Buyer in that Contract Year under its Sub-sales
Agreement; and
(b) in the case of a Retailer, delivered to that Retailer in that Contract
Year under its Agency Agreement,
is less than that Buyer's AMQ for that Contract Year.
"AQ" in relation to Gascor, is determined in accordance with the Principal
Contract and, in relation to a Buyer, is determined in accordance with that
Buyer's Sub-sales Agreement.
"ARBITRATION RULES" is defined in Clause 11.2(d).
"ASSIGNOR" is defined in Clause 14.2(e).
"BASE MDQ" means:
(a) in relation to a Retailer, its base MDQ, being (subject to Clause 3.5)
the MDQ rate, expressed in TJ/Day, specified in Clause 3.6(a)(1) of
its Sub-Sales Agreement for the purpose of calculating MDQ in the
period up to and including [THIS PARAGRAPH CONTAINS CONFIDENTIAL
INFORMATION WHICH HAS BEEN OMITTED, BUT FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.], and thereafter the MDQ rate,
expressed in TJ/Day, specified in Clause 3.6(a)(2) of its Sub-Sales
Agreement or in each case such other MDQ rate following adjustment
pursuant to Clause 3.6(b)(1), (2), (3) or (5) of its Sub-sales
Agreement; and
(b) in relation to Gascor, Gascor's base MDQ, being the MDQ rate,
expressed in TJ/Day, specified in Clause 5.7(a)(6) of the Principal
Contract for the purpose of calculating MDQ in the period up to and
including [THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH HAS
BEEN OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.], and thereafter the MDQ rate, expressed in TJ/Day,
specified in Clause 5.7(a)(ii) of the Principal Contract or in each
case such other MDQ rate following adjustment pursuant to Clauses
5.7(b)(i), (c) and (d) of the Principal Contract.
5
For the avoidance of doubt, MDQ adjustments resulting from Seller's Sales are
not taken into account for the purposes of determining a Retailer's or Gascor's
Base MDQ and Ecogen MDQ Reductions and reductions in MDQ made in accordance with
Clause 6.1(b)(3) as a result of the exercise of the Release Gas Option are not
taken into account for the purposes of determining a Retailer's Base MDQ.
"BIDDER" is defined in Clause 15.2(h).
"BUYER DEFAULT NOTICE" is defined in Clause 12.1(a).
"BUYERS" means the Retailers and RCo (each a "BUYER").
"BUYER'S ACCUMULATED MAKE-UP GAS" means, in relation to a Buyer, the aggregate
of the Buyer's Make-up Gas of that Buyer for each completed Contract Year less
the sum of all quantities of Buyer's Make-up Gas which Gascor has delivered to
that Buyer under its Sub-sales Agreement and its Agency Agreement (including
without limitation all quantities of Gas which are deemed to be Buyer's Make-up
Gas in accordance with Clause 2.3).
"BUYER'S ANNUAL DEFICIENCY PAYMENT" is defined in Clause 2.1(a).
"BUYER'S DEFAULT" means a Default by a Buyer.
"BUYER'S MAKE-UP GAS" means, in relation to a Buyer, where the Annual Minimum
Quantity for a Contract Year exceeds the quantity of Gas delivered to and taken
by Gascor under the Principal Contract in that Contract Year, a quantity of Gas,
expressed in GJ, equal to the Buyer's Annual Deficiency Payment (if any) paid by
that Buyer to Gascor in respect of that Contract Year divided by the Contract
Price for that Contract Year.
"BUYER'S MAKE-UP SHORTFALL AMOUNT" means, in respect of a Buyer, the amount paid
by that Buyer to Gascor by way of Buyer's Annual Deficiency Payments in respect
of a quantity of Gas equivalent to the Buyer's Make-up Shortfall Quantity
determined in respect of that Buyer (being that part of the most recent Buyer's
Annual Deficiency Payments made by that Buyer sufficient to include that
quantity).
"BUYER'S MAKE-UP SHORTFALL QUANTITY" means, in respect of a Buyer, where the
quantity by which the Buyer's Accumulated Make-up Gas of that Buyer has been
reduced pursuant to Clause 5.2(a) exceeds the quantity by which the Buyer's
Accumulated Make-up Gas of that Buyer has been increased pursuant to Clause
5.3(a), the amount of such excess which would have been capable of delivery to
that Buyer during the Make-up Period (having regard to the quantities of Buyer's
Accumulated Make-up Gas actually delivered to that Buyer during the Make-up
Period).
"BUYER'S OFF SPECIFICATION REDUCTION QUANTITY" means, in relation to a Buyer,
the quantity calculated in respect of an hour in accordance with the following
formula:
[THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH HAS BEEN
OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.]
Where:
6
BOSRQI is the Buyer's Off Specification Reduction Quantity;
A is the aggregate quantity of Gas of which that Buyer took
delivery from Gascor on the [THIS PARAGRAPH CONTAINS
CONFIDENTIAL INFORMATION WHICH HAS BEEN OMITTED, BUT FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.]
Performance Days most closely preceding the Day upon which
the suspension of delivery in respect of which the
calculation is being made occurred, excluding, in the case
of RCo, a quantity equal to the quantity of Gas which was
delivered by RCo and taken by Ecogen on such Performance
Days.
"BUYER'S UNDELIVERED GAS" means, in relation to a Buyer, the quantity calculated
in respect of that Buyer for a Contract Year as follows:
[THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH HAS BEEN
OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.]
Where:
XXx is the quantity of Buyer's Undelivered Gas calculated in
respect of that Buyer for a Contract Year;
GU is the quantity of [THIS PARAGRAPH CONTAINS CONFIDENTIAL
INFORMATION WHICH HAS BEEN OMITTED, BUT FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION.] for that
Contract Year (other than for periods when Off Specification
Reduction Quantities apply) as determined for the purposes
of paragraph (c) of the definition of Annual Minimum
Quantity in Clause 1 of the Principal Contract;
RGi is the aggregate quantity of Gas [THIS PARAGRAPH CONTAINS
CONFIDENTIAL INFORMATION WHICH HAS BEEN OMITTED, BUT FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.] in
that Contract Year as determined on a Daily basis in
accordance with Clause [THIS PARAGRAPH CONTAINS CONFIDENTIAL
INFORMATION WHICH HAS BEEN OMITTED, BUT FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION.], excluding, in
the case of RCo, a quantity equal to the quantity of Gas
which RCo was required to make available for delivery to
Ecogen in that Contract Year but failed to do so, provided
that if RGi as so determined is less then zero, RGi shall
be deemed to be zero; and
(SIGMA)RGi is the sum of the quantities RGi determined for all Buyers.
"CARBON TAX" means any royalty, tax, rate, duty, levy or charge in respect of
the production or emission into the atmosphere of carbon or any carbon compound.
"CHANGE IN CONTROL" occurs in relation to a Party if:
7
(a) any person or persons who between them control or beneficially own
more than 50% of the ordinary shares or other voting shares of the
Party or a holding company (within the meaning given to that
expression in section 9 of the Corporations Law) of the Party cease to
hold or control more than 50% of such ordinary shares or other voting
shares; or
(b) any person or persons who between them control the composition of the
board of the Party or a holding company (within the meaning given to
that expression in section 9 of the Corporations Law) of the Party
cease to have such control.
"CLAIM" is defined in Clause 11.3.
"CLAIMANT" is defined in Clause 11.3.
"C MARKET PRICE" is defined in the Principal Contract.
"C MARKET QUANTITY" is defined in the Principal Contract.
"COMMITTEE" is defined in paragraph 1(a) of Part A of Schedule 1.
"COMMUNICATIONS" is defined in Clause 16.1.
"COMPARATIVE FORCE MAJEURE PERIOD" is defined in paragraph 5 of Schedule 4.
"CONFIDENTIALITY OBLIGATION" is defined in Clause 15.7(a).
"CONSULTANT" is defined in Clause 15.2(g)(9).
"CONSUMER" means the owner or occupier of premises at any one location which is
able to receive and use Sales Gas where the end-use of Sales Gas is at those
premises.
"CONTRACT PERIOD" is defined in the Principal Contract.
"CONTRACT PRICE" means the C Market Price as adjusted from time to time in
accordance with the terms of the Principal Contract.
"CONTRACT YEAR" means a period of 12 consecutive Gas Months beginning at 9.00am
on 1 January in each year and ending at 9.00am on 1 January of the following
year during the Contract Period provided that:
(a) for the purposes of Clause 2.1, the first Contract Year shall be
deemed to have commenced at 9.00am on [THIS PARAGRAPH CONTAINS
CONFIDENTIAL INFORMATION WHICH HAS BEEN OMITTED, BUT FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION.] and will end at 9.00am
on [THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH HAS BEEN
OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.];
(b) other than for the purposes of Clause 2.1, the first Contract Year
shall be the period commencing at 9.00am on the date of this Agreement
and ending at 9.00am on[THIS PARAGRAPH CONTAINS CONFIDENTIAL
INFORMATION WHICH HAS BEEN OMITTED, BUT FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.]; and
8
(c) if the Contract Period ends on a date other than 1 January, then the
last Contract Year shall be the period commencing at 9.00am on 1
January immediately preceding and ending at the end of the Day on
which the Contract Period ends.
"COVERAGE RATIO CERTIFICATE" is defined in the Principal Contract.
"CPI" means the Consumer Price Index (All Groups) for Melbourne as first
published for a calendar quarter by the Australian Bureau of Statistics.
"CURRENT QUARTER" is defined, for the purposes of Clause 4.5(b), in Clause
4.5(b) and, for the purposes of Clause 4.5(c), in Clause 4.5(c).
"CURTAILMENT DAY" is defined in Clause 8.1.
"DAILY NOMINATION" means:
(a) in relation to a Buyer, a Daily Nomination as defined in that Buyer's
Sub-sales Agreement or Agency Agreement or a single nomination given
by that Buyer in place of two separate Daily Nominations (as so
defined) pursuant to Clause 7.3(a); and
(b) in relation to a Release Gas Purchaser, a Daily Nomination as defined
in that Release Gas Purchaser's Release Gas Contract.
"DAILY DELIVERED QUANTITY" is defined in Clause 7.1(a).
"DAY" means a period of 24 consecutive hours or, on the day on which daylight
saving time begins or ends, 23 consecutive hours or 25 consecutive hours (as the
case may be) beginning and ending at 9.00am.
"DEFAULT" means a Financial Default, a Material Financial Default, a Minimum
Quantity Default, a Non-financial Default, a Retail Licence Default or a
Solvency Default.
"DEFAULT RATE" means, for each Month or part thereof for which the Default Rate
is payable, an annual interest rate equal to [THIS PARAGRAPH CONTAINS
CONFIDENTIAL INFORMATION WHICH HAS BEEN OMITTED, BUT FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.]% above the average 90 day bank xxxx mid
rate as published on Reuters' page BBSY at or about 10.00am on the first Working
Day of that Month.
"DEFAULTING PARTY" means:
(a) in relation to a Default by a Buyer, that Buyer; and
(b) in relation to a Default by Gascor, Gascor.
"DETERMINED CLAIM" means a claim made by a Buyer against Gascor in respect of a
Default in relation to which the Panel has delivered an award, a court has given
judgment (except where the judgment is being appealed or Gascor has given notice
to the Buyer of its intention to appeal against the judgment) or which has been
settled by Gascor.
"DISCLOSING PARTY" is defined in Clause 15.2.
9
"D MARKET CONSUMER" means:
(a) a Consumer in the State:
(i) who is not party to a contract which contemplates the
purchase in each year during the currency thereof of at
least [THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION
WHICH HAS BEEN OMITTED, BUT FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.] TJ of Sales Gas; or
(ii) if a party to a contract of the type described in paragraph
(a)(1), to whom less than [THIS PARAGRAPH CONTAINS
CONFIDENTIAL INFORMATION WHICH HAS BEEN OMITTED, BUT FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.] TJ
of Sales Gas has been delivered pursuant to the contract in
the preceding 12 months; or
(b) a hospital in the State.
"D MARKET PRICE" is defined in the Principal Contract.
"D MARKET QUANTITY" is defined in the Principal Contract.
"ECOGEN" is defined in Recital D.
"ECOGEN MDQ REDUCTION" means, in relation to a Retailer, the quantity, expressed
in TJ/Day, calculated in respect of an Ecogen MDQ Reduction Month as follows:
[THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH HAS BEEN
OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.]
Where:
ERi is the quantity, expressed in TJ/Day, calculated in respect
of that Retailer for an Ecogen MDQ Reduction Month;
ERQ is the quantity, expressed in TJ/Day, set out in column 2 of
Part 1 of Schedule 3 against that Ecogen MDQ Reduction
Month;
BMi is that Retailer's [THIS PARAGRAPH CONTAINS CONFIDENTIAL
INFORMATION WHICH HAS BEEN OMITTED, BUT FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION.] on the last
Day of the Gas Month prior to that Ecogen MDQ Reduction
Month; and
(SIGMA)BMi is the sum of all Retailers' [THIS PARAGRAPH CONTAINS
CONFIDENTIAL INFORMATION WHICH HAS BEEN OMITTED, BUT FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.] on
the last Day of the Gas Month prior to that Ecogen MDQ
Reduction Month.
"ECOGEN MDQ REDUCTION MONTH" means, subject to Clauses 5.4(c)(1) and (2), a Gas
Month (other than a Gas Month during the Allocation Period) during Contract
Years [THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH HAS BEEN OMITTED,
BUT FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.] set out in
10
column 1 of Part 1 of Schedule 3 being a Gas Month in which each Retailer's MDQ
will be reduced pursuant to Clause 6.2(a).
"EXCLUDED SALES" means a sale and supply of Sales Gas:
(a) by either or both of the Sellers (including for the purpose of this
definition any Relevant Company) (whether alone or in conjunction with
others); or
(b) originally acquired from either or both of the Sellers (including for
the purpose of this definition any Relevant Company) and irrespective
of the number of intervening sales or transfers,
which is:
(c) made to Ecogen for its own consumption at the Newport or Jeeralang
power stations;
(d) for Sellers' Own Use; or
(e) made to a Consumer for an annual delivered quantity such that (alone
or when aggregated with other sales and supply of Sales Gas to that
Consumer at the one location) the extent of the combined interest of
the Sellers (aggregating Sales Gas sold and supplied by either or both
Sellers as referred to in paragraph (a) and Sales Gas originally
acquired from either or both Sellers as referred to in paragraph (b))
is greater than 5PJ per annum and either:
(i) Gascor had not supplied that Consumer at any time prior to
the sale; or
(ii) the extent of the combined interest of the Sellers
(aggregating Sales Gas sold and supplied by either or both
Sellers as referred to in paragraph 9a) and Sales Gas
originally acquired from either or both Sellers as referred
to in paragraph (b)) exceeds the annual quantity most
recently supplied by Gascor to that Consumer prior to the
sale and supply by at least 5PJ per annum, in which case the
sale and supply will be an Excluded Sale to the extent that
the combined interest of Sellers exceeds the annual quantity
most recently supplied by Gascor to that Consumer prior to
the sale and supply.
"EXEMPTION" means the Competition Policy Authorisation under Part 6B or Part 6C
of the Act and includes any other legislation or regulation which, in respect of
this Agreement, has the same effect as Part 6B or Part 6C of the Act.
"EXEMPTION EVENT" is defined in Clause 17.2(a).
"EXPERT" means a person appointed as an expert in accordance with Clause 10.
"FINANCIAL DEFAULT" means a Party's failure to satisfy a Financial Obligation
(but does not include a failure by Gascor to pay any disputed amount under a
Retailer's Agency Agreement where Gascor has complied with the terms of Clause
6.10(b) of that Retailer's Agency Agreement until such time as the disputed
amount is determined or agreed to be payable).
11
"FINANCIAL OBLIGATION" means an obligation under a Relevant Agreement to pay or
cause to be paid an amount of money.
"FIRST CONTESTABILITY DATE" means the first date on which any Retailer is
entitled to sell Gas to Contestable Customers (as defined in that Retailer's
Agency Agreement) in accordance with the terms of its Retail Licence (as defined
in that Retailer's Agency Agreement).
"FORCE MAJEURE" means any event or circumstance which relieves Gascor or any
Seller from liability in accordance with Clause 20.5 of the Principal Contract
for any failure in the fulfilment of any of their respective obligations under
the Principal Contract.
"FORCE MAJEURE PERIOD" means the period during which a Seller or Gascor is
relieved, in whole or in part, of its obligations under the Principal Contract
in accordance with Clause 20.5(a) of the Principal Contract.
"GAS" means:
(a) Sales Gas complying with the Gas Specifications;
(b) Off Specification Gas which is deemed to be Gas in accordance with
Clause 10(b) of a Buyer's Sub-sales Agreement; and
(c) Off Specification Gas which is deemed to be Contract Gas (as defined
in the Agency Agreements) in accordance with Clause 10(b) of a
Retailer's Agency Agreement.
"GAS ALLOCATION MECHANISMS" is defined in paragraph 1.1 of Schedule 2.
"GASCOR DEFAULT NOTICE" is defined in Clause 13.1.
"GASCOR'S ACCUMULATED MAKE-UP GAS" means the aggregate of Gascor's Make-up Gas
under the Principal Contract for each completed Contract Year less all
quantities of Gascor's Make-up Gas which Sellers have delivered to Gascor under
the Principal Contract.
"GASCOR'S MAKE-UP GAS" means, in respect of a Contract Year where the Annual
Minimum Quantity for that Contract Year exceeds the Gas delivered to and taken
by Gascor for that Contract Year under the Principal Contract, a quantity of
Gas, expressed in GJ, equivalent to that excess.
"GASCOR'S UNDELIVERED GAS" means any quantity of Undelivered Gas (as defined in
Clause 23.4(a) of the Principal Contract).
"GAS MONTH" means a period of time commencing with the beginning of the 1st Day
of any calendar month and ending at the end of the last Day which commences in
that calendar month.
"GAS SPECIFICATIONS" means the specifications and requirements for Gas delivered
to Gascor by a Seller, as set out in Schedule 6 to the Principal Contract.
"GIPPSLAND BASIN" is defined in the Principal Contract.
12
"GJ" means gigajoules, 1 gigajoule being equal to 1,000,000,000 joules.
"GST" means a tax, duty, levy or charge on the supply of goods or services
which:
(a) in general, is collected in instalments at each stage in the chain of
production and distribution; and
(b) permits businesses engaged in the production and distribution of goods
and services to offset the tax paid on acquisition of goods and
services against the tax collected on the supply of goods or services
(other than in specified circumstances, such where the end user has
exempt or zero-rated status),
and would include a tax having similar characteristics to the value added tax
applicable in the United Kingdom or the goods and services tax applicable in New
Zealand or Canada, in each case, as at the date of this Agreement.
"GUARANTEE" means, in relation to a Retailer, the deed of guarantee and
indemnity entered into in August 1998 between that Retailer, its Related
Distribution Companies and Gascor pursuant to which, amongst other things, its
Related Distribution Companies have agreed to guarantee its Financial
Obligations.
"INDEPENDENT ASSESSOR" is defined in paragraph 1(a) of Schedule 5.
"INITIAL NOMINATION" means, in relation to a Buyer, an Initial Nomination as
defined in that Buyer's Sub-sales Agreement or Agency Agreement.
"INTRA-QUARTER MDQ ADJUSTMENT" is defined in Clause 4.6(a).
"MAKE-UP PERIOD" is defined in Clause 8.5(c)(i) of the Principal Contract and
will be reduced or extended in accordance with the terms of the Principal
Contract.
"MAKE-UP SHORTFALL AMOUNT" is defined in the Principal Contract.
"MAQ" means:
(a) in relation to a Retailer, the maximum quantity of Gas which that
Retailer may take in any Contract Year under its Sub-sales Agreement
and its Agency Agreement as determined in accordance with Clause 7.5;
and
(b) in relation to RCo, the maximum quantity of Gas which RCo may take in
any Contract year under its Sub-sales Agreement.
"MATERIAL ADVERSE EFFECT" means a material adverse effect on:
(a) the financial condition of Gascor;
(b) the rights of Gascor under the Principal Contract, any Relevant
Agreement or any Guarantee; or
13
(c) the ability of Gascor to perform any of its obligations under the
Principal Contract or any of the Relevant Agreements or any statutory
or regulatory obligation (including without limitation any obligation
under any licence issued to Gascor under section 48E of the Act).
"MATERIAL FINANCIAL DEFAULT" means:
(a) the occurrence of one or more Financial Defaults where the aggregate
amount of money due is at least [THIS PARAGRAPH CONTAINS CONFIDENTIAL
INFORMATION WHICH HAS BEEN OMITTED, BUT FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.]; or
(b) a failure by a Retailer to comply with any of its obligations under
Clause 11.4 of its Guarantee or any of its obligations under any
agreement contemplated by Clause 10.1(b)(2) of its Guarantee.
"MDQ" means, subject to Clause 7.4(c):
(a) in relation to Gascor, the maximum daily quantity of Gas, expressed in
TJ/Day, which (subject to the Principal Contract) Gascor is entitled
to nominate and take on any Day pursuant to the Principal Contract;
(b) in relation to RCo, the maximum daily quantity of Gas, expressed in
TJ/Day, which RCo is entitled to nominate and take on any day pursuant
to its Sub-sales Agreement;
(c) in relation to a Retailer, the maximum daily quantity of Gas,
expressed in TJ/Day, which that Retailer is entitled to nominate and
take on any Day both pursuant to its Sub-sales Agreement and its
Agency Agreement in accordance with Clause 7.4(a); and
(d) for the purposes of Schedule 2 only, in relation to a Release Gas
Purchaser, the maximum daily quantity of Gas, expressed in TJ/Day,
which that Release Gas Purchaser is entitled to nominate and take on
any Day pursuant to its Release Gas Contract.
"MEASURING AGENCY" is defined in the Principal Contract.
"MEMBER" means a Voting Member or the Non-voting Member.
"MINIMUM QUANTITY DEFAULT", in relation to a Retailer, is defined in that
Retailer's Agency Agreement.
"MONTH" means a period of time commencing with the beginning of the 1st day of
any calendar month and ending at the end of the last day of that calendar month.
"NATURAL GAS" means a naturally occurring mixture of one or more hydrocarbons
being predominantly methane which normally exists in a gaseous state at 101.325
kilopascals and at a temperature of 15 degrees centigrade together with one or
more of hydrogen sulphide, nitrogen, helium, carbon dioxide or other
constituents.
14
"NOMINATION" means a Daily Nomination or a Non-Firm Nomination.
"NON-DEFAULTING PARTY" means:
(a) in the case of a Default by a Buyer (other than a Schedule 1 Default),
Gascor;
(b) in the case of a Schedule 1 Default, by RCo, Gascor;
(c) in the case of a Schedule 1 Default by a Retailer, Gascor or any other
Retailer; and
(d) in the case of a Default by Gascor, each Buyer who is affected by the
Default.
"NON-FINANCIAL DEFAULT" means a Party's failure to observe or perform any
obligation under a Relevant Agreement to which it is a party and which is not a
Financial Obligation while that obligation is not suspended by an event of Force
Majeure.
"NON-FIRM NOMINATION" means:
(a) in relation to a Buyer, a nomination given by that Buyer to Gascor
under Clause 3.3(b) or (d) of its Sub-sales Agreement or Clause 4.3(b)
or (d) of its Agency Agreement or a single nomination given by that
Buyer in place of two such nominations pursuant to Clause 7.3(a); and
(b) for the purposes of Schedule 2 only, in relation to a Release Gas
Purchaser, any nomination given by that Release Gas Purchaser to
Gascor or RCo under its Release Gas Contract other than a Daily
Nomination.
"NON-VOTING MEMBER" is the member of the Committee appointed by Gascor pursuant
to paragraph 2(c) of Part A of Schedule 1.
"OFF SPECIFICATION GAS" means gas which does not comply with the Gas
Specifications.
"OFF SPECIFICATION REDUCTION QUANTITY" is defined in the Principal Contract.
"PANEL" is defined in Clause 11.2(b).
"PANEL CHAIRPERSON" is defined in Clause 11.7.
"PARTIES TO THE ARBITRATION" is defined in Clause 11.2(a).
"PARTY" means a party to this Agreement.
"PERFORMANCE AUDITOR" is defined in paragraph 3(a) of Part B of Schedule 1.
"PERFORMANCE DAY" means a Day upon which each Seller delivered Gas to Gascor in
accordance with the Principal Contract without being affected by an event of
Force Majeure, any reduction in delivery pursuant to Clause 5.5 of the Principal
Contract or any reduction or shut down pursuant to Clause 17 of the Principal
Contract and without delivery of any Off Specification Gas or any failure to
delivery any quantity of Gas which by the terms of the Principal Contract each
Seller was obliged (disregarding Clause 16.2(c) of the Principal Contract) to
deliver to Gascor due to the likelihood of delivery of Off Specification Gas.
15
"PJ" means petajoules, 1 petajoule being equal to 1,000,000 GJs.
"POINT OF DELIVERY" is defined in the Principal Contract.
"PRECEDING QUARTER" is defined, for the purposes of Clause 4.5(b), in Clause
4.5(b) and, for the purposes of Clause 4.5(c), in Clause 4.5(c).
"PRINCIPAL CONTRACT" is defined in Recital A.
"PRINCIPAL CONTRACT REFERENCE" means a Reference (as that term is defined in the
Principal Contract).
"PROCESS AND MECHANISMS" is defined in the Principal Contract.
"PROCEEDINGS" is defined in paragraph 1 of Part E of Schedule 1.
"PRRT" means any Tax imposed or assessed under the Petroleum Resource Rent Tax
Xxx 0000 or the Petroleum Resource Rent Tax Assessment Xxx 0000.
"QT" is defined in Clause 7.1(b).
"QUARTER" means a period three Gas Months commencing at the beginning of the 1st
Day of January, April, July or October in any Contract Year.
"REASONABLE AND PRUDENT OPERATOR" means a person who exercises that degree of
skill, diligence, care, prudence and foresight that would reasonably and
ordinarily be exercised by skilled, diligent, prudent and experienced operators
under similar circumstances and conditions in accordance with applicable laws,
regulations and standards.
"REDUCTION DATE" is defined in Clause 4.4(c).
"RELATED COMPANY" means, in relation to a Retailer:
(a) a related body corporate (within the meaning of the Corporations Law)
of that Retailer;
(b) an entity controlled by the ultimate holding company of that Retailer;
(c) a body corporate ("BODY CORPORATE A") in respect of which any body
corporate or entity described in any of paragraphs (a) or (b) of this
definition alone or in conjunction with or when aggregated with any
other body corporate or entity described in any of such paragraphs:
(1) owns beneficially at least 50% of the issued shares;
(2) is in a position to cast or control the casting of at least
50% of the maximum number of votes that may be cast at a
general meeting of Body Corporate A;
(3) controls the composition of at least one half of the board
of directors or other governing body of Body Corporate A and
16
for the purposes of determining control, section 47 of the
Corporations Law will apply with necessary changes.
In this definition whether an entity or body corporate controls
another entity will be determined in the same way as it is determined
for the purposes of Part 3.6 of the Corporations Law.
"RELATED DETERMINED CLAIMS" means all claims (excluding Sellers' Related
Determined Claims) made by any one or more Buyers against Gascor in respect of
any one act, omission or event or any one series of related acts, omissions or
events in relation to which the Panel has delivered an award or awards, a court
has given judgment or judgments (except where the judgment is being appealed or
Gascor has given notice to the relevant Buyer or Buyers of its intention to
appeal against the judgment) or which has or have been settled by Gascor.
"RELATED DISPUTE" is defined in Clause 11.17.
"RELATED DISTRIBUTION COMPANIES" means:
(a) in relation to Energy 21 Pty Ltd, Stratus Networks Pty Ltd ACN 079 089
099 and Stratus Networks (Assets) Pty Ltd ACN 079 089 142;
(b) in relation to Ikon Energy Pty Ltd, Multinet Pty Ltd ACN 079 088 930
and Multinet (Assets) Pty Ltd ACN 079 088 967; and
(c) in relation to Kinetik Energy Pty Ltd, Westar Pty Ltd ACN 079 089 008
and Westar (Assets) Pty Ltd ACN 079 089 062 .
"RELATED SELLERS' SALE" means, in relation to a Retailer:
(a) a Sellers' Direct Sales which is made to a Consumer which prior to the
Sellers' Direct Sale purchased Sales Gas from that Retailer and where
there has been no intervening sale of Sales Gas to that Consumer by
any person; or
(b) a Sellers' Direct Sale which is made to a Consumer which last
purchased Sales Gas from that Retailer and where there have been
intervening sales of Sales Gas to that Consumer by one or more persons
(other than a Retailer).
"RELEASE GAS AQ REDUCTION QUANTITY" means, in relation to a Release Gas Year the
aggregate amount of the reduction to be made in respect of all Retailers' AQs in
that Release Gas Year as notified by Gascor to each Retailer in accordance with
Clause 6.1(i)(2).
"RELEASE GAS COMMENCEMENT DATE" means the date on which the Release Gas Period
will start as notified by Gascor to each Retailer in accordance with Clause
6.1(i)(1).
"RELEASE GAS CONTRACT" means, in relation to a Release Gas Purchaser, the
agreement entered into between that Release Gas Purchaser, RCo and Gascor
relating to the supply by RCo, and the purchase by that Release Gas Purchaser,
of Gas.
"RELEASE GAS OPTION" is defined in Clause 6.1(a).
17
"RELEASE GAS OPTION EXERCISE DATE" means the date on which Gascor gives the
release Gas Option Exercise Notice in accordance with Clause 6.1(g).
"RELEASE GAS OPTION EXERCISE NOTICE" is defined in Clause 6.1(g).
"RELEASE GAS PERIOD" means the period commencing at 9.00 am on the Release Gas
Commencement Date and ending at 9.00 am on 1 January 2004.
"RELEASE GAS PURCHASER" means any person who enters into an agreement with RCo
and Gascor relating to the sale by RCo, and the purchase by that person, of Gas
(being Gas which RCo is entitled to purchase from Gascor under its Sub-sales
Agreement), including without limitation Ecogen.
"RELEASE GAS YEAR" means:
(a) if the Release Gas Commencement Date occurs in the calendar year
ending on [THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH HAS
BEEN OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.], each of the Contract Years ending at 9.00 am on [THIS
PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH HAS BEEN OMITTED,
BUT FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.]
respectively;
(b) if the Release Gas Commencement Date occurs in the calendar year
ending on [THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH HAS
BEEN OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.], each of the Contract Years ending at 9.00 am on [THIS
PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH HAS BEEN OMITTED,
BUT FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.]
respectively; or
(c) if the Release Gas Commencement Date is [THIS PARAGRAPH CONTAINS
CONFIDENTIAL INFORMATION WHICH HAS BEEN OMITTED, BUT FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION.], each of the Contract
Years ending at 9.00 am on [THIS PARAGRAPH CONTAINS CONFIDENTIAL
INFORMATION WHICH HAS BEEN OMITTED, BUT FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.] respectively.
"RELEVANT AGREEMENTS" means this Agreement, the Transition Agreements, the
Sub-sales Agreements and the Agency Agreements (each a "RELEVANT AGREEMENT").
"RELEVANT COMPANY" means:
(a) a related body corporate (within the meaning of the Corporations Law)
of a Seller;
(b) a body corporate which would be a subsidiary (within the meaning of
the Corporations Law) of the ultimate holding company (within the
meaning of the Corporations Law) of one Seller ("SELLER A") if the
other Seller ("SELLER B") and each related boy corporate of Seller B
were each a subsidiary of the ultimate holding company of Seller A;
(c) an entity controlled by the ultimate holding company of a Seller;
18
(d) an entity that would be controlled by the ultimate holding company of
a Seller (Seller A) if the ultimate holding company of the other
Seller (Seller B) and each entity which it controls was each an entity
controlled by the ultimate holding company of Seller A;
(e) a body corporate ("BODY CORPORATE A") in respect of which any body
corporate or entity described in any of paragraphs (a) to (d) of this
definition alone or in conjunction with or when aggregated with any
other body corporate or entity described in any of paragraphs (a) to
(d) of this definition:
(1) owns beneficially at least 50% of the issued shares;
(2) is in a position to cast or control the casting of at least
50% of the maximum number of votes that might be cast at a
general meeting of Body Corporate A; or
(3) controls the composition of at least one half of the board
of directors or other governing body of Body Corporate A and
for the purposes of determining control section 47 of the
corporations Law will apply with necessary changes.
In this definition whether an entity or body corporate controls another entity
will be determined in the same way as it is determined for the purposes of Part
3.6 of the Corporations Law.
"RELEVANT PURCHASERS" means the Buyers and the Release Gas Purchasers (each a
"RELEVANT PURCHASER").
"RELEVANT RETAILER" is defined:
(a) for the purposes of Clause 3.1(h), in Clause 3.1(h);
(b) for the purposes of Clause 3.2(d), in Clause 3.2(d);
(c) for the purposes of Clause 3.4, in Clause 3.4;
(d) for the purposes of Clause 3.6, in Clause 3.6;
(e) for the purposes of Clause 4.4(c), in Clause 4.4(c);
(f) for the purposes of paragraph 2 of Part E of Schedule 1, in paragraph
2(c) of Part E of that Schedule; and
(g) for the purposes of paragraph 3 of Part E of Schedule 1, in paragraph
3(e) of Part E of that Schedule.
"RELEVANT SALE" means a sale and supply by either or both of the Sellers or any
Relevant Company (whether alone or in conjunction with others) of Sales Gas from
the Gippsland Basin where, and to the extent that, the ultimate Consumer or
Consumers are located in the State but does not include a sale and supply under
the Principal Contract or an Excluded Sale. If the sale is in conjunction with
19
others then it is only a Relevant Sale to the extent of the interest of the
Sellers or the Relevant Company in that sale and supply.
"RELEVANT YEAR" is defined, for the purposes of Clause 3.2(d), in Clause 3.2(d)
and, for the purposes of Clause 3.4, in Clause 3.4.
"REMAINING PARTY" is defined in Clause 14.2(e)(3).
"REPLY" is defined in Clause 11.5.
"RESERVES SHORTFALL" is defined in the Principal Contract.
"RESERVES SURPLUS" is defined in the Principal Contract.
"RESPONDENT" is defined in Clause 11.3.
"RESPONSE" is defined in Clause 11.4.
"RETAIL LICENCE DEFAULT", in relation to a Retailer, is defined in that
Retailer's Agency Agreement.
"SALES GAS" means Natural Gas which has been processed and is of marketable
quality.
"SCHEDULE 1 DEFAULT" means a Buyer's failure to observe or perform any
obligation which it is required to observe or perform under Schedule 1.
"SCHEDULE 1 DEFAULT NOTICE" is defined in Clause 12.1(b).
"SELLERS" means collectively Esso and BHP as defined in Recital A (each a
"SELLER").
"SELLERS' AGENT" is defined in the Principal Contract.
"SELLERS' CLAIM" is defined in paragraph 1 of Part E of Schedule 1.
"SELLERS' DEFAULT" means a failure by a Seller to satisfy, observe or perform
any obligation of that seller under the Principal Contract.
"SELLERS' DIRECT SALES" means any Relevant Sale pursuant to a contract or
agreement entered into after the date of the Principal Contract where the
contract or agreement is with the Consumer of that Sales Gas.
"SELLERS' GIPPSLAND BASIN" means the aggregate of the interest held from time to
time by each Seller and each Relevant Company in fields within the Gippsland
Basin.
"SELLERS' INDIRECT SALES" means any Relevant Sale pursuant to a contract or
agreement entered into after the date of the Principal Contract where the
contract or agreement is with a party (including an aggregator or distributor)
other than the Consumer of that Sales Gas.
"SELLERS' OWN USE" is defined in the Principal Contract.
20
"SELLERS' RELATED DETERMINED CLAIMS" means all claims made by any one or more
Buyers against Gascor in respect of any one act, omission or event or any one
series of related acts, omissions or events where that act, omission or event or
series of related acts, omissions or events has been directly or indirectly
caused by or has arisen as a result of a Seller's Default and in relation to
which the Panel has delivered an award or awards, a court has given a judgment
or judgments (except where the judgment is being appealed or Gascor has given
notice to the relevant Buyer or Buyers of its intention to appeal against the
judgment) or which has or have been settled by Gascor.
"SELLERS' SALES" means Sellers' Direct Sales plus Sellers' Indirect Sales.
"SELLERS' SALES ALLOCATION" means the quantity of Sellers' Sales in a period,
expressed in GJ, which is allocated to a Retailer in accordance with the
Sellers' Sales Allocation Mechanisms.
"SELLERS' SALES ALLOCATION AREA" means, in relation to a Retailer, any area in
which that retailer is from time to time licensed to sell gas to customers (as
defined in the Act), other than non-franchise customers (as defined in the Act),
pursuant to section 48E of the Act.
"SELLERS' SALES ALLOCATION MECHANISMS" is defined in Clause 4.2(a).
"SELLERS' SALES AUDITOR" is defined in paragraph 4(a) of Schedule 5.
"SOLVENCY DEFAULT" means the occurrence of any one or more of the following in
respect of a Party:
(a) an order being made or a resolution being passed for the winding up of
or dissolution without winding up of the Party unless the order or
resolution is for the purpose of reconstruction or amalgamation under
a scheme to which the other Parties have given consent; or
(b) the Party enters into any arrangement, reconstruction or composition
with or for the benefit of its creditors with the exception of a
reconstruction or amalgamation of a Party while solvent.
"SOU CUSTOMERS" means the persons listed in Schedule 9 of the Principal
Contract.
"STATE" means the State of Victoria.
"SUB-SALES AGREEMENT" means, in relation to a buyer, the agreement entered into
in August 1998 or, in the case of RCo, at any time after the date of this
Agreement between Gascor and that Buyer relating to the supply by Gascor, and
purchase by that Buyer, of Gas.
"TAX" means a royalty, tax, rate, duty, levy or charge levied or imposed by the
Commonwealth of Australia, the State or any other governmental authority in
Australia, and, without limiting the generality of the foregoing, includes, if
levied or imposed by the Commonwealth of Australia, the State or any other
governmental authority in Australia a Carbon Tax, sales tax, GST and PRRT.
"TJ" means terajoules, 1 terajoule being equal to 1,000 GJ.
21
"TOTAL DAILY DELIVERED QUANTITY" is defined in paragraph 1.1 of Schedule 2.
"TOTAL GASCOR GAS" means, in relation to a period, the total quantity of Gas
delivered to and taken by Gascor under the Principal Contract in that period.
"TOTAL QUANTITY" is defined in the Principal Contract.
"TRANSITION AGREEMENT" means, in relation to a Retailer, the agreement entered
into in August 1998 between Gascor and that Retailer containing certain
provisions of a savings and transitional nature relating to the commencement of
that Retailer's Agency Agreement and Sub-sales Agreement.
"TRANSITION COMPANY" means:
(a) Transmission Pipelines Australia Pty Ltd (ACN 079 089 268);
(b) Transmission Pipelines Australia (Assets) Pty Ltd (ACN 079 136 413);
or
(c) VENCorp.
"VENCORP" means the Victorian Energy Networks Corporation established under
Division 2A of Part 2 of the Act.
"VOTING MEMBER" is a member of the Committee appointed pursuant to paragraphs
2(b) or 2(e) of Part A of Schedule 1.
"WORKING DAY" means any day other than a Saturday or Sunday on which banks are
open for general banking business in the State.
--------------------------------------------------------------------------------
2. BUYERS ANNUAL DEFICIENCY PAYMENTS AND BUYER'S MAKE-UP GAS
--------------------------------------------------------------------------------
2.1 BUYER'S ANNUAL DEFICIENCY PAYMENTS
(a) If the aggregate quantities of Gas delivered to and taken by
all Buyers (giving each Buyer credit for the aggregate quantity of
Buyer's Make-up Gas taken as a result of Clause 2.3) during any
Contract Year is less than [THIS PARAGRAPH CONTAINS CONFIDENTIAL
INFORMATION WHICH HAS BEEN OMITTED, BUT FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.] for that Contract Year, each
Buyer which has an Annual Shortfall in that Contract Year must pay to
Gascor (in accordance with Clause 8 of its Sub-sales Agreement) an
amount (a "BUYER'S ANNUAL DEFICIENCY PAYMENT") calculated as follows:
[THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH HAS BEEN
OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.]
Where:
22
Bi is the Buyer's Annual Deficiency Payment (if any), expressed
in $, payable by that Buyer for that Contract Year;
ADP is the [THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION
WHICH HAS BEEN OMITTED, BUT FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.] (if any) payable by
Gascor to Sellers for that Contract Year under Clause [THIS
PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH HAS BEEN
OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.] of the Principal Contract;
BSi is that Buyer's [THIS PARAGRAPH CONTAINS CONFIDENTIAL
INFORMATION WHICH HAS BEEN OMITTED, BUT FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION.] for that
Contract Year; and
(SIGMA)BSi is the sum of all Buyers' respective [THIS PARAGRAPH
CONTAINS CONFIDENTIAL INFORMATION WHICH HAS BEEN OMITTED,
BUT FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.] for that Contract Year.
