Exhibit 10.8
Service Agreement No. 867760
Authorization: Blanket
(Reservation Charge)
SERVICE AGREEMENT
UNDER RATE SCHEDULE FT
THIS AGREEMENT, made and entered into as of this 1ST DAY OF
November, 1993, by and between Southern Natural Gas Company, a
Delaware corporation, hereinafter referred to as "Company", and
United Cities Gas Company, a Illinois corporation, hereinafter
referred to as "Shipper",
WITNESSETH
WHEREAS, Company is an interstate pipeline, as defined in
Section 2(15) of the Natural Gas Policy Act of 1978 (NGPA); and
WHEREAS, Shipper is a LDC/DISTRIBUTOR; and
WHEREAS, Shipper has requested fire transportation pursuant
to Rate Schedule FT of various supplies of gas for redelivery for
Shipper's account and has submitted to Company a request for such
transportation service in compliance with Section 2 of the
General Terms and Conditions applicable to Rate Schedule FT; and
WHEREAS, Company has agreed to provide Shipper with
transportation service of such gas supplies in accordance with
the terms and conditions of this Agreement.
NOW THEREFORE, the parties hereto agree as follows:
ARTICLE I
TRANSPORTATION QUANTITY
1.1 Subject to the terms and provisions of this Agreement,
Rate Schedule FT and the General Terms and Conditions thereto,
Shipper agrees to deliver or cause to be delivered to Company at
the Receipt Point(s) described in Exhibit A and Exhibit A-1 to
this Agreement, and Company agrees to accept at such point(s) for
transportation under this Agreement, an aggregate quantity of up
to 23,444 Mcf of natural gas per day for the period of October 1
through the following March 31 and 17,998 Mcf of natural gas per
day, for the period of April 1 through the following September 30
during the term of this Agreement (each such volume respectively
referred to herein as "Transportation Demand," as applicable).
The volume for the April - September period is subject to any
Commission order addressing the mitigation issues in Docket Nos.
RS92-10, et al. Company's obligation to accept gas on a firm
basis at any Receipt Point is limited to the Receipt Points set
out on Exhibit A and to the Maximum Daily Receipt Quantity (MDRQ)
stated for each such Receipt Point. The sum of the MDDQ's for the
Receipt Points on Exhibit A shall not exceed the Transportation
Demand.
1.2 Subject to the terms and provisions of this Agreement,
Rate Schedule FT and the General Terms and Conditions thereto,
Company shall deliver a thermally equivalent quantity of gas,
less the applicable fuel charge as set forth in Rate Schedule FT,
to Shipper at the Delivery Point(s) described in Exhibit B and
Exhibit B-1 hereto. Company's obligation to redeliver gas at any
Delivery Point on a firm basis is limited to the Delivery Points
specified on Exhibit B and to the Maximum Daily Delivery Quantity
(MDDQ) stated for each such Delivery Point. The sum of the MDDQ's
for the Delivery Points on Exhibit B shall equal the
Transportation Demand.
ARTICLE II
CONDITIONS OF SERVICE
2.1 It is recognized that the transportation service
hereunder is provided on a firm basis pursuant to, in accordance
with and subject to the provisions of Company's Rate Schedule FT,
and the General Terms and Conditions thereto, which are contained
in Company's FERC Gas Tariff, as in effect from time to time, and
which are hereby incorporated by reference. In the event of any
conflict between this Agreement and Rate Schedule FT, the terms
of Rate Schedule FT shall govern as to the point of conflict. Any
limitation of transportation service hereunder shall be in
accordance with the priorities set out in Rate Schedule FT and
the General Terms and Conditions thereto.
2.2 This Agreement shall be subject to all provisions of the
General Terms and Conditions applicable to Company's Rate
Schedule FT as such conditions may be revised from time to time.
Unless Shipper requests otherwise, Company shall provide to
Shipper the filings Company makes at the Federal Energy
Regulatory Commission ("Commission") of such provisions of the
General Terms and Conditions or other matters relating to Rate
Schedule FT.
