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EXHIBIT 10.15
GENERAL TERMS AND CONDITIONS
UPSTREAM ENERGY SERVICES, L.L.C.
These General Terms and Conditions are agreed to by Upstream Energy Services,
L.L.C., a Texas limited liability company ("Buyer") and Xxxxxxx Xxx Producing
Company, a Texas corporation, ("Seller") as of the first day of April, 1996.
ARTICLE 1
DEFINITIONS
For the purposes of these General Terms and Conditions the following
definitions shall be applicable:
1.1 "Gas" means natural gas produced from gas xxxxx, as produced in
association with oil (casinghead gas) and residue gas resulting from
processing either casinghead gas or gas well gas.
1.2 "Day" means a period of 24 consecutive hours beginning at 8:00 a.m., local
time at the point(s) of delivery specified in a Sales Agreement, on any
calendar day and ending at 8:00 a.m., local time at the point(s) of
delivery specified in a Sales Agreement, on the calendar day immediately
following.
1.3 "Month" means the period beginning at 8:00 a.m., local time at the
point(s) of delivery specified in a Sales Agreement, on the first day of a
calendar month and ending at 8:00 a.m., local time at the point(s) of
delivery specified in a Sales Agreement, on the first day of the calendar
month immediately following.
1.4 "Btu" means British thermal unit which is the quantity of the heat
required to raise the temperature of one pound of water one degree
Fahrenheit at 60 degrees Fahrenheit and "MMBtu" means one million British
thermal units.
1.5 "Sales Agreement" refers to the sale contract(s) which Buyer and Seller
may enter into which incorporate by reference these General Terms and
Conditions. All Sales Agreements shall be of the form attached hereto as
"Exhibit A".
1.6 "Transporters" means the interstate or intrastate natural gas pipeline
companies, gatherers, and local distribution companies whose transportation
services are required by Buyer and Seller.
1.7 "Force Majeure" shall mean acts of God, strikes, lockouts, or industrial
disputes or disturbances, civil disturbances, arrests and restraint of
rulers of people, acts of public enemy, wars, riots, blockades,
insurrections, or any other cause, whether of the kind herein enumerated or
otherwise, not reasonably within the control of the party claiming Force
Majeure.
1.8 "Mcf" means one thousand standard cubic feet of gas.
ARTICLE 2
QUANTITY AND DELIVERY
2.1 Xxxxx agrees to take and pay for and Xxxxxx agrees to sell and deliver the
quantity of gas set forth in each Natural Gas Sales Agreement, (attached
hereto as Exhibit "A"), entered into pursuant to these General Terms and
Conditions.
2.2 Seller represents that its interest in and to such supply of natural gas
is not and will not be subject to any commitment by Seller in conflict with
this contract.
2.3 The parties agree to use their best efforts to receive and deliver gas
purchased under each Sales Agreement at a relatively constant daily rate.
Buyer shall promptly notify Seller of any change in its rate of receipts
and Seller shall promptly notify Buyer of any change in its rate of
delivery.
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Immediately hereunder is dispatching information applicable to both
Buyer and Seller. Any change in such information by either party
shall be promptly reported to the other party under the terms of
Section 7.5 herein.
SELLER: BUYER:
XXXXXXX XXX PRODUCING COMPANY UPSTREAM ENERGY SERVICES, L.L.C.
Main Number: (000)000-0000 Main Number: (000)000-0000
Telecopier (Fax): (000) 000-0000 Telecopier (Fax): (000)000-0000
Dispatch Contact: Xxxxxxx X. Xxxxx Dispatch Contact: Xxxx Xxxxx
2.4 Seller shall be responsible for all costs incurred and fuel assessed
for the gathering and transportation of the gas to be sold under each
Sales Agreement at and to the point(s) of delivery specified in each
Sales Agreement, and Buyer shall be responsible for all costs
incurred and fuel assessed for the transportation of the gas beyond
the point(s) of delivery.
2.5 Transporters for Seller and Buyer may require certain nominating
procedures to be followed with respect to the daily and monthly
scheduling of deliveries of gas to the Transporters and the
redelivery of such gas by the transporters to Seller or Buyer or
their designees. Seller and Buyer agree to provide to the other, in
as prompt a manner as reasonable, all information necessary to permit
such scheduling requirements to be met, and shall act promptly to
balance receipts with deliveries on all sales pursuant to each
Natural Gas Sales Agreement.