(b) To avoid doubt, no Buyer shall have any liability to make a
Buyer's Annual Deficiency Payment in respect of a Contract Year if
Gascor is not required to [THIS PARAGRAPH CONTAINS CONFIDENTIAL
INFORMATION WHICH HAS BEEN OMITTED, BUT FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.] in respect of that Contract Year
under the Principal Contract.
2.2 OBLIGATION TO TAKE BUYER'S MAKE-UP GAS IN SUBSEQUENT YEARS
(a) Each Buyer must (subject to, and in accordance with, the
provisions of that Buyer's Sub-sales Agreement and Agency Agreement
and this Clause 2) take delivery from Gascor, without payment (subject
to Clause 2.6), of quantities of Buyer's Make-up Gas during any
subsequent Contract Year provided that:
(1) subject to Clause 2.3, a Buyer may not take delivery of any
Buyer's Make-up Gas in a Contract Year unless Gascor can
take delivery of Gascor's Make-up Gas in that Contract Year
under the Principal Contract;
(2) subject to Clause 2.3, the aggregate quantity of Buyer's
Make-up Gas which all Buyers must take in a Contract Year
shall not exceed the quantity of Gascor's Make-up Gas which
Gascor is entitled to take in that Contract Year;
(3) a Buyer may not take delivery of quantities of Buyer's
Make-up Gas in a Contract Year in excess of its Buyer's
Accumulated Make-up Gas less all quantities of Gas which
will be deemed to be Buyer's Make-up Gas of that Buyer in
each subsequent Contract Year as a result of the application
of Clause 2.3(b);
(4) title to Buyer's Make-up Gas will pass to a Buyer or a third
party only if and when that Gas is delivered to that Buyer
or a third party (as the case may be) in a subsequent
23
Contract Year under that Buyer's Sub-sales Agreement or
Agency Agreement (as the case may be); and
(5) RCo may not take delivery of quantities of Buyer's Make-up
Gas after the end of the Release Gas Period and any rights
of RCo to Buyer's Accumulated Make-up Gas remaining at the
end of the Release Gas Period will be forfeited.
(b) A Buyer is not entitled to take delivery of quantities of
Buyer's Make-up Gas other than in circumstances when it must take
quantities of Buyer's Make-up Gas in accordance with the provisions of
this Clause 2.
(c) Subject to Clause 2.2(a), each Buyer which has an Annual
Excess in a Contract Year and which has Buyer's Accumulated Make-up
Gas after deduction of all quantities of Gas which will be deemed to
be Buyer's Make-up Gas of that Buyer in each subsequent Contract Year
as a result of the application of Clause 2.3(b) must take delivery
from Gascor of a quantity of Buyer's Make-up Gas in that Contract Year
equal to the lesser of:
(1) a quantity equal to [THIS PARAGRAPH CONTAINS CONFIDENTIAL
INFORMATION WHICH HAS BEEN OMITTED, BUT FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION.]; or
(2) a quantity calculated as follows:
[THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH HAS
BEEN OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.]
Where:
BMi is the quantity of Buyer's Make-up Gas, expressed
in GJ, which that Buyer must take in that Contract
Year;
GM is the quantity of [THIS PARAGRAPH CONTAINS
CONFIDENTIAL INFORMATION WHICH HAS BEEN OMITTED,
BUT FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.] which [THIS PARAGRAPH
CONTAINS CONFIDENTIAL INFORMATION WHICH HAS BEEN
OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION.] must take in that
Contract Year under the Principal Contract less
any quantity of Gas which is deemed to be [THIS
PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH
HAS BEEN OMITTED, BUT FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.] in that
Contract Year pursuant to Clause [THIS PARAGRAPH
CONTAINS CONFIDENTIAL INFORMATION WHICH HAS BEEN
OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION.] of the Principal
Contract;
24
BEi is that Buyer's [THIS PARAGRAPH CONTAINS CONFIDENTIAL
INFORMATION WHICH HAS BEEN OMITTED, BUT FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION.] for that
Contract Year; and
(SIGMA)BEi is the sum of the [THIS PARAGRAPH CONTAINS
CONFIDENTIAL INFORMATION WHICH HAS BEEN OMITTED,
BUT FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.] in that Contract Year of all
Buyers which have Buyer's Accumulated Make-up Gas.
(d) If the quantity of Gascor's Make-up Gas which Gascor must
take in a Contract Year less any quantity of Gas which is deemed to be
Gascor's Make-up Gas in that Contract Year in accordance with Clause
4.10(a) of the Principal Contract exceeds the aggregate quantity of
Buyer's Make-up Gas which all Buyers must take in that Contract Year
as calculated in accordance with Clause 2.2(c) and by virtue of any
previous application of this Clause 2.2(d), then, subject to Clause
2.2(a), each Buyer which:
(1) has an Annual Excess in that Contract Year; and
(2) has Buyer's Accumulated Make-up Gas after deduction of all
quantities of Buyer's Make-up Gas which that Buyer must take
in that Contract Year in accordance with Clause 2.2(c) and
by virtue of any previous application of this Clause 2.2(d)
and after deduction of all quantities of Gas which will be
deemed to be Buyer's Make-up Gas of that Buyer in each
subsequent Contract year as a result of the application of
Clause 2.3(b),
must take an additional quantity of Buyer's Make-up Gas equal to the
lesser of:
(A) the quantity equal to that Buyer's Annual Excess for
that Contract Year after deduction of all quantities of
Buyer's Make-up Gas which that Buyer must take in that
Contract Year in accordance with Clause 2.2(c) and by virtue
of any previous applications of this Clause 2.2(d); or
(B) the quantity calculated as follows:
[THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH HAS
BEEN OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.]
Where:
AMi is the additional quantity of Buyer's Make-up Gas,
expressed in GJ, which a Buyer must take in that
Contract Year pursuant to this Clause 2.2(d);
GML is the quantity of [THIS PARAGRAPH CONTAINS
CONFIDENTIAL INFORMATION WHICH HAS BEEN OMITTED,
BUT FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.] which Gascor must take in
25
that Contract Year under the Principal Contract
less:
(i) any quantity of Gas which is deemed to
be [THIS PARAGRAPH CONTAINS CONFIDENTIAL
INFORMATION WHICH HAS BEEN OMITTED, BUT
FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.] in that Contract
Year pursuant to Clause [THIS PARAGRAPH
CONTAINS CONFIDENTIAL INFORMATION WHICH
HAS BEEN OMITTED, BUT FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE
COMMISSION.] of the Principal Contract;
and
(ii) the aggregate quantity of Buyer's
Make-up Gas which all Buyers must take
in that Contract Year in accordance with
Clause 2.2(c); and
(iii) the aggregate quantity of [THIS
PARAGRAPH CONTAINS CONFIDENTIAL
INFORMATION WHICH HAS BEEN OMITTED, BUT
FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.] which all Buyers
must take in that Contract Year by
virtue of any previous application of
this Clause 2.2(d);
BEi is that Buyer's Annual Excess in that
Contract Year; and
(SIGMA)BEi is the sum of the Annual Excess in that
Contract Year of all Buyers which have
remaining Buyer's Accumulated Make-up
Gas after deduction of all quantities of
Buyer's Make-up Gas which they must take
in that Contract Year in accordance with
Clause 2.2(c) and by virtue of any
previous application of this Clause
2.2(d) and after deduction of all
quantities of Gas which will be deemed
to be Buyer's Make-up Gas of that Buyer
in each subsequent Contract Year as a
result of the application of Clause
2.3(b).
(e) Clause 2.2(d) shall apply iteratively until all quantities
of Buyer's Make-up Gas which Buyers which have an Annual Excess must
take in that Contract Year pursuant to Clause 2.2(d) have been taken.
(f) If the quantity of Gascor's Make-up Gas which Gascor must
take in a Contract Year less any quantity of Gas which is deemed to be
Gascor's Make-up Gas in that Contract Year in accordance with Clause
4.10(a) of the Principal Contract exceeds the aggregate quantity of
Buyer's Make-up Gas which all Buyers must take in that Contract Year
as calculated in accordance with Clauses 2.2(c) to (e) inclusive, then
each Buyer which has Buyer's Make-up Gas (after deducting all
quantities of Buyer's Make-up Gas which that Buyer must take in that
Contract Year in accordance with Clauses 2.2(c) to (e) inclusive and
after deduction of all quantities of Gas which will be deemed to be
26
Buyer's Make-up Gas of that Buyer in each subsequent Contract Year as
a result of the application of Clause 2.3(b)) must take an additional
quantity of Buyer's Make-up Gas calculated in accordance with the
following formula:
[THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH HAS BEEN
OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.]
Where:
AMi is the additional quantity of Buyer's Make-up Gas, expressed
in GJ, which a Buyer must take in that Contract Year
pursuant to this Clause 2.2(f);
GML is the quantity of [THIS PARAGRAPH CONTAINS CONFIDENTIAL
INFORMATION WHICH HAS BEEN OMITTED, BUT FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION.] which Gascor
must take in that Contract Year under the Principal Contract
less:
(1) any quantity of Gas which is deemed to be [THIS
PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH
HAS BEEN OMITTED, BUT FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.] in that
Contract Year in accordance with Clause [THIS
PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH
HAS BEEN OMITTED, BUT FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.] of the
Principal Contract; and
(2) the aggregate quantity of Buyer's Make-up Gas
which all Buyers must take in that Contract Year
as calculated in accordance with Clauses 2.2(c) to
(e) inclusive;
BAi is the Buyer's Accumulated Make-up Gas of that Buyer less:
(1) all quantities of Buyer's Make-up Gas which that
Buyer must take in that Contract Year in
accordance with Clauses 2.2(c) to (e) inclusive;
and
(2) all quantities of Gas which will be deemed to be
Buyer's Make-up Gas of that Buyer in each
subsequent Contract Year as a result of the
application of Clause 2.3(b); and
(SIGMA)BAi is the sum of the Buyer's Accumulated Make-up Gas of all
Buyers less:
(1) the aggregate quantities of Buyer's Make-up Gas
which all Buyers must take in that Contract Year
in accordance with Clauses 2.2(c) to (e)
inclusive; and
(2) all quantities of Gas which will be deemed to be
Buyer's Make-up Gas of the Buyers in each
subsequent Contract Year as a result of the
application of Clause 2.3(b).
27
(g) The quantity of Buyer's Make-up Gas (if any) which a Buyer
must take in a Contract Year will be delivered under its Sub-sales
Agreement unless and to the extent that such quantity of Buyer's
Make-up Gas exceeds the quantity of Gas delivered to that Buyer under
its Sub-sales Agreement in that Contract Year, in which case the
excess will be delivered to that Buyer under its Agency Agreement.
(h) If a Retailer's Allocated Quantity is reduced to zero in a
Contract Year and that Retailer would have been entitled to take
delivery of quantities of Buyer's Make-up Gas during that Contract
Year in accordance with this Clause 2.2 but for that reduction, then:
(1) Gascor must pay to that Retailer within [THIS PARAGRAPH
CONTAINS CONFIDENTIAL INFORMATION WHICH HAS BEEN OMITTED,
BUT FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.] days after the end of that Contract Year an
amount calculated as follows:
[THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH HAS
BEEN OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.]
Where:
P is the amount of the payment to the Retailer,
expressed in $;
BMi is the quantity of Buyer's Make-up Gas which that
Retailer would have entitled to take delivery of
during that Contract Year in accordance with this
Clause 2.2 but for that reduction;
CP is the [THIS PARAGRAPH CONTAINS CONFIDENTIAL
INFORMATION WHICH HAS BEEN OMITTED, BUT FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.] for that Contract Year;
TD is the amount (if any), expressed in $, which
would have been payable by that Retailer in
respect of [THIS PARAGRAPH CONTAINS CONFIDENTIAL
INFORMATION WHICH HAS BEEN OMITTED, BUT FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.] in accordance with Clause [THIS
PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH
HAS BEEN OMITTED, BUT FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.] had that
Retailer taken delivery of a quantity of Buyer's
Make-up Gas equal to BMi;
TC is the amount (if any), expressed in $, which
would have been payable by Gascor to that Retailer
in respect of [THIS PARAGRAPH CONTAINS
CONFIDENTIAL INFORMATION WHICH HAS BEEN OMITTED,
BUT FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.] in accordance with [THIS
PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH
HAS BEEN OMITTED, BUT FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.] had that
28
Retailer taken delivery of a quantity of Buyer's
Make-up Gas equal to BMi; and
(2) the Buyer's Accumulated Make-up Gas of that Buyer will be
reduced with effect from the end of that Contract Year by
the quantity BMi determined in accordance with Clause
2.2(h)(1).
(i) If a Retailer's Allocated Quantity is reduced to zero in
a Contract Year and, at that time, that Retailer has a quantity of
Buyer's Accumulated Make-up Gas, that Retailer may only nominate that
quantity of Buyer's Accumulated Make-up Gas for delivery under its
Sub-sales Agreement during the Make-up Period in accordance with
Clause 2.5 and that Retailer may not nominate any quantity of Gas for
delivery under its Sub-sales Agreement at any time during the
remainder of that Contract Year.
2.3 OBLIGATIONS TO TAKE BUYER'S MAKE-UP GAS AT SELLER'S DIRECTION
(a) If Sellers direct, in accordance with Clause 4.10(a) of the
Principal Contract, that Gas delivered under the Principal Contract
will be deemed to be Gascor's Make-up Gas, then, subject to Clause
2.3(b), Gas delivered to and taken by each Buyer will be deemed to be
Buyer's Make-up Gas until the earlier of:
(1) the Buyer's Accumulated Make-up Gas of that Buyer being
reduced to zero; or
(2) the Day on which Gas delivered under the Principal Contract
is no longer deemed to be Gascor's Make-up Gas in accordance
with Clause 4.10(a) of the Principal Contract.
(b) If at the end of the Accumulated Make-up Gas Reduction
Period the aggregate quantity of Gascor's Make-up Gas which is deemed
to be delivered to Gascor during that period exceeds the total
quantity of Buyer's Make-up Gas which is deemed to be delivered to all
Buyers in that period in accordance with Clause 2.3(a), Gas delivered
after the end of the Accumulated Make-up Gas Reduction Period to each
Buyer which has Buyer's Accumulated Make-up Gas at the end of the
Accumulated Make-up Gas Reduction Period will continue to be deemed to
be Buyer's Make-Up Gas until such time as such Buyer has taken
delivery of a quantity of Gas calculated as follows:
[THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH HAS BEEN
OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.]
Where:
DMi is the quantity of Gas, expressed in GJ, delivered to a
Buyer which is deemed to be Buyer's Make-up Gas after the
end of the Accumulated Make-up Gas Reduction Period;
EM is the quantity by which the quantity of Gascor Make-up Gas
delivered to Gascor during the Accumulated Make-up Gas
Reduction Period in accordance with Clause 4.10(a) of the
29
Principal Contract exceeds the total quantity of Buyer's
Make-up Gas which is deemed to be delivered to all Buyers in
that period in accordance with Clause 2.3(a);
BAi is the remaining Buyer's Accumulated Make-up Gas of that
Buyer at the end of the Accumulated Make-up Gas Reduction
Period; and
(SIGMA)BAi is the aggregate remaining Buyer's Accumulated Make-up Gas
of all Buyers at the end of the Accumulated Make-up Gas of
all Buyers at the end of the Accumulated Make-up Gas
Reduction Period.
(c) If by the end of the Contract Period the quantity of Gas
delivered to a Retailer which is deemed to be Buyer's Make-up Gas
pursuant to Clause 2.3(b) is less than the quantity DMi determined in
respect of that Retailer in accordance with that Clause:
(1) Gascor must pay to that Retailer within [THIS PARAGRAPH
CONTAINS CONFIDENTIAL INFORMATION WHICH HAS BEEN OMITTED,
BUT FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.] Working Days after the end of the Contract
Period an amount calculated as follows:
[THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH HAS
BEEN OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.]
Where:
P is the amount of the payment to the Retailer,
expressed in $;
Ei is the quantity equal to the quantity [THIS
PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH
HAS BEEN OMITTED, BUT FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.] determined in
respect of that Retailer in accordance with Clause
[THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION
WHICH HAS BEEN OMITTED, BUT FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION.] less the
quantity of Gas delivered to that Retailer during
the remainder of the Contract Period which is
deemed to be Buyer's Make-up Gas in accordance
with that Clause;
CP is the [THIS PARAGRAPH CONTAINS CONFIDENTIAL
INFORMATION WHICH HAS BEEN OMITTED, BUT FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.] during the Accumulated Make-up Gas
Reduction Period or, if more than one [THIS
PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH
HAS BEEN OMITTED, BUT FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.] applied
during the Accumulated Make-up Gas Reduction
Period, the weighted average of such [THIS
PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH
HAS BEEN OMITTED, BUT FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.] based on the
30
number of Days to which each such [THIS PARAGRAPH
CONTAINS CONFIDENTIAL INFORMATION WHICH HAS BEEN
OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION.] applied;
TD is the amount (if any), expressed in $, which
would have been payable by that Retailer in
respect of [THIS PARAGRAPH CONTAINS CONFIDENTIAL
INFORMATION WHICH HAS BEEN OMITTED, BUT FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.] in accordance with Clause 2.6(b) had
that Retailer taken delivery of a quantity of
Buyer's Make-up Gas in the Accumulated Make-up Gas
Reduction Period equal to Ei.
TC is the amount (if any), expressed in $, which
would have been payable by Gascor to that Retailer
in respect of [THIS PARAGRAPH CONTAINS
CONFIDENTIAL INFORMATION WHICH HAS BEEN OMITTED,
BUT FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.] in accordance with Clause
2.6(c) had that Retailer taken delivery of a
quantity of Buyer's Make-up Gas in the Accumulated
Make-up Gas Reduction Period equal to [THIS
PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH
HAS BEEN OMITTED, BUT FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.]; and
(2) the Buyer's Accumulated Make-up Gas of that Buyer will be
reduced with effect from the end of the Contract Period by
the Quantity [THIS PARAGRAPH CONTAINS CONFIDENTIAL
INFORMATION WHICH HAS BEEN OMITTED, BUT FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION.] determined in
accordance with Clause 2.3(c)(i).
(d) If by the end of the Contract Period or, if earlier, the end
of the Release Gas Period the quantity of Gas delivered to RCo which
is deemed to be Buyer's Make-up Gas in accordance with Clause 2.3(b)
is less than the quantity DMi determined in respect of RCo in
accordance with that Clause:
(1) Gascor will pay to RCo within [THIS PARAGRAPH CONTAINS
CONFIDENTIAL INFORMATION WHICH HAS BEEN OMITTED, BUT FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.]
Working Days after the end of the Contract Period or, if
earlier, the end of the Release Gas Period an amount
calculated as follows:
[THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH HAS
BEEN OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.]
Where:
P is the amount of the payment to RCo, expressed in
$;
Ei is the quantity equal to the quantity [THIS
PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH
HAS BEEN OMITTED, BUT FILED SEPARATELY WITH THE
31
SECURITIES AND EXCHANGE COMMISSION.] determined in
respect of RCo in accordance with Clause [THIS
PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH
HAS BEEN OMITTED, BUT FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.] less the
quantity of Gas subsequently delivered to RCo
before the end of the Contract Period or, if
earlier, the end of the Release Gas Period which
is deemed to be Buyer's Make-up Gas in accordance
with that Clause;
CP is defined in Clause 2.3(c)(i);
TD is the amount (if any), expressed in $, which
would have been payable by RCo in respect of [THIS
PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH
HAS BEEN OMITTED, BUT FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.] in accordance
with Clause [THIS PARAGRAPH CONTAINS CONFIDENTIAL
INFORMATION WHICH HAS BEEN OMITTED, BUT FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.] had RCo taken delivery of a quantity
of Buyer's Make-up Gas in the Accumulated Make-up
Gas Reduction Period equal to [THIS PARAGRAPH
CONTAINS CONFIDENTIAL INFORMATION WHICH HAS BEEN
OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION.];
TC is the amount (if any), expressed in $, which
would have been payable by Gascor to RCo in
respect of [THIS PARAGRAPH CONTAINS CONFIDENTIAL
INFORMATION WHICH HAS BEEN OMITTED, BUT FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.] in accordance with Clause [THIS
PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH
HAS BEEN OMITTED, BUT FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.] had RCo taken
deliver of a quantity of Buyer's Make-up Gas in
the Accumulated Make-up Gas Reduction Period equal
to [THIS PARAGRAPH CONTAINS CONFIDENTIAL
INFORMATION WHICH HAS BEEN OMITTED, BUT FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.]; and
(2) the Buyer's Accumulated Make-up Gas of RCo will be reduced
with effect from the end of the Contract Period or, if
earlier, the end of the Release Gas Period by the quantity
[THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH HAS
BEEN OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.] determined in accordance with Clause
2.3(d)(i).
(e) In no event is Gascor required to make payments to Buyers in
accordance with this Clause 2.3 if and to the extent that the
aggregate amount of such payments plus the aggregate value of Buyer's
Make-up Gas deemed to be delivered to all Buyers after the Accumulated
Make-up Gas Reduction Period in accordance with Clause 2.3 (taking
into account any amounts payable by each Buyer or Gascor in respect of
32
Tax in relation to such Buyer's Make-up Gas in accordance with Clause
2.6) would exceed the aggregate amount paid by all Buyers to Gascor
for Gas delivered during the Accumulated Make-up Gas Reduction Period.
Any payments which Gascor would have been required to make but for
this Clause 2.3(e) must be reduced on a proportionate basis and the
quantity by which the Buyer's Accumulated Make-up Gas of a Buyer would
have been reduced but for this Clause 2.3(e) must be reduced on the
same basis.
2.4 PAYMENTS IN RESPECT OF REDUCED BUYER'S ACCUMULATED MAKE-UP GAS
If Gascor is paid all or part of the Make-up Shortfall Amount by the Sellers in
accordance with Clause 4.10(b) of the Principal Contract, then Gascor must,
within [THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH HAS BEEN OMITTED,
BUT FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.] Working Days
of receipt of such payment, pay to each Buyer an amount calculated as follows:
[THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH HAS BEEN OMITTED, BUT
FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.]
Where:
PBi is the amount which Gascor must pay to a Buyer, expressed in $;
GP is the amount of the [THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION
WHICH HAS BEEN OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.] paid to Gascor in accordance with Clause [THIS
PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH HAS BEEN OMITTED,
BUT FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.] of
the Principal Contract;
MSAi is the Buyer's Make-up Shortfall Amount determined in respect of that
Buyer adjusted to take account of changes in CPI since the date upon
which each Buyer's Annual Deficiency Payment used in determining the
Buyer's Make-up Shortfall Amount of that Buyer was paid; and
(SIGMA)MSAi is the aggregate amount of the Buyer's Make-up Shortfall Amounts
determined in respect of all Buyers, in each case adjusted to take
account of changes in CPI since the date upon which each Buyer's
Annual Deficiency Payment used in determining the Buyer's Make-up
Shortfall Amount of that Buyer was paid.
2.5 RIGHT TO TAKE BUYER'S ACCUMULATED MAKE-UP GAS IN MAKE-UP PERIOD
(a) If at the end of the Contract Period, a Retailer has Buyer's
Accumulated Make-up Gas:
(1) that Retailer may nominate Buyer's Accumulated Make-up Gas
for delivery under its Sub-sales Agreement during the
Make-up Period;
(2) that Retailer's MDQ for the Make-up Period will be
determined in accordance with Clauses 2.5(b) and (c);
33
(3) Gascor must notify that Retailer of the date on which the
Make-up Period ends as soon as reasonably practicable after
the Make-up Period has been determined;
(4) Gascor must during the Make-up Period deliver such Buyer's
Accumulated Make-up Gas as is nominated by each Retailer and
required to be delivered in accordance with the provisions
of its Sub-sales Agreement which continue to apply (as
specified in Clause 2.5(a)(v);
(5) delivery of Buyer's Accumulated Make-up Gas to a Retailer
during the Make-up Period will be in accordance with the
terms of that Retailer's Sub-sales Agreement (other than
Clauses 5.1 (Gas Price) and 15 (Tax) of that agreement); and
(6) any rights of a Retailer in relation to Buyer's Accumulated
Make-up Gas remaining at the end of the Make-up Period will
be forfeited.
(b) Subject to Clause 2.5(c), the Retailers must use their
reasonable endeavours to agree between themselves their respective
MDQs for the Make-up Period by no later than [THIS PARAGRAPH CONTAINS
CONFIDENTIAL INFORMATION WHICH HAS BEEN OMITTED, BUT FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION.] Working Days prior to
the final day on which Gascor may give a notice to the Sellers
nominating Gascor's MDQ for the Make-up Period in accordance with
Clause 8.5(c)(ii) of the Principal Contract. Subject to Clause 2.5(c),
if the Retailers fail to agree their respective MDQs or fail to notify
Gascor of their agreed MDQs by that date, each Retailer will (subject
to Clause 3.6(b)) be deemed to have elected an MDQ for the Make-up
Period equal to its Base MDQ on the final Day of the Contract Period.
(c) For the purposes of the Make-up Period, the MDQ of each
Retailer which has Buyer's Accumulated Make-up Gas at the start of the
Make-up Period will be calculated as follows:
[THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH HAS BEEN
OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.]
Where:
M is such a Retailer's MDQ for the Make-up Period;
GMi is [THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH
HAS BEEN OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION.] for the Make-up Period;
AMi is the [THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION
WHICH HAS BEEN OMITTED, BUT FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.] of that [THIS PARAGRAPH
CONTAINS CONFIDENTIAL INFORMATION WHICH HAS BEEN OMITTED,
BUT FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.] for the Make-up Period as agreed or deemed in
accordance with Clause [THIS PARAGRAPH CONTAINS CONFIDENTIAL
34
INFORMATION WHICH HAS BEEN OMITTED, BUT FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION.]; and
(SIGMA)AMi is the sum of the [THIS PARAGRAPH CONTAINS CONFIDENTIAL
INFORMATION WHICH HAS BEEN OMITTED, BUT FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION.] of all [THIS
PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH HAS BEEN
OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.] which have Buyer's Accumulated Make-up
Gas at the start of the Make-up Period for the Make-up
Period as agreed or deemed in accordance with Clause 2.5(b).
2.6 NO OBLIGATION TO MAKE PAYMENT FOR BUYER'S MAKE-UP GAS
(a) Subject to Clauses 2.6(b) and (c), a Buyer is not required
to pay any amount to Gascor in respect of the delivery by Gascor of,
and the taking by that Buyer of, Buyer's Make-up Gas.
(b) If in respect of the production and processing of Gas for
Gascor which comprises Buyer's Make-up Gas or the supply of Buyer's
Make-up Gas to a Buyer an amount is payable by Gascor in respect of a
new or increased level of Tax which was not included (pursuant to
Clause 15 of that Buyer's Sub-sales Agreement) in the Contract Price
or in any additional payment made at the time that Buyer was required
to make the corresponding Buyer's Annual Deficiency Payment:
(1) the next Monthly Statement (as defined in that Buyer's
Sub-sales Agreement) issued to that Buyer must include an
amount payable by that Buyer equivalent to the amount by
which the new or increased level of Tax would (if effective
as the time of corresponding Buyer's Annual Deficiency
Payment) have increased the payment for Gas pursuant to
Clause 15 of that Buyer's Sub-sales Agreement, expressed as
$/GJ, multiplied by the quantity of Buyer's Make-up Gas
delivered to and taken by that Buyer under its Sub-sales
Agreement; and
(2) in the case of a Retailer, the next Monthly Claim Form (as
defined in that Retailer's Agency Agreement) issued by that
Retailer must include an amount in reduction of the
Commission (as defined in that Retailer's Agency Agreement)
equal to the amount by which the new or increased level of
Tax would (if effective at the time of the corresponding
Buyer's Annual Deficiency Payment) have decreased the
Commission payable to that Retailer pursuant to Clause 16 of
that Retailer's Agency Agreement, express as a $/GJ,
multiplied by the quantity of Buyer's Make-up Gas (if any)
delivered to and taken by that Retailer under its Agency
Agreement,
provided that an amount must not be included in a Monthly Statement or
a Monthly Claim Form (as the case may be) in respect of Buyer's
Make-up Gas which a Buyer must take in a Contract Year in accordance
with Clause 2.2 or 2.3 until such time as that quantity of Buyer's
Make-up Gas has been determined in accordance with that Clause.
35
(c) If in respect of the production and processing of Gas for
Gascor which comprises Buyer's Make-up Gas or the supply of Buyer's
Make-up Gas to a Buyer no amount is payable by Gascor to Sellers in
respect of a Tax which was included in the Contract Price or in any
additional payment made to Sellers at the time that Buyer was required
to make the corresponding Buyer's Annual Deficiency Payment, or any
amount so payable by Gascor to Sellers is less than the amount
included in the price or additional payment, in either case due to
that Tax ceasing to apply or decreasing:
(1) the next Monthly Statement (as defined in that Buyer's
Sub-sales Agreement) issued to that Buyer must include an
amount payable by Gascor equivalent to the amount by which
the cessation or decrease in the level of Tax would (if
effective at the time of the corresponding Buyer's Annual
Deficiency Payment) have decreased the payment for Gas
pursuant to Clause 15 of that Buyer's Sub-sales Agreement,
expressed as a $/GJ, multiplied by the quantity of Buyer's
Make-up Gas delivered to and taken by that Buyer under its
Sub-sales Agreement; and
(2) in the case of a Retailer, the next Monthly Claim Form (as
defined in that Retailer's Agency Agreement) issued by that
Retailer must include an amount by way of increase in the
Commission (as defined in that Retailer's Agency Agreement)
equal to the amount by which the cessation or decrease in
the level of Tax would (if effective at the time of the
corresponding Buyer's Annual Deficiency Payment) have
increased the Commission payable to that Retailer pursuant
to Clause 16 of that Retailer's Agency Agreement, expressed
as a $/GJ, multiplied by the quantity of Buyer's Make-up Gas
(if any) delivered to and taken by that Retailer under its
Agency Agreement,
provided that an amount must no be included in a Monthly Statement or
a Monthly Claim Form (as the case may be) in respect of Buyer's
Make-up Gas which a Buyer must take in a Contract Year in accordance
with Clause 2.2 or 2.3 until such time as that quantity of Buyer's
Make-up Gas has been determined in accordance with that Clause.
(d) For the purposes of determining the corresponding Buyer's
Annual Deficiency Payment in Clauses 2.6(b) and (c) Buyer's Make-up
Gas will be deemed to be taken by a Buyer on a first-in-first-out
basis.
--------------------------------------------------------------------------------
3. ALLOCATION OF C MARKET QUANTITY AND D MARKET QUANTITY
--------------------------------------------------------------------------------
3.1 ALLOCATED QUANTITIES AND REDUCTIONS IN ALLOCATED QUANTITIES
(a) With effect from the start of the Allocation Day, each
Retailer will be allocated a proportion of the remaining D Market
Quantity and C Market Quantity under the Principal Contract (less a
quantity equal to RCo's Allocated Quantity) calculated as follows:
36
PQI = MQ X AQi
----------
(SIGMA)AQi
Where:
PQi is a Retailer's allocation, expressed in GJ, of the
remaining D Market Quantity and C Xxxx Quantity under the
Principal Contract as at the start of the Allocation Day;
MQ is the remaining D Market Quantity and C Market Quantity
under the Principal Contract as at the start of the
Allocation Day, expressed in GJ, less a quantity equal to
RCo's Allocated Quantity;
AQi is the AQ of that Retailer as at the start of the Allocation
Day; and
(SIGMA)AQi is the sum of all Retailers' AQs as at the start of the
Allocation Day.
(b) If the Allocation Day occurs before the end of the Release
Gas Period and RCo has not taken its Allocated Quantity by the end of
the Release Gas Period, then the Allocated Quantity of each Retailer
will be increased, with effect from 1 January 2004, by a quantity
calculated as follows:
QIi = RQ X AQi
----------
(SIGMA)AQi
Where:
QIi is the increase in a Retailer's Allocated Quantity,
expressed in GJ;
RQ is the quantity, expressed in GJ, equal to the difference
between RCo's Allocated Quantity and the total quantity of
Gas which RCO took under its Sub-sales Agreement in the
period commencing on the start of the Allocation Day and
expiring at the end of the Release Gas Period;
AQi is the AQ of that Retailer as at the start of the Allocation
Day;
(SIGMA)AQi is the sum of all Retailers' AQs as at the start of the
Allocation Day.
(c) Gascor must notify:
(1) each Buyer of its Allocated Quantity within 30 Working Days
after the Allocation Day; and
(2) each Retailer of any increase in its Allocated Quantity in
accordance with Clause 3.1(b) by no later than 31 January
2004.
(d) A Retailer's Allocated Quantity will be reduced by:
(1) deliveries of Gas under that Retailer's Sub-sales Agreement
or Agency Agreement (excluding deliveries of Buyer's Make-up
Gas);
37
(2) that Retailer's Sellers' Sales Allocations determined after
the Allocation Day (in accordance with Clause 4.4(b));
(3) the quantity determined in accordance with Clause 3.1(g);
(4) the quantity determined in accordance with Clause 5.2(b) as
a result of a Reserves Shortfall; and
(5) a quantity equal to the Buyer's Make-up Gas of that Retailer
determined in respect of each Contract Year ending after the
Allocation Day (being, in respect of a Contract year, the
quantity of Gas, expressed in GJ, equal to the Buyer's
Annual Deficiency Payment (if any) paid by that Retailer to
Gascor in respect of that Contract year divided by the
Contract Price for that Contract Year).
(e) RCo's Allocated Quantity will be reduced by:
(1) deliveries of Gas under its Sub-sales Agreement (excluding
deliveries of Buyer's Make-up Gas);
(2) the quantity determined in accordance with Clause 5.2(b) as
a result of a Reserves Shortfall; and
(3) a quantity equal to the Buyer's Make-up Gas of RCo
determined in respect of each Contract Year ending after the
Allocation Day (being in respect of a Contract year, the
quantity of Gas, expressed in GJ, equal to the Buyer's
Annual Deficiency Payment (if any) paid by RCo to Gascor in
respect of that Contract year divided by the Contract Price
for that Contract Year).
(f) A Retailer's Allocated Quantity will be increased as a
result of a Reserves Surplus in accordance with Clause 5.3(b);
(g) A Retailer's Allocated Quantity will be reduced as a result
of any reduction in that Retailer's AQ pursuant to Clause 3.7(e) or
(g) of its Sub-sales Agreement by an amount equal to the lesser of:
(1) the amount of any such reduction in AQ multiplied by the
number of Contract years for which the reduction in AQ is to
have effect; and
(2) the amount of that Retailer's Allocated Quantity as at the
start of the Day on which the reduction is to have effect.
(h) If a Retailer's AQ is reduced pursuant to Clause 3.7(e) or
(g) of its Sub-sales Agreement and the amount of such reduction in AQ
multiplied by the number of Contract Years for which the reduction in
AQ is to have effect exceeds the amount of the Retailer's Allocated
Quantity as at the start of the Day on which the reduction is to have
effect, then the remaining Allocated Quantity of each other Retailer
("RELEVANT RETAILER") which has any Allocated Quantity remaining as at
the start of that Day will be reduced by any amount calculated as
follows:
38
RQi = EQ X RQi
----------
(SIGMA)RQi
Where:
RQi is the amount of the reduction in the Relevant Retailer's
remaining Allocated Quantity;
EQ is the quantity by which the reduction in the first
mentioned Retailer's AQ multiplied by the number of Contract
Years for which such reduction is to have effect exceeds the
amount of that first mentioned Retailer's Allocated Quantity
as at the start of the Day on which the reduction in AQ is
to have effect;
RQi is the Allocated Quantity of the Relevant Retailer as at the
start of the Day on which the reduction in the first
mentioned Retailer's AQ is to have effect; and
(SIGMA)RQi is the sum of the Allocated Quantities of all Relevant
Retailers as at the start of the Day on which the first
mentioned Retailer's AQ is to have effect.
(i) Subject to Clause 3.1(b), reductions and increases in a
Retailer's Allocated Quantity will occur with effect from the Day upon
which a corresponding reduction or increase is made to the Total
Quantity under the Principal Contract.
(j) After a Retailer's Allocated Quantity has been reduced to
zero, that Retailer will only be entitled to take, and Gascor will
only be obliged to make available for delivery to that Retailer,
Buyer's Accumulated Make-up Gas in accordance with Clause 2.
3.2 MAQ ADJUSTMENT
(a) The MAQ of each Retailer for the Contract year in which the
Allocation Day falls and each subsequent Contract Year will be
calculated as follows:
MAQi = (XX - XX) X PMi
----------
(SIGMA)PMi
Where:
MAQi is the MAQ of a Retailer for the Contract year in which the
Allocation Day falls or a subsequent Contract Year;
GM is Gascor's MAQ for that Contract year;
RA is RCo's AQ for that Contract Year;
PMi is the MAQ of that Retailer immediately prior to the
Allocation Day or, in the case of a Contract Year commencing
after the Allocation Day, the MAQ of that Retailer
immediately prior to the start of that Contract Year;
39
(SIGMA)PMi is the aggregate MAQs of all Retailers immediately prior to
the Allocation Day or, in the case of a Contract Year
commencing after the Allocation Day, the aggregate MAQs of
all Retailers immediately prior to the start of that
Contract Year.
(b) If a Retailer's AQ is reduced in accordance with Clause
3.3(a)(i) or 3.3(a)(ii), the MAQ of that Retailer will be reduced,
with effect from the Day on which that Retailer's AQ is reduced, to a
quantity equal to the remainder of that Retailer's Allocated Quantity
plus the quantity of Gas already taken by that Retailer in that
Contract Year (if any).
(c) If during a Contract Year a Retailer's Allocated Quantity is
reduced to zero, for each subsequent Contract year during the Contract
Period that Retailer's MAQ will be reduced to zero.
(d) If a Retailer's AQ for a Contract year is reduced in
accordance with Clause 3.3(a)(i), 3.3(a)(ii) or 3.3(b), the MAQ of
each Retailer whose AQ has not been reduced for that Contract year in
accordance with Clause 3.3(a)(i), 3.3(a)(ii) or 3.3(b) ("RELEVANT
RETAILER") will be increased with effect from the start of the
Contract Year in respect of which the reduction takes effect
("Relevant Year") as follows:
MAi = (GM - XX - XX) X MRi
----------
(SIGMA)MRi
Where:
MAi is the amount of a Relevant Retailer's MAQ after having been
increased in accordance with Clause 3.2(d);
GM is Gascor's MAQ at the start of the Relevant Year;
RA is RCo's AQ for the Relevant year;
RM is the sum of the MAQs of the Retailers whose AQs have been
reduced in accordance with Clause 3.3(a)(i), 3.3(a)(ii) or
3.3(b) for the Relevant year immediately after such
reduction;
MRi is the amount which the Relevant Retailer's MAQ would have
been for the Relevant Year but for the adjustment pursuant
to this Clause 3.2(d); and
(SIGMA)MRi is the sum of the amounts which all Relevant Retailers'
respective MAQs would have been for the Relevant Year but
for adjustment pursuant to this Clause 3.2(d).
3.3 AQ IN FINAL CONTRACT YEARS
(a) Solely for the purpose of calculating a Retailer's AMQ:
(1) if, following the calculation of a Retailer's Sellers' Sales
Allocation for the preceding Contract year, the Retailer's
Allocated Quantity at the end of that Contract Year is less
40
than [THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH
HAS BEEN OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION.]% of its AQ, for the current
Contract Year that Retailer's AQ will be deemed to be equal
to [THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH
HAS BEEN OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION.] of that Retailer's Allocated
Quantity;
(2) if the Allocated Quantity of a Retailer is reduced during a
Contract Year in accordance with Clause 5.2(b) to such an
extent that the remaining Allocated Quantity of that
Retailer is less than [THIS PARAGRAPH CONTAINS CONFIDENTIAL
INFORMATION WHICH HAS BEEN OMITTED, BUT FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION.]% of its AQ
minus the quantity of Gas already taken by that Retailer in
that Contract Year, the Retailer's AQ will be deemed to be
equal to [THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION
WHICH HAS BEEN OMITTED, BUT FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.] of the aggregate of
that Retailer's remaining Allocated Quantity and the
quantity of Gas already taken by that Retailer in that
Contract Year;
(3) if either:
(A) Clause 20.5(b)(iii) of the Principal
Contract operates to extend the Contract Period;
or
(B) the Principal Contract is terminated
pursuant to Clause 20.7, 23 or 29 of the Principal
Contract
for the last Contract Year each Retailer's AQ will be
calculated as follows:
FAi = GFA X AFYi
-----------
(SIGMA)AFYi
Where:
FAi is the Retailer's AQ for the last Contract Year;
GFA is Gascor's AQ for the last Contract year as
calculated in accordance with Clause 8.5(f)(iv) of
the Principal Contract;
AFYi is that Retailer's Adjusted Final Year AQ; and
(SIGMA)AFYi is the sum of all Retailers' Adjusted Final Year
AQs.
(b) If during a Contract year a Retailer's Allocated
Quantity is reduced to zero, for each subsequent Contract Year during
the Contract Period that Retailer's AQ will be reduced to zero.