2.3 Company shall have the right to discontinue service
under this Agreement in accordance with Section 15.3 of the
General Terms and Conditions hereto.
2.4 The parties hereto agree that neither party shall be
liable to the other party for any special, indirect, or
consequential damages (including, without limitation, loss of
profits or business interruptions) arising out of or in any
manner related to this Agreement.
2.5 This Agreement is subject to the provisions of Part 284
of the Commission's Regulations under the NGPA and the Natural
Gas Act. Upon termination of this Agreement, Company and Shipper
shall be relieved of further obligation hereunder to the other
party except to complete the transportation of gas underway on
the day, of termination, to comply with provisions of Section 14
of the General Terms and Conditions with respect to any
imbalances accrued prior to termination of this Agreement, to
render reports, and to make payment for all obligations accruing
prior to the date of termination.
ARTICLE III
NOTICES
3.1 Except as provided in Section 8.6 herein, notices
hereunder shall be given pursuant to the provisions of Section 18
of the General Terms and Conditions to the respective party at
the applicable address, telephone number or facsimile machine
number stated below or such other addresses, telephone numbers or
facsimile machine numbers as the parties shall respectively
hereafter designate in writing from time to time:
Company:
Notices and General Correspondence
Southern Natural Gas Company
Post Office Box 2563
Birmingham, Alabama 35202-2563
Attention: Transportation Services Department
Telephone No.: (205) 325-7223
Facsimile Machine No.: (205) 325-7303
Dispatching Notices - Nominations/Confirmations/Scheduling
Southern Natural Gas Company
Post Office Box 2563
Birmingham, Alabama 35202-2563
Attention: Transportation Services Department
Telephone No.: (205) 325-7223
Facsimile Machine No.: (205) 325-7303
Emergencies/24-Hour Dispatching/
Limitation and Penalty Notices
Southern Natural Gas Company
Post Office Box 2563
Birmingham, Alabama 35202-2563
Attention: Gas Operations Department
Telephone No.: (205) 325-7308
Facsimile Machine No.: (205) 325-7375
Alternative Contacts:
(1) Attention: Gas Operations Department
Telephone No.: (205) 325-7305
Facsimile Machine No.: (205) 325-7375
(2) Attention: Gas Operations Department
Telephone No.: (205) 325-7309
Facsimile Machine No.: (205) 325-7375
Payments
Southern Natural Gas Company
Post Office Box 102502
68 Annex
Atlanta, Georgia 30368
Shipper:
Notices ant General Correspondence
RON MCDOWELL, VICE PRESIDENT - GAS SUPPLY
5300 MARYLAND WAY
BRENTWOOD, TN 37027
Telephone No.: (615) 373-0104
Facsimile Machine No.: (615) 790-9337
Dispatching Notices - Nominations/Confirmations
RON MCDOWELL, VICE PRESIDENT - GAS SUPPLY
5300 MARYLAND WAY
BRENTWOOD, TN 37027
Telephone No.: (615) 373-0104
Facsimile Machine No.: (615) 790-9337
Dispatching Notices - Limitations
RON MCDOWELL, VICE PRESIDENT - GAS SUPPLY
5300 MARYLAND WAY
BRENTWOOD, TN 37027
Telephone No.: (615) 373-0104
Facsimile Machine No.: (615) 790-9337
Emergencies and 24-Bour Dispatching Contact
WILLIAM OSBOBN
5300 MARYLAND WAY
BRENTWOOD, TN 37027
Telephone No.: (615) 373-0104
Facsimile Machine No.: (615) 790-9337
Alternative Contacts:
(1) MARC TRONZO
5300 MARYLAND WAY
BRENTWOOD, TN 37027
Telephone No.: (615) 373-0104
Facsimile Machine No.: (615) 790-9337
(2) RON MCDOWELL
5300 MARYLAND WAY
BRENTWOOD, TN 37027
Telephone No.: (615) 373-0104
Facsimile Machine No.: (615) 790-9337
Invoices
RON MCDOWELL, VICE PRESIDENT - GAS SUPPLY
5300 MARYLAND WAY
BRENTWOOD, TN 37027
ARTICLE IV
TERM
4.1 Subject to the provisions hereof, this Agreement shall
become effective as of the date first hereinabove written and
shall be in full force and effect for a primary term through the
following dates: 10/31/1998 for 2,444 Mcf per day of
Transportation Demand and 12/31/2000 for 21,000 Mcf per day, of
Transportation Demand and shall continue in force and effect for
successive terms of 1 year each after the end of each primary
term for the specified volume, unless and until cancelled with
respect to the associated volume by either party giving 180 days
written notice to the other party prior to the end of the
specified primary term or any yearly extension thereof.