2.6 In the event Buyer or Seller is assessed penalties or special charges
by its Transporters due solely to the failure of the other party to
fulfill its obligations under this contract to receive or deliver the
nominated quantity at the Delivery Point, the non-complying party will
reimburse the penalized party for all penalties so incurred, provided
however, neither party shall be obligated to reimburse the other
party for penalties if such deficiency or surplus in deliveries
results from factors outside the reasonable control of the
non-complying party.
2.7 Purchase and sale of gas pursuant to any Sales Agreement shall be
expressly subject to the ability of Transporters to accept Seller's
gas, and the Transporters' willingness to transport the gas to Buyer.
The obligation of Seller and Buyer with respect to the sale and
purchase of gas under a Sales Agreement shall be suspended during any
period when Transporters are unable or unwilling to transport.
2.8 Seller agrees to use its best efforts to effect and maintain all
transportation agreements necessary to transport the gas to be sold
and purchased hereunder. In the event Buyer requires an "on behalf
of" agency letter to secure the required transportation Seller
agrees to provide such letter.
ARTICLE 3
QUALITY
3.1 The gas sold and delivered to Buyer shall meet or exceed the minimum
quality specifications provided in the General Terms and Conditions
of the Gas Tariff of the first Transporter to transport gas sold
hereunder.
ARTICLE 4
TITLE, RISK OF LOSS AND LIABILITY
4.1 As between the parties hereto, Seller shall have title to gas sold
hereunder and shall be in control and possession of and responsible
for any damage, claim, liability or injury caused thereby until the
gas has been delivered to Buyer at the point(s) of delivery. After
delivery, Buyer or Buyer's
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Transporter shall be deemed to be in exclusive control and possession
thereof and responsible for any damage, claim liability or injury caused
thereby. The point(s) of delivery shall be as established in the
applicable Sales Agreement.
4.2 Buyer shall indemnify, defend and hold Seller harmless from and against all
loss, costs and expense, including court costs and reasonable attorneys'
fees, for any claims, suits, judgements, demands, actions or liability
growing out of the operations conducted hereunder by Xxxxx or arising
after the gas is delivered to Buyer at the point(s) of delivery. Seller
shall indemnify, defend and hold Buyer harmless from and against any loss,
cost and expense, including court costs and reasonable attorneys' fees,
for any claims, suits, judgements, demands, actions or liability growing
out of Seller's operations or arising at and prior to delivery of the gas
to Buyer at the point(s) of delivery.
ARTICLE 5
PRICE
5.1 The price to be paid by Buyer to Seller for all gas delivered at the
point(s) of delivery shall be set forth in the applicable Sales
Agreement. In the event any price agreed upon exceeds any maximum lawful
price established by the Federal Energy Regulatory Commission or any other
state, federal or local government entity with proper jurisdiction over
the sales price of the gas, the price shall be the highest price permitted
by law up to the agreed upon price per MMBtu.
ARTICLE 6
TAXES AND ROYALTY
6.1 Seller will pay, or cause to be paid, all royalties, taxes and other
payments due on the production, gathering, severance or handling of the
gas at and prior to its delivery by Seller to Buyer and will indemnify and
save Buyer harmless against all loss, damage and expense of every
character on account of adverse claims for such royalties, taxes or
payments. Buyer shall pay or cause to be paid all taxes or other charges
imposed on the gas or the sale of the gas after its delivery by Seller to
Buyer.
ARTICLE 7
BILLINGS, PAYMENTS AND NOTICES
7.1 On or before the twentieth day of the month following the month of first
delivery of gas under a Sales Agreement and on or before the twentieth day
of each month thereafter, Seller will invoice Buyer for all gas delivered
by Seller to Buyer during the preceding month, and buyer agrees to pay the
full amount of the invoice by wire transfer on or before the last business
day of the month to the Seller or an other party designated by the
Seller. The invoice will be supported by a statement showing the total
amount of gas delivered to Buyer, the Btu content thereof, the amount due
therefor and such other information as appropriate.
7.2 Should Buyer fail to pay the full amount of any invoice when due, interest
on any unpaid amount shall accrue at the lesser of the then effective
prime rate of interest charged by the First Interstate Bank of Texas and
Seller shall be entitled to suspend all further performance under the
Sales Agreement in addition to all other remedies at law and equity. Any
such suspension right shall not prejudice Seller's rights to collect any
sums due Seller for gas therefore delivered to Buyer.