41
3.4 AQ ADJUSTMENT
If a Retailer's AQ for a Contract year is reduced in accordance with Clause
3.3(a)(i), 3.3(a)(ii) or 3.3(b), the AQ of each Retailer whose AQ has not been
reduced for that Contract Year in accordance with Clause 3.3(a)(i), 3.3(a)(ii)
or 3.3(b) ("RELEVANT RETAILER") (will be increased with effect from the start of
the Contract Year in respect of which the reduction takes effect ("RELEVANT
YEAR") as follows:
AAi =(GA - XX - XX) X ARi
----------
(SIGMA)ARi
Where:
AAi is the amount of a Relevant Retailer's AQ after having been increased
in accordance with this Clause 3.4;
GA is Gascor's AQ at the start of the Relevant Year;
RA is RCo's AQ for the Relevant Year;
RR is the sum of the AQs of the Retailers whose AQs have been reduced in
accordance with Clause 3.3(a)(1), 3.3(a)(2) or 3.3(b) for the Relevant
Year immediately after such reduction;
ARi is the amount which that Relevant Retailer's AQ would have been for
the Relevant Year but for adjustment pursuant to this Clause 3.4; and
(SIGMA)ARi is the sum of the amounts which all Relevant Retailers' respective
AQs would have been for the Relevant Year but for adjustment pursuant
to this Clause 3.4.
3.5 MDQ FOR THE FINAL CONTRACT YEAR
The Retailers must use their reasonable endeavours to agree between themselves
their respective Base MDQs for the Contract Year at the commencement of which
the Total Quantity under the Principal Contract is less than 80% of Gascor's AQ
by no later than the day before the final day upon which Gascor may give a
notice to the Sellers nominating Gascor's MDQ for that Contract Year in
accordance with Clause 5.7(d) of the Principal Contract. If the Retailers fail
to agree their respective Base MDQs or to notify Gascor of their agreed Base
MDQs by that date, each Retailer's Base MDQ for that Contract Year will be equal
to its Base MDQ prevailing on the final Day of the preceding Contract Year.
3.6 MDQ ADJUSTMENT
(a) If a Retailer's Allocated Quantity is reduced to zero,
then for the remainder of the Contract Period that Retailer's MDQ will
be zero and the Base MDQ of each other Retailer which has an Allocated
Quantity ("RELEVANT RETAILER") will be increased with effect from the
Day following the Day on which the Retailer's Allocated Quantity is
reduced to zero ("ADJUSTMENT DAY") as follows:
MIi = GM X MRi
----------
(SIGMA)MRi
42
Where:
MIi is the amount of the Relevant Retailer's adjusted Base MDQ;
GM is Gascor's Base MDQ for the Contract Year in which the
Adjustment Date falls;
MRi is the amount which that Relevant Retailer's Base MDQ would
have been on the Adjustment Day but for adjustment pursuant
to this Clause 3.6(a); and
(SIGMA)MRi is the sum of the amounts which all Relevant Retailers'
respective Base MDQs would have been on the Adjustment Day
but for adjustment pursuant to this Clause 3.6(a).
(b) For the purposes of determining each Retailer's MDQ for
the Make-up Period, Clause 3.6(a) shall be deemed not to have applied
so that a Retailer whose Allocated Quantity is reduced to zero during
the Contract Period will have a Base MDQ on the final Day of the
Contract Period equal to its Base MDQ on the Day before the Adjustment
Day and a Retailer whose Base MDQ is increased in accordance with
Clause 3.6(a) will have a Base MDQ on the final Day of the Contract
Period equal to its Base MDQ on the Day before the Adjustment Day.
--------------------------------------------------------------------------------
4. SELLERS' SALES
--------------------------------------------------------------------------------
4.1 DETERMINATION OF SELLERS' SALES
(a) Sellers' Sales will be determined in accordance with the
provisions of the Principal Contract.
(b) Gascor must not give notice to Sellers under Clause
6.5(c) of the Principal Contract that it seeks a review of the Process
and Mechanisms, unless it has, prior to giving the notice:
(1) consulted with the Committee in relation to the giving of
the notice; and
(2) obtained the consent of the Committee to give the notice.
(c) Gascor must not agree to any amendment or change to the
Process and Mechanisms under Clause 6.5(d) of the Principal Contract
unless the Committee has consented to the change.
4.2 SELLERS' SALES ALLOCATION MECHANISMS
(a) The process for determining each Retailer's Sellers'
Sales Allocation ("SELLERS' SALES ALLOCATION MECHANISMS") is set out
in Clause 4.3 and Schedule 5.
43
(b) Any Retailer or Gascor may notify the other Parties
(other than RCo) that it seeks a review of the Sellers' Sales
Allocation Mechanisms if it considers that the Sellers' Sales
Allocation Mechanisms are not producing results consistent with the
principles in Clause 4.2(c).
(c) For the purpose of determining each Retailer's Sellers'
Sales Allocation, the Seller's Sales Allocation Mechanisms must give
effect to the following principles:
(1) wherever possible Sellers' Sales should be allocated to a
Retailer on an accurate basis, that is, where a Sellers'
Sale is to an identifiable end-user which was previously
supplied by a Retailer with Sales Gas, it should be
allocated to the Retailer which most recently supplied the
end-user with Sales Gas;
(2) where the Retailer which most recently supplied the end-user
is not identifiable, Sellers' Sales should be allocated on a
geographic basis to the Retailer in whose Sellers' Sales
Allocation Area the Sellers' Sales have occurred;
(3) where the Retailer which most recently supplied the end-user
is not identifiable and the Sellers' Sales are determined to
have occurred outside the Retailers' respective Sellers'
Sales Allocation Areas, the Sellers' Sales should be
allocated between the Retailers equally;
(4) the sum of the Retailers' Sellers' Sales Allocations for a
period should equal the Sellers' Sales for that period;
(5) each Retailer's Sellers' Sales Allocation will be determined
by an independent third party;
(6) the independent third party may determine the source and
point of supply of Sales Gas by reference to both
contractual and physical flows of gas;
(7) a gas swap is treated as two separate sale and purchase
transactions;
(8) each Retailer must disclose (and must ensure that each of
its Related Companies disclose) to the independent third
party such information as that party reasonably requests or
requires in order to make its determinations; and
(9) the independent third party must have rights to inspect the
records of a Retailer or its Related Companies where
necessary to make its determinations.
(d) If a notice is given pursuant to Clause 4.2(b), the
Retailers and Gascor must meet within 30 days of such notice being
given to seek to agree necessary amendments, if any, to the Sellers'
Sales Allocation Mechanisms to give effect to the principles in Clause
4.2(c).
44
(e) If the Retailers and Gascor are unable to agree
amendments within a period of 60 days of a notice being given under
Clause 4.2(b), any Retailer or Gascor may refer the matter to an
Expert provided that that Party has not referred a review of the
Sellers' Sales Allocation Mechanisms to an Expert pursuant to this
Clause 4.2(e) during the preceding year. Gascor will not be required
to bear any costs or expenses of the Expert relating to the referral.
(f) The Sellers' Sales Allocation Mechanisms will be deemed
to be amended to those agreed pursuant to Clause 4.2(d) or determined
pursuant to Clause 4.2(e) with effect from the date of such agreement
or determination, as the case may be.
4.3 ALLOCATION OF SELLERS SALES
(a) Subject to Clauses 4.3(b) and 4.4, each Retailer's
Sellers' Sales Allocation in respect of a period shall be determined
in accordance with the following formula:
RSAi = RDSi + GDSi + UDSi + GSIi + UISi
Where:
RSAi is the Retailer's Sellers' Sales Allocation for the period;
RDSi is the aggregate quantity of all Related Sellers' Sales made
in the period in respect of that Retailer;
GDSi is the aggregate quantity of all Sellers' Direct Sales made
in that Retailer's Sellers' Sales Allocation Area in the
period and which have not been included in the calculation
of RDSi in respect of any Retailer;
UDSi is a proportion of the aggregate quantity of all Sellers'
Direct Sales which have not been included in the calculation
of RDSi or GDSi in respect of any Retailer calculated as
follows:
1/3 X (TDS - (SIGMA)RDSi - (SIGMA)GDSi)
Where:
TDS is the aggregate quantity of Sellers' Direct Sales
in the period as determined in accordance with the
Principal Contract;
(SIGMA)RDSi is the aggregate quantity of Related Sellers'
Sales made in the period to all Retailers; and
(SIGMA)GDSi is the aggregate quantity of Sellers' Direct
Sales made in the Sellers' Sales Allocation Areas
in the period and which are not Related Sellers'
Sales.
XXXx is the quantity of Sellers' Indirect Sales estimated to be
made in the period in that Retailer's Sellers' Sales
Allocation Area calculated as follows:
XXXx = A - B - C - D
45
Where:
XXXx is the quantity of Sellers' Indirect Sales
estimated to be made in a Retailer's Seller's
Sales Allocation Area in the period;
A is the total quantity of Sales Gas from the
Gippsland Basin sold and supplied by either or
both of the Sellers in the period where, and to
the extent that, the ultimate Consumer or
Consumers are located in that Retailer's Sellers'
Sales Allocation Area (including without
limitation the quantity of the Total Gascor Gas
supplied to Consumers in that Retailer's Sellers'
Sales Allocation Area in the period);
B is the total amount of Excluded Sales made in that
Retailer's Sellers' Sales Allocation Area in the
period;
C is the quantity of the Total Gascor Gas supplied
to Consumers in that Retailer's Sellers' Sales
Allocation Area in the period;
D is the aggregate quantity of all Sellers' Direct
Sales made in that Retailer's Sellers' Sales
Allocation Area in the period; and
UISi is a proportion of the Sellers' Indirect Sales made in the
period which have not been included in the calculation of
XXXx in respect of any Retailer, calculated as follows:
1/3 X (TIS - (SIGMA)XXXx)
Where:
TIS is the aggregate quantity of Sellers' Indirect
Sales in the period as determined in accordance
with the Principal Contract; and
(SIGMA)XXXx is the aggregate quantity of Sellers' Indirect
Sales estimated to be made in the period of the
Sellers' Sales Allocation Areas in accordance with
this Clause 4.3(a);
(b) If a Retailer's Allocated Quantity or MDQ has been
reduced to zero prior to the date on which the Retailers' Sellers'
Sales Allocations have been determined in respect of a period, any
Sellers' Sales which would have been allocated to that Retailer in
accordance with the Sellers' Sales Allocation Mechanisms but for such
reduction will be allocated to the other Retailers in equal
proportions.
4.4 ANNUAL ADJUSTMENT FOR SELLERS' SALES
(a) The quantity of Sales Gas which is the subject of a
Retailer's Sellers' Sales Allocation in a Contract Year shall be taken
into account in accordance with paragraph 1(a) of Schedule 4 in
calculating that Retailer's AMQ for that Contract Year.
(b) The Sellers' Sales Allocation of a Retailer in a
Contract Year ended after the Allocation Day reduces that Retailer's
46
Allocated Quantity by an amount equal to the lesser of that Retailer's
Seller's Sales Allocation or that Retailer's Allocated Quantity.
(c) If a Retailer's Sellers' Sales Allocation in a Contract
Year exceeds that Retailer's remaining Allocated Quantity on the date
on which the reduction in that Retailer's Allocated Quantity is to
have effect as a result of that Sellers' Sales Allocation ("REDUCTION
DATE"), then the Allocated Quantity of each Retailer who has an
Allocated Quantity greater than zero after adjustment pursuant to
Clause 4.4(b) ("RELEVANT RETAILER") will be reduced by a quantity
equal to the lesser of:
(1) the Relevant Retailer's remaining Allocated Quantity; and
(2) the quantity calculated as follows:
Qi = ER X 1/R
Where:
Qi is the amount of the reduction in a Relevant
Retailer's Allocated Quantity;
ER is the amount by which the first mentioned
Retailer's Sellers' Sales Allocation exceeds that
Retailer's Allocated Quantity on the Reduction
Date; and
R is the number of Relevant Retailers;
(d) Clause 4.4(c) will apply iteratively until the total
quantity of Sales Gas which is the subject of the Sellers' Sales in a
Contract Year has been applied in reduction of the Retailers'
Allocated Quantities.
4.5 QUARTERLY MDQ ADJUSTMENTS
(a) Each Retailer's Sellers' Sales Allocation in a Quarter
of a Contract Year may reduce that Retailer's MDQ for the following
Quarter (and, where Clause 4.6 so provides, during the current
Quarter) in accordance with the terms of Clause 4.5 and 4.6 and the
Sellers' Sales Allocation Mechanisms.
(b) Once Sellers' Sales for a Quarter ("PRECEDING QUARTER")
have been determined and Gascor's MDQ for the following Quarter
("CURRENT QUARTER") has been determined pursuant to Clause 6.2(b) or
(c) of the Principal Contract, the MDQ of each Retailer for the
Current Quarter will be reduced by an amount calculated as follows:
DQi = (GFQ X SSAi )
---
(SIGMA)SSAi
Where:
DQi is the amount, expressed in TJ/Day, of the reduction in a
Retailer's MDQ in the Current Quarter;
47
GFQ is the amount, expressed in TJ/Day, equal to Gascor's Base
MDQ for the Current Quarter less Gascor's MDQ for the
Current Quarter as determined in accordance with Clause 6.2
of the Principal Contract;
SSAi is that Retailer's Sellers' Sales Allocation for the
Preceding Quarter; and
(SIGMA)SSAi is the total quantity of Sellers' Sales for the Preceding
Quarter.
(c) The reduction in each Retailer's MDQ calculated pursuant
to Clause 4.5(b)in respect of a Quarter will have effect on the second
Working Day after the Sellers' Sales Allocations of the Retailers have
been determined pursuant to the Sellers' Sales Allocation Mechanisms,
provided that if the first calculation of such reduction in respect of
a Quarter ("CURRENT QUARTER") has not been determined by the time
Gascor's MDQ for that Current Quarter has been determined pursuant to
Clause 6.2(b) or (c) of the Principal Contract, then the MDQ of each
Retailer for the Current Quarter will be reduced by an amount
calculated as follows:
DQi = GFQ X EAi
----------
(SIGMA)EAi
Where:
DQi is the amount, expressed in TJ/Day of the reduction to a
Retailer's MDQ for the Current Quarter;
GFQ is the amount, expressed in TJ/Day, equal to Gascor's Base
MDQ for the Current Quarter less Gascor's MDQ for the
Current Quarter as determined in accordance with Clause 6.2
of the Principal Contract;
EAi is the estimated Sellers' Sales Allocation for that Retailer
for the Quarter preceding the Current Quarter ("PRECEDING
QUARTER"), calculated as follows:
EAi = SAi + [SU X SSA (Q-2)i ]
-------------
(SIGMA)SSA (Q-A)i
Where:
SAi is the quantity of Sales Gas which is the subject
of Sellers' Sales in the Preceding Quarter which
has been allocated to that Retailer in accordance
with the Seller's Sales Allocation Mechanisms as
at the date on which such Sellers' Sales have been
determined;
SU is the quantity of Sales Gas which is the subject
of Sellers' Sales in the Preceding Quarter which
has not been allocated to any Retailer in
accordance with the Sellers' Sales Allocation
Mechanisms as at the date on which such Sellers'
Sales have been determined;
48
SSA(Q-2)i is that Retailers' Sellers' Sales Allocation for
the second Quarter before the Current Quarter;
(SIGMA)SSA (Q-A)i is the total quantity of Sellers' Sales
for the second Quarter before the Current Quarter;
and
(SIGMA)EAi is the sum of the EAis calculated in respect of all
Retailers,
provided that, if the Retailers' Sellers' Sales Allocation for the
Current Quarter are subsequently determined so that the reduction in
the Retailers' respective MDQs can be calculated for the Current
Quarter pursuant to Clause 4.5(b), the reduction in the MDQ of each
Retailer as so calculated will have effect on the second Working Day
after the calculation is determined.
4.6 INTRA-QUARTER MDQ ADJUSTMENTS
(a) If Gascor's MDQ is adjusted during a Quarter in a
Contract Year pursuant to paragraph 2 of Schedule 2 to the Principal
Contract (an "INTRA QUARTER MDQ ADJUSTMENT"), the MDQ of each Retailer
for that Quarter will be adjusted by an amount calculated as follows:
AMi = GMA X SDSi
-----------
(SIGMA)SDSi
Where:
AMi is the amount, expressed in TJ/Day, by which that Retailer's
MDQ is adjusted for that Quarter;
GMA is the amount, expressed in TJ/Day, of the increase or
decrease (as the case may be) in Gascor's MDQ as a result of
that Intra-Quarter MDQ Adjustment;
SDSi is that Retailer's Sellers' Sales Allocation of the Sellers'
Direct Sales in respect of which the Intra-Quarter MDQ
Adjustment is made; and
(SIGMA)SDSi is the total quantity of Sellers' Direct Sales in respect
of which the Intra Quarter Adjustment is made.
(b) Any MDQ adjustment determined in respect of a Quarter
pursuant to this Clause 4.6 will have effect on the day on which the
Intra-Quarter MDQ Adjustment has effect.
(c) Any MDQ adjustment determined in respect of a Quarter
pursuant to this Clause 4.6 will cease to have effect on the next day
on which the MDQ of the Retailer in respect of which the adjustment is
determined is reduced as a result of the application of Clause 4.5.
(d) Subject to Clause 4.6(c), adjustments made to a
Retailer's MDQ during a Quarter in accordance with this Clause 4.6
will apply cumulatively.
49
(e) If the calculation of the adjustment to each Retailer's
MDQ for a Quarter has not been determined in accordance with Clause
4.6(a) prior to the day on which the Intra-Quarter MDQ Adjustment
which is the subject of the calculation has effect under the Principal
Contract, the Independent Assessor must, prior to that day, determine
an adjustment to each Retailer's MDQ on such basis as the Independent
Assessor considers equitable.
4.7 MDQ REPAYMENTS
If prior to the first Quarter of Contract Year 2001 a Retailer's MDQ is reduced
as a result of a reduction in Gascor's MDQ pursuant to Clause 6.3 of the
Principal Contract or during a Quarter pursuant to the Process and Mechanisms,
Gascor must pay to that Retailer, with effect from and including the Day upon
which the reduction takes effect, the amounts described in Part 2 of Schedule 1
of that Retailer's Sub-sales Agreement at the times described in Part 2 of
Schedule 1 of that Sub-sales Agreement.
--------------------------------------------------------------------------------
5. RESERVES
--------------------------------------------------------------------------------
5.1 RESERVES NOTICES
(a) Gascor must promptly give each Buyer a copy of any
Coverage Ratio Certificate or any other certificate or notice which
Gascor receives from the Sellers under Clause 4 of the Principal
Contract.
(b) If at any time a Reserves Shortfall or a Reserves
Surplus is agreed or determined under the Principal Contract, Gascor
must as soon as reasonably practicable after such agreement or
determination, notify each Buyer of:
(1) the amount of the reduction or increase (as the case may be)
in the Total Quantity;
(2) the amount of the reduction or increase (as the case may be)
in the C Market Quantity or the D Market Quantity; and
(3) the amount of the reduction or increase (as the case may be)
in Gascor's Accumulated Make-up Gas.
(c) If at any time a Reserves Shortfall or a Reserves
Surplus is agreed or determined under the Principal Contract, the
Buyers' Allocated Quantities and Buyer's Accumulated Make-up Gas will
be reduced or increased (as the case may be) in accordance with
Clauses 5.2 and 5.3.
5.2 RESERVES SHORTFALL
(a) If a Reserves Shortfall is agreed or determined pursuant
to the provisions of the Principal Contract and, as a result of such
agreement or determination, Gascor's Accumulated Make-up Gas is
reduced pursuant to Clauses 4.8(c) and (d) of the Principal Contract,
50
the Buyer's Accumulated Make-up Gas of each Buyer will be reduced by
the quantity calculated in accordance with the following formula:
RBi = RA X BMGi
-----------
(SIGMA)BMGi
Where:
RBi is the reduction, expressed in GJ, in the Buyer's
Accumulated Make-up Gas of a Buyer;
RA is the reduction, expressed in GJ, in Gascor's Accumulated
Make-up Gas calculated in accordance with Clauses 4.8(c) and
(d) of the Principal Contract;
BMGi is the quantity, expressed in GJ, of the Buyer's Accumulated
Make-up Gas of that Buyer as at the day on which the
Reserves Shortfall is agreed or determined; and
(SIGMA)BMGi is the aggregate quantity, expressed in GJ, of the Buyer's
Accumulated Make-up Gas of all Buyers as at the date on
which the Reserves Shortfall is agreed or determined.
(b) If, at any time after the Allocation Day, a Reserves
Shortfall is agreed or determined pursuant to the provisions of the
Principal Contract, any reduction in the C Market Quantity or the D
Market Quantity calculated pursuant to Clause 4.8(c) and (d) of the
Principal Contract will be applied in reduction of the Allocated
Quantity of each Buyer in accordance with the following formula:
BAi = RCD X BAQi
-----------
(SIGMA)BAQi
Where:
BAi is the amount, expressed in GJ, of the reduction to be
applied against a Buyer's Allocated Quantity;
RCD is an amount, expressed in GJ, equal to the reduction in the
C Market Quantity and the D Market Quantity calculated in
accordance with Clauses 4.8(c) and (d) of the Principal
Contract;
BAQi is the Allocated Quantity, expressed in GJ, of that Buyer
immediately prior to the corresponding reduction in the
Total Quantity pursuant to Clauses 4.8(c) and (d) of the
Principal Contract; and
(SIGMA)BAQi is the aggregate amount, expressed in GJ, of the Allocated
Quantities of all Buyers immediately prior to the
corresponding reduction in the Total Quantity pursuant to
Clauses 4.8(c) and (d) of the Principal Contract.
51
5.3 RESERVES SURPLUS
(a) If a Reserves Surplus is agreed or determined pursuant
to the provisions of the Principal Contract and, as a result of such
agreement or determination, Gascor's Accumulated Make-up Gas is
increased pursuant to Clauses 4.9(c) and (d) of the Principal
Contract, the Buyer's Accumulated Make-up Gas of each Retailer will be
increased by a quantity calculated in accordance with the following
formula:
IBi = IAM X RBAi
-----------
(SIGMA)RBAi
Where:
IBi is the increase, expressed in GJ, in the Buyer's Accumulated
Make-up Gas of a Retailer;
IAM is the increase, expressed in GJ, in Gascor's Accumulated
Make-up Gas calculated in accordance with Clauses 4.9(c) and
(d) of the Principal Contract;
RBAi is the total amount, expressed in GJ, of the reductions in
the Buyer's Accumulated Make-up Gas of that Retailer
pursuant to Clause 5.2(a) not previously recovered pursuant
to this Clause 5.3(a), if any;
(SIGMA)RBAi is the sum of the total amount, expressed in GJ, of all
reductions in the Buyer's Accumulated Make-up Gas of all
Retailers pursuant to Clause 5.2(a) not previously recovered
pursuant to this Clause 5.3(a), if any.
(b) If at any time after the Allocation Day a Reserves
Surplus is agreed or determined pursuant to the provisions of the
Principal Contract and, as a result of such agreement or
determination, the D Market Quantity or the C Market Quantity is
increased pursuant to Clauses 4.9(c) and (d) of the Principal
Contract, the Allocated Quantity of each Retailer will be increased by
a quantity calculated in accordance with the following formula:
IAi = ITQ X RAQi
-----------
(SIGMA)RAQi
Where:
IAi is the increase, expressed in GJ, in that Retailer's
Allocated Quantity;
ITQ is an amount, expressed in GJ, equal to the total increase
in the D Market Quantity and the C Market Quantity
calculated in accordance with Clauses 4.9(c) and (d) of the
Principal Contract;
RAQi is the total amount, expressed in GJ, of the reductions in
that Retailer's Allocated Quantity pursuant to Clause 5.2(b)
not previously recovered pursuant to this Clause 5.3(b), if
any;
52
(SIGMA)RAQi is the sum of the total amount, expressed in GJ, of all
reductions in the Allocated Quantities of all Retailer
pursuant to Clause 5.2(b) not previously recovered pursuant
to this Clause 5.3(b), if any.
(c) For the purpose of Clause 5.3(b) only, if a Reserves
Shortfall is agreed or determined pursuant to the provisions of the
Principal Contract prior to the Allocation Day, each Retailer's
Allocated Quantity will be deemed to have been reduced pursuant to
Clause 5.2(b) by the quantity calculated in accordance with the
following formula:
DRi = RTQ X AQi
--------------
(SIGMA)AQi
Where:
DRi is the amount, expressed in GJ, of the deemed reduction in a
Retailer's Allocated Quantity;
RTQ is an amount, expressed in GJ, equal to the reduction in the
C Market Quinte and the D Market Quantity arising as a
result of that Reserves Shortfall as calculated in
accordance with Clauses 4.8(c) and (d) of the Principal
Contract;
AQi is that Retailer's AQ immediately prior to the date on which
the increase in the D Market Quantity or the C Market
Quantity which is the subject of the calculation in Clause
5.3(b) takes effect in accordance with the terms of the
Principal Contract; and
(SIGMA)AQi is the sum of all Retailers' AQs immediately prior to the
date on which the increase in the D Market Quinte or the C
Market Quantity which is the subject of the calculation in
Clause 5.3(b) takes effect in accordance with the terms of
the Principal Contract.
5.4 MDQ ADJUSTMENTS
(a) If Gascor's MDQ is revised pursuant to Clause 5.7(c) of
the Principal Contract as a result of a Reserves Shortfall or a
Reserves Surplus, then each Retailer's Base MDQ will be adjusted with
effect from the Day on which Gascor's revised MDQ takes effect in
accordance with the following formula:
BMi = RGM X MDQi
-----------
(SIGMA)MDQi
Where:
BMi is a Retailer's adjusted Base MDQ;
RGM is Gascor's revised MDQ pursuant to Clause 5.7(c) of the
Principal Contract;
53
MDQi is that Retailer's Base MDQ immediately prior to the time
when Gascor's revised MDQ is determined pursuant to Clause
5.7(c) of the Principal Contract;
(SIGMA)MDQi is the sum of all Retailers' Base MDQs immediately prior
to the time when Gascor's revised MDQ is determined pursuant
to Clause 5.7(c) of the Principal Contract.
(b) If the Release Gas Option is exercised and prior to the
end of the Release Gas Period Gascor's MDQ is reduced pursuant to
Clause 5.7(c) of the Principal Contract as a result of a Reserves
Shortfall, the variable MR in the formula contained in Clause
6.1(b)(3) and Clause 7.4(b) will, with effect from the Day on which
Gascor's reduced MDQ takes effect be deemed to be as follows:
MR = 50 X MDQN
----------
(SIGMA)MDQO
MDQn is Gascor's MDQ immediately after it is reduced pursuant to
Clause 5.7(c) of the Principal Contract; and
MDQo is Gascor's MDQ immediately before it is reduced pursuant to
Clause 5.7(c) of the Principal Contract,
and the amount by which each Retailer's MDQ will be reduced pursuant
to Clause 6.1(b)(3) for the Release Gas Year in which Gascor's MDQ is
reduced and each subsequent Release Gas Year will be recalculated in
accordance with that Clause.
(c) If, prior to 31 December 2003, Gascor's MDQ is reduced
pursuant to Clause 5.7(c) of the Principal Contract as a result of a
Reserves Shortfall:
(1) for the purposes of Clauses 6.2(a) and 7.4(b), the months of
April, October and November in the period ending on 31
December 2003 will cease to be Ecogen MDQ Reduction Months
with effect from the Day on which Gascor's revised MDQ takes
effect; and
(2) if the reduction in Gascor's MDQ pursuant to Clause 5.7(c)
of the Principal Contract is greater than 100TJ, for the
purposes of Clauses 6.2(a) and 7.4(b), the Gas Month in
which Gascor's reduced MDQ takes effect and each subsequent
Gas Month in the period ending on 31 December 2003 will
cease to be an Ecogen MDQ Reduction Month with effect from
the Day on which Gascor's revised MDQ takes effect.
5.5 AQ ADJUSTMENT
If Gascor's AQ is revised pursuant to Clause 5.8(h)(i) or (ii) of the Principal
Contract as a result of a Reserves Shortfall or a Reserves Surplus, then,
subject to Clause 6.1(b)(1), each Retailer's AQ shall be revised with effect
from the time that Gascor's AQ is revised in accordance with the following
formula:
54
RAi = GRA X AQi
----------
(SIGMA)AQi
Where
RAi is a Retailer's revised AQ;
GRA is Gascor's revised AQ pursuant to Clause 5.8(h)(i) or (ii)
of the Principal Contract;
AQi is that Retailer's AQ immediately before the adjustment made
pursuant to this Clause 5.5; and
(SIGMA)AQi is the sum of all Retailers' AQs immediately before the
adjustment made pursuant to this Clause 5.5.
(a) If the Release Gas Option has been exercised and, prior
to the end of the Release Gas Period, Gascor's AQ is reduced pursuant
to Clause 5.8(h)(i) or (ii) of the Principal Contract as a result of a
Reserves Shortfall, the Release Gas AQ Reduction Quantity for the
Release Gas Year in which the reduction takes effect and each
subsequent Release Gas Year will be reduced, with effect from the time
that Gascor's reduced AQ takes effect as follows:
Where:
RQn is the reduced Release Gas AQ Reduction Quantity for the
relevant Release Gas Year;
RQo is the Release Gas AQ Reduction Quantity for that Release
Gas Year prior to the reduction;
GAn is Gascor's AQ after reduction pursuant to Clause 5.8(h)(i)
or (ii) of the Principal Contract; and
GAo is Gascor's AQ immediately prior to reduction pursuant to
Clause 5.8(h)(i) or (ii) of the Principal Contract,
and the amount by which each Retailer's AQ will be reduced in
accordance with Clause 6.1(b)(1) in the Release Gas Year in which
Gascor's AQ is reduced and each subsequent Release Gas Year will be
recalculated in accordance with that Clause.
5.6 MAQ ADJUSTMENT
If Gascor's AQ is revised pursuant to Clause 5.8(h)(i) or (ii) of the Principal
Contract as a result of a Reserves Shortfall or a Reserves Surplus, then,
subject to Clause 6.1(b)(2), each Retailer's MAQ for the Contract Year in which
Gascor's revised AQ takes effect and each subsequent Contract Year shall be
revised with effect from the time that Gascor's AQ is revised in accordance with
the following formula:
MAQi = (GM - EQ) X MAQi
----------
(SIGMA) MAQi
55
Where:
MAQi is the Retailer's revised MAQ, expressed in PJ/year;
GM is the quantity, expressed in PJ, equal to 130% of Gascor's revised AQ
pursuant to Clause 5.8(h)(i) or (ii) of the Principal Contract;
EQ is, in relation to a Contract Year ending on or before 1 January 2004:
(a) if Gascor's MDQ is reduced by less than or equal to
100TJ/Day pursuant to Clause 5.7(c) of the Principal
Contract, the quantity (if any) expressed in PJ, set out
opposite that Contract Year in column 2 of Part 2 of
Schedule 3; or
(b) if Gascor's MDQ is reduced by more than 100TJ/Day pursuant
to Clause 5.7(c) of the Principal Contract, zero;
MAQi is that Retailer's MAQ, expressed in PJ/year immediately before the
adjustment made pursuant to this Clause 5.6; and
(SIGMA)MAQi is the sum of all Retailer's MAQs, expressed in PJ/year, immediately
before adjustment pursuant to this Clause 5.6
--------------------------------------------------------------------------------
6. RELEASE GAS PROGRAMME
--------------------------------------------------------------------------------
6.1 RELEASE GAS OPTION
(a) Gascor may elect to reduce each Retailer's AQ, MAQ and
MDQ for each Release Gas Year in accordance with the provisions of
this Clause 6.1 ("RELEASE GAS OPTION").
(b) If Gascor exercises the Release Gas Option:
(1) the AQ of each Retailer for each Release Gas Year will be
reduced by an amount calculated as follows:
Where:
Ri = RQA X RAi
-----------
(SIGMA)RAi
Ri is the amount, expressed in PJ, of the reduction
in a Retailer's AQ for a Release Gas Year;
RQA is the Release Gas AQ Reduction Quantity,
expressed in PJ, for that Release Gas Year (as
reduced, if at all, in accordance with Clause
5.5(b));
56
RAi is that Retailer's AQ expressed in PJ, on the
Release Gas Commencement Date; and
(SIGMA)RAi is the sum of all Retailer's AQs, expressed in
PJ, on the Release Gas Commencement Date;
(2) the MAQ of each Retailer for each Release Gas Year will be
reduced by the same amount, expressed in PJ, as the
reduction in that Retailer's AQ for that Release Gas Year as
determined in accordance with Clause 6.1(b)(1);
(3) the MDQ of each Retailer for each Release Gas Year will be
reduced, subject to Clauses 6.1(d) and (e), by an amount
calculated as follows:
Where:
RMi is the amount of the reduction in a Retailer's
MDQ, expressed in TJ/Day, for a Release Gas Year;
RGD is, in the case of the first Release Gas Year, the
number of Days from and including the first Day of
the Release Gas Period to and including the last
Day of that Release Gas Year or, in the case of
any other Release Gas Year, 365;
MR is, subject to Clause 5.4(b), 50;
RQ is the Release Gas AQ Reduction Quantity,
expressed in PJ, for that Release Gas Year prior
to the reduction (if any) made in accordance with
Clause 5.5(b);
BMi is the Base MDQ of that Retailer on the Release
Gas Commencement Date; and
(SIGMA)MDQi is the sum of the Base MDQs of all Retailers on
the Release Gas Commencement Date; and
(4) for the purposes of Clause 6.7(a) of each Retailer's Agency
Agreement and paragraph (a) of Part 1 of Schedule 1 of each
Retailer's Sub-sales Agreement, the Annual MDQ Amount for
each Retailer will, subject to Clause 6.1(f), be reduced for
each Release Gas Year to an amount calculated as follows:
Ri = APi X MNi
---
MOi
Where:
Ri is a Retailer's Annual MDQ Amount for a Release
Gas Year after adjustment pursuant to this Clause
6.1(b)(4);
57
APi is that Retailer's Annual MDQ Amount prior to
adjustment pursuant to this Clause 6.1(b)(4);
MNi is the Base MDQ of that Retailer (in the case of
the first Release Gas Year) on the Release Gas
Commencement Date or (in the case of any other
Release Gas Year) on the first Day of that Release
Gas Year less the amount of the reduction in that
Retailer's MDQ as determined in accordance with
Clause 6.1(b)(3); and
MOi is the Base MDQ of that Retailer (in the case of
the first Release Gas Year) on the Release Gas
Commencement Date or (in the case of any other
Release Gas Year) on the first day of that Release
Gas Year.
(c) Any reduction in a Retailer's AQ or MAQ pursuant to this
Clause 6.1 will have effect for the Release Gas Year in respect of
which it is calculated.
(d) Any reduction in a Retailer's MDQ pursuant to Clause
6.1(b)(3) will take effect:
(1) for the first Release Gas Year in respect of which the
reduction is calculated, on the Release Gas Commencement
Date;
(2) for each subsequent Release Gas Year in respect of which the
reduction is calculated, on the first Day of that Release
Gas Year.
(e) Any reduction in a Retailer's MDQ pursuant to Clause
6.1(b)(3) will cease to have effect on the Day after the last Day of
the Release Gas Year in respect of which the reduction is calculated.
(f) Any reduction in the Annual MDQ Amount for a Retailer
pursuant to Clause 6.1(b)(4) will take effect:
(1) for the first Release Gas Year in respect of which the
reduction is calculated, for the Month commencing on the
Release Gas Commencement Date and for each subsequent Month
in that Contract Year; and
(2) for each subsequent Release Gas Year in respect of which the
reduction is calculated, for each Month in that Release Gas
Year.
(g) Subject to Clause 6.1(h), Gascor may exercise the
Release Gas Option by giving notice of exercise ("RELEASE GAS OPTION
EXERCISE NOTICE") to each Retailer at any time on or before 30
November 2000.
(h) The Release Gas Option will lapse if Gascor does not
give a Release Gas Option Exercise Notice on or before 30 November
2000.
(i) The Release Gas Option Exercise Notice given to each
Retailer must specify:
58
(1) the date on which the Release Gas Period will start, which
may be any date on or before 1 January 2001 provided that it
is not less than 30 days after the Release Gas Option
Exercise Date;
(2) the aggregate amount of the reduction to be made in respect
of all Retailers' AQs for each Release Gas Year, which may
be:
(A) in the case of the first Release Gas
Year, any quantity expressed in PJ, up to and
including the maximum quantity calculated as
follows:
Q = 15 X RGD
---
365
Where:
Q is the maximum quantity; and
RGD is the number of Days from and including
the first Day of the Release Gas Period
to and including the last Day of that
Release Gas Year; or
(B) in the case of each Release Gas Year
other than the first Release Gas Year, any
quantity, expressed in PJ, up to and including
15PJ;
(3) the amount of the reduction in that Retailer's AQ for each
Release Gas Year as determined in accordance with Clause
6.1(b)(1);
(4) the amount of the reduction in that Retailer's MAQ for each
Release Gas Year as determined in accordance with Clause
6.1(b)(2);
(5) the amount of the reduction in that Retailer's MDQ for each
Release Gas Year as determined in accordance with Clause
6.1(b)(3); and
(6) the amount of the reduction in that Retailer's Annual MDQ
Amount for the first Release Gas Year as determined in
accordance with Clause 6.1(b)(4).
6.2 ECOGEN MDQ REDUCTIONS
(a) The MDQ of each Retailer will be reduced in each Ecogen
MDQ Reduction Month by an amount equal to the Ecogen MDQ Reduction
calculated in respect of that Retailer.
(b) If the Base MDQ of a Retailer changes prior to 31
December 2003, Gascor must notify each Retailer of its Ecogen MDQ
Reduction for each subsequent Ecogen MDQ Reduction Month as soon as
practicable after such change.
59
(c) If Gascor's MDQ is reduced pursuant to Clause 5.7 of the
Principal Contract prior to 31 December 2003, Gascor must notify each
Buyer of that fact and of the application of Clause 5.4(c)(1) or (2)
(as the case may be) as soon as practicable after it becomes aware of
the amount of such reduction.
6.3 SALE OF GAS TO RCO
(a) If Gascor exercises the Release Gas Option, Gascor and
RCo must amend the terms of RCo's Sub-sales Agreement to provide for
the sale by Gascor, and purchase by RCo, of additional quantities of
Gas equivalent to the quantities which the Retailers would have been
able to take but for the exercise of the Release Gas Option.
(b) RCo's AQ for a Release Gas Year will be equal to the
Release Gas AQ Reduction Quantity for that Release Gas Year.
(c) If the Release Gas AQ Reduction Quantity is reduced in
accordance with Clause 5.5(b), RCo's AQ will be reduced by the same
amount.
--------------------------------------------------------------------------------
7. NOMINATIONS, DELIVERIES AND QUANTITIES
--------------------------------------------------------------------------------
7.1 DETERMINATION OF DAILY DELIVERED QUANTITIES
(a) Gascor must determine for each Day the quantity of Gas
made available for delivery by Gascor to, and taken by, each Buyer on
that Day ("DAILY DELIVERED QUANTITY") by reference to that Buyer's
Nominations (or (in the case of RCo) if RCo does not give any
Nominations for that Day, the Release Gas Purchasers' Nominations) for
that Day in accordance with the Gas Allocation Mechanisms.
(b) For the purposes of Clause 3.8(a) of each Buyer's
Sub-sales Agreement and Clause 6.4(a) or each Retailer's Agency
Agreement, the total quantity of Gas made available for delivery by
Gascor to, and taken by, each Buyer in a Gas Month ("QT") will be
equal to the sum of the Daily Delivered Quantities determined in
respect of that Buyer in accordance with the Gas Allocation Mechanisms
for each Day of that Gas Month.
(c) If Gascor is in possession of sufficient data to enable
it to do so, Gascor must determine the Daily Delivered Quantity on a
Day for each Buyer, and notify each Buyer of its Daily Delivered
Quantity on that Day, by not later than 12.00 noon on the second Day
after that Day. If Gascor is not in possession of sufficient data to
enable it to do so, Gascor must notify each Buyer of its Daily
Delivered Quantity on a Day as soon as reasonably practicable after
Gascor is in possession of sufficient data.
(d) For the purposes of Clause 7.1(c), Gascor must use its
best endeavours to take such action as the Committee may reasonably
request to obtain sufficient data to enable Gascor to determine the
Daily Delivered Quantity for each Buyer by the time specified in
Clause 7.1(c) (including without limitation by procuring, insofar as
it is able to do so, that a Transmission Company or another person
collects and provides relevant data), provided that Gascor is not
60
required to take any action requested by the Committee pursuant to
this Clause 7.1(d) unless the conditions set out in paragraph 1(b) of
Part B of Schedule 1 are satisfied in relation to such action.
(e) Without derogating from Clause 7.1(d), the Parties
acknowledge that Gascor may not be in possession of sufficient data to
enable it to determine the Daily Delivered quantity on each Day if the
Measuring Agency is required, in accordance with paragraph 4(b) of
Schedule 8 of the Principal Contract, to measure the volume of gas
which passes daily to persons other than Gascor or SOU Customers
through their respective points of off-take.