ARTICLE V
CONDITIONS PRECEDENT
5.1 Unless otherwise agreed to by the parties, the teems of
Rate Schedule FT, and the General Terms and Conditions thereto,
shall apply to the acquisition or construction of any facilities
necessary to effectuate this Agreement. Other provisions of this
Agreement notwithstanding, Company shall be under no obligation
to commence service hereunder unless and until (1) all facilities
of whatever nature, as are required to permit the receipt,
measurement, transportation, and delivery of natural gas
hereunder have been authorized, installed, and are in operating
condition, and (2) Company, in its reasonable discretion, has
determined that such service would constitute transportation of
natural gas authorized under all applicable regulatory
authorizations and the Commission's Regulations.
ARTICLE VI
REMUNERATION
6.1 Shipper shall pay Company monthly for the transportation
services rendered hereunder the charges specified in Rate
Schedule FT, including an, penalty and other authorized charges
assessed under Rate Schedule FT and the General Terms and
Conditions. Company shall notify Shipper as soon as practicable
of the date services will commence hereunder, and if said date is
not the first day, of the month, the Reservation Charge for the
first month of service hereunder shall be adjusted to reflect
only the actual number of days during said month that
transportation service is available. Company may agree from time
to time to discount the rate charged Shipper for services
provided hereunder in accordance with the provisions of Rate
Schedule FT. Said discounted charge shall be set forth on Exhibit
E hereto.
6.2 The rates and charges provided for under Rate Schedule
FT shall be subject to increase or decrease pursuant to any order
issued by the Commission in any proceeding initiated by Company
or applicable to the services performed hereunder. Shipper agrees
that Company shall, without any further agreement by Shipper,
have the right to change from time to time, all or any part of
this Agreement, as well as all or any part of Rate Schedule FT,
or the General Terms and Conditions thereto, including without
limitation the right to change the rates and charges in effect
hereunder, pursuant to Section 4(d) of the Natural Gas Act as
may, be deemed necessary by Company in its reasonable judgment,
to assure just and reasonable service and rates under the Natural
Gas Act. Nothing contained herein shall prejudice the rights of
Shipper to contest at any time the changes made pursuant to this
Section 6.2, including the right to contest the transportation
rates or charges for the services provided under this Agreement,
from time to time, in any subsequent rate proceedings by Company
under Section 4 of the Natural Gas Act or to file a complaint
under Section 5 of the Natural Gas Act with respect to such
transportation rates or charges.
ARTICLE VII
SPECIAL PROVISIONS
7.1 If Shipper is a seller of gas under more than one
Service Agreement and requests that Company alloy it to aggregate
nominations for certain Receipt Points for such Agreements,
Company will allow such an arrangement under the terms and
conditions set forth in this Article VII. To be eligible to
aggregate gas, Shipper must comply with the provisions of Section
2.2 of the General Terms and Conditions and the terms and
conditions of the Supply Pool Balancing Agreement executed by
Shipper and Company pursuant thereto.
7.2 If Shipper is a purchaser of gas from seller(s) that are
selling from an aggregate of Receipt Points, Shipper and its
seller(s) shall execute an Agency Agreement in the format
attached hereto as Exhibit D for each such seller from whom
Shipper is purchasing gas.
