Xxxxxx 0, 0000
XxxxxxXxxxx Natural Gas Inc.
0000 Xxx Xxxxxx
Xxxxxxxxxx, XX 00000-0000
Attention: Xx. Xxxxxx X. Xxxxxxx via facsimile: (000) 000-0000
RE: CONTRACT RESTRUCTURING LETTER AGREEMENT
Dear Don:
This Contract Restructuring Letter Agreement ("Letter
Agreement") is entered into by and between Tennessee Gas
Pipeline Company ("Tennessee"), and EnergyNorth Natural Gas
Inc. ("EnergyNorth"). Whereas, Tennessee and EnergyNorth
(being hereinafter individually referred to as a "Party" and
collectively referred to as the "Parties"), have agreed upon
the terms and conditions under which to extend and amend
certain Firm Transportation and Storage Service Agreements
("Firm Agreement(s)") to restructure the firm services
received by EnergyNorth from Tennessee (hereinafter referred
to as "Contract Restructuring"), the Parties wish to proceed
with the Contract Restructuring based on the following terms
and principles subject to the execution and regulatory
approval of final agreements effectuating the provisions
described herein:
1. FT-A Transportation Agreement No. 8587 ("K #8587")
(a) EnergyNorth shall elect to extend a Transportation
Quantity ("TQ") of 25,407 Dth/d (i.e., 100% of the
currently existing Maximum Daily Quantity) of K
#8587 pursuant to Article III, Section 10.5 of the
General Terms and Conditions of Tennessee's FERC
Gas Tariff for a period of three years such that
the subsequent expiration date of K #8587 is
October 31, 2003. This extension shall constitute
the Primary Extended Term as outlined in Section
10.5.
(b) Subject to EnergyNorth's election to extend the
Firm Agreement as described in Section 1(a) and
participation in an open season to change primary
points in accordance with Article XXVIII, Section
5.7 of the General Terms and Conditions of
Tennessee's FERC Gas Tariff, Tennessee shall allow
EnergyNorth to amend K #8587 to effectuate a
change in primary receipt points from meters
located in Zones 00, 0L, and 01 to meter number 07-
0018, Tennessee's Northern Storage Withdrawal
(located in Tennessee's Zone 4) to be effective on
November 1, 1999;
PAGE>
provided, however, EnergyNorth's rights shall be
limited to 3,811 Dth/d (i.e., 15% of the TQ).
The reduction of primary firm receipt meter TQ
by 3,811 Dth/d from the current primary receipt
points in Xxxxx 00, 0X, xxx 00 xxxxx xx implemented
pro rata across K #8587. Thus, the currently
existing Zones 00, 0L and 01 primary receipt points
on K #8587 shall each be reduced by 15% and meter
number 07-0018 shall be increased by the like
quantity so that the receipt quantity of K #8587
is thereby preserved.
(c) Subject to EnergyNorth's successful primary
receipt point amendment as described in Section
1(b), EnergyNorth shall remit a cash payment to
Tennessee no later than November 1, 1999 which
shall be equivalent to 60% of the applicable Base
Reservation Rates for a one year period
apportioned as follows:
Xxxx 00 - Xxxx 04 1,242 Xxx/x
Xxxx 0X - Xxxx 00 2,476 Dth/d
Xxxx 00 - Xxxx 00 00 Xxx/x
d) Subject to EnergyNorth's compliance with Sections 1(a),
(b) and (c), for the period commencing on November 1, 1999
and extending through the Primary Extended Term, EnergyNorth
shall pay a negotiated rate for service under K #8587
comprised of the following: (1) Tennessee's Base
Reservation Rate effective as of November 1, 1999; and (2)
Tennessee's Base Commodity Rate effective as of November 1,
1999. In addition, EnergyNorth shall pay all then-effective
surcharges and applicable fuel (The rates are therefore
fixed, but the surcharges and fuel charges are not). During
the period defined above, this Letter Agreement shall be the
sole agreement between the Parties affecting the rates.
2. FT-A Transportation Agreement No. 632 ("K #632")
(a) EnergyNorth shall elect to extend a TQ of 15,265
Dth/d (i.e., 100% of the currently existing
Maximum Daily Quantity) of K #632 pursuant to
Article III, Section 10.5 of the General Terms and
Conditions of Tennessee's FERC Gas Tariff for a
period of four years such that the subsequent
expiration date of K #632 is October 31, 2004.
This extension shall constitute the Primary
Extended Term as outlined in Section 10.5.
(b) Subject to EnergyNorth's compliance with Section
2(a), for the period commencing on November 1,
1999 and extending through the Primary Extended
Term, EnergyNorth shall pay a negotiated rate for
service under K #632 comprised of the following:
(1) Tennessee's Base Reservation Rate effective
as of November 1, 1999; and (2) Tennessee's Base
Commodity Rate effective as of November 1, 1999.