(f) For the purposes of determining the Daily Delivered
Quantity for each buyer pursuant to Clause 7.1(c), Gascor must, unless
the Parties otherwise agree, use its reasonable endeavours to ensure
that the quantity of Gas delivered by the Sellers to Gascor on a Day
at the Point of Delivery is measured in a way which is consistent with
the provisions of Schedule 8 in the Principal Contract.
(g) On or before the 10th day of each Month or, if that day
is not a Working Day, on the next Working Day, Gascor must determine
and give to each Buyer a detailed statement setting out the Daily
Delivered Quantity for that Buyer for each Day of the preceding Gas
Month and the quantity Qt determined in respect of that buyer for that
preceding Gas Month, in each case based on the information contained
in the statement given to Gascor and each Seller by the Measuring
Agency pursuant to Clause 18.1 of the Principal Contract.
(h) This Clause 7.1(h) applies in the event that the market
is suspended prior to 1 October 1999 and the only market participants
at the time of the suspension are the Retailers. In such
circumstances:
(1) the quantity of gas made available for delivery by Gascor to
each Retailer during the period of the market suspension
will not be determined in accordance with the Gas Allocation
Mechanisms, but shall be determined, insofar as practicable,
in accordance with the "interim billing system" as
contemplated by the provisions of Clauses 4.1 and 4.2 of the
Interim Agency Agreements (pursuant to which Gas delivered
at the Point of Delivery is allocated between the Retailers
by reference to the consumption of their respective
customers as opposed to nominations);
(2) the Parties must endeavour to agree any amendment which may
need to be made to the Relevant Agreements to give effect to
Clause 7.1(h)(1) (including without limitation any
reconciliations which may be required to ensure that all Gas
delivered at the Point of Delivery is allocated to, and paid
for by, the Retailers under the Relevant Agreements); and
(3) if the Parties fail to agree the amendments (if any) which
are required to be made to the Relevant Agreements in
accordance with Clause 7.1(h)(2) within 30 days of the date
on which the market is suspended, any Party may refer the
matter to Gascor's Accountants for determination. If the
matter is referred to Gascor's Accountants in accordance
with this Clause 7.1(h)(3), Gascor's Accountants will be
deemed not to be in arbitrator, but shall give their
61
determination as an expert and their decision shall be final
and binding on the Parties in the absence of fraud or
manifest error.
(i) For the purposes of Clause 7.1(h):
(1) "MARKET" means the market for gas operated and administered
by VENCorp in accordance with the MSOR;
(2) "MSOR" means the Market and System Operations Rules
established under section 48N of the Act; and
(3) the market is suspended if VENCorp declares the market to be
suspended in accordance with section 6.7 of the MSOR.
7.2 REDETERMINATION OF DAILY DELIVERED QUANTITIES
(a) If, after a statement has been issued in respect of a
Gas Month pursuant to Clause 7.1(g), it is determined that the
quantity of Gas which the Sellers delivered to Gascor on a Day in that
Gas Month as specified in the statement given to Gascor by the
measuring Agency pursuant to Clause 18.1 of the Principal Contract was
not properly measured or calculated in accordance with the terms of
the Principal Contract, whether as a result of a measurement error or
otherwise, and that a revised quantity should be substituted, Gascor
must, as soon as reasonably practicable after such determination,
redetermine the Daily Delivered Quantity of each Buyer for that Day in
accordance with the Gas Allocation Mechanisms and give each Buyer a
statement specifying the substituted quantity, details of the improper
measurement or calculation and the revised Daily Delivered quantity of
that Buyer for that Day.
(b) If the quantity of Gas delivered to a Retailer in a Gas
Month as revised in accordance with Clause 7.2(a) differs from the
quantity specified for that Gas Month in the statement given pursuant
to Clause 7.1(g) by less than or equal to 5 per cent of the latter
quantity, then only the quantity of Gas delivered by Gascor to that
Retailer in that Gas Month under its Sub-sales Agreement will be
adjusted.
(c) If the quantity of Gas delivered to a Retailer in any
Gas Month as revised in accordance with Clause 7.2(a) differs from the
quantity specified for that Gas Month in the statement given pursuant
to Clause 7.1(g) by more than 5 per cent of the latter quantity, then
that Retailer must as soon as reasonably practicable recalculate the
quantity of Gas delivered by Gascor to that Retailer in that Gas Month
under both its Sub-sales Agreement and its Agency Agreement.
(d) If the quantity of Gas delivered by Gascor to a Buyer in
a Gas Month under its Sub-sales Agreement or its Agency Agreement is
adjusted or redetermined in accordance with this Clause 7.2, the
redetermined or adjusted quantity must be taken into account in the
next Monthly Statement (as defined in that Buyer's Sub-sales
Agreement) and, if appropriate, the next Monthly Claim Form (as
defined in that Buyer's Agency Agreement), in which case Clause 8.6 of
that Buyer's Sub-sales Agreement and Clause 6.12 of that Buyer's
Agency Agreement will apply (as the case may be).
62
7.3 COMBINED NOMINATIONS
(a) Notwithstanding Clause 3 of each Retailer's Sub-sales
Agreement and Clause 4 of each Retailer's Agency Agreement, each
Retailer must (unless Gascor otherwise agrees), instead of giving
separate estimates of its requirements for Gas, Initial Nominations,
Daily Nominations or other nominations which are required to be given
at or before the same time under its Sub-sales Agreement and its
Agency Agreement, give a single estimate or nomination to Gascor of
its requirements for Gas for the relevant Contract Year, Gas Month or
Day (as the case may be) to be delivered under both agreements at or
before the time specified in that Retailer's Sub-sales Agreement.
(b) Any nominations given by a Retailer pursuant to Clause
7.3(a) must be given in accordance with the communications procedures
contained in Clause 19.5 of that Retailer's Sub-sales Agreement.
(c) Each Retailer must ensure that any single estimate or
nomination of its requirements for Gas given in accordance with Clause
7.3(a) will be made in good faith and when given will be the
Retailer's best estimate as a Reasonable and Prudent Operator of its
reqirements for Gas to be delivered under its Agency Agreement and its
Sub-sales Agreement for the relevant Contract Year, Gas Month or Day
(as the case may be).
(d) If a Retailer nominates for delivery on a Day in
accordance with Clause 7.3(a) a quantity of Gas which exceeds the MDQ
of that Retailer in effect for that Day, that Retailer will be deemed
to have nominated a quantity of Gas equal to that MDQ.
7.4 MDQ
(a) Notwithstanding Clause 3.6 of each Retailer's Sub-sales
Agreement and Clause 4.6 of each Retailer's Agency Agreement, the
maximum quantity of Gas which a Retailer is entitled to nominate and
take on any Day both under its Sub-sales Agreement and its Agency
Agreement is equal to the Base MDQ of that Retailer applicable on that
Day less:
(1) if that Day is in a Release Gas Year, the amount of any
reduction required in respect of that Retailer for that
Release Gas Year in accordance with Clause 6.1(b)(3);
(2) if that Day is in an Ecogen MDQ Reduction Month, the amount
of the Ecogen MDQ Reduction calculated in respect of that
Retailer;
(3) the amount of any reduction in that Retailer's MDQ required
for the Quarter in which that Day falls as a result of
Sellers' Sales in accordance with Clause 4.5; and
(4) the amount of any adjustment to that Retailer's MDQ required
as a result of an Intra-Quarter MDQ Adjustment in accordance
with Clause 4.6 as a result of Sellers' Sales.
63
(b) The maximum quantity of Gas which RCo is entitled to
nominate and take on any Day under its Sub-sales Agreement is
calculated as follows:
MDQR = 365 X (MR X RQ) + E
--- --
RGD 15
Where:
MDQR is the maximum quantity of Gas which RCo is entitled to
nominate and take on a Day, expressed in TJ/Day;
RGD is, if the Day is in the first Release Gas Year, the number
of Days from and including the first Day of the Release Gas
Period to and including the last Day of that Release Gas
Year or, if the Day is in any other Release Gas Year, 365;
MR is, subject to Clause 5.4(b), 50;
RQ is the Release Gas AQ Reduction Quantity, expressed in PJ
for the Release Gas Year in which that Day falls prior to
the reductions, if any, made pursuant to Clause 5.5(b); and
E is, subject to Clause 5.4(c)(1) and (2), the quantity,
expressed in TJ/Day, set out in column 2 of Part 1 of
Schedule 3 against that Ecogen MDQ Reduction Month.
(c) Notwithstanding any other provisions of this Agreement
or any provision of any other Relevant Agreement, the Parties intend
that the sum of the MDQs of all Buyers on a Day should be equal to
Gascor's MDQ on that Day. If, as a result of the operation of any
other provision of this Agreement or of any provision of any other
Relevant Agreement, the sum of the MDQs of all Buyers on a Day will
not be equal to Gascor's MDQ on that Day, each Retailer's MDQ for the
Day will be adjusted as follows:
MDQAi = MDQi + (D X MDQi)
-----------
(SIGMA)MDQi
Where:
MDQAi is the Retailer's adjusted MDQ for that Day, expressed in
TJ;
MDQi is that Retailer's MDQ on that Day but for the operation of
this Clause 7.4(c);
D is the difference, expressed in TJ, between Gascor's MDQ on
that Day and the sum of all Buyers' MDQs on that Day but for
the operation of this Clause 7.4(c), expressed as a negative
number if Gascor's MDQ on that Day is less than the sum of
all Buyers' MDQs on that Day and expressed as a positive
number if Gascor's MDQ on that Day is more than the sum of
all Buyers' MDQs on that Day; and
64
(SIGMA)MDQi is the sum of the MDQs of all Retailers on that Day but
for operation of this Clause 7.4(c).
(d) Notwithstanding any other provision of this Agreement,
the MDQ of a Buyer must not be less than zero and if, as a result of
the application of any formula contained in any provision of this
Agreement, the MDQ of a Buyer would, but for this Clause 7.4(d), be
less than zero, the Buyer's MDQ shall be zero.
(e) Without limitation to the generality of Clause 7.4(d),
if, as a result of the application of Clause 7.4(c), the MDQ of a
Buyer would, but for Clause 7.4(d), be less than zero, that Buyer's
MDQ shall be zero and Clause 7.4(c) shall apply iteratively until the
sum of the MDQs of all Buyers equals Gascor's MDQ.
7.5 MAQ
(a) Notwithstanding Clauses 3.7(c) and (d) of each
Retailer's Sub-sales Agreement and Clauses 4.7(c) and (d) of each
Retailer's Agency Agreement, the MAQ of each Retailer for a Contract
Year is equal to the maximum quantity of Gas which that Retailer may
take in that Contract Year as determined in accordance with Clauses
3.7(c) and (d) of that Retailer's Sub-sales Agreement.
(b) Notwithstanding any other provision of this Agreement or
any provision of any other Relevant Agreement, the Parties intend that
the sum of the MAQs of all Buyers for a Contract Year should be equal
to Gascor's MAQ for that Contract Year. If as a result of the
operation of any other provision of this Agreement or of any provision
of any other Relevant Agreement, the sum of the MAQs of all Buyers for
a Contract Year is not equal to Gascor's MAQ for that Contract Year,
each Retailer's MAQ for that Contract Year will be adjusted as
follows:
MAQAi = MAQi + (D X MAQi)
-----------
(SIGMA)MAQi
Where:
MAQAi is the Retailer's adjusted MAQ for the Contract Year,
expressed in the PJ;
MAQi is that Retailer's MAQ for that Contract Year but for the
operation of this Clause 7.5(b);
D is the difference, expressed in PJ, between Gascor's MAQ for
that Contract Year and the sum of all Buyers' MAQs for that
Contract Year but for the operation of this Clause 7.5(b),
expressed as a negative number if Gascor's MAQ for that
Contract Year is less than the sum of all Buyer's MAQs for
that Contract Year and expressed as a positive number if
Gascor's MAQ for that Contract Year is more than the sum of
all Buyers' MAQs for that Contract Year; and
(SIGMA)MAQi is the sum of the MAQs of all Retailers for that Contract
Year but for the operation of this Clause 7.5(b).
65
7.6 AQ
(a) Notwithstanding Clauses 3.7(a) and (b) of each
Retailer's Sub-sales Agreement and Clauses 4.7(a) and (b) of each
Retailer's Agency Agreement, the AQ of each Retailer for a Contract
Year is equal to the AG of that Retailer as determined in accordance
with Clauses 3.7(a) and (b) of that Retailer's Sub-sales Agreement.
(b) Notwithstanding any other provision of this Agreement or
any provision of any other Relevant Agreement, the Parties intend that
the sum of the AQ's of all Buyers for a Contract Year should be equal
to Gascor's AQ for that Contract Year. If as a result of the operation
of any other provision of this Agreement or of any provision of any
other Relevant Agreement, the sum of the AQs of all Buyers for a
Contract Year is not equal to Gascor's AQ for that Contract Year, each
Retailer's AQ for that Contract Year will be adjusted as follows:
AQAi = AQi + (D X AQi)
----------
(SIGMA)AQi
Where:
AQAi is the Retailer's adjusted AQ for the Contract Year,
expressed in PJ;
AQi is that Retailer's AQ for that Contract Year but for the
operation of this Clause 7.6(b);
D is the difference, expressed in PJ, between Gascor's AQ for
that Contract Year and the sum of all Buyer's AQs for that
Contract Year but for the operation of this Clause 7.6(b),
expressed as a negative number if Gascor's AQ for that
Contract Year is less than the sum of all Buyer's AQs for
that Contract Year and expressed as a positive number if
Gascor's AQ for that Contract Year is more than the sum of
all Buyer's AQs for that Contract Year; and
(SIGMA)AQi is the sum of the AQs of all Retailers for that Contract
Year but for the operation of this Clause 7.6(b).
7.7 POINT OF DELIVERY
The delivery point for the delivery of Gas under the Sub-sales Agreements and
the Agency Agreements is the Point of Delivery.
7.8 OTHER POINTS OF DELIVERY
(a) Gascor must not consent to any change in the Point of
Delivery or additional Point of Delivery under Clause 12.2 of the
Principal Contract unless all the Buyers consent.
(b) Each Buyer agrees that it will not unreasonably withhold
its consent under Clause 7.8(a).
66
(c) Subject to Clause 7.8(d), Gascor must compensate each
Buyer for any net disadvantage, taking full account of advantages and
savings, to that Buyer existing or foreseeable at the time of addition
or substitution or due to or arising out of any additional or
substitute Point of Delivery, including (without limitation) to the
extent incurred:
(1) the cost of release from a transmission contract;
(2) any additional costs of a new transmission contract;
(3) any cost of providing new and altering existing facilities
or reticulation.
(d) A buyer will only be entitled to compensation from
Gascor under Clause 7.8(c) in respect of an additional or substitute
Point of Delivery if Gascor has received compensation from Sellers
under Clause 12.2 of the Principal Contract in respect of that
additional or substitute Point of Delivery and, if the amount of
compensation received by Gascor under Clause 12.2 of the Principal
Contract is less than the total compensation payable by Gascor to all
Buyers, then the amount of the compensation payable to a Buyer under
Clause 7.8(c) shall be calculated in accordance with the following
formula:
Ci = CG X CBi
----------
(SIGMA)CBi
Where:
Ci is the amount of the compensation payable to a Buyer under
Clause 7.8(c) in respect of an additional or substitute
Point of Delivery;
CG is the compensation received by Gascor under Clause 12.2 of
the Principal Contract in respect of that additional or
substitute Point of Delivery;
CBi is the compensation which would be payable to that Buyer
pursuant to Clause 7.8(c) in respect of that additional or
substitute Point of Delivery but for the operation of this
Clause 7.8(d); and
(SIGMA)CBi is the total amount of compensation which would be payable
to all Buyers in respect of that additional or substitute
Point of Delivery but for the operation of this Clause
7.8(d).
(e) For the purpose of enabling Gascor to determine the
compensation (if any) payable to each Buyer in accordance with Clause
7.8(c), each Buyer must provide Gascor with such information as Gascor
may reasonably request.
7.9 GAS TO BE DELIVERED IN A SINGLE STREAM
Gas to be delivered under the Sub-sales Agreements and the Agency Agreements at
the Point of Delivery will be tested, measured and delivered in a single stream
that may be commingled with Sales Gas for delivery to other buyers.
67
7.10 DELIVERY RATE
Gascor is not obliged to deliver Gas to the Buyers in any hour of a Day at a
rate which is different to the rate at which the Sellers deliver Gas to Gascor
under the Principal Contract. The Parties acknowledge that, under Clause 5.6(a)
of the Principal Contract, a Seller is not obliged to deliver Gas in any hour of
a Day at a rate greater than the rate which would deliver 1/24th of its
Proportionate Share (as defined in the Principal Contract) of Gascor's
applicable MDQ during that Day.
7.11 DELIVERY PRESSURE
The Parties acknowledge that Gas sold under the Principal Contract will be
delivered by each Seller against the pressure existing from time to time at the
Point of Delivery and that a Seller will not at any time be required to deliver
Gas to Gascor under the Principal Contract at a pressure in excess of the
Maximum Delivery Pressure (as defined in the Principal Contract).
7.12 UNDELIVERED QUANTITIES
(a) If on any Day there is any quantity of Gascor's
Undelivered Gas, then Gascor will be deemed to have failed to have
delivered to each Buyer on that Day a quantity of Gas equal to:
(1) the quantity of Gas which Gascor would have been required to
allocate to that Buyer on that Day in accordance with the
Gas Allocation Mechanisms if the Sellers had delivered to
Gascor on that Day the quantity of Gascor's Undelivered Gas
in addition to the quantity of Gas actually delivered by the
Sellers to Gascor on that Day; less
(2) the Daily Delivered Quantity determined in respect of that
Buyer for that Day.
(b) If Gascor is deemed to have failed to have delivered a
quantity of Gas to a Retailer on a Day in accordance with Clause
7.12(a), then the quantity of Gas which Gascor shall be deemed to have
failed to deliver to that Retailer under its Agency Agreement and its
Sub-sales Agreement respectively shall be calculated as follows:
(1) Gascor shall be deemed to have failed to have delivered to
the Retailer under its Agency Agreement on that Day a
quantity of Gas equal to the lesser of:
(A) the quantity of Gas which Gascor is
deemed to have failed to have delivered to that
Retailer on that Day in accordance with Clause
7.12(a); or
(B) the estimated quantity of Gas
supplied by that Retailer to Gascor Customers (as
defined in that Retailer's Agency agreement) on
that Day as calculated on the basis set out in
Clause 6.4(a)(2) of that Retailer's Agency
Agreement plus the quantity of Gas which that
Retailer estimates that it would have supplied on
that Day to those Gascor Customers, if any, who
68
were curtailed on that Day but for such
curtailment less that Retailer's Daily Delivered
Quantity for that Day; and
(2) Gascor shall be deemed to have failed to have delivered to
the Retailer under its Sub-sales Agreement on that Day the
balance of that Gas if any.
(c) Each Buyer is entitled, subject to the provisions of
Clause 15 of that Buyer's Agency Agreement and Clause 14 of that
Buyer's Sub-sales Agreement, to xxx Gascor for damages in respect of
any deemed failure to deliver any quantity of Gas under that Buyer's
Agency Agreement or Sub-sales Agreement (as the case may be) in
accordance with Clauses 7.12(a) and (b).
7.13 ADDITIONAL NOMINATIONS
(a) The Buyers acknowledge that, as at the date of this
Agreement, Gascor is in negotiations with the Sellers for the purpose
of giving additional nominations under the Principal Contract (which
additional nominations may vary the Daily Nomination (as defined in
the Principal Contract)) for the duration of the period for which the
Sellers continue to claim that they are relieved from their
obligations to deliver Gas under the Principal Contract as a result of
Force Majeure (as defined in the Principal Contract) (being the
explosion which occurred at the Sellers' Longford facilities on or
about 25 September 1998).
(b) Each Buyer agrees and undertakes that, if Gascor agrees
with the Sellers (after consultation with the Buyers) to give
additional nominations to the Sellers as contemplated by Clause
7.13(a), it will:
(1) give such additional nominations to Gascor of its
requirements for Gas as Gascor may reasonable require to
enable it to meet its additional obligations to the Sellers;
and
(2) not unreasonably withhold or delay its consent to such
consequential amendments to each of the Relevant Agreements
to which it is a party to give effect to Gascor's reasonable
requirements.
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8. CURTAILMENT AND EXTENDED FORCE MAJEURE
--------------------------------------------------------------------------------
8.1 ORDER OF ALLOCATION
The Parties intend that Gas available for delivery under the Principal Contract
should be allocated in the order of priority set out in Clause 11.1 of the
Principal Contract in the event that on any day ("CURTAILMENT DAY"), due to a
Seller's default under the Principal Contract or Force Majuere, that Seller has
less quantities of Gas available from the Sellers' Gippsland Basin than the
quantities of Gas required on that Day for the purposes of satisfying its
aggregate obligations under all of its sales contracts, supplied from the
Sellers' Gippsland Basin. Accordingly, each Buyer must, immediately upon request
by Gascor, advise Gascor of the Gas requirements directly or indirectly
supplied, or to be supplied, by that Buyer of D Market Consumers for a
Curtailment Day not otherwise able to be met by that Buyer.
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8.2 COOPERATION ON CURTAILMENT
Gascor must, as soon as reasonably practicable, notify each Buyer of any
information it has received from a Seller as to any possible need for the
curtailment of Gas deliveries.
8.3 BUYER'S CERTIFICATE
Each Buyer must, as soon as reasonably practicable after request by Gascor, give
to Gascor a certificate confirming the basis of and means of calculating the
quantity advised for the purposes of Clause 8.1 including confirmation of any
gas supplied by that Buyer on the Curtailment Day for any purpose other than
meeting the Gas requirements of D Market Consumers.
8.4 EXTENDED FORCE MAJEURE
(a) If the obligations of a Seller or Gascor under the Principal Contract
to deliver or take Gas are permanently reduced in accordance with
Clause 20.7 of the Principal Contract as a result of the Sellers
giving a notice pursuant to that Clause, then the obligations of
Gascor to deliver and each Buyer to take Gas under each Relevant
Agreement to which it is a party will be permanently reduced (with
effect from the time of the reductions under the Principal Contract)
by such amount as, subject to Clause 8.4(e), Gascor considers, after
consultation with the Buyers, to be fair and reasonable with the
intent that Gascor should not suffer or incur any loss or liability as
a result of or in connection with any reduction of any Seller's or
Gascor's obligations under the Principal Contract.
(b) For the purpose of determining a reduction in the Parties' respective
obligations under the Relevant Agreements Gascor must treat all Buyers
impartially.
(c) Gascor must give each Buyer notice of the permanent reduction in its
and Gascor's obligations pursuant to Clause 8.4(a) as soon as
reasonably practicable after its determination.
(d) The Relevant Agreements will remain in full force and effect following
the giving of a notice pursuant to Clause 8.4(c) save to the extent
that the obligations of the Parties thereunder are reduced in
accordance with the notice.
(e) If a Party considers that the reduction in its obligations as
determined by the Gascor pursuant to Clause 8.4(a) is not fair and
reasonable, that Party may refer the matter to an Expert.
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9. OFF SPECIFICATION GAS
--------------------------------------------------------------------------------
If Gascor requires the Sellers to suspend deliveries of Off Specification Gas
pursuant to Clause 16.2(c) of the Principal Contract for a period greater than
or equal to one hour, for the purpose of calculating each Buyer's AMQ, a
reduction will be made in accordance with the following formula:
RQi = GRQ X RRQi
-----------
(SIGMA)RRQi
70
Where:
RQi is the amount of the reduction to be made in calculating a Buyer's
AMQ;
GRQ is the quantity equivalent to the Off Specification Reduction Quantity
(as defined in the Principal Contract) calculated in respect of the
period of suspension multiplied by the number of whole hours during
the period of suspension;
RRQi is a quantity equivalent to the Buyer's Off Specification Reduction
Quantity of that Buyer calculated in respect of the period of
suspension multiplied by the number of whole hours during the period
of suspension; and
(SIGMA)RRQi is a quantity equivalent to the sum of the Buyer's Off Specification
Reduction Quantities of all Buyers calculated in respect of the period
of suspension multiplied by the number of whole hours during the
period of suspension.
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10. THE EXPERT
--------------------------------------------------------------------------------
10.1 APPLICATION OF THIS CLAUSE
Wherever in this Agreement any person is to be appointed as an expert ("EXPERT")
or any matter is to be referred to an Expert, and whenever the Parties agree
that a point of difference between them is to be resolved by an Expert, this
Clause 10 will apply and there will be a single proceeding before the Expert for
the purposes of this Agreement. Gascor, and each of the Buyers, severally, will
be bound by a determination of an Expert in accordance with this Agreement, save
in the event of fraud or manifest error.
10.2 APPOINTMENT
The procedure for the appointment of an Expert is as follows:
(a) the Party wishing the appointment to be made must give notice to that
effect to the other Parties, giving details of the matter which is
proposed to be resolved by the Expert and designating its
representative in negotiations, being a senior officer of the Party
with authority to settle the matter. The other Parties must within 5
working days give notice designating their representative in
negotiations, with similar authority;
(b) within 15 working days of the notice proposing the appointment of an
Expert, the designated representatives of the Parties must meet to
seek to resolve the matter;
(c) if the matter to be referred to the Expert is not resolved by the
representatives within a period of 10 working days of their first
meeting of 25 working days from the date of the notice first referred
to in Clause 10.2(a), the Parties must meet to agree upon a single
Expert to whom the matter in dispute will be referred for
determination;
71
(d) if, within 20 working days of the first date on which the Parties were
required to meet pursuant to Clause 10.2(c), the Parties fail to agree
upon the appointment of a single Expert, any Party to the
determination may request the Chairman of the Australian Commercial
Disputes Centre Limited to appoint an Expert. In order for the request
to be valid, the Party giving the request must, at the same time as
the request is made, give a copy of the request to the other Parties
to the determination. Provided each Party to the determination is
consulted prior to any appointment of an Expert, that appointment will
be final and binding on the Parties to the determination.
10.3 QUALIFICATION
(a) No person may be appointed by a Party to the determination to act as
an Expert under this Clause 10 unless that person is qualified by
education, experience and training to determine the matter in dispute,
but a person appointed pursuant to Clause 10.2(d) may act even though
that person is not so qualified as long as that person is a member of
the Institution of Engineers Australia (Victoria Division) or of The
Institute of Arbitrators Australia, a retired judge of a Supreme Court
of an Australian State or of the Federal Court of Australia or Senior
Counsel or equivalent.
(b) A person may not be appointed, or remain, an Expert if at the time of
the appointment or at any time before that person gives his or her
determination under such appointment, that person has, has had or may
have some interest or duty (either as an employee or adviser or
otherwise) which conflicts or may conflict with his or her function
under such appointment.
10.4 POWERS AND DUTIES
(a) The Parties to a determination under this Clause 10 may
make submissions to the Expert in relation to any matter before the
Expert for determination. The Expert must, promptly after his or her
appointment, fix a reasonable time and place (being Melbourne unless
the Parties agree otherwise) for receiving submissions or information
from the Parties or from any other persons that he or she may think
fit. The Expert may make such further enquiries and require such other
evidence as the Expert may consider necessary for determining the
matter before him or her and must, in accordance with this Agreement,
determine the matter with all due diligence and speed.
(b) The Expert will be deemed not be an arbitrator, but
shall render his or her decision as an expert and his or her decision
will be final and binding on the Parties in the absence of fraud or
manifest error. The Commercial Arbitration Act 1984 and the law
relating to arbitrators will not apply to the Expert or his or her
determination or the procedure by which the Expert reaches his or her
determination.
(c) Each Party to the determination will bear the costs and
expenses of all counsel, witnesses and employees retained by it, but,
except where otherwise specifically provided in this Agreement, the
cost and expenses of the Expert will be apportioned between the
Parties in such proportions as the Expert, in the circumstances,
considers proper.
72
10.5 CONFIDENTIALITY
(a) The matter for determination, all submissions, documents
and the Expert's determination must be kept confidential by the
Parties to the determination during the term of this Agreement and for
five years after the termination of this Agreement and shall not be
disclosed except as may be permitted under Clause 15. Nothing in this
Clause 10.5(a) applies to or in relation to or restricts in any way:
(1) disclosure of information to the Expert; or
(2) disclosure of the matter for determination or the
determination in the course of legal proceedings or in the
course of any other judicial, arbitral or administrative
proceedings (including proceedings before an arbitator)
between the Parties to the determination.
(b) It will be a term of the Expert's appointment that the
Expert be required to undertake to keep confidential matters coming to
his or her knowledge by reason of his or her appointment and carrying
it out.
10.6 REMOVAL OF EXPERT
If an Expert appointed under this Clause 10 has not arrived at a determination
within three Months of the date of his or her appointment, any Party to the
determination may, upon giving notice to the other, terminate such appointment
and a new Expert must be appointed and the matter in dispute must be resubmitted
for determination in accordance with this Clause 10.
10.7 REFERRAL TO EXPERT DOES NOT AFFECT OBLIGATIONS
The referral of a dispute or difference to an Expert pursuant to this Clause 10
will not affect the obligations of the Parties to supply, take or pay for Gas in
accordance with the terms and conditions of this Agreement and their respective
Sub-sales Agreements and Agency Agreements.
10.8 COMMUNICATIONS TO BE COPIED TO ALL PARTIES
Any communication by one of the Parties to the determination with the Expert
(whether pursuant to Clause 10.4 or otherwise) must be copied, at the same time,
to the other Parties to the determination.
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11. DISPUTE RESOLUTION
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11.1 OBLIGATION TO SEEK RESOLUTION
(a) Except for matters to be referred to an Expert under
Clause 10, if a Party claims a difference or dispute has arisen in
connection with this Agreement that Party must give notice to the
other Parties identifying such difference or dispute and designating
its representative in negotiations. The other Parties must within 3
73
Working Days give notice designating their representative in
negotiations. The representative of each Party must be a senior
officer of the Party with authority to settle the matter.
(b) Within 5 Working Days of the notice of a difference or
dispute, the designated representatives of the Parties must meet to
seek to resolve the matter.
(c) If the difference or dispute is not resolved by the
representatives within a period of 10 Working Days of their first
meeting or 15 Working Days of receipt of the notice identifying such
difference or dispute under Clause 11.1(a), any Party may then
commence arbitration in accordance with Clause 11.2.
11.2 GENERAL REQUIREMENT
(a) Subject to Clause 11.1, any dispute or difference
between the Parties arising out of or in connection with:
(1) this Agreement or the subject matter of this Agreement;
(2) the construction of this Agreement;
(3) the rights, obligations, duties or liabilities of any Party
under this Agreement,
must, in default of agreement between the Parties and in the absence
of any provision in this Agreement to the contrary, be referred to a
single arbitration by Gascor and each Buyer (Gascor and the Buyers
being collectively the ("PARTIES TO THE ARBITRATION").
(b) The arbitration will be conducted by a panel of
arbitrators to be appointed in accordance with Clause 11.7 (the
"PANEL").
(c) Every such arbitration will be conducted in accordance
with the Commercial Arbitration Act 1994 (Vic) and, unless the Parties
to the Arbitration agree otherwise, in Melbourne, Victoria.
(d) In any arbitration proceedings under this Clause, the
rules set out in this Clause 11 (the "ARBITRATION RULES") will apply.
In the event of any conflict between the Commercial Arbitration Act
1994 (Vic) and a specific provision of this Clause 11, this Clause 11
will prevail.
(e) A Party may, by giving notice to the other Parties,
elect not to be a Party to the Arbitration on the grounds that it is
not affected by the dispute or difference which is the subject of the
arbitration or on any other grounds, in which case that Party shall
not be one of the Parties to the Arbitration.
(f) An award delivered by the Panel is binding on a Party
which elects not to be a Party to the Arbitration pursuant to Clause
11.2(e) and a Party who so elects is not entitled to dispute or raise
any objection to such an award.
(g) A Party must cease to be one of the Parties to the
Arbitration if the dispute or difference arising out of or in
connection with:
74
(1) a Relevant Agreement to which that Party is not a party or
the subject matter of such an agreement;
(2) the construction of such an agreement; or
(3) the rights, obligations, duties or liabilities of any other
Party under such an agreement,
unless that Party can demonstrate, to the satisfaction of the Panel,
that the rights of that Party under any other Relevant Agreement will
be, or are likely to be, materially and adversely affected by any
award which the Panel may deliver in relation to the dispute or
difference.
11.3 THE CLAIM
The arbitration proceedings will be commenced by delivery by one or more of the
Parties to the Arbitration (a "CLAIMANT" or, together, the "CLAIMANTS") of its
or their claims and contentions (the "CLAIM"), which must be set out in writing
and signed by or on behalf of each Claimant, to each other Party to the
Arbitration (a "RESPONDENT").
11.4 THE RESPONSE
A Respondent must, within 15 Working Days after receipt of the Claim, deliver to
each Claimant a document signed by or on behalf of that Respondent, specifically
admitting or not admitting the claims and contentions of its own in relation to
the subject matter of the dispute or any other matter which may be referred to
arbitration in accordance with this Clause and which it wishes to have resolved
in the arbitration proceedings (a "RESPONSE") and, subject to any such Response,
that Respondent will be deemed to have considered each Claimant's claims and
contentions.
11.5 THE REPLY
Each Claimant may, within 15 Working Days after delivery of a Response, deliver
to the relevant Respondent a reply specifically admitting or not admitting any
of the claims and contentions in that Response (a "REPLY") and, subject to any
such Reply, a Claimant will be deemed to have considered each of those claims
and contentions.
11.6 AMENDMENTS
The Claim, any Response or any Reply may at any time be amended in writing:
(a) by agreement and on such conditions (if any) as are agreed between the
Parties to the Arbitration; or
(b) by leave of the Panel and on such conditions (if any) as the Panel
imposes.
75
11.7 THE PANEL
(a) Unless the Parties to the Arbitration agree otherwise,
the Panel will comprise three arbitrators being the Claimants'
nominee, the Respondents' nominee and a third person who will be
nominated by agreement between the first two arbitrators and will
chair the Panel (the "PANEL Chairperson"). If, within 15 Working Days
after delivery of the Response, any or all of the arbitrators have not
been appointed, the arbitrator or arbitrators who have not been
appointed will be the person or persons nominated, at the request of
any Party to the Arbitration, by the Chairman of the Victorian Bar
Council.
(b) Each arbitrator must consent in writing to act as an
arbitrator and undertake that, in so acting, he will abide by the
Arbitration Rules.
(c) The Panel, and each member of the Panel, must endeavour
to complete the hearing of the arbitration and deliver an award in
accordance with the Arbitration Rules as soon as practicable.
(d) No person, who at the time of being nominated or at any
time before the Panel delivers its award, has, had had or may have
some interest or duty (either as an employee or adviser or otherwise)
which conflicts or may conflict with his or her function as a member
of the Panel may be nominated or remain as a member of the Panel.
11.8 PANEL'S JURISDICTION
The jurisdiction of the Panel will be ascertained by reference to the respective
claims and contentions of the Parties to the Arbitration as admitted or not
admitted from time to time in accordance with Clauses 11.3 and 11.6 inclusive.
11.9 DISCOVERY OF DOCUMENTS
Each Party to the Arbitration must, within 30 Working Days after the final date
upon which a Response may be delivered pursuant to Clause 11.4, deliver a list
of documents, verified by affidavit, to each other Party to the Arbitration,
setting out all the documents which would be discoverable if the arbitration
were an action in the Supreme Court of Victoria and claiming any applicable
privilege in like form as that privilege would be claimed in such an action.
11.10 INSPECTION
Each Party to the Arbitration must, during the period of 15 Working Days after
delivery of its list of documents under Clause 11.9, permit each other Party to
the Arbitration to inspect documents not subject to privilege, either by
physical inspection or, at the option of the inspecting party to the
Arbitration, by the provision of legible photocopies at the cost of the
inspecting Party to the Arbitration.
11.11 DIRECTIONS
(a) A directions conference must be convened and conducted
by the Panel as soon as practicable after the Panel Chairperson's
appointment and conclusion of inspection of documents in accordance
with Clause 11.10.
76
(b) A directions conference may also be convened and
conducted by the Panel, either of the Panel's own motion or at the
request of any Party to the Arbitration, at any other time and at such
place as the Panel appoints.
(c) A directions conference may not be convened at a place
away from Melbourne, Victoria except with the consent of the Parties
to the Arbitration (provided that a video conference may be arranged
if requested by a Party to the Arbitration and approved by the Panel).
(d) Subject to any applicable law and the Arbitration Rules,
the Panel has power at any directions conference to give such
directions for the conduct of the arbitration as the Panel thinks fit.
11.12 THE HEARING
(a) The hearing of the arbitration will be conducted in
Melbourne, Victoria in the presence of the Panel.
(b) Each Party to the Arbitration will be entitled to be
represented by solicitors and counsel.
(c) Subject to any applicable law, the Arbitration Rules,
any agreement between the Parties to the Arbitration and the
directions of the Panel, the procedure at the hearing will be the
same, as nearly as possible, as the procedure at a trial of a
commercial action in the Supreme Court of Victoria.
11.13 CONFIDENTIALITY
The proceedings at any directions conference and at the hearing will be in
camera. No Party to the Arbitration may cause or permit any part of the
proceedings to be published in the press or other media. All such proceedings,
the documentation and information relevant to the proceedings (to the extent
treated as confidential by one or other of the Parties to the Arbitration) and
the reasons for the award must be kept confidential by the Parties to the
Arbitration during the term of this Agreement and for five years after the
termination of this Agreement and may not be disclosed other than to the extent
permitted under Clause 15. Nothing in this Clause 11.13 applies to or in
relation to or restricts in any way:
(a) disclosure of information to the Panel; or
(b) disclosure of the proceedings or the reasons for the
award in the course of legal proceedings relating to the arbitration
or the award or in the course of any other judicial, arbitral or
administrative proceedings (including proceedings before an Expert)
between the Parties to the Arbitration.
11.14 AWARD
(a) The Panel may either:
(1) deliver a single award in relation to the whole dispute or
difference between the Parties to the Arbitration; or
77
(2) treat each contention raised by either Party to the
Arbitration as a separate dispute or difference referred to
arbitration and deliver separate awards in respect of each
such contention or any group of contentions.
(b) An award is binding if, and only if, it contains (as
part of the award) a statement of the Panel's reasons.
(c) In the event of disagreement between members of the
Panel, decisions of the Panel will be made by a majority of
arbitrators comprising the Panel.
11.15 COSTS
Subject to any agreement between the Parties to the Arbitration to the contrary,
the Panel may award the costs of the arbitration at its discretion.
11.16 GENERAL
(a) The Parties to the Arbitration must at all times do all
things which are reasonably necessary or desirable to enable a just
award to be made in an arbitration under this Clause, and no Party to
the Arbitration may wilfully do or cause to be done any act or delay
unreasonably to prevent an award being made.
(b) The Parties to the Arbitration must co-operate in good
faith to make all such administrative arrangements (including the
provisions of hearing facilities and a transcript) as may be
reasonably necessary or desirable for the proper and convenient
conduct of the arbitration.
(c) Documents relating to an arbitration may be delivered in
the same way as a notice may be given by one Party to another under
this Agreement.
(d) A Party to the Arbitration must at all times do all
things which are reasonably necessary or desirable to preserve the
confidentiality of documents or information relevant to an arbitration
which constitute the confidential information of any other Party to
the Arbitration. If requested by one Party to the Arbitration, each of
the other Parties to the Arbitration must execute a confidentiality
agreement (in a form reasonably acceptable to the Parties to the
Arbitration) in respect of such confidential information.
11.17 INTER-RELATIONSHIP WITH THE PRINCIPAL CONTRACT
If any dispute or difference between the Parties arising out of or in connection
with this Agreement occurs and the subject matter of the dispute or difference
is the subject matter, or is in connection with the subject matter, of a dispute
or difference between Gascor and a Seller under the Principal Contract (a
"RELATED DISPUTE"), or the difference or dispute between the Parties would or
might be affected by the resolution of a Related Dispute, the Panel must:
(a) not deliver any award in relation to the dispute or
difference between the Parties until the Related Dispute has been
resolved or determined;
78
(b) ensure, insofar as reasonably practicable, that any
award delivered in relation to the dispute or difference between the
Parties is not inconsistent with the resolution or determination of,
or an award delivered in relation to, the Related Dispute.
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12. BUYER'S DEFAULT
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12.1 DEFAULT NOTICE
(a) If a Buyer's Default occurs (including without
limitation a Schedule 1 Default), Gascor may give the Defaulting Party
a notice ("BUYER DEFAULT NOTICE") specifying the Default that has
occurred.
(b) If a Schedule 1 Default by a Retailer occurs, any other
Retailer may give the Defaulting Party a notice ("SCHEDULE 1 DEFAULT
NOTICE") specifying the Default that has occurred.
12.2 CURE PERIOD
Upon receipt of a Buyer Default Notice or a Schedule 1 Default Notice, the
Defaulting Party will have:
(a) in the case of a Financial Default, [THIS PARAGRAPH
CONTAINS CONFIDENTIAL INFORMATION WHICH HAS BEEN OMITTED, BUT FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.] Working Days
to cure that Default;
(b) in the case of a Non-financial Default (other than a
Schedule 1 Default) which Gascor reasonably considers may be cured,
that period which Gascor and the Defaulting Party agree in good faith
is a reasonable period in which to cure the Default or, if they are
unable to agree a period, [THIS PARAGRAPH CONTAINS CONFIDENTIAL
INFORMATION WHICH HAS BEEN OMITTED, BUT FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.] days, provided that the cure
period will end at the time the Defaulting Party ceases to be
diligently pursuing a cure of the Default;
(c) in the case of a Schedule 1 Default (other than a
Financial Default) where Gascor has given a Buyer Default Notice, no
Retailer has given a Schedule 1 Default Notice and Gascor reasonably
considers the Default may be cured, that period which Gascor and the
Defaulting Party agree in good faith is a reasonable period in which
to cure the Default or, if they are unable to agree a period, [THIS
PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH HAS BEEN OMITTED,
BUT FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.]
days, provided that the cure period will end at the time the
Defaulting Party ceases to be diligently pursuing a cure of the
Default;
(d) in the case of a Schedule 1 Default (other than a
Financial Default) where Gascor has given a Buyer Default Notice, a
Retailer has given a Schedule 1 Default Notice and Gascor reasonably
considers the Default may be cured, that period which Gascor and each
Retailer (other than the Defaulting Party) agree in good faith is a
reasonable period in which to cure the Default, or, if they are unable
79
to agree a period, [THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION
WHICH HAS BEEN OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.] days, provided that the cure period will end at
the time the Defaulting Party ceases to be diligently pursuing a cure
of the Default;
(e) in the case of a Schedule 1 Default where Gascor has not
given a Buyer Default Notice, a Retailer has given a Schedule 1
Default Notice and that Retailer reasonably considers the Default may
be cured, that period which the Retailers (other than the Defaulting
Party) agree in good faith is a reasonable period in which to cure the
Default or, if they are unable to agree a period, [THIS PARAGRAPH
CONTAINS CONFIDENTIAL INFORMATION WHICH HAS BEEN OMITTED, BUT FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.] days,
provided that the cure period will end at the time the Defaulting
Party ceases to be diligently pursuing a cure of the Default;
(f) in the case of a Schedule 1 Default where Gascor has not
given a Buyer Default Notice, a Retailer has given a Schedule 1
Default Notice and the Retailers (other than the Defaulting Party)
reasonably consider that the Default cannot be cured, no period in
which to cure the Default;
(g) in the case of a Non-financial Default (including a
Schedule 1 Default) where Gascor has given a Buyer Default Notice and
Gascor reasonably considers that the Default cannot be cured, no
period in which to cure the Default; or
(h) in the case of a Minimum Quantity Default, a Retail
Licence Default or a Solvency Default, no period in which to cure the
Default.
12.3 REMEDIES FOR DEFAULT
(a) If a Buyer's Default has occurred and is not cured
within the cure period (if any) described in Clause 12.2, Gascor may
(without prejudice to any of its other rights under any Relevant
Agreement to which the Defaulting Party is a party) exercise any or
any combination of the following remedies as appropriate:
(1) if the Default is a Material Financial Default, subject to
giving [THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION
WHICH HAS BEEN OMITTED, BUT FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.] Working Days' notice in
writing to the Defaulting Party stating its intention to do
so if the Default is not cured (and the Default is not cured
within that notice period):
(A) terminate the agreement between
Gascor and the Defaulting Party recorded by the
Relevant Agreements to which the Defaulting Party
is a party; or
(B) suspend any obligations which it
owes to the Defaulting Party under any of the
Relevant Agreements to which the Defaulting Party
is a party until the Default is cured;
(2) if the Default is a Minimum Quantity Default, a Retail
Licence Default or a Solvency Default, subject to giving
[THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH HAS
80
BEEN OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.] Working Days' notice in writing to the
Defaulting Party stating its intention to do so:
(A) terminate the agreement between Gascor and the
Defaulting Party recorded by the Relevant Agreements to
which the Defaulting Party is a party; or
(B) suspend any obligations which it owes to the
Defaulting Party under any of the Relevant Agreements to
which the Defaulting Party is a party until the Default is
cured;
(3) if the Default is a Non-financial Default which has a
Material Adverse Effect, subject to giving [THIS PARAGRAPH
CONTAINS CONFIDENTIAL INFORMATION WHICH HAS BEEN OMITTED,
BUT FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.] Working Days' notice in writing to the
Defaulting Party stating its intention to do so if the
Default is not cured (and the Default is not cured within
that notice period):
(A) terminate the agreement between Gascor and the
Defaulting Party recorded by the Relevant Agreements to
which the Defaulting Party is a party; or
(B) suspend any obligations which it owes to the
Defaulting Party under any of the Relevant Agreements to
which the Defaulting Party is a party until the Default is
cured;
(4) subject to Clause 12.4(a), xxx the Defaulting Party for
damages for that Default; or
(5) exercise all other available legal and equitable remedies
(other than in respect of damages), including, without
limitation, suing for specific performance, injunctive
relief or such other orders as it deems appropriate.
(b) If a Schedule 1 Default has occurred and is not cured
within the cure period (if any) described in Clause 12.2, the Retailer
which has given the Schedule 1 Default Notice may exercise any or any
combination of the following remedies as appropriate:
(1) subject to Clause 12.4(b), xxx the Defaulting Party for
damages; or
(2) exercise all other available legal and equitable remedies
(other than the right to terminate the agreement between
that Retailer and the Defaulting Party recorded by the
provisions of Schedule 1), including, without limitation,
suing for specific performance, injunctive relief or such
order as it deems appropriate.
81
12.4 DAMAGES AND CONSEQUENTIAL LOSS
(a) Subject to Clause 12.5, if any Buyer's Default gives
Gascor a right to damages, such damages will be limited to damages for
direct and foreseeable loss attributable to such Default and the
Defaulting Party will not be liable to Gascor for any loss of profit
or anticipated profit, business interruption, indirect loss,
consequential loss or loss of use suffered by Gascor;
(b) If any Schedule 1 Default by a Retailer gives another
Retailer a right to damages, such damages will be limited to damages
for direct and foreseeable loss attributable to such Default and the
Defaulting Party will not be liable to a Retailer for any loss of
profit or anticipated profit, business interruption, indirect loss,
consequential loss or loss of use suffered by that Retailer.
12.5 INDEMNITY
Subject to the indemnities contained in paragraphs 2(c)(4) and 2(d)(5) of Part E
of Schedule 1, which indemnities must, if applicable, be enforced by Gascor
prior to enforcement of the indemnities contained in this Clause 12.5, each
Buyer agrees to indemnify Gascor and keep Gascor indemnified from and against
any and all liability, loss, damage, cost or expense which Gascor may suffer or
incur as a result of or in connection with any action or claim which any Seller
may bring against Gascor as a result of a failure by Gascor to observe or
perform any obligation under the Principal Contract if and to the extent that
such failure arose directly or indirectly as a result of or in connection with a
Default by that Buyer.
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13. GASCOR'S DEFAULT
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13.1 DEFAULT NOTICE
If a Default by Gascor occurs, each Non-defaulting Party may give Gascor a
notice ("GASCOR DEFAULT NOTICE") specifying the Default that has occurred.
13.2 CURE PERIOD
Upon receipt of a Gascor Default Notice, Gascor will have:
(a) in the case of a Financial Default, [THIS PARAGRAPH
CONTAINS CONFIDENTIAL INFORMATION WHICH HAS BEEN OMITTED, BUT FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.] Working Days
to cure that Default;
(b) in the of a Non-financial Default, that period which
Gascor and the Non-defaulting Parties agree in good faith is a
reasonable period in which to cure the Default or, if they are unable
to agree a period, [THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION
WHICH HAS BEEN OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.] days, provided that the cure period will end at
the time Gascor ceases to be diligently pursuing a cure of the
Default; or
(c) in the case of a Solvency Default, where the
Non-defaulting Parties reasonably consider that the Default may be
cured, [THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH HAS
82
BEEN OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.] Working Days to cure the Default.
13.3 REMEDIES FOR DEFAULT
If a Default by Gascor has occurred and is not cured within the cure period
described in Clause 13.2, a Non-defaulting Party may (without prejudice to any
other of its other rights in this Agreement) exercise any or any combination of
the following remedies as appropriate:
(a) subject to Clauses 13.5 and 13.6, xxx Gascor for damages
for that Default; or
(b) subject to Clause 13.4, exercise all other available
legal and equitable remedies (other than in respect of damages or the
right to terminate this Agreement), including without limitation suing
for specific performance, injunctive relief or such other orders as it
deems appropriate.
13.4 NO RIGHT TO TERMINATE
Notwithstanding any right of law or equity to the contrary, a Buyer is not in
any circumstances entitled to terminate the agreement between that Buyer and
Gascor recorded by this Agreement as a result of a Default by Gascor or for any
other reason.
13.5 DAMAGES AND CONSEQUENTIAL LOSS
If any Default by Gascor (other than a Default which was directly or indirectly
caused by or arose as a result of a Seller's Default, in which case Clause
13.6(a) applies) gives a Party a right to damages, such damages will be limited
to damages for direct and foreseeable loss attributable to such Default and
Gascor will not be liable to any other Party for any loss of profit or
anticipated profit, business interruption, indirect loss, consequential loss or
loss of use suffered by a Party or any other person.
13.6 MAXIMUM LIABILITY OF GASCOR
(a) Subject to paragraphs 2(a)(iii), 2(c)(ii), 2(d)(iii),
3(b)(ii), 3(d)(iii) and 3(e)(iii) of Part E of Schedule 1, if any
Default by Gascor is directly or indirectly caused by or arises as a
result of a Seller's Default, Gascor's aggregate liability to the
Buyers under all Relevant Agreements for that Default and all other
Defaults which are directly or indirectly caused by or arise as a
result of that Seller's Default shall be limited to the amount of
compensation which Gascor receives in cleared funds from the Sellers
under the Principal Contract in respect of that Seller's Default after
deduction of all costs and expenses incurred by Gascor in recovering
such compensation and any Tax payable by Gascor in respect of such
compensation.
(b) The maximum aggregate liability of Gascor under all
Relevant Agreements in respect of all Defaults (other than a Default
which was directly or indirectly caused by or arose as a result of a
Seller's Default, in which case Clauses 13.6(a) and 13.6(g) apply)
which occur in a Contract Year ending on or before 1 January 2002 is
limited to an amount equal to the greater of:
83
(1) $5,000,000 (five million dollars); and
(2) the proceeds (if any) of all insurance claims (if any) made
in respect of such Defaults received by Gascor in cleared
funds after deduction of all costs and expenses incurred by
Gascor in recovering such proceeds and any Tax payable by
Gascor in respect of such proceeds.
(c) The maximum aggregate liability of Gascor under all
Relevant Agreements in respect of all Defaults (other than a Default
which was directly or indirectly caused by or arose as a result of a
Seller's Default, in which case Clauses 13.6(a) and 13.6(g) apply)
which have arisen as a result of:
(1) any one act, omission or event or any act, omission or event
relating to or consequential upon such an act, omission or
event; or
(2) any one series of related acts, omissions or events
which occurs in a Contract Year ending on or before 1 January 2002 is
limited to an amount equal to the greater of:
(3) $500,000 (five hundred thousand dollars); and
(4) the proceeds (if any) of all insurance claims (if any) made
in respect of such Defaults received by Gascor in cleared
funds after deduction of all costs and expenses incurred by
Gascor in recovering such proceeds and any Tax payable by
Gascor in respect of such proceeds.
(d) The maximum aggregate liability of Gascor under all
Relevant Agreements in respect of:
(1) any one act, omission or event or any act, omission or event
relating to or consequential upon such an act, omission or
event; or
(2) any one series of related acts, omissions or events
(other than in respect of a Default which was directly or indirectly
caused by or arose as a result of a Seller's Default, in which case
Clauses 13.6(a) and 13.6(g) apply) which occurs in any Contract Year
ending after 1 January 2002 is limited to the proceeds (if any) of all
insurance claims (if any) made in respect of such act, omission or
event or series of related acts, omissions or events received by
Gascor in cleared funds after deduction of all costs and expenses
incurred by Gascor in recovering such proceedings and any Tax payable
by Gascor in respect of such proceeds.
(e) Gascor will have no liability in respect of any Default
(other than a Default which was directly or indirectly caused by or
arose as a result of a Seller's Default, in which case Clauses 13.6(a)
and 13.6(g) apply) unless and to the extent that Gascor's liability in
respect of that Default exceeds $50,000.
84
(f) Subject to Clause 13.6(e), Gascor must pay compensation
to a Buyer in respect of a Determined Claim in accordance with the
following provisions of this Clause 13.6(f):
(1) the compensation payable by Gascor in accordance with Clause
13.6(f)(ii) or (iii) in respect of each Determined Claim
which is determined in a Contract Year must be paid by
Gascor within 30 days after the end of that Contract Year;
(2) if the total liability of Gascor in respect of all Related
Determined Claims determined in a Contract Year would, but
for the provisions of Clause 13.6(c) or (d), exceed the
limit on Gascor's liability under Clause 13.6(c) or (d) in
respect of all such Related Determined Claims, each Buyer
which has a Related Determined Claim which has been
determined in that Contract Year is entitled to be paid an
amount of compensation calculated as follows:
Ci = TL X RDCi
-----------
(SIGMA)RDCi
Where:
Ci is the amount of compensation which a Buyer is
entitled to receive from Gascor in respect of its
Related Determined Claim;
TL is Gascor's maximum aggregate liability in respect
of all such Related Determined Claims (as
determined in accordance with Clause 13.6(c) or
(d));
RDCi is the amount of compensation which Gascor would
have had to pay to that Buyer in respect of that
Related Determined Claim but for the provisions of
Clause 13.6(c) or(d); and
(SIGMA)RDCi is the total amount of compensation which Gascor
would have had to pay to all Buyers in respect of
all such Related Determined Claims but for the
provisions of Clause 13.6(c) or (d);
(3) if the total liability of Gascor in respect of all
Determined Claims determined in a Contract Year would, but
for the provisions of Clause 13.6(b) exceed the limit on
Gascor's liability under Clause 13.6(b) in respect of all
such Determined Claims, each Buyer which has a Determined
Claim or Determined Claims which has or have been determined
in that Contract Year is entitled to be paid an amount of
compensation calculated as follows:
Ci = TL X DCi
----------
(SIGMA)DCi
Where:
85
Ci is the amount of compensation which a Buyer is
entitled to receive from Gascor in respect of its
Determined Claim or Determined Claims;
TL is Gascor's maximum aggregate liability in respect
of all such Determined Claims (as determined in
accordance with Clause 13.6(b));
DCi is the amount of compensation which Gascor would
have had to pay to that Buyer in respect of its
Determined Claim or Determined Claims but for the
provisions of Clause 13.6(b); and
(SIGMA)DCi is the total amount of compensation which Gascor
would have had to pay to all Buyers in respect of
all such Determined Claims but for the provisions
of Clause 13.6(b).
(g) Subject to paragraphs 2(a)(iii), 2(c)(ii), 2(d)(iii),
3(b)(ii), 3(d)(iii) and 3(e)(iii) of Part E of Schedule 1, if the
total liability of Gascor in respect of all Sellers' Related
Determined Claims would, but for the provisions of Clause 13.6(a),
exceed the limit on Gascor's liability under Clause 13.6(a) in respect
of all such Sellers' Related Determined Claims, each Buyer which has a
Sellers' Related Determined Claim is entitled to be paid an amount of
compensation calculated as follows:
Ci = TL X Si
---------
(SIGMA)Si
Where:
Ci is the amount of compensation which a Buyer is entitled to
receive from Gascor in respect of its Sellers' Related
Determined Claim;
TL is Gascor's maximum aggregate liability in respect of all
such Sellers' Related Determined Claims (as determined in
accordance with Clause 13.6(a));
Si is the amount of compensation which Gascor would have had to
pay to that Buyer in respect of that Sellers' Related
Determined Claim but for the provisions of Clause 13.6(a);
and
(SIGMA)Si is the total amount of compensation which Gascor would have
had to pay to all Buyers in respect of all such Sellers'
Related Determined Claims but for the provisions of Clause
13.6(a).
(h) Subject to the provisions of Part E of Schedule 1,
Gascor must not pay compensation to a Buyer in respect of a Determined
Claim, a Related Determined Claim or a Sellers' Related Determined
Claim other than in accordance with the provisions of this Clause
13.6.
(i) The amounts referred to in Clauses 13.6(b)(i),
13.6(c)(iii) and 13.6(e) will be adjusted in each Contract Year
(excluding Contract Year 1998) as follows:
86
CY = PY X CPI(T-1)
--------
CPIb
Where:
CY is the amount referred to in Clause 13.6(b)(i), 13.6(c)(iii)
or 13.6(e) (as the case may be) as adjusted for the current
Contract Year;
PY is the amount referred to in Clause 13.6(b)(i), 13.6(c)(iii)
or 13.6(e) (as the case may be);
CPI(T-1) is the CPI for the quarter ended on 30 September of the year
immediately preceding the current Contract Year; and
CPIb is the base CPI, being 119.5 (the CPI for the quarter ended
30 September 1997).
13.7 MITIGATION OF LOSS
Each Buyer must use reasonable endeavours to mitigate its losses as a result of
a Default by Gascor, provided that a Buyer is not required to take any action or
incur any liability in excess of its right to compensation or damages under any
Relevant Agreement.
13.8 PAYMENT OF COMPENSATION RECEIVED FROM SELLERS
Subject to Clause 13.6(g) and the provisions of Part E of Schedule 1, if any
Default by Gascor is caused by a Seller's Default and Gascor receives
compensation from the Sellers in cleared funds in respect of that Seller's
Default, Gascor must pay any amount due and owing to a Buyer in respect of that
Default to the Buyer within 5 Working Days of receipt of such compensation.
--------------------------------------------------------------------------------
14. ASSIGNMENT
--------------------------------------------------------------------------------
14.1 INTERPRETATION
In this Clause "ASSIGN" includes transfer or otherwise dispose of any legal or
equitable interest, either in whole or in part, whether by sale, lease,
declaration or creation of a trust or otherwise.
14.2 GENERAL REQUIREMENTS
(a) A Party may not assign any rights under a Relevant
Agreement except as permitted by this Clause 14.
(b) A Party may not assign rights under a Relevant Agreement
unless the assignee also assumes the corresponding obligations under
the Relevant Agreement in the manner envisaged by this Clause 14.
87
(c) A Party may not assign rights under a Relevant Agreement
to an assignee unless that Party also assigns its rights under each
other Relevant Agreement to which it is a party to that assignee in
the manner envisaged by this Clause 14.
(d) A Party may not assign rights under a Relevant Agreement
if such assignment, whether alone or together with any other proposed
assignment of rights under a Relevant Agreement, would result in a
breach of any provision of the Principal Contract. If, in order to
effect such an assignment without breaching the Principal Contract, a
Seller's consent is required or any other condition is required to be
satisfied under the Principal Contract, Gascor and the Party desiring
to assign its rights under a Relevant Agreement must, at the cost of
such Party, use their reasonable endeavours to ensure that such
consent is obtained or condition satisfied.
(e) A Party ("ASSIGNOR") may assign rights under a Relevant
Agreement and be released from, and have the assignee assume,
obligations under a Relevant Agreement on the following basis:
(1) it may assign all (but not part) of its rights under a
Relevant Agreement and be released from its obligations on
the basis that any such assignment must be an assignment to
one person and an assumption of all obligations by one
person;
(2) subject to Clauses 14.3(a), 14.3(c), 14.3(d) and 14.5, if
the Assignor is a Buyer it must obtain the prior written
consent of Gascor and if the Assignor is Gascor it must
obtain the prior written consent of each other Party; and
(3) the proposed assignee must enter into a deed with both the
Assignor and each other Party ("REMAINING PARTY") under
which:
(A) the proposed assignee assumes from a
particular date all of the obligations of the
Assignor under each Relevant Agreement to which
the Assignor is a Party; and
(B) each Remaining Party releases the
Assignor in respect of the obligations assumed by
the proposed Assignee under each Relevant
Agreement to which that Remaining Party is a
party.
14.3 CONSENT
(a) A Party may not unreasonably refuse or delay its consent
for the purposes of Clause 14.2(e)(ii). In deciding whether to give
its consent, a Party shall only have regard to the likelihood of
performance of the obligations under each Relevant Agreement to be
assumed by the proposed assignee on the basis of its financial,
technical and operating competence and capacity.
(b) If a Party refuses to give its consent for the purposes
of Clause 14.2(e)(ii) it must, at the same time as giving notice of
such refusal, provide reasons in writing for the refusal.
88
(c) At the same time that it requests consent from a Party
under Clause 14.2(e)(ii), the Assignor must provide to that Party such
information concerning the proposed assignee as is reasonably
available and as would be reasonably required by a Party for the
purposes of deciding whether to give its consent. Information provided
under this Clause 14.3(c) may be provided on the basis that it is
confidential, that it is only to be used for the purposes described in
this Clause 14.3(c) and that it may not be disclosed to another person
except if required by law.
(d) If a Party does not:
(1) give or refuse its consent for the purposes of Clause
14.2(e)(ii); or
(2) provide written reasons for its refusal of consent,
within 20 Working Days of the request being made or the information
described in Clause 14.3(c) being provided (whichever is later), it
shall be taken to have consented for the purposes of Clause
14.2(e)(ii)
(e) Each Party who (being required to give its consent)
consents or is taken to have consented for the purposes of Clause
14.2(e)(ii) or whose consent is not required pursuant to Clause 14.5
must duly execute and deliver a deed of the type described in Clause
14.2(e)(iii).
14.4 CHANGE IN CONTROL
(a) Subject to Clauses 14.4(b) and 14.6, a Change in Control
of a Party ("CHANGING PARTY") may not occur without the prior written
consent of Gascor, if the Changing Party is a Buyer, or each other
Party ("OTHER PARTY"), if the Changing Party is Gascor, such consent
not to be unreasonably withheld or delayed. In deciding whether to
give its consent an Other Party shall only have regard to the
likelihood of performance by the Changing Party of its obligations
under each Relevant Agreement to which it is a party following the
change of control by assessing the financial, technical and operating
competence and capacity of the Changing Party. The provisions of
Clauses 14.3(a), (b), (c) and (d) apply to this consent with necessary
changes and on the basis that the information to be provided under
Clause 14.3(c) will be provided by the Changing Party and will concern
the proposed new controllers of the Changing Party.
(b) Clause 14.4(a) does not apply in relation to a Change in
Control of a Party if there is no change in the ultimate holding
company (within the meaning of the Corporations Law) of the Party or
if, following a Change in Control of Gascor, Gascor continues to be
ultimately controlled by the State.
14.5 ASSIGNMENT BY GASCOR
The consent of a Party is not required under Clause 14.2(e)(ii) to an assignment
and release where Gascor is the Assignor and the proposed assignee is:
(a) a person to whom Gascor may assign rights under the
Principal Contract; or
89
(b) a body corporate ultimately controlled by the State, a
State instrumentality or a statutory authority.
14.6 CHANGE OF CONTROL EXEMPTION
The consent of a Party is not required under Clause 14.4(a) to a Change in
Control of a Party where:
(a) immediately prior to the Change in Control the Party is
ultimately controlled by the State, a State instrumentality or a
statutory authority; and
(b) the Change in Control occurs by reason of a transfer of
shares in the Party (or a holding company of the Party) to a person or
persons selected by the State.
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15. CONFIDENTIALITY
--------------------------------------------------------------------------------
15.1 GENERAL OBLIGATION
Subject to Clauses 15.2, 15.3, 15.4, 15.5 and 15.8, this Agreement, all
information with respect to this Agreement and all operations under this
Agreement must be kept confidential by the Parties from the date of this
Agreement until the date which is 5 years after the termination of this
Agreement and must not be disclosed to any person, other than persons that are
dealing with this Agreement, or matters arising from or related to this
Agreement, in the service or employment of or retained by the Party receiving or
holding the same or persons to whom that Party is compelled by law to disclose
the same, unless the agreement of the other Parties is first obtained (such
agreement not to be unreasonably withheld). A Party who discloses information
under this Clause 15.1 to a person in the service or employment of that Party or
retained by that Party must use all reasonable endeavours to ensure that the
person does not disclose the information except in the circumstances permitted
by this Clause 15.
15.2 EXCEPTIONS
The information referred to in Clause 15.1 may be disclosed by a Party
("DISCLOSING PARTY"):
(a) to any related body corporate (within the meaning of the
Corporations Law) of that Party, subject to the related body corporate
first agreeing with the Disclosing Party to be bound by
confidentiality provisions no less onerous than those contained in
this Clause 15, and the Disclosing Party will be liable to each other
Party for any breach of such confidentiality provisions by its related
body corporate;
(b) to any lending or financial institution which has made,
or is considering making, financial accommodation available to or is
otherwise engaged by the Disclosing Party or a related body corporate
of the Disclosing Party, subject to such institution first undertaking
for the benefit of each other Party to be bound by confidentiality
provisions substantially the same as those contained in this Clause 15
90
(except that information may be disclosed to the persons in the
service or employment of or retained by the lending or financial
institution who are dealing with the financial accommodation or
possible financial accommodation);
(c) to any party with whom a Disclosing Party is in bona
fide negotiations to assign the whole of its interest in this
Agreement, subject to such party first agreeing with the Disclosing
Party (which will be deemed to hold the benefit of that agreement for
each other Party) to be bound by confidentiality provisions
substantially the same as those contained in this Clause 15;
(d) to the State or any statutory authority of the State;
(e) to the Commonwealth of Australia or any statutory
authority of the Commonwealth of Australia subject to the Disclosing
Party first notifying the other Parties and, to the maximum extent
practicable, minimising the disclosure and informing the person to
whom the disclosure is made of the commercial and confidential nature
of the information disclosed;
(f) to the Australian Consumer and Competition Commission,
the Office of the Regulator-General of the State or any other
government body which regulates the conduct of any business of the
Disclosing Party subject to the Disclosing Party first notifying the
other Parties and, to the maximum extent practicable, minimising the
disclosure and informing the person to whom disclosure is made of the
commercial and confidential nature of the information disclosed;
(g) to:
(1) an independent third party referred to in Clause 4.2(c)(v);
(2) the Chairman of the Australian Commercial Disputes Centre
Limited if required to appoint an Expert pursuant to Clause
10.2(d) or any other person required to appoint an
independent third party under this Agreement;
(3) an Expert or a person whom a Party is considering as an
Expert; or
(4) the Chairman of the Victorian Bar Council if required to
nominate a person pursuant to Clause 11.7(a);
(5) to any Performance Auditor or Allocation Auditor appointed
pursuant to Part B of Schedule 1;
(6) to an auditor of that Party appointed under Part 3.7 of the
Corporations Law;
(7) to an allocation agent (as defined in the MSO Rules), for
the purposes contemplated by the MSO Rules;
(8) to any other party who a Disclosing Party wishes or the
Parties wish to employ or retain as a consultant, adviser or
potential witness ("CONSULTANT") in relation to any matter
under this Agreement,
91
subject to the Disclosing Party, minimising the disclosure and
informing the person to whom the disclosure is made of the commercial
and confidential nature of the information disclosed and, in the case
of paragraph (9), the Consultant first agreeing with the Disclosing
Party (which will be deemed to hold the benefit of that agreement for
each other Party) to be bound by the confidentiality provisions
substantially the same as those contained in this Clause 15;
(h) where the Disclosing Party is Gascor, to any person or
persons ("BIDDER") with whom the State or Gascor is in negotiations
(which includes the calling of expressions of interest) to transfer
all or any of the shares in a Retailer or a Transmission Company or
all or a substantial part of the assets or undertaking of a Retailer
or a Transmission Company or to any lending or financial institution
which has made, or is considering making, financial accommodation
available to or is otherwise engaged by the Bidder or any legal or
financial adviser or consultant engaged by the Bidder; or
(i) for the purposes of a prospectus or other offering
document relating to the offering of shares in the Buyer or any
Related Company of the Buyer as part of a proposed listing of the
Buyer or that Related Company on a stock exchange subject to the
Disclosing Party first notifying the other Parties and, to the maximum
extent practicable, minimising the disclosure.
15.3 TRANSPORT EXEMPTION
To the extent only that the information referred to in Clause 15.1 relates to
the quantity, quality measurement and testing of Gas delivered or to be
delivered to a Buyer under its Agency Agreement or Sub-sales Agreement, it may
be disclosed by Gascor or that Buyer to a Transmission Company or any other
person who transports, or a person with whom that Buyer is in bona fide
negotiations in relation to the transportation of, Gas taken under any such
agreement, subject to the person first agreeing with the disclosing Party (which
will be deemed to hold the benefit of that agreement for each other Party) to be
bound by confidentiality provisions substantially the same as those contained in
this Clause 15.
15.4 GENERAL EXCEPTIONS
This Clause 15 does not apply to information which is now, or after the date of
this Agreement becomes, a part of the public domain through no fault of the
Party wishing to disclose it or which corresponds in substance to information
furnished by a third party without restriction on disclosure or which must be
disclosed pursuant to a statutory obligation.
15.5 OTHER PERMITTED DISCLOSURES
Any Party required by law or the rules of an established stock exchange, or
finding it desirable in submissions to an Expert or in the assertion of any
claim or defence in a judicial, arbitral or administrative proceeding, to
disclose information which is otherwise required to be maintained in confidence
pursuant to this Clause 15 may make such disclosure, regardless of this Clause
15, provided that the disclosing Party first notifies the other Parties of such
requirement or desirability and, to the maximum extent practicable, minimises
the disclosure of any such information.
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15.6 RESTRICTIONS SURVIVE TERMINATION
Notwithstanding Clauses 12, 17 and 18, the Parties agree that the restrictions
contained in this Clause 15 will survive the termination of this Agreement.
15.7 PARAMOUNT CONFIDENTIALITY OF PRINCIPAL CONTRACT AND BUYER INFORMATION
(a) Gascor is not obliged to disclose any information to any
Buyer or any other person under or in connection with this Agreement
if to do so would breach:
(1) any obligation of confidence owed by Gascor to a Seller
under or in connection with the Principal Contract; or
(2) any obligation of confidence owed by Gascor to a Buyer under
Clause 15.8;
each a "CONFIDENTIALITY OBLIGATION".
(b) If the performance by Gascor of any obligation under
this Agreement would require Gascor to breach a Confidentiality
Obligation, Gascor is released from that obligation to the extent
necessary to prevent Gascor from breaching that Confidentiality
Obligation.
(c) If Gascor is released by virtue of Clauses 15.7(a)(1)
and (b) from performing an obligation, the Parties must promptly
renegotiate in good faith the terms of this Agreement to the extent
necessary to substitute the affected obligation with another
obligation which achieves substantially the same commercial outcome
but the performance of which by Gascor will not breach any
Confidentiality Obligation.
(d) Without prejudice to Clause 15.7(a), Gascor is not
obliged to disclose to a Buyer any of its computations, calculations
allocations or adjustments under this Agreement if by doing so it
would breach a Confidentiality Obligation. If any information required
for the purpose of any computation, calculation, allocation or
adjustment under this Agreement cannot be disclosed by Gascor because
of any Confidentiality Obligation, Gascor will be deemed to have
performed any obligation to substantiate or explain that computation,
calculation allocation or adjustment if the accuracy or veracity of
the computation, calculation, allocation or adjustment is certified by
a senior officer of Gascor.
15.8 CONFIDENTIALITY OF BUYER INFORMATION
All information provided to Gascor by a Buyer under this Agreement, and all
allocations, computations, calculations or adjustments made in respect of a
Buyer under this Agreement, must not be disclosed by Gascor to any person other
than persons who are dealing with this Agreement, or matters arising from or
related to this Agreement, in the service or employment of or retained by
Gascor, except:
(a) with the consent of the relevant Buyer;
93
(b) to enable Gascor to perform any of its obligations under the Principal
Contract, this Agreement or the relevant Buyer's Agency Agreement or
Sub-sales Agreement subject to Gascor first notifying the relevant
Buyer insofar as reasonably practicable and, to the maximum extent
possible, minimising the disclosure and informing the person to whom
the disclosure is made of the commercial and confidential nature of
the information disclosed;
(c) if allowed or required by law;
(d) to a person referred to in Clauses 15.2(a), (c), (d), (e), (f) or (g);
or
(e) in the circumstances where disclosure of information is permitted in
accordance with Clauses 15.4 or 15.5.
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16. COMMUNICATIONS
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16.1 COMMUNICATIONS
All notices, Buyer Default Notices, Gascor Default Notices, Schedule 1, Default
Notices, notifications, nominations, consents, approvals, requests,
requirements, reports, acknowledgments, invoices and the like ("COMMUNICATIONS")
between the Parties must be in legible writing and in the English language.
16.2 MANNER OF SERVICE
Subject to Clause 7.3(b), any Communication given in connection with this
Agreement must be:
(a) delivered by hand;
(b) sent by prepaid post;
(c) sent by facsimile; or
(d) sent by such other electronic media as the Parties may agree.
16.3 SERVICE PARTICULARS
Subject to Clause 7.3(b), to be effective each Communication to a Party must be
sent in accordance with the particulars of the Party set out below or such other
particulars as may be notified from time to time by that Party.
The address, facsimile and telephone particulars of each Party as at the date of
this Agreement are:
GASCOR
Address: 0xx Xxxxx, 00 Xxxxxxx Xxxxxx, Xxxxxxxxx Xxx 0000
Telephone: 0000 0000
Facsimile: 9629 2511
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Attention: Contracts Manager
ENERGY 21 PTY LTD
Address: Xxxxx 0, 000 Xxxxxxxx Xxxxxx, Xxxxxxxxx Xxx 0000
Telephone: 0000 0000
Facsimile: 9652 5053
Attention: General Manager
IKON ENERGY PTY LTD
Address: Xxxxx 0, XXX Building, 00 Xxxx Xxxx, Xxxxxxxxx
Xxx 0000
Telephone: 0000 0000
Facsimile: 9926 5580
Attention: General Manager
KINETIK ENERGY PTY LTD
Address: Xxxxx 00, Xxxx Xxxxx, 00 Xxxx Xxxx, Xxxxxxxxx
Xxx 0000
Telephone: 0000 0000
Facsimile: 9299 2699
Attention: General Manager
RCO
Address: 0xx Xxxxx, 00 Xxxxxxx Xxxxxx, Xxxxxxxxx Xxx 0000
Telephone: 0000 0000
Facsimile: 9629 2511
Attention: Contracts Manager
16.4 TIMING OF SERVICE
(a) Communications will be properly served or given and
deemed received if:
(1) delivered by hand, on the date of delivery;
(2) sent by prepaid post, 4 days after posting;
(3) sent by facsimile on production of a transmission report by
the machine from which the facsimile was sent which
indicates that the facsimile was sent in its entirety to the
facsimile number of the recipient or, if transmission is not
effected during a Working Day and the subject matter of the
Communication is not required by (and sent to) the operating
personnel of a Party, at the commencement of the next
following Working Day.
95
(b) The Parties must endeavour to ensure that all date
stamps appearing on facsimile are in accordance with the time in
Melbourne.
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17. SEVERANCE
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17.1 GENERAL CASE
(a) If the whole or any part of a provision of this
Agreement is or becomes void, unenforceable or illegal or otherwise
contravenes any law or statute, it is severed from this Agreement and
the remainder of this Agreement continues in full force and effect.
(b) If the severance referred to in Clause 17.1(a) would
alter the basic nature of this Agreement (other than a Party's right
to information), this Agreement will be deemed to have terminated on
the date upon which the Parties first become aware of the provision
being void, unenforceable or illegal or otherwise contravening any law
or statute.
17.2 EXEMPTION EVENT
(a) If any Party becomes aware that the Exemption is likely
to be repealed or amended or to cease to apply to any of the Sellers,
any Buyer, Gascor and this Agreement or to lapse within 3 months (the
occurrence of each such event being an "EXEMPTION EVENT"), that Party
must notify all other Parties. The Parties must meet within 5 Working
Days of such notice to discuss the potential Exemption Event.
(b) (1) If following a meeting pursuant to Clause 17.2(a), a
Party reasonably considers that the Exemption Event may
result in that Party being in contravention of Part IV of
the Trade Practices Xxx 0000, the Party may so notify the
other Parties and the Parties must then jointly brief, as
soon as reasonably practicable, a Senior Counsel or
equivalent (experienced in matters relating to the Trade
Practices Act 1974) to advise on the likelihood of such a
contravention.
(2) If the Parties are unable to agree on Counsel within 5
Working Days of a Party's notice under Clause 17.2(b)(i),
any Party may request that the Chairman of the Victorian Bar
Council nominate counsel and such nomination will be binding
on the parties.
17.3 NEW AGREEMENT
(a) If either:
(1) this Agreement is terminated pursuant to Clause 17.1(b); or
(2) the advice obtained from Counsel pursuant to Clause 17.2(b)
confirms the likelihood of a contravention of Part IV of the
Trade Practices Act 1974 upon the occurrence of the
Exemption Event, and the Exemption has not been replaced by
96
another regulation, enactment or arrangement having the same
effect as the Exemption,
the Parties must meet as soon as possible thereafter and negotiate in
good faith with the intent of agreeing the terms of a new agreement
relating to the matters dealt with in this Agreement on terms and
conditions similar to those in this Agreement taking into account the
effect of those provisions that contravene or are likely in any
Party's reasonable opinion to contravene the provisions of Part IV of
the Trade Practices Xxx 0000.
(b) Negotiations commenced under Clause 17.3(a)(ii) may
cease upon it becoming apparent that:
(1) the Exemption will not be repealed, amended, cease to apply
or lapse;
(2) the Exemption has been replaced by another regulation,
enactment or arrangement having the same effect as the
Exemption; or
(3) the Exemption is not required in order to prevent a Party
being in contravention of Part IV of the Trade Practices Xxx
0000.
(c) If:
(1) the Parties have not agreed the terms of a new agreement
within 60 days after the occurrence of an Exemption Event;
(2) the Exemption has not been replaced by another regulation,
enactment or arrangement having the same effect as the
Exemption; and
(3) it has not become apparent that the Exemption is not
required in order to prevent the Party seeking to utilise
this Clause 17.3(c) being a contravention of Part IV of the
Trade Practices Xxx 0000,
a Party may by notice to the other Parties terminate this
Agreement with effect from the latter of:
(A) the Exemption being repealed,
amended, ceasing to apply to each of the Parties
and this Agreement or lapsing; and
(B) the date of such notice.
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18. COMMENCEMENT AND TERMINATION
--------------------------------------------------------------------------------
18.1 COMMENCEMENT
The terms and provisions of this Agreement take effect as from the date of this
Agreement.
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18.2 TERMINATION OF PRINCIPAL CONTRACT
Without prejudice to each Buyer's rights under Clause 13 and Gascor's rights
under Clause 12, the agreement between Gascor and each Buyer recorded by the
Relevant Agreements to which that Buyer is a party will automatically terminate
if the Principal Contract is terminated.
18.3 TERMINATION OF AGREEMENT WITH EACH BUYER
(a) Subject to Clauses 12 and 17, the agreement between
Gascor and a Buyer recorded by this Agreement will automatically
terminate:
(1) if that Buyer's Allocated Quantity has been reduced to zero
and that Buyer has no Buyer's Accumulated Make-up Gas, at
the end of the Day on which that Buyer's Allocated Quantity
was reduced to zero;
(2) if that Buyer's Allocated Quantity has been reduced to zero
and that Buyer has Buyer's Accumulated Make-up Gas, on the
earlier to occur of:
(A) the end of the Day on which the
Buyer's Accumulated Make-Up Gas of that Buyer has
been reduced to zero; and
(B) the end of the Make-up Period; or
(3) in the case of RCo, at 9.00 am on 1 January 2004.
(b) Subject to Clause 15.6 upon termination of the agreement
between Gascor and a Buyer recorded by this Agreement, Gascor and that
Buyer will be discharged from any further obligations or liabilities
under this Agreement without prejudice to any rights, obligations or
liabilities which have accrued up to that date.
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19. RELATIONSHIP BETWEEN EACH BUYER AND GASCOR
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19.1 SEPARATE AGREEMENT WITH GASCOR AND EACH BUYER
(a) This Agreement records the terms and conditions of a
separate agreement between Gascor of the one part and each Buyer of
the other part.
(b) If any Buyer is not bound by this Agreement, this
Agreement will continue to bind Gascor and each other Buyer.
19.2 NO AGREEMENT BETWEEN EACH BUYER
(a) This Agreement (other than the provisions of Schedule 1)
does not constitute an agreement between a Buyer of the one part and
any other Buyer of the other part.
(b) The provisions of Schedule 1 of this Agreement record
the terms and conditions of a separate agreement between each Buyer of
the one part and each other Buyer of the other part.
98
(c) No Party intends by this Agreement to create between the
Parties a fiduciary relationship or a relationship of a trustee to a
beneficiary and no Party shall hold any right, or be required to
exercise any right, for the benefit of any other Party.
19.3 NO PARTNERSHIP AND SEVERAL LIABILITY
(a) No Party intends by this Agreement to create, nor will
this Agreement be construed as creating, between all or any of the
Parties, a partnership, joint venture or association whatsoever.
(b) The liability of each Party under this Agreement is
limited to the performance of its obligations and the discharge of its
liabilities only. No Party is responsible for the obligations or
liabilities of any other Party under this Agreement.
19.4 NO RELEASE
The non-performance or non-discharge by a Party of any of its obligations or
liabilities under this Agreement will not release or discharge:
(a) that Party from any of its obligations or liabilities
under this Agreement;
(b) any other Party from any of its obligations or
liabilities under this Agreement.
--------------------------------------------------------------------------------
20. GENERAL
--------------------------------------------------------------------------------
20.1 ENTIRE AGREEMENT AND OPERATION OF SCHEDULES
(a) The Relevant Agreements constitute the entire contract
between the Parties (insofar as they are parties to those agreements)
and supersede all other agreements and understandings between the
Parties with regard to the matters dealt with in the Relevant
Agreements and no representations, terms, conditions or warranties not
contained in the Relevant Agreements will be binding on the Parties.
(b) The Schedules form part of this Agreement and the
Parties must perform their respective obligations as set out in the
Schedules.
20.2 TERMINATION OF AGREEMENT BETWEEN GASCOR AND A BUYER
If the agreement ("TERMINATED AGREEMENT") between Gascor and a Buyer recorded by
the Relevant Agreements to which that Buyer is a party is terminated (other than
by virtue of the application of Clause 18 of this Agreement or by virtue only of
the passing of time) but at least one other such agreement between Gascor and
another Buyer continues in force, then, solely for the purposes of applying the
formulas contained in Clauses 2.1, 2.2, 2.3, 2.4, 2.5, 3.1, 3.2, 3.3, 3.4, 3.6,
4.3, 4.4, 4.5, 4.6, 5.2, 5.3, 5.4, 5.5, 5.6, 6.1, 7.4, 7.5, 7.6, 7.8 and 9 and
Schedules 2 and 4:
99
(a) the Terminated Agreement will be deemed not to have
terminated and Gascor will be deemed to have become a party to the
Terminated Agreement in place of that Buyer and will be deemed to have
assumed all rights and obligations of that Buyer under the Terminated
Agreement with effect from the date of termination of the Terminated
Agreement;
(b) subject to Clause 20.2(c), any Gas supplied or sold by
Gascor to third parties after the date of termination of the
Terminated Agreement (excluding any sale or supply of Gas by Gascor to
any other Buyer under its Sub-sales Agreement or Agency Agreement)
will be deemed to have been supplied or sold by Gascor under the
Terminated Agreement; and
(c) if at any time there is more than one Terminated
Agreement, any Gas supplied or sold by Gascor to third parties
(excluding any sale or supply by Gascor to any other Buyer under its
Sub-sales Agreement or Agency Agreement) will be deemed to have been
supplied or sold by Gascor under the Terminated Agreements in equal
proportions,
with the intent that the provisions and formulae contained in those Clauses
should have effect, as between Gascor and the other Buyers, as if the Terminated
Agreement or Terminated Agreements had not been terminated.
20.3 ALLOCATION DISCREPANCIES
(a) Subject to Clause 20.3(b), the Parties acknowledge that
it is their intention that the rights and obligations of Gascor under
the Principal Contract to nominate and take delivery of quantities of
Gas from the Sellers should be allocated in full among the Buyers and
that there should be no discrepancy between the quantities of Gas
which Gascor may or is required to take under the Principal Contract
and the quantities of Gas which all Buyers may or are required to take
under the Relevant Agreements.
(b) The Buyers acknowledge that, whereas Gascor must pay to
the Sellers the D Market Price for the D Market Quantity, all Gas
supplied by Gascor to the Buyers must be paid for under their
respective Sub-sale Agreements, or accounted for in determining the
commission payable to the Retailers under their respective Agency
Agreements, at the C Market Price (as adjusted from time to time in
accordance with the terms of the Principal Contract) and that Gascor
is entitled to retain all right, title, benefit or interest in or to
the difference between the amounts payable by Gascor to the Sellers
for Gas and the aggregate amounts payable by the Buyers to Gascor for
Gas under the Sub-sales Agreements and retained by Gascor after the
payment of the Retailers' commissions under the Agency Agreements.
(c) If at any time there is a discrepancy between the
quantities of Gas which Gascor may or is required to take under the
Principal Contract on a Day or in any period and the quantities of Gas
which all the Buyers may or are required to take on that Day or in
that period so that Gascor is unable to comply with any obligations
under the Principal Contract or any Relevant Agreement or Gascor has
retained a benefit which, at the date of this Agreement, the State did
not intend Gascor to retain by virtue of the Relevant Agreements (and
whether or not the State had such an intention shall be determined
conclusively by the Treasurer of the State), any Party may notify the
100
other Parties of that fact and the Parties must use their best
endeavours to renegotiate in good faith the terms of this Agreement to
the extent necessary to achieve the intent of the Parties described in
Clause 20.3(a).
(d) If the Parties have not agreed the terms upon which the
Relevant Agreements will be amended within 60 days of the date of a
Party's notice pursuant to Clause 20.3(c), any Party may refer the
matter to an Expert.
20.4 WAIVERS
A Party may not allege or purport to rely upon any waiver of any breach of or
non-compliance with any warranty, term or condition of this Agreement unless
that waiver is in writing and signed by the Party against which that waiver is
claimed. A waiver of any breach or non-compliance will not be and will not be
deemed to be a waiver of any other or subsequent breach or non-compliance.
20.5 VARIATIONS
(a) A Party may not allege or purport to rely upon any
modification, variation or amendment of this Agreement unless it is in
writing and signed by each Party.
(b) No Party shall agree to any modification, variation or
amendment of a Relevant Agreement to which it is a party if such
modification, variation or amendment would result in another Party
incurring a liability under this Agreement which that other Party
would not have incurred but for that modification, variation or
amendment.
20.6 FURTHER ASSURANCE
From time to time at the request of a Party, each other Party must do and
execute or cause to be done or executed all such acts, deeds and assurances
reasonably necessary for ensuring full and proper compliance with or performance
of the terms of this Agreement.
20.7 EXERCISE OF RIGHTS
A Party may exercise a right, power or remedy at its discretion, and separately
or concurrently with another right, power or remedy. A single or partial
exercise of a right, power or remedy by a Party does not prevent a further
exercise of that or any other right, power or remedy. Failure by a Party to
exercise a right, power or remedy in respect of any breach does not prevent the
exercise of a right, power or remedy in respect of any subsequent breach.
20.8 COUNTERPARTS
This Agreement may be executed in any number of counterparts, each of which is
an original instrument and all of which constitute one and the same instrument.
20.9 GOVERNING LAW AND JURISDICTION
This Agreement will be governed by and interpreted in accordance with the laws
from time to time in force in the State. The Parties irrevocably and
101
unconditionally submit to the non-exclusive jurisdiction of the Courts of the
State and all Courts which are competent to hear appeals in that jurisdiction.
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21. REFERENCES
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21.1 CHANGES TO A REFERENCE
(a) If at any time and from time to time any Reference is
suspended, modified, discontinued or not published for any other
reason or is wound up or ceases to exist or its method of calculation
or scope of operations substantially alters, then any Party may give
notice to the other Parties of such event. The Parties must meet as
soon as reasonably practicable to attempt to agree upon a substitute
Reference that is published by an independent organisation (in the
case of a Reference referred to in Clause 21.2(a) or (b)) and
necessary consequential amendments to the Relevant Agreements.
(b) If, within 30 days of the notice in Clause 21.1(a), the
Parties are unable to agree on a substitute Reference that is
published by an independent organisation (where applicable) or on a
procedure to develop a revised or new Reference or necessary
consequential amendments, any Party may request an Expert to provide a
substitute Reference that is the nearest equivalent to the Reference
the subject of the notice and to determine any necessary consequential
amendments and the substitute Reference provided by the Expert will
then be the applicable Reference and any necessary consequential
amendments determined by the Expert will be made.
(c) If at any time any Principal Contract Reference is
replaced by a substitute Principal Contract Reference in accordance
with Clause 30.1 of the Principal Contract, that substitute Principal
Contract Reference will apply, where applicable, as the new Reference
under the Relevant Agreements with effect from the date on which the
substitute Principal Contract Reference applies under the Principal
Contract.
21.2 MEANING OF "REFERENCE"
In this Clause "REFERENCE" means:
(a) any index, forecast index or other reference including
any form of CPI and any forecast of CPI;
(b) the average 90 day bank xxxx mid rate on Reuters' page
BBSY;
(c) the Australian Commercial Disputes Centre Limited or the
office of Chairman of that company;
(d) the Institute of Chartered Accountants in Australia or
the office of President of that institute;
(e) the Victorian Bar Council or the office of chairman of
that Council; and
(f) the Institute of Arbitrators, Australia.
102
in each case as used in any Relevant Agreement.
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22. INTERPRETATION
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22.1 QUANTITIES OF GAS
In this Agreement, any reference to a quantity of gas is a reference to the
energy content of gas and the related volume of gas necessary to supply that
energy content.
22.2 INTERPRETATION
In this Agreement, unless the context otherwise requires:
(a) words (including words herein defined or given a special
meaning) denoting the singular include the plural and vice versa;
words of any gender include the corresponding words of the other
genders; other parts of speech and grammatical forms of a word or
phrase defined in this Agreement have a corresponding meaning; and
references to persons include corporations and vice versa;
(b) a reference to a Clause, Recital, Schedule or Annexure
is respecitvely a reference to the specified Clause, Recital, Schedule
or Annexure of this Agreement; and a reference in a Schedule to a
paragraph is a reference to the specified paragraph is a reference to
the specified paragraph in that Schedule or, if that Schedule has more
than one Part, to the specified paragraph in the Part in which the
reference occurs;
(c) all references to units of measurement in this Agreement
are references to the units of measurement defined in or for the
purposes of the National Measurement Act, 1960 (Commonwealth);
(d) all references to amounts of money in this Agreement are
references to those amounts in the lawful currency of Australia;
(e) a reference to this Agreement includes the Recitals,
Schedules and Annexure to this Agreement;
(f) the headings in this Agreement are inserted for
convenience only and do not affect the construction of this Agreement;
(g) reference to any Act of the Parliament of the
Commonwealth of Australia or any State of that Commonwealth or any
regulations thereunder includes, subject to the context and not
including the Exemption, any consolidations, amendments, re-enactments
or replacements of any of them and, in the case of a reference to an
Act, the regulations for the time being in force under it;
(h) all numerical information used and calculations made
under this Agreement will be, as far as practicable, to an accuracy of
4 decimal places or such greater accuracy as may be necessary to
ensure that financial calculations are correct to the nearest cent and
103
all payments to be made under this Agreement will be rounded to the
nearest dollar;
(i) reference to any Party includes a reference to the Party
and its successors and permitted substitutes (including persons taking
by novation) and assigns;
(j) reference to a time and date in connection with the
performance of an obligation or the exercise of a right by a Party is
a reference to the time and date in Melbourne, Victoria;
(k) if a period of time is specified and dates from a given
day or the day of an act or event, it is to be calculated exclusive of
that day;
(l) if an event must occur on a stipulated day which is not
a Working Day then the stipulated day will be taken to be the next
Working Day;
(m) a reference to a quantity of Gas being "PURCHASED" by a
person means a quantity taken or purchased by that person from Gascor
under its Sub-sales Agreement;
(n) a reference to a quantity of Gas being "DELIVERED" to,
or "TAKEN" by, a person means a quantity delivered to, or taken by,
that person under its Sub-sales Agreement or, as agent of Gascor,
under its Agency Agreement;
(o) the word person includes a firm, a body corporate, an
unincorporated association or an authority;
(p) a reference to a Relevant Agreement or another agreement
or instrument (not including the Exemption) includes any variation of
any of them; and
(q) where a word or expression is referred to in Clause 1 as
being defined in the Principal Contract, that word or expression has
the same meaning in this Agreement.
22.3 THIS AGREEMENT PREVAILS
To the extent that any provision of this Agreement is inconsistent with any
provision of any Sub-sales Agreement or any Agency Agreement, the provision of
this Agreement will prevail.
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SCHEDULE 1
MANAGEMENT OF THE PRINCIPAL CONTRACT
PART A
THE COMMITTEE
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1. ESTABLISHMENT OF COMMITTEE
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(a) The Retailers and Gascor agree that a management
committee (the "COMMITTEE") will be established with the functions and
powers set out in this Schedule.
(b) The purpose of the Committee is:
(1) to oversee the management by Gascor of the Principal
Contract and this Agreement;
(2) to consult with Gascor in relaiton to the management of the
Principal Contract and this Agreement;
(3) to make recommendatons to Gascor relating to the management
of the Principal Contract and this Agreement; and
(4) where the Committee is entitled pursuant to this Schedule to
require Gascor to take action in relation to the Principal
Contract to determine the action which Gascor must take.
(c) The Committee is not a committee of the board of
directors of Gascor or an agent or representative of Gascor and has no
power to assume any obligations or incur any liabilities on behalf of
Gascor or any other Party.
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2. CONSTITUTION OF THE COMMITTEE
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(a) The Committee shall comprise not more than four Members.
(b) Each Retailer is entitled to appoint a representative to
be a voting member of the Committee.
(c) Gascor is entitled to appoint a representative to be a
non-voting member of the Committee.
(d) RCo is not entitled to appoint a member of the
Committee.
(e) If:
105
(1) the agreement between a Retailer and Gascor recorded by this
Agreement is terminated in accordance with the provisioins
of this Agreement; or
(2) Gascor suspends any obligations which it owes to a
Defaulting Party under any of the Relevant Agreements to
which the Defaulting Party is a party in accordance with the
provisions of any such Relevant Agreement,
Gascor is entitled to appoint a representative to be a voting member.
(f) Each Party may remove its appointed Member and appoint a
replacement.
(g) A Member may only be removed by the Party who appointed
him.
(h) A Party appointing or removing a Member must do so by
giving written notice of the appointment or removal to each other
Party. The appointment or removal takes effect:
(1) in the case of an appointment or a removal by a Party other
than Gascor, on delivery of the notice to Gascor or, if
later, the date specified in the notice as being the date on
which the appointment or removal take effect; or
(2) in the case of an appointment or removal by Gascor, on
delivery of the notice at a meeting of the Committee or to
the chairperson of the Committee or, if later, the date
specified in the notice as being the date on which the
appointment or removal takes effect.
(i) If an agreement between a Retailer and Gascor recorded
by this Agreement is terminated by Gascor in accordance with the
provisions of this Agreement, the appointment of the Voting Member
appointed by that Retailer will automatically terminate and that
Retailer shall cease to be entitled to appoint a Voting Member of the
Committee.
(j) If Gascor suspends any obligations which it owes to a
Defaulting Party under any of the Relevant Agreements to which the
Defaulting Party is a party in accordance with the provisions of any
such Relevant Agreement, the appointment of the Voting Member
appointed by that Defaulting Party will automatically terminate and
that Defaulting Party shall cease to be entitled to appoint a Voting
Member of the Committee until the suspension is lifted by Gascor.
(k) A Member must be an officer or senior employee of the
Party which that Member represents.
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3. QUORUM
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(a) No business may be transacted at a meeting of the
Committee unless a quorum is present at the time the business is dealt
with.
106
(b) Subject to paragraph 5(e), a quorum consists of at least
two Voting Members present at the meeting of the Committee.
(c) If a quorum is not present at a meeting of the Committee
the meeting is adjourned to the same time and place on the same day in
the following week. If a quorum is not present at the adjourned
meeting the meeting is dissolved.
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4. CHAIRPERSON
--------------------------------------------------------------------------------
(a) Each Retailer is entitled, by rotation in the order in
which their names are first listed in this Agreement, to appoint its
Member to be the chairperson of the Committee for a period of one
year.
(b) The first chairperson will be the Member first appointed
by Energy 21 Pty Ltd or his/her replacement pursuant to paragraph
2(f).
(c) If the chairperson is not present at a meeting of the
Committee, the Members present may elect one of them to preside as
chairperson at the meeting.
(d) The chairperson is not entitled to a second or casting
vote.
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5. DECISIONS AT MEETINGS
--------------------------------------------------------------------------------
(a) Subject to paragraph 5(b) each Voting Member is entitled
to one vote.
(b) The Voting Member appointed by Gascor is entitled to:
(1) one vote for each agreement which is terminated as referred
to in paragraph 2(e)(1); and
(2) one vote for each suspension referred to in paragraph
2(e)(2) which is in effect.
(c) The Non-voting Member is entitled to attend, and speak
at, meetings of the Committee but is not entitled to vote.
(d) Subject to paragraph 5(e), questions arising at a
meeting of the Committee (including without limitation questions
relating to the matters listed in Part D of this Schedule) are to be
decided by a majority of votes cast by the Voting Members present.
(e) Any questions which relates to a matter listed in Part C
of this Schedule may only be decided by the Committee at a meeting at
which all the Voting Members are present and by an affirmative vote of
all the Voting Members.
(f) If all the Voting Members assent to a document
containing a statement to the effect that an act, matter or thing has
been done or resolution has been passed, then that act, matter, thing
or resolution is to be taken as having been done or passed by a
meeting of the Committee.
107
(g) For the purpose of paragraph 5(f):
(1) the meeting is to be taken as held:
(A) if the Voting Members assented to
the document on the same day, on the day on which
the document was assented to and at the time at
which the document was last assented to by a
Voting Member; or
(B) if the Voting Members assented to
the document on different days, on the day on
which, and at the time at which, the document was
assented to by the last Voting Member to assent to
the document;
(2) two or more separate documents in identical terms, each of
which is assented to by one or more Voting Members, are to
be taken as constituting one document; and
(3) a Voting Member may signify assent to a document by signing
the document or by notifying Gascor of the Voting Member's
assent by post or facsimile transmission.
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6. ALTERNATE MEMBERS
--------------------------------------------------------------------------------
(a) A Member may appoint a person to be the Member's
alternate for such period as the Member thinks fit.
(b) An alternate Member may, but need not, be a Member.
(c) An alternate Member must be an officer or senior
employee of a Party.
(d) One person may act as alternate to more than one Member.
(e) An alternate Member is entitled, if the appointor does
not attend a meeting of the Committee, to attend and vote in place of
and on behalf of the appointor.
(f) The appointment of an alternate is terminated if and
when the Member who appointed the alternate is removed as a Member.
(g) The appointment of an alternate may be terminated at any
time by the appointor.
(h) An appointment, or the termination of an appointment, of
an alternate must be in writing signed by the Member who makes or made
the appointment and does not take effect until Gascor has received
notice in writing of the appointment or termination. A member who
appoints or removes an alternate must give notice in writing of the
appointment or removal to all the other Members.
108
(i) An alternate who attends a meeting is to be counted as a
Voting Member for each Voting Member on whose behalf the alternate is
attending the meeting for the purpose of determining whether a quorum
is present at that meeting.
(j) An alternate Member may exercise all the rights and
powers of the Members who appointed him (other than the right to
appoint an alternate).
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7. MEETINGS AND NOTICES
--------------------------------------------------------------------------------
(a) Unless all the Members otherwise agree, the Committee
must meet at regular intervals not exceeding three months.
(b) All meetings of the Committee must be held in Melbourne
unless all the Members otherwise agree.
(c) A Member may, whenever the Member thinks fit, convene a
meeting of the Committee.
(d) Unless all the Members otherwise agree, each Member must
be given at least 7 days notice of a meeting of the Committee.
(e) A notice of a meeting of the Committee:
(1) must specify the time and place of the meeting;
(2) may be given in person or by post or facsimile transmission
or by such other electronic media as the Retailers and
Gascor may agree; and
(3) will be deemed to have been given to an alternate Member if
it is given to the Member who appointed that alternate.
(f) A Member may waive notice of any meeting of the
Committee by notifying the other Members (or their respective
alternates) to that effect in person or by post or facsimile
transmission.
(g) The Members may meet together for the despatch of
business and adjourn and otherwise regulate meetings of the Committee
as they think fit.
(h) The contemporaneous linking together by telephone or
other method of audio or audio visual communication of a number of the
Members sufficient to constitute a quorum, constitutes a meeting of
the Committee and all the provisions in this Schedule relating to
meetings of the Committee apply, so far as they can and with such
changes as are necessary, to meetings of the Committee by telephone or
audio or audio visual communication.
(i) A Member participating in a meeting by telephone or
audio or audio visual communication is to be taken to be present in
person at the meeting.
(j) A meeting by telephone or audio or audio visual
communication is to be taken to be held at the place determined by the
109
chairperson of the meeting provided that at least one of the Members
involved was at the place for the duration of the meeting.
--------------------------------------------------------------------------------
8. SECRETARY AND MINUTES
--------------------------------------------------------------------------------
(a) The Members must appoint a secretary to the Committee.
(b) The Secretary to the Committee must cause minutes of all
proceedings of each meeting of the Committee to be prepared and sent
to all the Members and those minutes must be signed by the
chairperson.
(c) Any minutes of a meeting purporting to be signed by the
chairperson are (in the absence of proof to the contrary) sufficient
evidence of:
(1) the matters stated in the minutes;
(2) the meeting having been duly convened and held; and
(3) the validity of all proceedings at the meeting.
110
PART B
MANAGEMENT OF THE PRINCIPAL CONTRACT
--------------------------------------------------------------------------------
1. ACTION GASCOR IS REQUIRED TO TAKE
--------------------------------------------------------------------------------
(a) Subject to paragraph 1(b) and paragraph 7, Gascor must
take such action as the Committee may request:
(1) subject to the provisions of Part E of this Schedule and any
procedures which are agreed by Gascor and the Retailers in
accordance with paragraph 5(a), to exercise any of the
rights or discretions of Gascor under the Principal Contract
listed in Part C or D of this Schedule;
(2) subject to the provisions of Part E of this Schedule, to
enforce any rights or remedies which Gascor may have against
a Seller in the event of a Seller's Default or to defend any
action or claim which a Seller may bring against Gascor in
connection with the Principal Contract;
(3) subject to the provisions of Part E of this Schedule, in
relation to the conduct of any arbitration proceedings under
Clause 22 of the Principal Contract; or
(4) in relation to the conduct of any matter referred to an
expert under Clause 21 of the Principal Contract.
(b) Gascor is not required to take any action requested by
the Committee:
(1) if, in Gascor's Reasonable opinion, the action would result
in, or be likely to result in, Gascor being in breach of any
provisions of the Principal Contract or any Relevant
Agreement; or
(2) if, in Gascor's opinion, the action would, or would be
likely to, prejudice the ability of Gascor to take delivery
of the D Market Quantity; or
(3) unless Gascor is indemnified and kept indemnified by the
Retailers whose Members have voted in favour of taking the
action, to Gascor's reasonable satisfaction, from and
against any and all liabilities, losses, damages, costs and
expenses which Gascor may suffer or incur as a result of, or
in connection with, taking the action requested and provided
with security in such amount and of such kind as Gascor may
reasonably request for the purpose of securing Gascor from
and against all such liabilities, losses, damages, costs and
expenses; or
(4) unless the action requested has been approved by the
Committee and the resolution of the Committee has been
properly minuted.
(c) Subject to paragraph 1(d), if a matter in respect of
which Gascor may be required to take action in accordance with this
paragraph 1:
111
(1) is considered by the Committee, but the Committee is unable
to determine the action which it requires Gascor to take in
respect of that matter; and
(2) the committee resolves that Gascor should not take any
action, or cease taking any specified action, pending
determination of the action which the Committee may require
Gascor to take; and
(3) the chairperson of the Committee gives Gascor notice in
writing of that resolution,
Gascor must not take any action, or must cease the action
specified, in relation to the matter until the earliest to
occur of the following:
(A) Gascor receiving notice of the
Committee's determination of the action which is
requires Gascor to take in relation to the matter;
(B) Gascor receiving notice that the
Committee is no longer considering the matter; or
(C) the expiry of 30 days after the date
on which Gascor receives the notice referred to in
sub-paragraph (3).
(d) Notwithstanding paragraph 1(c), Gascor may take such
action (or not take action) in relation to a matter referred to in
paragraph 1(a) as it considers necessary or desirable to ensure:
(1) the efficient operation of the Principal Contract;
(2) that Gascor is not in breach, or likely to become in breach,
of any of its obligations under the Principal Contract; or
(3) that Gascor does not incur any material liability, loss,
damage, cost or expense as a result of a failure to take any
action.
(e) Any reference in this paragraph 1 to Gascor taking
action, or being required to take action, shall include a reference to
Gascor not taking action, omitting to take action or being required
not to take any action.
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2. INFORMATION AND REPORTING
--------------------------------------------------------------------------------
(a) Each Retailer must provide Gascor with such information
as Gascor may reasonably request to enable it to comply with its
obligations under the Principal Contract or any Relevant Agreement or
to facilitate the efficient management of the Principal Contract and
the Relevant Agreements.
(b) Subject to Clause 15 of this Agreement, Gascor must
provide each Voting Member with such information as such Voting Member
may reasonably request relating to the operation of the Principal
Contract, provided that Gascor is not obliged to provide a Voting
112
Member with any information which any Party (other than the Party
which has appointed that Voting Member) has designated in writing as
being confidential to that Party.
(c) Gascor must, in consultation with the Retailers, develop
procedures for reporting to the Committee on Gascor's management of
the Principal Contract and providing notices and other communications
received from the Sellers or the Sellers' Agent to the Committee.
(d) Gascor must use its reasonable endeavours to comply with
the procedures referred to in paragraph 2(c) as developed and varied
from time to time.
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3. PERFORMANCE AUDITS
--------------------------------------------------------------------------------
(a) The Committee may require Gascor to appoint, at the cost
of the Retailers whose Members have voted in favour of such
appointment, an independent auditor (the "PERFORMANCE AUDITOR") to
review the management of the Principal Contract with the objective of
making recommendations to improve the efficient and effective
operation of the Principal Contract and the Relevant Agreements.
(b) The Performance Auditor must be a member of a reputable
firm of chartered accountants approved by Gascor (such approval not to
be unreasonably withheld or delayed). Unless all the Retailers and
Gascor otherwise agree, no person who, at the time of the appointment
or at any time whilst they remain the Performance Auditor, has had or
may have some interest or duty (either as an employee or advisor or
otherwise) which conflicts or may conflict with their function under
such appointment may be appointed as or remain as the Performance
Auditor.
(c) The Committee must not appoint a Performance Auditor to
carry out a review under this paragraph 3 less than 18 months after
the conclusion of a previous review carried out pursuant to this
paragraph 3, provided that if the Committee appoints a Performance
Auditor to carry out a review of the operational trials which will
take place prior to the commencement of the gas market which will be
operated by VENCorp, the next review by the Performance Auditor may be
carried out less than 18 months after the first review.
(d) Gascor must co-operate with the Performance Auditor in
relation to the conduct of its review under this paragraph and make
available to the Performance Auditor such information as the
Performance Auditor may reasonably request for the purpose of carrying
out its review.
(e) Without derogating from Clause 15.2(g)(6), it must be a
term of appointment of the Performance Auditor that the Performance
Auditor must not disclose to any Buyer any information which Gascor
must not disclose to that Buyer in accordance with the terms of this
Agreement or the Principal Contract.
113
(f) Subject to paragraph 3(a), the terms of appointment of
the Performance Auditor must be determined by the Committee and
approved by Gascor (such approval not to be unreasonably withheld or
delayed).
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4. ALLOCATION AUDITS
--------------------------------------------------------------------------------
(a) No later than 30 days after the date of this Agreement,
the Committee must meet to endeavour to agree upon the appointment by
Gascor of an independent auditor (the "ALLOCATION AUDITOR") to review,
inter alia, any calculations made by Gascor based on the formulas set
out in this Agreement.
(b) The Allocation Auditor must be a member of a reputable
firm of chartered accountants nominated by the Committee and approved
by Gascor (such approval not to be unreasonably withheld or delayed).
(c) If the Committee has failed to agree upon the Allocation
Auditor within 60 days after first meeting pursuant to paragraph 4(a),
any Retailer or Gascor may, subject to giving a copy of the request to
the other Parties (other than RCo) at the same time as the request is
made, request the President of the Institute of Chartered Accountants
in Australia to appoint an Allocation Auditor and, provided the
Parties (other than RCo) are given a reasonable opportunity to make
submissions prior to any decision, that appointment will be final and
binding on the Parties.
(d) Unless all the Retailers and Gascor otherwise agree, no
person who, at the time of the appointment or at any time whilst they
remain the Allocation Auditor has, has had or may have some interest
or duty (either as an employee or advisor or otherwise) which
conflicts or may conflict with their function under such appointment
may be appointed as or remain as the Allocation Auditor.
(e) The Allocation Auditor must be appointed by Gascor for
an initial term of one year. The Allocation Auditor's appointment may
be renewed for any number of subsequent periods of one year if the
Committee so determines. Notwithstanding the term of his or her
appointment, the Allocation Auditor must be removed if the Committee
so determines, such removal to be with effect from the time of
appointment of a replacement pursuant to paragraph 4(f). If the office
of Allocation Auditor is vacant other than by reason of the removal of
the Allocation Auditor, a person must be appointed as the Allocation
Auditor, pursuant to paragraph 4(f) unless the Committee determines
otherwise.
(f) If the office of Allocation Auditor is vacant or the
Committee determines that the Allocation Auditor must be removed, the
Committee must, unless it determines otherwise, meet within 30 days of
such vacancy or determination (as the case may be) to endeavour to
agree upon an Allocation Auditor or a replacement Allocation Auditor
for the purposes of this Agreement. If the Committee has failed to
agree upon the Allocation Auditor or the replacement within 60 days
after meeting pursuant to this paragraph 4(f), any Retailer or Gascor
may, subject to giving a copy of the request to the other Parties
(other than RCo) at the same time as the request is made, request the
President of the Institute of Chartered Accountants in Australia to
appoint an Allocation Auditor and, provided the Parties (other than
114
RCo) are given a reasonable opportunity to make submissions prior to
any decision, that appointment will be binding and final on the
Parties.
(g) Without derogating from Clause 15.2(g)(6), it must be a
term of the Allocation Auditor's appointment that the Allocation
Auditor must not disclose to a Buyer any information which Gascor must
not disclose to that Buyer in accordance with the terms of this
Agreement or the Principal Contract.
(h) Subject to paragraph 4(g) and Clauses 15.7 and 15.8, the
terms of appointment of the Allocation Auditor must be determined by
the Committee from time to time and approved by Gascor (such approval
not to be unreasonably withheld or delayed).
(i) The Allocation Auditor must be instructed by Gascor, no
later than 30 days after the end of each Contract Year, to carry out a
review of all calculations made by Gascor based on the formulas set
out in this Agreement in respect of that Contract Year and to prepare
a report setting out its findings.
(j) Subject to paragraph 4(g), Gascor must use its
reasonable endeavours to ensure that each Buyer receives a copy of the
Allocation Auditor's annual report by no later than 90 days after the
end of the Contract Year to which the report relates.
(k) In addition to the Allocation Auditor's annual review,
any Buyer may at any time during a Contract Year request the
Allocation Auditor to review a particular calculation made by Gascor
under this Agreement and to report on its findings.
(l) Gascor must co-operate with the Allocation Auditor in
relation to the conduct of a review under paragraph 4(i) or 4(k) and
make available to the Allocation Auditor, at the cost of Gascor, such
information as the Allocation Auditor may reasonably request for the
purpose of carrying out its review.
(m) If the Allocation Auditor concludes in any report made
pursuant to this paragraph 4 that Gascor has made a calculation under
this Agreement which is not in accordance with the terms of this
Agreement and the matter cannot be resolved by the Parties within 60
days of the date of issue of the relevant report:
(1) the matter must, if the Parties agree that the information
upon which the calculation is based and the results of the
calculation can be disclosed by Gascor to all the Parties,
be resolved in accordance with the provisions of Clause 11
of this Agreement; or
(2) if the Parties do not agree that the information upon which
the calculation is based and the results of the calculation
can be disclosed by Gascor to all the Parties, any Party may
refer the matter to an Expert in accordance with the
provisions of Clause 10 of this Agreement.
(n) The costs and expenses of the Allocation Auditor will be
apportioned between the Parties in such proportions as the Allocation
Auditor thinks fit having regard to, among other things, the extent to
which Gascor's calculations have been made in accordance with the
terms of this Agreement.
115
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5. OFF SPECIFICATION GAS AND CURTAILMENT
--------------------------------------------------------------------------------
(a) Gascor and the Retailers must use their best endeavours
to develop and agree, by no later than 1 September 1998, procedures to
be followed by Gascor in the event that:
(1) Off Specification Gas is being, or is likely to be, or has
been, delivered to it by the Sellers; or
(2) the curtailment provisions contained in Clause 11 of the
Principal Contract will, or are likely to, apply.
(b) The procedures referred to in paragraph 5(a)(1) must
address at least the following issues:
(1) the nature and extent of Gascor's obligation to inform the
Retailers if Gascor receives an advice from the Sellers
under Clause 16.2(a) of the Principal Contract; and
(2) the circumstances in which Gascor must require the Sellers
under Clause 16.2(c) of the Principal Contract to suspend
deliveries of Off Specification Gas.
(c) The Retailers must ensure that the procedures referred
to in paragraph 5(a)(1):
(1) enable the Retailers to comply with their obligations (if
any) under the Gas Safety Xxx 0000; and
(2) be consistent with the safety case (if any) submitted by
each Retailer to the Office of Gas Safety under Division 2
of Part 3 of the Gas Safety Xxx 0000,
and Gascor must not unreasonably refuse to agree to a procedure, or a
change in a procedure, which is proposed for such a purpose, provided
that Gascor is not obliged to agree any procedure, or any change in a
procedure, which would result, or be likely to result, in a breach by
Gascor of any of its obligations under the Principal Contract.
(d) The Retailers and Gascor must review the procedures
referred to in paragraph 5(a) at regular intervals, not exceeding 12
months, and endeavour to agree any changes to such procedures.
(e) Gascor must use its reasonable endeavours to comply with
the procedures referred to in paragraph 5(a) as developed or agreed
from time to time.
116
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6. INSURANCE
--------------------------------------------------------------------------------
(a) Subject to paragraph 6(b), Gascor must arrange and
maintain in the name of Gascor with insurers or underwriters of good
repute such insurance policies as any Retailer or Retailers may
reasonably require from time to time.
(b) The Retailer or Retailers who require Gascor to arrange
and maintain any insurance policy must pay on behalf of Gascor, and
(if more than one Retailer so requires) in such proportions as such
Retailers must from time to time agree and notify to Gascor, all
premiums and other costs payable in respect of such insurance policy
by the due date. Gascor is not obliged to take out or renew any
insurance policy if the relevant Retailer or Retailers fail to pay all
premiums and other costs payable in respect of such insurance policy
by the due date.
(c) Gascor must use its reasonable endeavours to pursue any
rights which it may have under any insurance policy to recover any
insurance proceeds.
--------------------------------------------------------------------------------
7. SUSPENSION OF THE POWERS OF THE COMMITTEE IN THE EVENT OF AN EMERGENCY
--------------------------------------------------------------------------------
(a) In the event of, and for the duration of, an Emergency:
(1) Gascor is not required to take any action requested by the
Committee in accordance with paragraph 1(a); and
(2) without limiting the generality of paragraph 7(a)(1), Gascor
may take such action as it determines in its entire
discretion to be appropriate in response to or in connection
with the Emergency, including without limitation
communicating and attending meetings with the Sellers and
exercising Gascor's rights under the Principal Contract
(including without limitation the giving of default
notices).
(b) Gascor shall not be liable to the Buyers for any action
which it takes or omits to take in response to or in connection with
the Emergency, whether or not such action or omission results in
Gascor being in breach of its obligations under this Schedule 1,
provided that Gascor at all times acts in good faith.
(c) Paragraphs 7(a) and (b) only apply if and for so long as
all the shares in Gascor are directly or indirectly legally and
beneficially owned by or on behalf of the State or any statutory
authority or instrumentality of the State.
(d) For the purposes of this Clause 7, an "EMERGENCY" will
be deemed to:
(1) occur when:
(A) the Governor in Council by
proclamation declares Part 6A of the Act to apply
as a result of or in connection with an event or
117
situation relating to the operation of the
Sellers' Facilities (as defined in the Principal
Contract);
(B) the Minister gives a direction under
Part 6A of the Act which in Gascor's reasonable
opinion, affects Gascor's rights under, or the
operation of, the Principal Contract;
(C) the Office of Gas Safety gives a
direction under section 149 of the Act or under
section 106 or 107 of the Gas Safety Xxx 0000
which, in Gascor's reasonable opinion, affects
Gascor's rights under, or the operation of, the
Principal Contract; or
(D) VENCorp gives a direction under
section 16H of the Act or an emergency direction
under the MSOR which, in Gascor's reasonable
opinion, affects Gascor's rights under, or the
operation of, the Principal Contract; and
(2) continue on each Day on which:
(A) a Seller delivers, or in Gascor's
reasonable opinion is likely to deliver, under the
Principal Contract less than 80 per cent of the
lowest quantity of Gas which Gascor has nominated
under the Principal Contract for delivery at the
Point of Delivery on that Day; and
(B) any one or more customers in
Victoria have been or, in Gascor's reasonable
opinion, are likely to be, directed (directly or
indirectly) to curtail their use or consumption of
gas by VENCorp or any person authorised or
required by law to make such a direction.
118
PART C
MATTERS REQUIRING THE UNANIMOUS APPROVAL OF THE COMMITTEE
Words and expressions defined in the Principal Contract have the same meanings
in this Part C.
CLAUSE OF THE PRINCIPAL CONTRACT SUMMARY OF MATTER
5.8(h) If MDQ is reduced or increased as a
result of a Reserves Shortfall or
Reserves Surplus, the Parties must meet
within 14 days and negotiate in good
faith to endeavour to agree upon a
revised AQ.
23.3(a) and (b) Right of Buyer to terminate the Contract
in the event of a Default.
119
PART D
RIGHTS AND DISCRETIONS UNDER THE PRINCIPAL CONTRACT
Words and expressions defined in the Principal Contract have the same meanings
in this Part D of this Schedule.
CLAUSE OF THE PRINCIPAL SUMMARY OF RIGHT/DISCRETION
CONTRACT
4.8 Reserves Shortfall 4.8(a) Right to Buyer to give notice to
Sellers if it considers that there
is a Reserves Shortfall.
Obligation on the Parties to meet
and endeavour to agree the amount
of the Reserves Shortfall.
4.8(b)(i) Right to appoint an independent
auditor to review Sellers' records
to determine the Additional
Agreement Quantity.
4.8(b)(ii) Right to refer any matter relating
to the calculation of the Reserves
Shortfall to an Expert.
4.9 Reserves Surplus 4.9(a)(i) Right of Buyer to give notice to
Sellers if it considers that there
is a Reserve Surplus.
4.9(a)(ii) If Seller gives a notice, Buyer
has 30 days to notify Sellers
whether it wishes the Total
Quantity to be increased as a
result of the Reserves Surplus.
4.9(a)(iv) Parties must meet and endeavour to
agree the amount of the Reserves
Surplus.
4.9(b)(i) Buyer may request that an
independent auditor reviews the
records of the Sellers to determine
the Additional Agreement Quantity.
4.9(b)(ii) Buyer may refer any matter relating
to the calculation of the Reserves
Surplus to an Expert.
5.7 MDQ 5.7(c)(v) If Buyer considers that the revised
MDQ calculated by Sellers as a
result of a Reserves Shortfall or
Reserves Surplus does not
accurately reflect the impact on
deliverability of the revised
assessment of Recoverable Gas, it
may refer the matter to an Expert.
120
5.7(d) If at the commencement of a
Contract Year the Total Quantity is
less than [THIS PARAGRAPH CONTAINS
CONFIDENTIAL INFORMATION WHICH HAS
BEEN OMITTED, BUT FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE
Commission.] of AQ, Buyer has the
right to nominate a percentage of
the MDQ prevailing on the final day
of the preceding Contract Year to
apply. The nomination must be given
on or before 31 December 2005.
5.7(f)(ii) Right of Buyer to give notice
prior to [THIS PARAGRAPH CONTAINS
CONFIDENTIAL INFORMATION WHICH HAS
BEEN OMITTED, BUT FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE
Commission.] of each Contact Year
requesting Sellers to provide a
certificate stating that the
deliverability of Gippsland Reserve
Quantity will be sufficient to meet
the maximum MDQ and the
deliverability requirements of all
Additional Agreements.
6. Sellers' Sales 6.5(c) Buyer may notify Sellers that it
seeks a review of the Process and
Mechanisms if it considers that
they are not producing results
consistent with the principles in
Clauses 6.1 and 6.4. The Parties
must meet within 30 days of such
notice being given to agree
necessary amendments.
6.5(e) If the Parties are unable to
agree amendments, within 90 days,
Buyer may refer the matter to an
Expert.
11.2 Co-operation on 11.2 In the event of a curtailment of
curtailment gas deliveries, each Seller and
Buyer must liaise to ensure that
deliveries of gas to Buyer are made
in a manner which is consistent
with each Seller and Buyer acting
as Reasonable and Prudent
Operators.
12.2 Other points of delivery 12.2 Buyer must not unreasonably
withhold its consent to a change in
the Point of Delivery or to
additional Points of Delivery.
16.2 Off Specification Gas 16.2(c) Right of Buyer to suspend
deliveries of Off Specification Gas
for such period as is nominated by
Buyer. Right of Buyer to remove any
suspension.
121
16.2(d)(iii) Buyer must request a suspension
within 2 hours of becoming aware of
the delivery of Off Specification
Gas.
17.1 Scheduled maintenance 17.1(b) The Parties must schedule or
co-ordinate maintenance
requirements so as to minimise
shortfalls and deliveries.
17.2(b)(ii) Right of Buyer to require
Sellers to deliver additional Gas
prior to maintenance or replacement
activity with a view to enabling
Buyer to hold a much gas as
possible and as it considers
necessary in storage or pipelines.
17.2(c) Buyer's consent required for
Sellers to shut down or reduce
their production or processing
capacity (such consent not to be
unreasonably withheld).
18.5 Disputed amounts 18.5(a) Right of Buyer to request further
information in relation to the
contents of a Statement.
18.5(b) Buyer to notify the Sellers of a
dispute as soon as practicable and,
in any event, within 14 days after
the day on which the disputing
party becomes aware of material
grounds for dispute.
18.5(c) Buyer must meet with Seller with
a view to settling the dispute.
20.4 Force majeure 20.4 Buyer must consult in good faith
with Sellers to assess any Force
Majeure and any ways in which it
might be avoided or mitigated.
20.7(a) Buyer may give notice to Sellers,
if Sellers are affected by force
majeure, permanently reducing the
obligations of each Seller to
deliver and Buyer to take gas by an
amount nominated in such notice.
21 Expert 21.2(a) Buyer to designate its
representative in negotiations,
being a senior officer of Buyer
with authority to settle the
matter. Buyer to designate its
representative within 5 Working
Days.
21.2(c) Buyer must meet with Sellers to
agree upon an Expert if the matter
to be referred to the Expert is not
resolved by the senior officers
within 10 Working Days.
122
21.2(d) Buyer may request the Chairman of
the Australian Commercial Disputes
Centre Limited to appoint an Expert
if the Parties fail to agree upon
the appointment of an Expert.
21.4(a) Buyer may make submissions to the
Expert.
22 Dispute resolution 22.1(a) If Buyer claims a dispute has
arisen, it must give notice to the
Sellers identifying the dispute and
designating its representatives in
negotiations.
22.1(b) The senior officers of each Party
must meet to seek to resolve the
matter.
22.1(c) If the dispute is not resolved by
the senior officers within 10
Working Days, Buyer may then
commence arbitration.
22.3 Claimant must deliver its Claim to
the other Parties.
22.4 The Respondent must deliver a
Response within 30 days after
receipt of the Claim. The
Respondent must nominate an
arbitrator.
22.5 The Claimant may delivery a Reply
to the Respondent within 30 days
after the delivery of the Response.
22.7(a) If, within 30 days after delivery
of the Response, the Chairperson
has not been agreed, the Buyer may
request the Chairman of the
Victorian Bar Council to nominate
the Chairperson.
22.9 Buyer must, within 90 days after
the final date upon which a
Response may be delivered, deliver
a list of documents setting out all
the documents which would be
discoverable if the arbitration
were an action in the Supreme Court
of Victoria.
22.16 Buyer must at all times do all
things which are reasonably
necessary or desirable to enable a
just award to be made in an
arbitration and must not do or
cause to be done any act or delay
unreasonably to prevent an award
being made.
22.16 Buyer must co-operate in good faith
to make all such administrative
123
arrangements as may be reasonably
necessary or desirable for the
proper and convenient conduct of
the arbitration.
23. Default 23.1 Right of Buyer to give a Default
Notice.
23.2(b) Right of Buyer to agree a period in
which the Default may be cured.
23.3(c) and Right of Buyer to xxx Xxxxxxx for
(d) damages or to exercise other legal
and equitable remedies.
23.4 Right of the Buyer to claim
compensation in the event of a
failure to deliver Gas.
23.4(d) Obligation of Buyer to use
reasonable endeavours to mitigate
its losses.
25.3 Assignment 25.3 Right of Buyer to withhold consent
in the event of a proposed
assignment by a Seller.
25.6 Right of Buyer to withhold consent
to a change in control of a Seller.
30.1 References 30.1 If any Reference is suspended or
modified or discontinued, Buyer may
give notice to Sellers of such
event and Buyer and Sellers must
meet to attempt to agree upon a
substitute Reference.
Schedule 2 - Sellers' Sales 1.1(a) Parties to agree upon the
Adjustments appointment of the Independent
Assessor.
1.1(b) If the Parties fail to agree upon
an Independent Assessor, Buyer may
request the President of the
Institute of Chartered Accountants
to appoint an Independent Assessor.
1.1(d) Buyer may agree with the Sellers to
remove and replace an Independent
Assessor.
1.4(a) Buyer may request an independent
audit of any determination made by
the Independent Assessor.
1.4(b) If an independent audit indiciates
a material discrepancy, the matter
may be referred by Buyer to an
Expert.
2(a) Buyer may agree an intra-quarter
MDQ or request a determination by
the Independent Assessor.
124
Schedule 8 - Measurement 1. Right of Buyer to agree the
appointment of the Measuring
Agency.
2(b) Right of Buyer to approve the type
of metering equipment and to
approve the terms of operation of
metering equipment.
4(e) Right of Buyer to require Seller to
agree on an alternative method of
measuring if it demonstrates that
the method of measuring is
operating inequitably.
4(f) If Sellers and Buyer are unable to
agree on an alternative method,
Buyer may refer the matter to an
Expert.
6(d) Right of Buyer to conduct
independent tests of the measuring
equipment.
10.1(a) The gas measurement and testing
principles for the purposes of the
Contract are to be as agreed from
time to time between the Parties.
Right to appoint an Expert in the
event of a failure to agree.
10 Paragraph 10 provides for the
Parties to agree revisions to the
standards and methods of
measurement.
125
PART E
LITIGATION INVOLVING THE PRINCIPAL CONTRACT
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1. INTERPRETATION
--------------------------------------------------------------------------------
In this Part E, unless the context otherwise requires:
"SELLER'S CLAIM" means:
(a) the giving of a written notice or other communication by
a Seller or the Sellers to Gascor of its or their intention to
commence arbitration under Clause 22 of the Principal Contract or to
issue legal proceedings in connection with the Principal Contract;
(b) the giving of a notice by a Seller or the Sellers
identifying a difference or dispute in accordance with Clause 22.1 of
the Principal Contract; or
(c) the issue of legal proceedings (other than arbitration
proceedings under Clause 22 of the Principal Agreement) by a Seller or
the Sellers against Gascor in connection with the Principal Contract.
"PROCEEDINGS" means:
(a) any arbitration or other legal proceedings (whether under Clause 22 of
the Principal Contract or otherwise) which Gascor may bring against a
Seller or the Sellers in the event of a Seller's Default or alleged
Seller's Default; or
(b) a notice in writing to a Seller or the Sellers of an intention to
commence, or reserving the right to commence, such arbitration or
other legal proceedings.
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2. PROCEEDINGS BROUGHT BY THE SELLERS AGAINST GASCOR
--------------------------------------------------------------------------------
The following provisions shall apply as between the Retailers and Gascor in the
event of a Seller's Claim:
(a) Gascor may, by giving notice in writing to each of the
Retailers no later than 30 days after it becomes aware of the Seller's
Claim, assume conduct of the defence of the Seller's Claim. If Gascor
assumes conduct of the defence of a Seller's Claim in accordance with
this paragraph 2(a):
(1) without limiting any rights which Gascor may have against a
Buyer for indemnity or compensation, Gascor will be
responsible for all costs (including any legal costs)
incurred by it in relation to the Seller's Claim;
(2) Gascor shall not be required to take any action requested by
the Committee in relation to the Seller's Claim; and
126
(3) Gascor may make, and shall have conduct of, any counterclaim
against a Seller or the Sellers at its cost and shall be
entitled to retain, and apply as it thinks fit, any sums
recovered from a Seller or the Sellers in respect of such
counterclaim.
(b) Gascor may only assume conduct of the defence of the
Seller's Claim in accordance with paragraph 2(a) or 2(e) if and for so
long as Gascor is directly or indirectly owned or controlled by or on
behalf of the State, a statutory authority or an instrumentality of
the State.
(c) If Gascor does not assume conduct of the defence of the
Seller's Claim in accordance with paragraph 2(a) and it is alleged in
writing by a Retailer or Gascor that the Seller's Claim has been
caused by or arisen directly or indirectly as a result of a Default by
a Retailer or Retailers ("RELEVANT RETAILERS"), the Relevant Retailers
may, by giving notice in writing to Gascor and each of the other
Retailers no later than 60 days after the Relevant Retailers
collectively (if more than one) become aware of the Seller's Claim,
assume conduct of the defence of the Seller's Claim. If the Relevant
Retailers assume conduct of the defence of the Seller's Claim in
accordance with this paragraph 2(c):
(1) the Relevant Retailers will be responsible for all costs
(including any legal costs) incurred in relation to the
defence of the Seller's Claim;
(2) the Relevant Retailers may make, and have conduct of, any
counterclaim in the name of Gascor against a Seller or the
Sellers at their cost and shall be entitled to any sums
recovered from a Seller or the Sellers in respect of such
counterclaim (after deduction of any unpaid costs incurred
by Gascor in connection with the Seller's Claim or
counterclaim and any Tax payable by Gascor in respect of
such sums);
(3) Gascor must take such lawful action as the Relevant
Retailers may reasonably request in relation to the conduct
of the defence of the Seller's Claim or any counterclaim
referred to in paragraph 2(c)(2); and
(4) the Relevant Retailers must jointly and severally indemnify
Gascor and keep Gascor indemnified from and against any
claim, action, damage, loss, liability, cost, outgoing or
payment which Gascor may pay, suffer or incur as a result of
or in connection with the Seller's Claim (including any
judgment or order made in connection with such claim), any
counterclaim referred to in paragraph 2(c)(2) (including any
judgment or order made in connection with such counterclaim)
or any action which Gascor may take in accordance with
paragraph 2(c)(3).
(d) If neither Gascor nor the Relevant Retailers assume
conduct of the defence of the Seller's Claim in accordance with
paragraph 2(a) or 2(c), the Committee may, subject to the provisions
of paragraph 1 of Part B of this Schedule, assume conduct of the
defence of the Seller's Claim. If the Committee assumes conduct of the
defence of the Seller's Claim in accordance with this paragraph 2(d):
(1) the Retailers whose Members have voted in favour of the
Committee assuming the conduct of the defence of the
Seller's Claim will be responsible for all costs (including
127
any legal costs) incurred in relation to the defence of the
Seller's Claim;
(2) the Committee may make, and have conduct of, any
counterclaim in the name of Gascor against a Seller or the
Sellers at their cost;
(3) the Retailers whose Members have voted in favour of the
Committee assuming the conduct of the defence of the
Seller's Claim shall be entitled to any sums recovered from
a Seller or the Sellers in respect of any counterclaim
referred to in paragraph 2(d)(2) (after deduction of any
unpaid costs incurred by Gascor in connection with the
Seller's Claim or counterclaim and any Tax payable by Gascor
in respect of such sums);
(4) Gascor must take such lawful action as the Committee may
reasonably request in relation to the conduct of the defence
of the Seller's Claim or any counterclaim referred to in
paragraph 2(d)(2); and
(5) the Retailers whose Members have voted in favour of the
Committee assuming the conduct of the defence of the
Seller's Claim must jointly and severally indemnify Gascor
and keep Gascor indemnified from and against any claim,
action, damage, loss, liability, cost, outgoing or payment
which Gascor may pay, suffer or incur as a result of or in
connection with the Seller's Claim (including any judgment
or order made in connection with such claim), any
counterclaim referred to in paragraph 2(d)(2) (including any
judgment or order made in connection with such counterclaim)
or any action which Gascor may take in accordance with
paragraph 2(d)(4).
(e) If, at any time after the Committee assumes or the
Relevant Retailers assume conduct of the defence of the Seller's Claim
in accordance with paragraph 2(c) or 2(d), Gascor reasonably considers
that the defence of the Seller's Claim is not being conducted
diligently or in the best interests of Gascor, Gascor may take over
the conduct of the defence of the Seller's Claim and any counterclaim
which may have been made from the Committee or the Relevant Retailers
(as the case may be), provided that Gascor shall reimburse each
Retailer whose Member voted in favour of the Committee assuming the
defence of the Seller's Claim or each Relevant Retailer (as the case
may be) all reasonable costs and expenses incurred by such Retailer in
connection with the defence of the Seller's Claim or any counterclaim
prior to the date on which Gascor takes over the conduct of the
defence. If Gascor takes over the defence of the Seller's Claim in
accordance with this paragraph 2(e), paragraph 2(a) will apply.
(f) Neither Gascor, the Relevant Retailers nor the Committee
may settle or compromise any Seller's Claim or any counterclaim made
against the Sellers without the prior written consent of all the
Retailers and Gascor (such consent not to be unreasonably withheld or
delayed) if the terms of such settlement or compromise include any
agreement to vary the terms of or terminate the Principal Contract.
(g) If the Relevant Retailers or the Committee assume the
conduct of the defence of the Seller's Claim, each of the Relevant
Retailers or each Retailer whose Member votes in favour of the
128
Committee assuming conduct (as the case may be) must provide Gascor
with all such information as Gascor may reasonably request relating to
the Seller's Claim or any counterclaim, including all pleadings, legal
opinions, notices, relevant correspondence and other communications.
(h) If Gascor assumes the conduct of the defence of a
Seller's Claim, Gascor must provide each Retailer on a commercial and
confidential basis with all such information as it may reasonably
request relating to the Seller's Claim or any counterclaim, including
all pleadings, legal opinions, notices, relevant correspondence and
other communications.
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3. PROCEEDINGS BROUGHT BY GASCOR AGAINST THE SELLERS
--------------------------------------------------------------------------------
The following provisions shall apply as between the Retailers and Gascor in the
event of the Seller's Default or if Gascor has reasonable grounds for believing
that there has been a material Seller's Default:
(a) Gascor must notify each of the Retailers of the Seller's
Default or alleged Seller's Default as soon as reasonably practicable
after it becomes aware of the Seller's Default or the alleged Seller's
Default.
(b) Gascor may, by giving notice in writing to each Retailer
no later than 30 days after it becomes aware of the Seller's Default
or alleged Seller's Default of its intention to do so, retain the
right in its sole discretion to commence Proceedings in respect of the
Seller's Default or alleged Seller's Default and to assume conduct of
the Proceedings. If Gascor assumes conduct of the Proceedings in
accordance with this paragraph 3(b):
(1) Gascor will be responsible for all costs (including legal
costs) incurred by it in relation to the Proceedings;
(2) Gascor will be entitled to retain, and apply as it thinks
fit, any sums recovered from a Seller or the Sellers in
respect of the Proceedings up to the amount of the loss
which Gascor has suffered as a result of the Seller's
Default in respect of which the Proceedings have been
commenced, including without limitation any loss arising as
a result of a failure by the Sellers to deliver any part of
the D Market Quantity and any costs incurred by Gascor in
connection with the conduct of the Proceedings, but
excluding any loss which Gascor has suffered as a result of
any Buyer's right to damages under any of the Relevant
Agreements.
(c) Gascor may only retain the right to commence and assume
the conduct of Proceedings in accordance with paragraph 3(b) if and
for so long as Gascor is directly or indirectly owned or controlled by
or on behalf of the State, a statutory authority or an instrumentality
of the State.
(d) If Gascor does not retain the right to commence and
assume the conduct of Proceedings in accordance with paragraph 3(b),
the Committee may decide, no later than 60 days after all the
Retailers have received notice of the Seller's Default or alleged
Seller's Default in accordance with paragraph 3(a), to commence
129
Proceedings in the name of Gascor and assume conduct of the
Proceedings. If the Committee assumes conduct of the Proceedings in
accordance with this paragraph 3(d):
(1) the Committee must assume the conduct of the defence of any
counterclaim brought by a Seller or the Sellers against
Gascor in connection with the Proceedings;
(2) Gascor must, subject to the provisions of paragraph 1 of
Part B of this Schedule and paragraph 3(d)(4), take such
lawful action as the Committee may reasonably request in
relation to the conduct of the Proceedings or any
counterclaim referred to in paragraph 3(d)(1);
(3) the Retailers whose Members have voted n favour of the
Committee assuming the conduct of the Proceedings shall be
entitled to any sums recovered (after deduction of any
unpaid costs incurred by Gascor in connection with the
Proceedings and any Tax payable by Gascor in respect of
those sums) in such proportions as they may determine; and
(4) the Retailers whose Members have voted in favour of the
Committee assuming the conduct of the Proceedings must
jointly and severally indemnify Gascor and keep Gascor
indemnified from and against any claim, action, damage,
loss, liability, cost, outgoing or payment which Gascor may
pay, suffer or incur in respect of the Proceedings
(including any judgment or order made in connection with
them) or any counterclaim referred to in paragraph 3(d)(1)
(including any judgment or order made in connection with the
counterclaim) or any action which Gascor may take in
accordance with paragraph 3(d)(2).
(e) If the Committee cannot agree on whether or not to
commence Proceedings or decides not to commence Proceedings, any
Retailer or Retailers ("RELEVANT RETAILERS") may decide, no later than
80 days after all the Retailers have received notice of the Seller's
Default or alleged Seller's Default in accordance with paragraph 3(a),
to commence Proceedings in the name of Gascor and assume conduct of
the Proceedings at their cost. If the Relevant Retailers assume
conduct of the Proceedings in accordance with this paragraph 3(e):
(1) the Relevant Retailers must assume the conduct of the
defence of any counterclaim brought by a Seller or the
Sellers against Gascor in connection with the Proceedings;
(2) Gascor must, subject to the provisions of paragraph 1 of
Part B of this Schedule and paragraph 3(e)(4), take such
lawful action as the Relevant Retailers may reasonably
request in relation to the conduct of the Proceedings or any
counterclaim referred to in paragraph 3(e)(1);
(3) the Relevant Retailers shall be entitled to any sums
recovered (after deduction of any unpaid costs incurred by
Gascor in connection with the Proceedings and any Tax
payable by Gascor in respect of those sums) in such
proportions as they may determine; and
130
(4) the Relevant Retailers must jointly and severally indemnify
Gascor and keep Gascor indemnified from and against any
claim, action, damage, loss, liability, cost, outgoing or
payment which Gascor may pay, suffer or incur in respect of
the Proceedings (including any judgment or order made in
connection with them) or any counterclaim referred to in
paragraph 3(e)(1) (including any judgment or order made in
connection with the counterclaim) or any action which Gascor
may take in accordance with paragraph 3(e)(2).
(f) If Gascor decides commence Proceedings, it must provide
each Retailer on a commercial and confidential basis with all such
information as the Retailer may reasonably request relating to the
Proceedings and any counterclaim, including all pleadings, legal
opinions, notices, correspondence and other communications.
(g) If any Retailers or the Committee decide to commence
Proceedings, each of the Relevant Retailers or each Retailer whose
Member voted in favour of commencing Proceedings (as the case may be)
must provide Gascor on a commercial and confidential basis with all
such information as Gascor may reasonably request relating to the
Proceedings and any counterclaim, including all pleadings, legal
opinions, notices, correspondence and other communications.
(h) Neither Gascor, nor the Committee nor the Relevant
Retailers (as the case may be) may settle or compromise the
Proceedings or any counterclaim brought by the Sellers against Gascor
without the consent of all the Retailers and Gascor (such consent not
to be unreasonably withheld or delayed) if the terms of such
settlement or compromise include any agreement to vary the terms of or
terminate the Principal Contract.
(i) Subject to paragraph 3(h), Gascor, the Committee or the
Relevant Retailer (as the case may be) may decide to settle or
compromise any Proceedings of which it or they have conduct on such
terms as it or they think fit.
131
PART F
MANAGEMENT FEES AND COST RECOVERY
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1. DEFINITIONS
--------------------------------------------------------------------------------
In this Part F, unless the context otherwise requires:
"DISPUTE RESOLUTION ACCOUNTANT" means a person appointed to resolve a dispute
relating to an Operating Budget in accordance with paragraphs 3.1(e) to (l).
"EXCLUDED EXPENDITURE" means any costs or expenses incurred by or on behalf of
Gascor in performing or carrying out the Excluded Functions.
"EXCLUDED FUNCTIONS" means any or all of the following function or activities
performed or carried out by or on behalf of Gascor.
(a) the management and administration of the Agency Agreements;
(b) the management and administration of any Measurement Services
Agreement other than to the extent specified in paragraph (b) of the
definition of Routine Functions; and
(c) any function or activity performed or carried on by Gascor which does
not relate to the purchase, sale, supply or trade in gas.
"MEASUREMENT SERVICES AGREEMENT" means any agreement entered into between Gascor
and a Transmission Company or any other person relating to the provision of
measurement services in connection with the Principal Contract.
"MANAGEMENT FEE" means the management fee payable by a Buyer in respect of a
Contract Year as determined in accordance with paragraphs 2(a), 3.2(a) or 5(b).
"NON-ROUTINE EXPENDITURE" means any costs or expenses incurred by or on behalf
of Gascor other than Routine Expenditure and Excluded Expenditure.
"NON-ROUTINE FUNCTIONS" means any or all of the following functions or
activities performed or carried on by or on behalf of Gascor:
(a) activities relating to the appointment and the functions of the
Independent Assessor (as defined in the Principal Contract) under the
Principal Contract;
(b) the negotiation of amendments to the Principal Contract or any
Relevant Agreement.
(c) the resolution of disputes under the Principal Contract or any
Relevant Agreement and the conduct of arbitration or expert
determination proceedings under the Principal Contract or any Relevant
Agreement;
132
(d) the conduct of any claim or litigation brought or commenced by any
person (other than a claim by a Buyer under a Relevant Agreement or by
a Seller under the Principal Contract);
(e) the conduct of any price review under the Principal Contract;
(f) the administration of the provisions of Clauses 4.7 to 4.9 (inclusive)
of the Principal Contract relating to reserves shortfalls and
surpluses;
(g) any action which Gascor is required or decides to take as a result of
or in connection with a force majeure event, an event of curtailment
of supply or an emergency;
(h) the maintenance or upgrading of Gascor's electronic gas ordering and
gas allocation systems;
(i) any other function or activity not expressly included as a Routine
Function or an Excluded Function.
"OPERATING BUDGET" means an operating budget prepared by Gascor in accordance
with paragraph 3.1(a) and which has been approved by the Committee or in respect
of which the Dispute Resolution Accountant has given a determination.
"PROPORTIONATE SHARE" means, in relation to a Buyer:
(a) in the case of Contract Years [THIS PARAGRAPH CONTAINS
CONFIDENTIAL INFORMATION WHICH HAS BEEN OMITTED, BUT FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION.] and [THIS PARAGRAPH
CONTAINS CONFIDENTIAL INFORMATION WHICH HAS BEEN OMITTED, BUT FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.], the
following proportions:
Each Retailer [THIS PARAGRAPH CONTAINS CONFIDENTIAL
INFORMATION WHICH HAS BEEN OMITTED, BUT FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.]
RCo [THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH
HAS BEEN OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.]
provided that, if RCo does not exercise the Release Gas Option, RCo's
proportion will be zero and each Retailer's proportion will be
increased to one third;
(b) in the case of each subsequent Contract Year, the
following proportion:
Each Retailer [THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION
WHICH HAS BEEN OMITTED, BUT FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION.]
RCo [THIS PARAGRAPH CONTAINS CONFIDENTIAL
INFORMATION WHICH HAS BEEN OMITTED, BUT FILED
133
SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.]
"RESERVE FUND" means the reserve fund which Gascor is required to establish in
accordance with paragraph 4(a).
"ROUTINE EXPENDITURE" means any costs or expenses incurred by or on behalf of
Gascor in performing or carrying out any Routine Functions (including without
limitation a reasonable allocation of overheads).
"ROUTINE FUNCTIONS" means any or all of the following functions or activities
performed or carried on by or on behalf of Gascor:
(a) the management and administration of the Principal Contract in
relation to matters which are, or are likely to be, of a recurring or
routine nature (including without limitation the operation of Gascor's
electronic gas ordering and gas allocation systems);
(b) the supervision of the performance by any Transmission Company or any
other person of its obligations under a Measurement Services Agreement
to provide statements of the quantity of Gas delivered to Gascor
during any period;
(c) the management and administration of all billing and settlement
functions relating to payments under this Agreement and the Sub-sales
Agreements and which are, or likely to be, of a routine or recurring
nature;
(d) day-to-day communication with the Sellers or the Sellers' Agent or the
Buyers in relation to matter arising in connection with the Principal
Contract or the Relevant Agreements which are, or are likely to be, of
a recurring or routine nature;
(e) routine communications with any allocation agent appointed in respect
of Longford under the MSO Rules;
(f) the maintenance of accounting systems;
(g) the preparation of management accounts and annual audited accounts;
(h) compliance with all regulatory, financial reporting and company
secretarial requirements;
(i) participation in meetings of the Committee; and
(j) the development and implementation of procedures for reporting to the
Committee,
but excluding all Non-routine Functions and Excluded Functions.
134
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2. RECOVERY OF ROUTINE EXPENDITURE PRIOR TO 1 JANUARY 2002
--------------------------------------------------------------------------------
(a) Each Buyer must pay Gascor, in accordance with Clause 8
of its Sub-sales Agreement, a management fee for each Month from and
including the Month in which the First Contestability Date falls to
and including December 2001 as determined in accordance with Clause
5.2 of its Sub-sales Agreement.
(b) Subject to any other provision of this Agreement to the
contrary, no Buyer is obliged to fund or reimburse any Routine
Expenditure incurred by Gascor in the period ending 31 December 2001
other than by way of payment of management fees in accordance with
paragraph 2(a).
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3. RECOVERY OF ROUTINE EXPENDITURE ON OR AFTER 1 JANUARY 2002
--------------------------------------------------------------------------------
3.1 DETERMINATION OF OPERATING BUDGETS
(a) Subject to paragraph 5, not later than 31 October in
each Contract Year commencing on or after 1 January 2001, Gascor must
prepare and submit to the Committee for review an operating budget for
the following Contract Year and each Month in that Contract Year.
(b) Each Operating Budget must be prepared in accordance
with generally accepted accounting principles in Australia and
contain:
(1) Gascor's best estimate of the Routine Expenditure which
Gascor will, or is likely to, incur in the Contract Year for
which the Operating Budget is prepared and each Month in
that Contract Year; and
(2) such contribution to the Reserve Fund (if any) as the Buyers
may agree.
(c) For the purposes of preparing an Operating Budget,
Gascor must not include a profit margin.
(d) The Retailers must ensure that their respective Members
use their reasonable endeavours to review and agree each Operating
Budget submitted by Gascor by no later than 30 November in the
Contract Year in which the Operating Budget is submitted.
(e) If the Committee has not approved the Operating Budget
submitted by Gascor in respect of a Contract Year on or before 30
November in the preceding Contract Year, any Party may refer the
matter in dispute for determination by the Dispute Resolution
Accountant in accordance with the provisions of paragraphs 3.1(f) to
(l).
135
(f) A Party wishing to appoint a Dispute Resolution
Accountant must give notice to that effect to the other Parties,
giving details of the matter which is proposed to be resolved.
(g) The Parties must meet within 5 Working Days of the
giving of a notice in accordance with paragraph 3.1(f) to agree upon
the appointment of the Dispute Resolution Accountant. If the Parties
fail to agree upon the appointment of the Dispute Resolution
Accountant at that meeting, any Party may request the President of the
Institute of Chartered Accountants in Australia to appoint a Dispute
Resolution Accountant, and that appointment will be final and binding
on the Parties.
(h) The Dispute Resolution Accountant must be a member of
the Institute of Chartered Accountants in Australia or the Australian
Society of Certified Practising Accountants.
(i) A person may not be appointed, or remain, as the Dispute
Resolution Accountant if at the time of the appointment, or at any
time before that person gives his or her determination, that person
has had or may have some interest or duty which conflicts or may
conflict with his or her functions under such appointment, provided
that this paragraph 3.1(i) shall not prevent Gascor's auditors being
appointed or remaining as the Dispute Resolution Accountant.
(j) The Dispute Resolution Accountant who is appointed
pursuant to paragraph 3.1(g) must be instructed by the person who
appointed him or her to resolve the dispute referred to him or her and
to make such amendments to the Operating Budget which is the subject
of dispute as may be necessary to give effect to his or her
determination.
(k) The Dispute Resolution Accountant will be deemed not to
be an arbitrator, but shall render his or her decision as an expert
and his or determination will be final and binding on the Parties in
the absence of fraud or manifest error. The Commercial Arbitration Act
1984 will not apply to the Dispute Resolution Accountant or his or her
determination or the procedure by which the Dispute Resolution
Accountant reaches his or her determination.
(l) The costs and expenses of the Dispute Resolution
Accountant must be paid by the Parties in such proportions as the
Dispute Resolution Accountant thinks fit.
3.2 CALCULATION AND PAYMENT OF MANAGEMENT FEE
(a) Subject to paragraph 5, for each Contract Year
commencing on or after 1 January 2002, each Buyer must pay Gascor a
management fee equal to:
(1) its [THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH
HAS BEEN OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION.] of the estimated [THIS PARAGRAPH
CONTAINS CONFIDENTIAL INFORMATION WHICH HAS BEEN OMITTED,
BUT FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.] for that Contract Year as specified in the
[THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH HAS
136
BEEN OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.] for that Contract Year; and
(2) its [THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH
HAS BEEN OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION.] of the required contribution (if
any) to the [THIS PARAGRAPH CONTAINS CONFIDENTIAL
INFORMATION WHICH HAS BEEN OMITTED, BUT FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION.] for that
Contract Year as agreed by the Buyers.
(b) Each Buyer's Management Fee shall be payable in arrears
in twelve equal monthly instalments in accordance with Clause 8 of its
Sub-sales Agreement.
3.3 BUDGET AMENDMENTS
(a) Gascor may at any time submit to the Committee a
proposal in writing to amend the Operating Budget for a Contract Year,
which proposal must include full supporting details of the amendments.
(b) The Committee must approve or reject a proposed
amendment to an Operating Budget within [THIS PARAGRAPH CONTAINS
CONFIDENTIAL INFORMATION WHICH HAS BEEN OMITTED, BUT FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION.] Working Days after the
submission of the proposal.
(c) If the Committee approves an amendment to an Operating
Budget, each Buyer's Management Fee for the relevant Contract Year
shall be adjusted to take account of the amended Operating Budget with
effect from the date on which the amendment is approved and the
remaining monthly instalments payable in respect of each Buyer's
Management Fee will be adjusted as appropriate.
--------------------------------------------------------------------------------
4. RESERVE FUND
--------------------------------------------------------------------------------
(a) Gascor must establish a reserve fund out of which
Non-routine Expenditure may be paid.
(b) Gascor must credit the following amounts received from
each Retailer and, if the Release Gas Option is exercised, RCo by way
of Management Fees in the period ending [THIS PARAGRAPH CONTAINS
CONFIDENTIAL INFORMATION WHICH HAS BEEN OMITTED, BUT FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION.] to the Reserve Fund:
YEAR ENDING 31 YEAR ENDING 31 YEAR ENDING 31
DECEMBER 1999* DECEMBER 2000* DECEMBER 2001*
Each Retailer
RCo
------------------- ------------------ ------------------
Total
=================== ================== ==================
137
*[THESE COLUMNS CONTAIN CONFIDENTIAL INFORMATION WHICH HAS BEEN OMITTED, BUT
FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.]
(c) The Buyers may agree to make contributions, or increase
their contributions, to the Reserve Fund in any Contract Year
commencing on or after 1 January 2002, in which case such
contributions will be taken into account in determining the Operating
Budget and each Buyer's Management Fee for that Contract Year.
(d) Gascor must credit to the Reserve Fund a proportion of
any payment received from a Buyer on account of the Management Fee
payable by that Buyer in a Contract Year equal to the proportion which
the total contribution which that Buyer is required to make to the
Reserve Fund in that Contract Year bears to the total amount of the
Management Fee payable by that Buyer in respect of that Contract Year.
(e) Any interest accruing to the Reserve Fund shall be
credited to, and form part of, the Reserve Fund.
(f) Gascor may at any time apply the balance standing to the
credit of the Reserve Fund in or towards payment of any Non-routine
Expenditure, provided that the amount so applied in relation to any
single matter must not exceed $25,000.
(g) Subject to paragraph 4(f), Gascor must not apply the
Reserve Fund in or towards payment of any costs, expenses or other
liabilities without the prior approval of the Committee.
(h) Without derogating from the provisions of paragraph 1 of
Part B of this Schedule 1, no Buyer or Buyers may require Gascor to
incur any Non-routine Expenditure unless and until the Committee and
Gascor have agreed the basis upon which such expenditure will be
funded and, if such expenditure is to be funded by the Buyers, the
proportion in which such funding is to be made available by each
Buyer.
--------------------------------------------------------------------------------
5. RECOVERY OF EXPENDITURE ON OR AFTER 1 JANUARY 2002 WHERE GASCOR
REMAINS OWNED BY THE STATE
--------------------------------------------------------------------------------
(a) Sections 3 and 4 of this Part F will not apply if and
for so long as Gascor remains in State Ownership.
(b) If and for so long as Gascor remains in State Ownership
after the expiry of the Contract Year ending on [THIS PARAGRAPH
CONTAINS CONFIDENTIAL INFORMATION WHICH HAS BEEN OMITTED, BUT FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.], each Buyer
must pay Gascor in accordance with Clauses 5.2(b) and 8 of its
Sub-sales Agreement, a Monthly management fee determined in accordance
with this paragraph 5.
138
(c) For each Month ("MONTHM") commencing on or after 1
January 2002, each Buyer must pay a Management Fee calculated as
follows:
[THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH HAS BEEN
OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.]
Where:
MF is the amount of the Management Fee which a Buyer is
required to pay in respect of MonthM;
A is, subject to paragraph 5(g), [THIS PARAGRAPH CONTAINS
CONFIDENTIAL INFORMATION WHICH HAS BEEN OMITTED, BUT FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION.];
AQi is that Buyer's AQ for that Contract Year (as determined at
the start of MonthM); and
(SIGMA)AQi is the sum of all Buyer's AQs for that Contract Year (as
determined at the start of MonthM).
(d) If the aggregate amount of Management Fees payable by a
Buyer in respect of any Contract Year, as determined in accordance
with paragraphs 5(b) and (c) ("TOTAL ANNUAL CHARGE"), is more than the
Maximum Annual Fee for that Buyer for that Contract Year (as
determined in accordance with paragraphs 5(e) and (f), Gascor must pay
that Buyer, by way of reimbursement of management fees, an amount
equal to the Total Annual Charge less the Maximum Annual Fee for that
Contract Year. Any such amount will be included in the Monthly
Statement (as defined in that Buyer's Sub-sales Agreement) for March
of the following Contract Year.
(e) For the purposes of paragraph 5(d), the "MAXIMUM ANNUAL
FEE" for a Contract Year means, in relation to a Buyer, the amount
calculated as follows:
[THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH HAS BEEN
OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.]
Where:
MAF is the Maximum Annual Fee for that Contract Year for that
Buyer;
B is the aggregate amount of the [THIS PARAGRAPH CONTAINS
CONFIDENTIAL INFORMATION WHICH HAS BEEN OMITTED, BUT FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.] and
the [THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH
HAS BEEN OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION.] incurred by [THIS PARAGRAPH
CONTAINS CONFIDENTIAL INFORMATION WHICH HAS BEEN OMITTED,
BUT FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.] in that Contract Year as certified by Gascor's
Accountants;
139
AQi is that Buyer's AQ for that Contract Year (as determined at
the start of that Contract Year); and
(SIGMA)AQi is the sum of all Buyers' AQs for that Contract Year (as
determined at the start of that Contract Year).
(f) For the purposes of paragraphs (d) and (e), Gascor must
procure that Gascor's Accountants certify the aggregate amount of the
Routine Expenditure and the Non-Routine Expenditure incurred by Gascor
in a Contract Year by no later than 28 February in the following
Contract Year.
(g) The amount referred to in variable A in paragraph 5(c)
will be adjusted at the start of each Contract Year ("CURRENT CONTRACT
YEAR") as follows:
[THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH HAS BEEN
OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.]
Where:
CY is the amount referred to in variable A in paragraph 5(d) or
the amount referred to in variable B in paragraph 5(f) (as
the case may be) as adjusted for the current Contract Year.
PY is the amount referred to in variable A in paragraph 5(d) or
the amount referred to in variable B in paragraph 5(f) (as
the case may be);
CPI(t-i) is the CPI for the quarter ended on [THIS PARAGRAPH CONTAINS
CONFIDENTIAL INFORMATION WHICH HAS BEEN OMITTED, BUT FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.] of
the year immediately preceding the current Contract Year;
and
CPIb is the base CPI, being [THIS PARAGRAPH CONTAINS CONFIDENTIAL
INFORMATION WHICH HAS BEEN OMITTED, BUT FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION.] (the CPI for
the quarter ended [THIS PARAGRAPH CONTAINS CONFIDENTIAL
INFORMATION WHICH HAS BEEN OMITTED, BUT FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION.]).
(h) If Gascor ceases to be in State Ownership at any time
during a Contract Year commencing on or after [THIS PARAGRAPH CONTAINS
CONFIDENTIAL INFORMATION WHICH HAS BEEN OMITTED, BUT FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION.], sections 3 and 4 of
this Part F will immediately apply, save that Gascor must prepare and
submit an Operating Budget for the remaining part of that Contract
Year in accordance with paragraph 3.1(a) as soon as reasonably
practicable after Gascor ceases to be in State Owneship.
(i) For the purposes of this section 5, Gascor is, or
remains, in "STATE OWNERSHIP" if the shares in Gascor are directly or
indirectly legally and beneficially owned by or on behalf of the State
or a statutory authority or instrumentality of the State.
140
(j) For the avoidance of doubt, the obligation on each
Retailer to pay Gascor a Management Fee in accordance with this
section 5 is in addition to, and does not limit, the obligation of
that Retailer to indemnify Gascor in respect of action which the
Committee requires Gascor to take in accordance with paragraph 1(b)(3)
of Part B of this Schedule.
141
SCHEDULE 2
ALLOCATION OF GASCOR'S DELIVERED QUANTITY OF GAS
--------------------------------------------------------------------------------
1. PART 1 - GENERAL
--------------------------------------------------------------------------------
1.1 This Schedule contains the processes and mechanisms ("GAS ALLOCATION
MECHANISMS") which are to apply for the purpose of allocating the
quantity of Gas which the Sellers deliver to Gascor on a Day ("TOTAL
DAILY DELIVERED QUANTITY") amongst the Relevant Purchasers.
1.2 Any Party may notify the other Parties that it seeks a review of the
Gas Allocation Mechanisms if it considers that they are not producing
results consistent with the principles in Part 2 of this Schedule.
1.3 If a Party gives such a notice the Parties must meet within 30 days to
seek to agree necessary amendments to this Schedule to give effect to
the principles in Part 2 of this Schedule.
1.4 If the Parties do not agree amendments within 60 days of a notice
being given under paragraph 1.3, any Party may refer the matter to an
Expert at its own cost.
1.5 This Schedule will be deemed to be amended (as agreed or determined)
with effect from the date of such agreement or determination. However,
this paragraph does not prevent a retrospective amendment if all of
the Parties agree to the amendment having retrospective effect.
1.6 Without prejudice to paragraphs 1.2 to 1.5 (inclusive) if the Sellers
or Gascor (at the direction of the Committee) seek to agree an
alternative method of measuring and determining the quantities of Gas
delivered at the Point of Delivery for Gascor and other users in
accordance with paragraph 4(e) of Schedule 8 of the Principal
Contract, the Parties must review the Gas Allocation Mechanisms with a
view to ensuring that, having regard to any such proposed alternative
method, they continue to give effect to the principles in Part 2 of
this Schedule.
1.7 For the purposes of this Schedule 2 only, a Daily Nomination or a
Nomination means, in relation to a Relevant Purchaser, a Daily
Nomination or a Nomination which has been given, or which has been
deemed to have been given, to Gascor by that Relevant Purchaser (in
the case of a Buyer, in accordance with the terms of that Buyer's
Sub-sales Agreement, Agency Agreement or Clause 7.3, or, in the case
of a Release Gas Purchaser, in accordance with the terms of its
Release Gas Contract), irrespective of whether Gascor submits a
corresponding nomination to the Sellers under the Principal Contract.
1.8 For the purposes of this Schedule 2, if a Relevant Purchaser nominates
for delivery on a Day a quantity of Gas which exceeds the MDQ of that
142
Relevant Purchaser on that Day, that Relevant Purchaser will be deemed
to have nominated a quantity equal to that MDQ.
1.9 FOR THE PURPOSE OF CLAUSE 7.1(A), IF RCO DOES NOT GIVE A NOMINATION
FOR A DAY, THE QUANTITY OF GAS MADE AVAILABLE FOR DELIVERY BY GASCOR
TO, AND TAKEN BY, RCO ON THAT DAY IS EQUAL TO THE TOTAL QUANTITY OF
GAS ALLOCATED TO ALL RELEASE GAS PURCHASERS ON THAT DAY IN ACCORDANCE
WITH THIS SCHEDULE 2.