ARTICLE VIII
MISCELLANEOUS
8.1 This Agreement constitutes the entire Agreement between
the parties and no waiver by Company or Shipper of any default of
either party under this Agreement shall operate as a waiver of
any subsequent default whether of a like or different character.
8.2 The laws of the State of Alabama shall govern the
validity, construction, interpretation, and effect of this
Agreement.
8.3 No modification of or supplement to the terms and
provisions hereof shall be or become effective except by
execution of a supplementary written agreement between the
parties except that in accordance with the provisions of Rate
Schedule FT, and the General Terms and Conditions thereto,
Receipt Points may be added to or deleted from Exhibit A and the
Maximum Daily Receipt Quantity for any Receipt Point on Exhibit A
may be changed upon execution by Company and Shipper of a Revised
Exhibit A to reflect said change(s), and Delivery Points may be
added to or deleted from Exhibit B and the Maximum Daily Delivery
Quantity for any Delivery Point may be changed upon execution by
Company and Shipper of a Revised Exhibit B to reflect said
change(s); provided, however, that any such change to Exhibit A
or Exhibit B must include corresponding changes to the existing
Maximum Daily Receipt Quantities or Maximum Daily Delivery
Quantities, respectively, such that the sum of the changed
Maximum Daily Receipt Quantities shall not exceed the
Transportation Demand and the sum of the Maximum Daily Delivery
Quantities equals the Transportation Demand.
8.4 This Agreement shall bind and benefit the successors and
assigns of the respective parties hereto. Subject to the
provisions of Section 22 of the General Tents and Conditions
applicable hereto, neither party may assign this Agreement
without the prior written consent of the other party, which
consent shall not be unreasonably withheld; provided, however,
that either party may assign or pledge this Agreement under the
provisions of any mortgage, deed of trust, indenture or similar
instrument.
8.5 Exhibits A, A-1, B, B-1, C, D and/or E, if applicable,
attached to this Agreement constitute a part of this Agreement
and are incorporated herein.
8.6 This Agreement is subject to all present and future
valid laws and orders, rules, and regulations of any regulatory
body of the federal or state government having or asserting
jurisdiction herein. After the execution of this Agreement, each
party shall make and diligently prosecute all necessary filings
with federal or other governmental bodies, or both, as may be
required for the initiation and continuation of the
transportation service which is the subject of this Agreement and
to construct and operate any facilities necessary therefor. Each
party shall have the right to seek such governmental
authorizations as it deems necessary, including the right to
prosecute its requests or applications for such authorization in
the manner it deems appropriate. Upon either party's request, the
other party shall timely provide or cause to be provided to the
requesting party such information and Material not within the
requesting party's control and/or possession that may be required
for such filings. Each party shall promptly inform the other
party of any changes in the representations made by such party
herein and/or in the information provided pursuant to this
paragraph. Each party shall promptly provide the party with a
copy of all filings, notices, approvals, and authorizations in
the course of the prosecution of its filings. In the event all
such necessary regulatory approvals have not been issued or have
not been issued on terms and conditions acceptable to Company or
Shipper within twelve (12) months from the date of the initial
application therefor, then Company or Shipper may terminate this
Agreement without further liability or obligation to the other
party by giving written notice thereof at any time subsequent to
the end of such twelve-month period, but prior to the receipt of
all such acceptable approvals. Such notice will be effective as
of the date it is delivered to the U. S. Mail, for delivery by
certified mail, return receipt requested.
8.7 This Agreement supersedes and cancels the Service Agreement
(#848970) dated 10/20/1988, between the parties hereto.
IN WITNESS THEREOF, this Agreement has been executed by the
parties as of the date first written above by their respective
duly authorized officers.
ATTEST: SOUTHERN NATURAL GAS COMPANY
By
Its
ATTEST: UNITED CITIES GAS COMPANY
By
Its