In addition, EnergyNorth shall pay all then-
effective surcharges and applicable fuel (The
rates are therefore fixed, but the surcharges and
fuel charges are not). During the period defined
above, this Letter Agreement shall be the sole
agreement between the Parties affecting the rates.
3. FS-MA Firm Storage Agreement No. 523 ("K #523")
(a) EnergyNorth shall elect to extend 100% of the
currently existing Maximum Storage Quantity
("MSQ") of K #523 pursuant to Article III, Section
10.5 of the General Terms and Conditions of
Tennessee's FERC Gas Tariff for a period of four
years such that the subsequent expiration date of
K #523 is October 31, 2004. This extension shall
constitute the Primary Extended Term as outlined
in Section 10.5. Unless otherwise expressly
agreed by Tennessee, EnergyNorth's currently
existing Maximum Daily Injection Quantity, Maximum
Daily Withdrawal Quantity and ratchet levels under
K #523 shall remain in effect through the Primary
Extended Term.
(b) Subject to EnergyNorth's compliance with Section
3(a), for the period commencing on November 1,
1999 and extending through the Primary Extended
Term, EnergyNorth shall pay a negotiated rate for
service under K #523 comprised of the following:
(1) Tennessee's Tariff Rate effective as of
November 1, 1999 for deliverability, space,
injection, withdrawal and overrun. In addition,
EnergyNorth shall pay all then-effective
surcharges and applicable fuel (The rates are
therefore fixed, but the surcharges and fuel
charges are not).
4. Letter Agreement
(a) This Letter Agreement shall be treated as
confidential and the Parties agree not to disclose
any information concerning this Letter Agreement
including, without limitation, the existence of
this Letter Agreement without the prior written
consent of the other Party except to employees,
consultants, agents and advisors who must be aware
of the Letter Agreement to perform the Party's
obligations hereunder if these persons have agreed
to be bound by the Parties' confidentiality
obligations; provided, however, either Party may
disclose the terms of this Letter Agreement if:
one, such disclosure is required in a judicial or
administrative process in connection with any
action, suit, proceeding, investigation, audit or
claim or otherwise by applicable law and two, the
Party requests confidential treatment of the
disclosure in the judicial or administrative
process.
(b) Notwithstanding anything herein to the contrary,
this Letter Agreement and the execution of any
agreements to effectuate the arrangements proposed
in this Letter Agreement shall be in accordance
with and subject to the terms of Tennessee's FERC
Gas Tariff and to all valid laws, orders, rules
and regulations of duly constituted authorities
having jurisdiction as amended from time to time
and to the receipt and acceptance of all
regulatory authorizations necessary on terms
acceptable to Tennessee; provided further, if the
regulatory authorizations are not received in time
to implement all of the terms of this Letter
Agreement by November 1, 1999, Tennessee shall
have the right to terminate this Letter Agreement
at any time prior to November 1, 1999.
(c) EnergyNorth and Tennessee agree to cooperate in
the preparation and filing of all necessary
applications for authorizations and to support
such filings in their entirety to effectuate the
arrangements proposed in this Letter Agreement.
(d) If either Party is deprived of any right or
benefit that is the subject matter of this Letter
Agreement, and if the deprivation is not caused by
the action or inaction of the deprived Party
(including any actions required to perform a
condition precedent) then this Letter Agreement
shall be and is terminated ab initio, and any
other agreements entered into to effectuate the
provisions of this Letter Agreement shall be
deemed null and void. To the extent any benefits
have been extended, one Party to the other, prior
to the termination, then the recipient of those
benefits shall return them to the other Party so
that the Parties will be returned to a position
equal to that as if this Letter Agreement had
never been executed.
If this Letter Agreement accurately represents your
understanding of the agreement among Tennessee and
EnergyNorth, please have the appropriate party execute the
facsimile copy of this Letter Agreement and return same to
the undersigned. Upon execution by Tennessee, I will fax
one (1) fully executed original of the Letter Agreement for
your retention. If you have any questions, please do not
hesitate to contact me at (000) 000-0000.
Sincerely,
Xxxxx X. Xxxxxx
Account Manager
Marketing Northern Accounts
AGREED TO AND ACCEPTED AGREED TO AND ACCEPTED
THIS _____ DAY OF __________, 1999. THIS _____ DAY OF __________, 1999.
TENNESSEE GAS PIPELINE COMPANY ENERGYNORTH NATURAL GAS, INC.
By: _________________________ By: _________________________
Name: _______________________ Name: ______________________
Title: ______________________ Title: _____________________