--------------------------------------------------------------------------------
2. PART 2 - SUB-ALLOCATION PRINCIPLES
--------------------------------------------------------------------------------
The Parties agree to the following allocation principles:
2.1 the allocation process should minimise each Relevant Purchaser's
allocation risk, that is the difference between a Relevant Purchaser's
last Nomination for a Day and the quantity of Gas which is allocated
to it in respect of that Day in accordance with this Schedule;
2.2 the allocation process should allocate 100% of the Total Daily
Delivered Quantity amongst all Relevant Purchasers;
2.3 unless the Total Daily Delivered Quantity exceeds the total of all
Relevant Purchasers' MDQs, the allocation process should not allocate
to any Relevant Purchaser more than its MDQ;
2.4 the allocation process should be consistent with, and take into
account, the order of allocation contained in Clause 11.1 of the
Principal Contract (Curtailment) when the Day is a Curtailment Day;
and
2.5 no Relevant Purchaser should be treated less favourably than any other
Relevant Purchaser or, as between the Relevant Purchasers,
discriminated against.
--------------------------------------------------------------------------------
3. PART 3 - UNDER DELIVERY WITH RESPECT TO DAILY AND LAST NOMINATIONS
--------------------------------------------------------------------------------
3.1 If the Total Daily Delivered Quantity on a Day is less than the sum of
all Relevant Purchasers' Daily Nominations for that Day and is also
less than the sum of the all Relevant Purchasers' last Nominations for
that Day, then the quantity of Gas allocated to each Relevant
Purchaser on that Day (other than if that Day is a Curtailment Day, in
which case Part 7 of this Schedule applies) will be calculated as
follows:
(a) For each Relevant Purchaser, the quantity LOi
will be determined as follows:
[THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH HAS
BEEN OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.]
143
Where:
Fi is that Relevant Purchaser's Daily Nomination for
the Day; and
Ni is that Relevant Purchaser's last Nomination for
the Day.
(b) If the Total Daily Delivered Quantity exceeds
or is equal to the aggregate quantity of all Relevant
Purchasers' LOi, then each Relevant Purchaser's Daily
Delivered Quantity will be determined in accordance with
Part 4 of this Schedule.
(c) If the Total Daily Delivered Quantity is less
than the aggregate quantity of all Relevant Purchasers' LOi,
then each Relevant Purchaser will be allocated the following
quantity:
[THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH HAS
BEEN OMITTED, BUT FILED separately WITH THE SECURITIES AND
EXCHANGE COMMISSION.]
Where:
SAi is the allocated quantity for a Relevant
Purchaser;
DQ is the Total Daily Delivered Quantity;
LOi is LOi for that Relevant Purchaser;
(SIGMA)LOi is the sum of LOi for all Relevant Purchasers.
--------------------------------------------------------------------------------
4. PART 4 - UNDER DELIVERIES WITH RESPECT TO LAST NOMINATIONS
--------------------------------------------------------------------------------
4.1 If the Total Daily Delivered Quantity on a Day is less than the sum of
all Relevant Purchasers' last Nominations for that Day, then the
quantity of Gas allocated to each Relevant Purchaser on that Day
(other than if that Day is a Curtailment Day, in which case Part 7 of
this Schedule applies) will be calculated as follows:
(a) For each Relevant Purchaser, the quantity LOi
will be determined as follows:
[THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH HAS
BEEN OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.]
Where:
Fi is that Relevant Purchaser's Daily Nomination for
the Day;
Ni is that Relevant Purchaser's last Nomination for
the Day.
144
If the Total Daily Delivered Quantity is less than the sum
of LOi for all Relevant Purchasers, then paragraphs 4.1(c)
to (d) shall not apply and each Relevant Purchaser's Daily
Delivered Quantity will be determined in accordance with
Part 3.
(b) If the Total Daily Delivered Quantity is equal
to or exceeds the sum of LOi for all Relevant Purchasers,
then each Relevant Purchaser will be allocated first the
quantity LOi under this Part 4. For a Relevant Purchaser
whose LOi is equal to Ni no further quantity of Gas will be
allocated to that Relevant Purchaser under this Part 4.
(c) The remainder of the Total Daily Delivered
Quantity after the application of paragraph 4.1(b) shall be
allocated to each Relevant Purchaser who has not yet been
allocated a quantity equal to its last Nomination for the
Day as follows:
[THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH HAS
BEEN OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.]
Where:
FQi is the additional quantity of Gas allocated to a
Relevant Purchaser whose last Nomination for the
Day exceeded its Daily Nomination for the Day;
RQ is the remainder of the Total Daily Delivered
Quantity not yet allocated after the application
of paragraph 4.1(b);
Fi is that Relevant Purchaser's Daily Nomination for
the Day; and
(SIGMA)Fi is the aggregate of the Daily Nominations for the
Day of all Relevant Purchasers who have not yet
been allocated a quantity of Gas equal to their
respective last Nominations for the Day under
paragraph 4.1(b);
Ni is that Relevant Purchaser's last Nomination for
the Day,
provided that if the aggregate of the Daily Nominations for
the Day of all Relevant Purchasers who have not yet been
allocated a quantity of Gas equal to their respective last
Nominations for the Day under paragraph 4.1(b) is equal to
zero, then this paragraph 4.1(c) shall not apply and the
remainder of the Total Daily Delivered Quantity after the
application of paragraph 4.1(b) shall be allocated in
accordance with paragraph 4.1(d).
(d) The remainder of the Total Daily Delivered
Quantity after the application of paragraphs 4.1(b) and (c)
shall be allocated to all Relevant Purchasers who have not
yet been allocated a quantity of Gas equal to their
respective last Nominations for the Day calculated as
follows:
145
[THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH HAS
BEEN OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.]
Where:
FFQi is the additional quantity of Gas allocated to a
Relevant Purchaser under this paragraph;
RRQ is the remainder of the Total Daily Delivered
Quantity not yet allocated after the application
of paragraphs 4.1(a), (b) and (c);
Ni is that Relevant Purchaser's last Nomination for
the Day;
PAi is the total quantity of gas allocated to that
Relevant Purchaser under paragraphs 4.1(a), (b)
and (c); and
(SIGMA)(Ni - PAi) is the sum of the quantity (Ni - PAI) for
all Relevant Purchasers who have not yet been
allocated a quantity of Gas equal to their
respective last Nominations for the Day under
paragraphs 4.1(a), (b) and (c).
--------------------------------------------------------------------------------
5. PART 5 - OVER DELIVERIES WITH RESPECT TO LAST NOMINATIONS
--------------------------------------------------------------------------------
5.1 If the Total Daily Delivered Quantity on a Day exceeds the sum of all
Relevant Purchasers' last Nominations for that Day, then the quantity
of Gas allocated to each Relevant Purchaser on that Day (other than if
that Day is a Curtailment Day, in which case Part 7 of this Schedule
applies) will be calculated as follows:
(a) Each Relevant Purchaser will be allocated
first the quantity Ni being the last Nomination for the Day,
subject to a maximum of that Relevant Purchaser's MDQ for
that Day.
(b) For each Relevant Purchaser whose last
Nomination is less than its Daily Nomination for the Day,
the quantity (Fi - Ni) shall be calculated, where Fi is that
Relevant Purchaser's Daily Nomination for the Day.
(c) If the remainder of the Total Daily Delivered
Quantity after the application of paragraph 5.1(a) is less
than or equal to the aggregate of the quantities (Fi - Ni)
for all Relevant Purchasers whose last Nominations for the
Day were less than their respective Daily Nominations for
the Day, each such Relevant Purchaser will be allocated an
additional quantity of Gas as follows (and paragraph 5.1(d)
shall not apply:
146
Where:
[THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH HAS
BEEN OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.]
FQi is the additional quantity of Gas allocated to a
Relevant Purchaser whose last Nomination for the
Day is less than that Relevant Purchaser's Daily
Nomination for the Day;
RQ is the remainder of the Total Daily Delivered
Quantity not yet allocated after the application
of paragraph 5.1(a);
Fi is that Relevant Purchaser's Daily Nomination for
the Day;
Ni is that Relevant Purchaser's last Nomination for
the Day;
(SIGMA)(Fi - Ni) is the aggregate of the quantity (Fi - Ni)
for all Relevant Purchasers whose last Nominations
for the Day are less than their respective Daily
Nominations for the Day; and
MDQi is the MDQ of that Relevant Purchaser.
(d) If the remainder of the Total Daily Delivered
Quantity after the application of paragraph 5.1(a) is
greater than the aggregate of the quantities determined in
paragraph 5.1(b) for Relevant Purchasers whose last
Nominations for the Day were less than their respective
Daily Nominations for the Day, then each such Relevant
Purchaser will be allocated an additional quantity of Gas
equal to the quantity [THIS PARAGRAPH CONTAINS CONFIDENTIAL
INFORMATION WHICH HAS BEEN OMITTED, BUT FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION.] as calculated
under paragraph 5.1(b) and paragraph 5.1(c) will not apply.
(e) If the remainder of the Total Daily Delivered
Quantity after the application of paragraphs 5.1(a), (c) or
(d) is greater than zero, then each Relevant Purchaser shall
be allocated an additional quantity of Gas determined as
follows:
[THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH HAS
BEEN OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.]
Where:
147
FFQi is the additional quantity allocated to a Relevant
Purchaser under this paragraph 5.1(e);
RRQ is the remainder of the Total Daily Delivered
Quantity not yet allocated after the application
of paragraphs 5.1(a), (c) or (d) (whichever is
applicable);
Ni is that Relevant Purchaser's last Nomination for
the Day;
(SIGMA)Ni is the aggregate of all Relevant Purchasers' last
Nominations for the Day;
FQi is the additional quantity allocated to that
Relevant Purchaser under paragraph 5.1(c) or (d)
(whichever is applicable); and
MDQi is that Relevant Purchaser's MDQ for the Day,
provided that if (SIGMA)Ni is zero, then FFQi is zero
(f) If the remainder of the Total Daily Delivered Quantity
after the application of paragraphs 5.1(a), (c) or (d) (whichever is
applicable) and (e) ("REMAINING QUANTITY") is greater than zero, then
each Relevant Purchaser which has not yet been allocated a quantity of
Gas equal to their MDQ for the Day shall be allocated an additional
quantity of Gas determined as follows:
(1) If the Remaining Quantity exceeds the sum of such Relevant
Purchasers' MDQs less the total quantity of Gas allocated to
all such Relevant Purchasers for the Day prior to the
application of this paragraph 5.1(f), then each such
Relevant Purchaser will be allocated an additional quantity
equal to [THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION
WHICH HAS BEEN OMITTED, BUT FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.]; or
(2) if the Remaining Quantity is less than the sum of such
Relevant Purchasers' MDQs less the total quantity of Gas
allocated to all such Relevant Purchasers prior to the
application of this paragraph 5.1(f), then each such
Relevant Purchaser will be allocated an additional quantity
calculated as follows:
[THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH HAS
BEEN OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.]
Where:
FEQi is the additional quantity of Gas allocated to a
Relevant Purchaser;
REQ is the Remaining Quantity;
MDQi is that Relevant Purchaser's MDQ;
148
PAi is the quantity of Gas allocated to that Relevant
Purchaser after the application of paragraphs
5.1(a), (c) or (d) (whichever is applicable) and
(e); and
(SIGMA)(MDQi - PA) is the aggregate quantity (MDQi - PA) for
all such Relevant Purchasers.
(g) If the remainder of the Total Daily Delivered Quantity
after the application of paragraphs 5.1(a), (c) or (d) (whichever is
applicable), (e) and (f) is greater than zero, then each Relevant
Purchaser shall be allocated an additional quantity of Gas determined
as follows:
[THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH HAS
BEEN OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.]
Where:
FRQi is the additional quantity allocated to a Relevant
Purchaser under this paragraph 5.1(g);
FRQ is the remainder of the Total Daily Delivered
Quantity not yet allocated after the application
of paragraphs 5.1(a), (c) or (d) (whichever is
applicable), (e) and (f);
Ni is that Relevant Purchaser's last Nomination for
the Day;
(SIGMA)Ni is the aggregate of all Relevant Purchasers'
respective last Nominations for the Day;
provided that if (SIGMA)Ni is zero, then:
[THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH HAS
BEEN OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.]
Where:
MDQ is that Relevant Purchaser's MDQ; and
(SIGMA)MDQi is the sum of the MDQs of all Relevant
Purchasers.
--------------------------------------------------------------------------------
6. PART 6 - NO UNDER OR OVER DELIERY
--------------------------------------------------------------------------------
If the Total Daily Delivered Quantity on a Day is equal to the sum of the last
Nominations of all Relevant Purchasers on that Day, each Relevant Purchaser will
be allocated a quantity of Gas on that Day equal to its last Nomination.
149
--------------------------------------------------------------------------------
7. PART 7 - ALLOCATION IN THE EVENT OF A CURTAILMENT DAY
--------------------------------------------------------------------------------
7.1 If a Day is a Curtailment Day, then the quantity of Gas allocated to
each Relevant Purchaser on that day will be calculated as follows:
(a) For the purpose of this Part 7, DMi means, in
relation to a Relevant Purchaser, the Gas requirements
directly or indirectly supplied by that Relevant Purchaser
of D Market Consumers for that Curtailment Day not otherwise
able to be met by that Relevant Purchaser.
(b) If the Total Daily Delivered Quantity is less
than the sum of all Relevant Purchasers' DMi on a
Curtailment Day, then each Relevant Purchaser will be
allocated the following quantity of Gas (and the following
provisions of this Part 7 shall not apply):
[THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH HAS
BEEN OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.]
Where:
SAi is the allocated quantity for a Relevant
Purchaser;
DQ is the Total Daily Delivered Quantity;
DMi is the DMi for that Relevant Purchaser; and
(SIGMA)DMi is the sum of DMi for all Relevant Purchasers.
(c) If the Total Daily Delivered Quantity is equal
to or exceeds the sum of all Relevant Purchasers' DMi, then
each Relevant Purchaser will be first allocated a quantity
of Gas equal to that Relevant Purchaser's DMi.
(d) If the remainder of the Total Daily Delivered
Quantity after the application of paragraph 7.1(c) is
greater than zero then a further quantity of Gas will be
allocated to each Relevant Purchaser who has not yet been
allocated a quantity equal to their last Nomination for the
Day, calculated as follows:
[THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH HAS
BEEN OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.]
Where:
FQi is the further quantity to be allocated to each
Relevant Purchaser in addition to that allocated
under paragraph 7.1(c);
RQ is the balance of the Total Daily Delivered
Quantity not yet allocated after the application
of paragraph 7.1(c);
150
LDi is the lesser of (Fi - DMi) or (Ni - DMi), subject
to a minimum value of zero, where:
Fi is that Relevant Purchaser's Daily
Nomination for the Day; and
Ni is that Relevant Purchaser's last
Nomination for the Day; and
(SIGMA)LDi is the sum of LDi for all Relevant Purchasers.
provided that:
(1) if (SIGMA)LDi is zero, then
[THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION
WHICH HAS BEEN OMITTED, BUT FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION.]
Where:
Fi is that Relevant Purchaser's Daily
Nomination for that Day; and
(SIGMA)Fi is the sum of all Relevant Purchaser's
Daily Nomination for that Day; and
(2) if (SIGMA)Fi is zero then
[THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION
WHICH HAS BEEN OMITTED, BUT FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION.]
Where:
MDQi is that Relevant Purchaser's MDQ; and
(SIGMA)(MDQi - DMi) is the sum of the quantity
(MDQi - DMi) for all Relevant
Purchasers.
--------------------------------------------------------------------------------
8. PART 8 - ALLOCATION FOR SELLERS' OWN USE
--------------------------------------------------------------------------------
8.1 The Parties acknowledge that Kinetik Energy Pty Ltd ACN 079 089 188
("KINETIK") has entered into a deed ("TRANSPORTATION DEED") with the
Sellers pursuant to which Kinetik may be required to arrange for the
transportation of Gas from the Point of Delivery to the SOU Customers
and assume certain market risks if the quantity of gas delivered at
the Point of Delivery on a Day for the SOU Customers ("SOU INPUT") is
151
more or less than the quantity of gas withdrawn by the SOU Customers
on that Day at their respective points to offtake ("SOU OFFTAKE").
8.2 The Parties acknowledge that the effect of the current methodology for
determining the quantity of Gas delivered to Gascor under the
Principal Contract (as set out in paragraph 4 of Schedule 8 of the
Principal Contract) and the application of this Schedule 2 is that, as
at the date of this Agreement, the Buyers together share the risk
which results from the Sellers' delivering at the Point of Delivery on
a Day for the SOU Customers a quantity of Gas which is more or less
than the quantity of Gas withdrawn by the SOU Customers on that Day
and that it is their intent that, if and for so long as Kinetik
arranges for the transportation of Gas to the SOU Customers under the
Transportation Deed, this imbalance risk should be assumed by Kinetik.
8.3 The Parties therefore agree that, if and for so long as Kinetik
arranges for the transportation of Gas under the Transportation Deed:
(a) If the SOU Input on a Day, as determined in
accordance with the Transportation Deed, exceeds the SOU
Offtake on that Day, Kinetik should be allocated, in
priority to the other Buyers, under the Gas Allocation
Mechanisms an additional quantity of Gas equal to the SOU
Input on that Day less the SOU Offtake on that Day; and
(b) if the SOU Input on a Day is less than the SOU
Offtake on that Day, Kinetik's allocation of Gas under the
Gas Allocation Mechanism should be reduced by a quantity
equal to the SOU Offtake on that Day less the SOU Input on
that Day.
8.4 The Parties acknowledge and agree that Xxxx Xxxxxxxxxx Consulting Pty
Ltd ("XXXXXXXXXX") has been and shall continue to be appointed to
determine such amendments to Parts 3 to 7 of this Schedule and to the
Relevant Agreements as are necessary to give effect to paragraph 8.3
and the intent of the Parties as described in paragraph 8.2.
Xxxxxxxxxx will be deemed not to be an arbitrator, but shall render
its decision as an expert and its decision will be final and binding
on the Parties in the absence of fraud or manifest error. The costs
and expenses of Xxxxxxxxxx will be apportioned between the Parties in
such proportions as Xxxxxxxxxx, in the circumstances, considers
proper.
8.5 The Parties must do all things and execute such documents as
Xxxxxxxxxx may consider necessary or desirable to give effect to its
decision.
8.6 The Parties (other than Kinetik) acknowledge that the terms of the
Transportation Deed are confidential to Kinetik and the Sellers and
that Kinetik is not required to disclose information relating to the
Transportation Deed to the Parties (other than to Gascor and to
Xxxxxxxxxx to the extent necessary for the purposes of this Schedule
2).
152
SCHEDULE 3
ECOGEN MDQ REDUCTION AND MAXIMUM ANNUAL QUANTITY
PART 1 - ECOGEN MDQ REDUCTION
COLUMN 1 COLUMN 2* COLUMN 0 XXXXXX 0*
XXXXXX MDQ TOTAL MDQ REDUCTION ECOGEN MDQ TOTAL MDQ REDUCTION
REDUCTION MONTH REDUCTION MONTH
1998: July 2002: January
August February
September March
October April
November May
December June
July
1999: January August
February September
March October
April November
May December
June
July 2003: January
August February
September March
October April
November May
December June
July
2000: January August
February September
March October
April November
May December
June
July
August
September
October
November
December
2001: January
February
March
April
May
June
July
August
September
October
November
December
*[THESE COLUMNS CONTAIN CONFIDENTIAL INFORMATION WHICH HAS BEEN OMITTED, BUT
FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.]
153
PART 2 - ECOGEN MAXIMUM ANNUAL QUANTITY
COLUMN 1 COLUMN 2
CONTRACT YEAR MAXIMUM ANNUAL QUANTITY (PJ)*
1998
1999
2000
2001
2002
2003
*[THIS COLUMN CONTAINS CONFIDENTIAL INFORMATION WHICH HAS BEEN OMITTED, BUT
FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.]
154
SCHEDULE 4
AMQ
The provisions of this Schedule 4 will apply for the purposes of determining
each Buyer's Annual Excess or Annual Shortfall for a Contract Year.
1. "AMQ" means, in relation to a Buyer, that Buyer's AQ for a Contract
Year (or, if more than one AQ applies during a Contract Year under
that Buyer's Sub-sales Agreement, the weighted average of those AQs in
proportion to the number of Days each was applicable during that
Contract Year) multiplied by [THIS PARAGRAPH CONTAINS CONFIDENTIAL
INFORMATION WHICH HAS BEEN OMITTED, BUT FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.] and then reduced by the aggregate
of:
(a) in the case of a Retailer, that Retailer's
Sellers' Sales Allocation for that Contract Year;
(b) the aggregate quantity of reductions required
in respect of Off Specification Gas calculated in respect of
that Buyer for that Contract Year pursuant to Clause 9 of
this Agreement;
(c) the quantity of Buyer's Undelivered Gas
calculated in respect of that Buyer for that Contract Year;
and
(d) where any quantity of Gas was not delivered to
or taken by that Buyer during that Contract Year during one
or more Force Majeure Periods, the quantity calculated as
follows:
(1) in respect of each Force Majeure Period lasting 30
Days or less:
[THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH HAS
BEEN OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.]
Where:
Ri is the amount of the reduction;
GR is the amount of the reduction in the
Annual Minimum Quantity in respect of
that Force Majeure Period as calculated
pursuant to paragraph (d)(i) of the
definition of Annual Minimum Quantity in
Clause 1 of the Principal Contract;
PDi is one-seventh of the aggregate quantity
of Gas delivered to that Buyer on the
[THIS COLUMN CONTAINS CONFIDENTIAL
INFORMATION WHICH HAS BEEN OMITTED, BUT
FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.] Performance Days
155
most closely preceding the Force Majeure
Period, excluding, in the case of RCo, a
quantity equal to the quantity of Gas
delivered by RCo to Ecogen on such
Performance Days;
FM is the number of whole and part Days
during the Force Majeure Period;
DGi is the quantity of Gas delivered to that
Buyer in the Force Majeure Period
excluding, in the case of RCo, a
quantity equal to the quantity of Gas
delivered to RCo to Ecogen in that
period.
(SIGMA)PDi is one-seventh of the aggregate quantity
of Gas delivered to all Buyers on the
[THIS COLUMN CONTAINS CONFIDENTIAL
INFORMATION WHICH HAS BEEN OMITTED, BUT
FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.] Performance Days
most closely preceding the Force Majeure
Period, excluding, in the case of RCo, a
quantity equal to the quantity of Gas
delivered by RCo to Ecogen on such
Performance Days; and
(SIGMA)DGi is the aggregate quantity of Gas
delivered to all Buyers in the Force
Majeure Period, excluding, in the case
of RCo, a quantity equal to the quantity
of Gas delivered by RCo to Ecogen in
that period,
provided that if, in relation to a Buyer, (PDi x
FM) - DGi, is less than zero, it shall be deemed
to be zero and there shall be deducted from the
quantity (SIGMA)DGi a quantity equal to the amount
by which (PDi X FM) - DGI is less than zero;
(2) in respect of each Force Majeure Period lasting
longer than 30 Days:
[THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION
WHICH HAS BEEN OMITTED, BUT FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION.]
Where:
Ri is the amount of the reduction;
GR is the amount of the reduction in the
Annual Minimum Quantity in respect of
that Force Majeure Period as calculated
pursuant to paragraph (d)(ii) of the
definition of Annual Minimum Quantity in
Clause 1 of the Principal Contract;
156
CPi is the quantity of Gas deemed to have
been delivered to that Buyer in the
Comparative Force Majeure Period as
calculated in accordance with paragraph
2;
DGi is the quantity of Gas delivered to that
Buyer in the Force Majeure Period,
excluding, in the case of RCo, a
quantity equal to the quantity of Gas
delivered by RCo to Ecogen in that
period;
(SIGMA)CPi is the aggregate quantity of Gas deemed
to have been delivered to all Buyers in
the Comparative Force Majeure Period as
calculated in accordance with paragraph
2; and
(SIGMA)DGi is the aggregate quantity of Gas
delivered to all Buyers in the Force
Majeure Period, excluding, in the case
of RCo, a quantity equal to the quantity
of Gas delivered by RCo to Ecogen in
that period,
provided that if, in relation to a Buyer, (CPi -
DPi) is less than zero, it shall be deemed to be
zero and there shall be deducted from the quantity
(SIGMA)DGi a quantity equal to the amount by which
(CPi - DGi) is less than zero.
2. For the purposes of paragraph 1(d)(2), CPi is, subject to paragraph 4,
determined in accordance with this paragraph 2:
(a) if the Force Majeure Period occurs in [THIS COLUMN CONTAINS
CONFIDENTIAL INFORMATION WHICH HAS BEEN OMITTED, BUT FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.],
CPi is the quantity of Gas deemed to have been delivered to
a Retailer in the Comparative Force Majeure Period (as
defined in paragraph 5) calculated as follows:
[THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH HAS
BEEN OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.]
Where:
GQ is the quantity of Gas delivered by the Sellers to
Gascor in the Comparative Force Majeure Period,
being the quantity Cpi calculated in respect of
that Comparative Force Majeure Period in
accordance with paragraph (d)(ii) of the
definition of Annual Minimum Quantity in Clause 1
of the Principal Contract; and
Pi is:
157
(1) in the case of Energy 21 Pty Ltd,
[THIS COLUMN CONTAINS CONFIDENTIAL INFORMATION
WHICH HAS BEEN OMITTED, BUT FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION.];
(2) in the case of Ikon Energy Pty Ltd,
[THIS COLUMN CONTAINS CONFIDENTIAL INFORMATION
WHICH HAS BEEN OMITTED, BUT FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION.]; and
(3) in the case of Kinetik Energy Pty
Ltd, [THIS COLUMN CONTAINS CONFIDENTIAL
INFORMATION WHICH HAS BEEN OMITTED, BUT FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.];
(b) if the Force Majeure Period occurs in Contract Years [THIS
COLUMN CONTAINS CONFIDENTIAL INFORMATION WHICH HAS BEEN
OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.]:
(1) in the case of RCo, CPi is the quantity of Gas
deemed to have been delivered to RCo in the
Comparative Force Majeure Period calculated as
follows:
[THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION
WHICH HAS BEEN OMITTED, BUT FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION.]
Where:
GQ is the quantity of Gas delivered by the
Sellers to Gascor for the Comparative
Force Majeure Period, being the quantity
CPi calculated in respect of that
Comparative Force Majeure Period in
accordance with paragraph (d)(ii) of the
definition of Annual Minimum Quantity in
Clause 1 of the Principal Contract;
AQr is RCo's AQ during the Force Majeure
Period;
(SIGMA)AQi is the sum of all Buyers' AQs during
the Force Majeure Period.
RD is:
(A)
if the Force Majeure Period commences in
the first Release Gas Year, the number
of Days from and including the first Day
of the Release Gas Period to and
including the last Day of that Release
Gas Year; or
158
(B)
if the Force Majeure Period
commences in any other Contract Year,
365.
(2) in the case of a Retailer, CPi is the quantity of
Gas deemed to have been delivered to that Retailer
in the Comparative Force Majeure Period calculated
as follows:
[THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION
WHICH HAS BEEN OMITTED, BUT FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION.]
Where:
GQ is defined in paragraph 2(b)(1);
RC is the quantity of Gas deemed to have
been delivered to RCo in the Comparative
Force Majeure Period, as calculated in
accordance with paragraph 2(b)(1);
RQi is the quantity of Gas delivered by
Gascor and taken by that Retailer in the
Comparative Force Majeure Period;
(SIGMA)RQi is the aggregate quantity of Gas
delivered by Gascor and taken by all
Retailers in the Comparative Force
Majeure Period;
(c) if the Force Majeure Period occurs in Contract Years [THIS
PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH HAS BEEN
OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.], in the case of each Buyer, CPi is the
quantity of Gas deemed to have been delivered to that Buyer
in the Comparative Force Majeure Period calculated as
follows:
[THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH HAS
BEEN OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.]
Where:
GQ is the quantity of Gas delivered by the Sellers to
Gascor for the Comparative Force Majeure Period,
being the quantity CP calculated in respect of
that Comparative Force Majeure Period in
accordance with paragraph (d)(ii) of the
definition of Annual Minimum Quantity in Clause 1
of the Principal Contract;
BQi is:
159
(1) in relation to a Retailer, the quantity
of Gas delivered by Gascor and taken by
that Retailer in the Comparative Force
Majeure Period; and
(2) in relation to RCo, is the quantity
calculated as follows:
[THIS PARAGRAPH CONTAINS CONFIDENTIAL
INFORMATION WHICH HAS BEEN OMITTED, BUT
FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.]
Where:
RQ is the quantity of Gas
delivered by Gascor and taken
by RCo in the Comparative
Force Majeure Period;
EQ is the quantity of Gas
delivered by RCo to Ecogen in
the Comparative Force Majeure
Period;
AQf is RCo's AQ for the Contract
Year in which the Force
Majeure Period falls; and
AQc is RCo's AQ for the Contract
Year in which the Comparative
Force Majeure Period falls;
and
(SIGMA)BQi is the sum of BQi calculated for all Buyers; and
(d) if the Force Majeure Period occurs in 2004 or any subsequent
Contract Year, in the case of each Retailer, CPi is the
quantity of Gas deemed to have been delivered to each
Retailer in the Comparative Force Majeure Period calculated
as follows:
[THIS PARAGRAPH CONTAINS CONFIDENTIAL INFORMATION WHICH HAS
BEEN OMITTED, BUT FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.]
Where:
GQ is the quantity of Gas delivered by the Sellers to
Gascor for that Comparative Force Majeure Period,
being the quantity CP calculated in respect of
that Force Majeure Period in accordance with
paragraph (d)(ii) of the definition of Annual
Minimum Quantity in Clause 1 of the Principal
Contract;
RQi is the quantity of Gas delivered by Gascor and
taken by that Retailer in the Comparative Force
Majeure Period;
160
(SIGMA)RQi is the aggregate quantity of Gas delivered by
Gascor and taken by all Retailers in the
Comparative Force Majeure Period.
3. For the purposes of paragraph 1(d)(1), if the [THIS PARAGRAPH CONTAINS
CONFIDENTIAL INFORMATION WHICH HAS BEEN OMITTED, BUT FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION.] Performance Days most
closely preceding the Force Majeure Period includes Days in more than
one Contract Year or includes the first Day of the Release Gas Period,
the quantity of Gas delivered to RCo on such Performance Days will be
adjusted to take account equitably of the difference between RCo's AQs
in such Contract Years or the difference between RCo's AQs before and
after the Release Gas Commencement Date (as the case may be).
4. For the purposes of paragraphs 1(d)(2) and 2, if a Force Majeure
Period includes Days in more than one Contract Year, the quantity of
Gas (if any) deemed to have been delivered to each Buyer in the
Comparative Force Majeure Period shall be calculated as if there was a
separate Force Majeure Period in each Contract Year and two separate
corresponding Comparative Force Majeure Periods, except that the
quantity of Gas (if any) deemed to have been delivered to each Buyer
will be adjusted equitably if necessary so that the total quantity of
Gas deemed to have been delivered to all Buyers in the Comparative
Force Majeure Period is equal to the quantity of Gas delivered by
Sellers to Gascor in the Comparative Force Majeure Period.
5. For the purposes of this Schedule, "COMPARATIVE FORCE MAJEURE PERIOD"
means, in relation to a Force Majeure Period lasting longer than 30
Days, the period commencing one year prior to the commencement of the
Force Majeure Period and continuing for the same number of whole Days
as the Force Majeure Period.
6. For the purposes of this Schedule, when determining the quantity of
Gas deemed to have been delivered to a Buyer in a Comparative Force
Majeure Period, the quantity deemed to have been delivered, but for
this paragraph 6, will be adjusted to take account equitably of any
Days during the period which were not Performance Days.
7. If Gascor and the Buyers are unable to agree the quantity of Gas
deemed to have been delivered to each Buyer in the circumstances
described in paragraph 4 or the adjustments required to be made in
accordance with paragraphs 3 or 6 within 30 days after the end of the
Contract Year in respect of which the calculation or adjustment is to
be made for the purposes of this Schedule, any Party may refer the
matter to an Expert.
161
SCHEDULE 5 - SELLERS' SALES ALLOCATION MECHANISMS
--------------------------------------------------------------------------------
1. INDEPENDENT ASSESSOR
--------------------------------------------------------------------------------
(a) Gascor must appoint an independent assessor for the
purposes of this Agreement ("INDEPENDENT ASSESSOR").
(b) The Committee must, within 10 days of Gascor giving
notice to the Committee that Gascor or Sellers have requested the
appointment of an independent assessor under the Principal Contract
for the purposes of determining Sellers' Sales, meet to endeavour to
agree upon an Independent Assessor to be appointed for the purposes of
this Agreement.
(c) If the Committee has failed to agree upon an Independent
Assessor within 30 days after the meeting pursuant to paragraph 1(b),
any Party may, subject to giving a copy of the request to the other
Parties at the same time as the request being made, request the
President of the Institute of Chartered Accountants in Australia to
appoint an Independent Assessor and, provided the Parties are given a
reasonable opportunity to make submissions prior to any decision, that
appointment will be final and binding on the Parties.
(d) The Independent Assessor will be appointed for a term of
3 years. Notwithstanding the term of appointment the Independent
Assessor may be removed if the Committee so determines, such removal
to be with effect from the time of appointment of a replacement either
by resolution of the Committee or pursuant to paragraph 1(e). If the
office of the Independent Assessor is vacant other than by reason of
the removal of the Independent Assessor, a person must be appointed as
Independent Assessor either by resolution of the Committee or pursuant
to paragraph 1(e).
(e) If the office of Independent Assessor is vacant for any
reason, the Committee must meet within 30 days of a request from a
Party to endeavour to agree upon an Independent Assessor to be
appointed for the purposes of this Agreement. If the Committee has
failed to agree upon an Independent Assessor within 30 days after
meeting pursuant to this paragraph any Party may, subject to giving a
copy of the request to the other Parties at the same time as the
request being made, request the President of the Institute of
Chartered Accountants in Australia to appoint an Independent Assessor
and, provided the Parties are given a reasonable opportunity to make
submissions prior to any decision, that appointment will be final and
binding on the Parties.
(f) No person may be appointed to act as the Independent
Assessor unless that person is qualified by eduction, experience and
training to determine the relevant matters.
(g) Unless the Parties otherwise agree, no person who, at
the time of the appointment or at any time whilst they remain the
Independent Assessor, has, has had or may have some interest or duty
162
(either as an employee or adviser or otherwise) which conflicts or may
conflict with their function under such appointment may be appointed
as or remain as Independent Assessor.
(h) The Independent Assessor must undertake in writing to
perform the role and duties allocated to that position in accordance
with this Agreement.
(i) If will be a term of the Independent Assessor's
appointment that the Independent Assessor be required to undertake not
to disclose any confidential information (except in the circumstances
contemplated by Clause 15) coming to its knowledge by reason of its
appointment to any person other than the person who provided that
confidential information.
(j) The costs and expenses of the Independent Assessor not
paid by or recoverable from any person, will be borne in equal shares
by each of the Retailers.
--------------------------------------------------------------------------------
2. DUTIES OF INDEPENDENT ASSESSOR
--------------------------------------------------------------------------------
(a) The Independent Assessor will determine in respect of
each Quarter in a Contract Year and each Contract Year the Sellers'
Sales Allocation of each Retailer in accordance with the principles
set out in Clause 4.2(c) and the Sellers' Sales Allocation Mechanisms.
(b) The Independent Assessor will determine in respect of
each Quarter of a Contract Year the adjustment (if any) which is
required to be made to each Retailer's MDQ for that Quarter as a
result of that Retailer's Sellers' Sales Allocation for that Quarter
in accordance with the provisions of Clauses 4.5 and 4.6 and the
Sellers' Sales Allocation Mechanisms.
(c) The Independent Assessor must use its best endeavours to
determine the Sellers' Sales Allocation of each Retailer and any
adjustment to a Retailer's MDQ on the same day as or as soon as
reasonably practicable after the relevant Sellers' Sales or
corresponding adjustment to Gascor's MDQ is determined under the
Principal Contract.
(d) Sellers' Sales for a Quarter will be annualised in
accordance with the Process and Mechanisms (as defined in the
Principal Contract) under the Principal Contract.
(e) The Independent Assessor shall have regard to
information supplied by the Parties pursuant to paragraph 3 and may
also make such further enquiries and rely upon such other information
as the Independent Assessor considers necessary for determining the
Retailers' respective Sellers' Sales Allocations and the matters
referred to in paragraphs 2(a) and (b).
(f) The Independent Assessor must make its determinations
with all due diligence and speed and must provide a copy of its
determinations (which must explain the basis of its determinations to
the extent that it is able to do so without disclosing confidential
information to any Party) to each Party.
163
(g) Subject to paragraph 4, a determination by the
Independent Assessor is binding save in the event of fraud or manifest
error, on Gascor and on the Retailers severally.
--------------------------------------------------------------------------------
3. DISCLOSURE OF INFORMATION TO INDEPENDENT ASSESSOR
--------------------------------------------------------------------------------
(a) Each Party must promptly disclose (and must ensure that
each of its Related Companies promptly discloses) to the Independent
Assessor such information as the Independent Assessor requests or
requires in order to make its determinations as required by paragraphs
2(a) and (b).
(b) The Independent Assessor may inspect the records of a
Party or a Related Company of a Party and a Party must co-operate (and
must ensure that each of its Related Companies co-operates) with the
Independent Assessor in relation to such inspection.
--------------------------------------------------------------------------------
4. AUDIT RIGHTS
--------------------------------------------------------------------------------
(a) The Committee may appoint a member of a reputable firm
of chartered accountants or such other person as the Committee may
agree ("SELLERS' SALES AUDITOR") to carry out an independent audit of
any determination made by the Independent Assessor pursuant to
paragraph 2(a) and (b).
(b) If a Party (other than RCo) reasonably considers that an
independent audit indicates a material error or discrepancy, that
Party must give notice to the other Parties (other than RCo)
identifying the error or discrepancy. The Parties (other than RCo)
must meet within 10 Working Days of the notice given pursuant to this
paragraph 4(b) to seek to resolve the matter.
(c) If the matter is not resolved by the Parties (other than
RCo) within 20 Working Days of their first meeting in accordance with
paragraph 4(b), the subject of the original determination by the
Independent Assessor may be referred by any Party to an Expert.
(d) The costs of the work of the Sellers' Sale Auditor will
be borne by the Parties requesting the audit in equal proportions
unless such Parties agree otherwise.
(e) It will be a term of the Sellers' Sale Auditor's
appointment that the Sellers' Sales Auditor be required not to
disclose any confidential information coming to its knowledge by
reason of its appointment to any person other than the person who
provided that information.
164
--------------------------------------------------------------------------------
5. COST OF THE INDEPENDENT ASSESSOR APPOINTED UNDER THE PRINCIPAL
CONTRACT
--------------------------------------------------------------------------------
Any costs and expenses which Gascor may incur in relation to the appointment of
the independent assessor under paragraph 1.1 of Schedule 2 of the Principal
Contract, any variation of the terms of such appointment or the performance by
such independent assessor of its functions or duties in accordance with the
terms of the Principal Contract or the terms of its appointment must be borne by
the Retailers in equal shares.
EXECUTED by the Parties.
THE OFFICIAL SEAL of )
GASCOR )
was affixed by the Administrator of )
Gascor appointed under the Gas Industry )
Xxx 0000 (Vic) )
X X XXXXX
---------------------------------------
Administrator
XXXX X XXXXX
---------------------------------------
Print Name
THE COMMON SEAL of )
ENERGY 21 PTY LTD )
ACN 079 089 213 )
was affixed to this document )
in the presence of: )
XXXXX XXXXXX XXXXX XXXXXXXX
--------------------------------------- -----------------------------------
Signature of director Signature of secretary
XXXXX X XXXXXX XXXXX X XXXXXXXX
--------------------------------------- -----------------------------------
Name of director (please print) Name of secretary (please print)
165
THE COMMON SEAL of )
IKON ENERGY PTY LTD )
ACN 079 089 553 )
was affixed to this document )
in the presence of: )
XXXXX XXXXXX XXXXXXX XXXXXXXXX
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Signature of director Signature of secretary
XXXXX X XXXXXX XXXXXXX XXXXXXXXX
--------------------------------------- -----------------------------------
Name of director (please print) Name of secretary (please print)
THE COMMON SEAL of )
KINETIK ENERGY PTY LTD )
ACN 079 089 188 )
was affixed to this document )
in the presence of: )
XXXXXXX XXXXX XXXXX XXX
--------------------------------------- -----------------------------------
Signature of director Signature of secretary
XXXXXXX X XXXXX XXXXX XXX
--------------------------------------- -----------------------------------
Name of director (please print) Name of secretary (please print)
THE COMMON SEAL of )
GAS RELEASE CO PTY LTD )
ACN 079 089 286 )
was affixed to this document )
in the presence of: )
X X XXXXX X XXXXXXX
--------------------------------------- -----------------------------------
Signature of director Signature of secretary
XXXX X XXXXX X X XXXXXXX
--------------------------------------- -----------------------------------
Name of director (please print) Name of secretary (please print)
166