7.3 Every notice, request, invoice or other communications provided for in
these General Terms and Conditions shall be in writing and shall be deemed
properly given when hand delivered, telegraphed by prepaid telegram,
telecopied or mailed from within the United States by United States mail,
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xxxxxxx paid to the address of the other party as set forth below and as
such address may be changed from time to time by notice to the other
party.
NOTICES & CORRESPONDENCE
SELLER: BUYER:
Xxxxxxx Xxx Producing Company Upstream Energy Services, L.L.C.
00000 Xxxxxxxxx Xxxxxxx, Xxxxx 000 00000 Xxxxxxxxx Xxxxxxx, Xxxxx 000
Xxxxxxx, Xxxxx 00000 Xxxxxxx, XX 00000
Attn: Xxxxx X. Xxxx Attn: Contract Administration
7.4 Payment shall be made to the following account:
Fuji Bank & Trust Company
ABA # 000000000
Account # 001-007483
Credit to Triassic Energy Partners, L.P.
7.5 Each party shall have the right to examine the records of the other party
to the extent necessary to verify the accuracy of any statement or
payment made hereunder. Any error discovered in any payment or payment
shall be promptly corrected, except for errors discovered more than two
years subsequent to the statement or payment in question.
ARTICLE 8
MEASUREMENT OF GAS
8.1 Equipment used for measurement shall be that installed and operated by
the Transporters. Both Buyer and Seller shall have the right to install
check measurement equipment and may request calibration of pipeline
meters, subject to the terms of the transportation contract(s). Buyer
shall not be obligated to install any measuring equipment.
ARTICLE 9
FORCE MAJEURE
9.1 In the event that either Seller or Buyer is rendered unable, by reason of
an event of force majeure, to perform, wholly or in part, any obligation
set forth in these General Terms and Conditions or a Sales Agreement,
except for the obligation to make payments when due, then upon such
party's giving notice and full particulars of such event of force
majeure, the obligation of such party shall be suspended to the extent
and for the period of such force majeure condition. Any force majeure
condition shall be remedied so far as practicable with all reasonable
dispatch.
ARTICLE 10
TERM OF AGREEMENT
10.1 The term of this agreement shall commence from the date hereof and
continue for a primary term of one (1) year extending quarterly
thereafter. Xxxxx and Xxxxxx may agree to extend the primary term of this
agreement as evidenced by the execution of an "Exhibit "A", Sales
Agreement" as it may be amended from time to time. This agreement may be
terminated by either party with prior written notice to the other given
at least sixty (60) days before the expiration of the primary term or any
quarterly extension thereafter.
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ARTICLE 11
REGULATORY BODIES
11.1 These General Terms and Conditions shall be subject to all valid laws,
orders, rules and regulations of any and all duly constituted
governmental authorities, whether Federal, State or local, having
jurisdiction over the subject matter hereof to the extent that such laws,
regulations and orders are applicable and effective from time to time.
ARTICLE 12
MISCELLANEOUS
12.1 These General Terms and Conditions together with any Sales Agreement
executed pursuant hereto contain the entire agreement of the parties with
respect to the subject matter hereof and all previous agreements, whether
written or oral are hereby superseded. These General Terms and Conditions
may be amended only by written instrument executed by the parties hereto.
12.2 This contract may not be assigned, in whole or in part, by either party,
except to an entity controlled by or under common control with the
assigning party without the express written consent of the other party.
12.3 This contract shall be governed by and interpreted in accordance with,
the laws of the state of Texas.
IN WITNESS WHEREOF the parties hereto have executed these General Terms and
Conditions as of the date first mentioned.
Accepted and agreed to on this Accepted and agreed to on this
6 day of November, 1996. 6 day of November, 1996.
SELLER: BUYER:
XXXXXXX XXX PRODUCING COMPANY UPSTREAM ENERGY SERVICES, L.L.C.
/s/ XXXXX X. XXXX /s/ XXXX X. XXXXXXX
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Xx. Xxxxx X. Xxxx Xx. Xxxx X. Xxxxxxx,
Chairman of the Board & CEO President
/s/ XXXX X. XXX XXXXXX /s/ XXXX XXXXX
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WITNESS: WITNESS:
