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MASTER POWER PURCHASE 
AND SALE AGREEMENT
COVER SHEET

This Master Power Purchase and Sale Agreement ("Master Agreement" ) is made as of the following date: _________ ("Effective Date") .  The Master Agreement (together with the exhibits, schedules and any written supplements hereto) together with all Transactions shall be referred to as the "Agreement."  The Parties to (hereinafter referred to as the "Master Agreement") is made as of this___ day of ___________,______, between __________________________, a ____________ corporation (A_____________@), and _________________ (A________________@ or ACounterparty@). ____________ and _____________ are hereinafter referred to singularly as AParty@ and collectively as AParties@. For capitalized terms not otherwise defined in the text, see Article 1 below.

WITNESSETH:

[WHEREAS, from time to time, the Parties may, but shall not be obligated to, enter into transactions for the purchase and sale of any Product or Products (each, a ATransaction@) under this Master Agreement are the following: and the applicable tariff described below. For Transactions in which __________ is the Seller and Counterparty is the Buyer, ___________ will provide services to Counterparty under the ___________Tariff dated ____________, as accepted by FERC, Docket No.____________, hereinafter referred to as the A____________ Tariff@ and its incorporated service schedules, as they may be amended from time to time. For Transactions in which __________ is the Buyer and Counterparty is the Seller, Counterparty will provide services to___________ under the ___________Tariff dated ____________, as accepted by FERC, Docket No.____________, hereinafter referred to as the ACounterparty Tariff@ and its incorporated service schedules, as they may be amended from time to time;

WHEREAS, the Parties wish to agree to certain additional terms and conditions with respect to Transactions between the Parties that are governed by the _____________ Tariff or the Counterparty Tariff, as the case may be;]

NOW, THEREFORE, the Parties agree as follows:

Name (A__________________@ or AParty A@)
Street, City Zip
Attn: Contract Administration
Phone: 				
Facsimile: 			
Duns: __________________________
Federal Tax ID Number: ______________________
Invoices:
     Attn:
     Phone: 			
     Facsimile: 			
Scheduling:
     Attn:
     Phone: 			
     Facsimile: 			
Payments:
     Attn:
     Phone: 			
     Facsimile: 			
Wire Transfer:
     BNK:
     ABA:
     ACCT:
Credit and Collections:
     Attn:
     Phone: 			
     Facsimile: 				
Name (ACounterparty@ or AParty B@)
Street, City, Zip
Attn: Contract Administration
Phone: 				
Facsimile: 			
Duns: 				
Federal Tax ID Number: ________________________
Invoices:
     Attn:
     Phone: 			
     Facsimile: 			
Scheduling:
     Attn:
     Phone: 			
     Facsimile: 			
Payments:
     Attn:
     Phone: 			
     Facsimile: 			
Wire Transfer:
     BNK:
     ABA:
     ACCT:
Credit and Collections:
     Attn:
     Phone: 			
     Facsimile: 				

	

The Parties hereby agree that the General Terms and Conditions are incorporated herein, and to the following provisions as provided for in the General Terms and Conditions:

Party A Tariff

Party B Tariff	
Tariff __________________ Dated _______________ Docket Number  			

Tariff __________________ Dated _______________ Docket Number 				

Article Four
Remedies for Failure to Deliver or Receive	
Accelerated Payment of Damages: G Yes  GNo

Article Five
Events of Default;
Remedies	
G Cross Default for Party A:
G Party A: _____   Cross Default Amount $_______
G Other: _______ Cross Default Amount $_______
G Cross Default for Party B:
G Party B: _____   Cross Default Amount $_______
G Other: _______ Cross Default Amount $_______
Guarantor for Party A: _________________________	Amount of Guaranty: _______
Guarantor for Party B: _________________________	Amount of Guaranty: _______
5.6 (Setoff):   G Option A	G Option B (AAffiliates@ shall mean ____________________)	G Option C (No Setoff)

Article 8
Credit and Collateral Requirements	
8.1 Credit Information:
Party A:							
G Option A									G Option B   Specify :______________________
G Option C   Specify:______________________

Party B:
G Option A	
G Option B   Specify :______________________
G Option C   Specify:______________________
8.2  G Applicable if no other selection is made.
8.3  G  
8.4  G  Option A		G Option B
Party A Exposure Amount: $_________; provided, however, that each Party=s Exposure Amount shall be zero if an Event of  Default or Potential Event of Default with respect to such Party has occurred and is continuing.
Party B Exposure Amount: $ __________; provided, however, that each Party=s Exposure Amount shall be zero if an Event of  Default or Potential Event of Default with respect to such Party has occurred and is continuing.
Party A Rounding Amount: $__________
Party B Rounding Amount: $__________

8.5 Downgrade Event applicable
 G It shall be a Downgrade Event for Party A if __________=s Credit Rating falls below __________ from S&P or  __________ from Moody=s or if  _________ is not rated  by either S&P or Moody=s
 G It shall be a Downgrade Event for Party B if __________=s Credit Rating falls below __________ from S&P or  __________ from Moody=s or if  __________ is not rated by either S&P or Moody=s 
 G Other:
Specify: ______________________

Article 10
Confidentiality	
Confidentiality Applicable  G  If not checked, inapplicable. 

Schedule M	
 G Party A is a Governmental Entity and Schedule M is applicable
 G Party B is a Governmental Entity and Schedule M is applicable
 G Add 3.5
 G Add 8.6	
   Other Changes:  			    Specify, if any:

IN WITNESS WHEREOF, the Parties have caused this Master Agreement to be duly executed as of the date first above written.

Company Name						Company Name

By: ____________________________________		By: ____________________________________

Name: __________________________________	Name: __________________________________

Title: ___________________________________	Title: ___________________________________

	GENERAL TERMS AND CONDITIONS

ARTICLE ONE:
GENERAL DEFINITIONS

1.1	AAgreement@ has the meaning set forth in the Cover Sheet. 

1.2	ABankrupt@ means with respect to a Party or entity, such Party or entity (i) files a petition or otherwise commences, authorizes or acquiesces in the commencement of a proceeding or cause of action under any bankruptcy, insolvency, reorganization or similar law, or has any such petition filed or commenced against it, (ii) makes an assignment or any general arrangement for the benefit of creditors, (iii) otherwise becomes bankrupt or insolvent (however evidenced), (iv) has a liquidator, administrator, receiver, trustee, conservator or similar official appointed with respect to it or any substantial portion of its property or assets, or (v) is generally unable to pay its debts as they fall due.

1.3	ABusiness Day@ means any day except a Saturday, Sunday, a Federal Reserve Bank holiday or a holiday according to as defined by the North American Electric Reliability Council or any successor organization thereto.  A Business Day shall open at 8:00 a.m. and close at 5:00 p.m. local time for each Party=s principal place of business.

1.4	ABuyer@ means the Party to a Transaction that is obligated to purchase and receive, or cause to be received, the Product.

ACommercially reasonable manner@ shall include commercially reasonable purchases and sales of the Product in the market, but shall not require a Non‑Defaulting Party to utilize or change its utilization of its owned or controlled assets or market positions to minimize a Defaulting Party=s liability.

1.5	"Claiming Party" has the meaning set forth in Section 2.3.

1.6	AClaims@ means all claims or actions, threatened or filed and, whether groundless, false or fraudulent, that directly or indirectly relate to the subject matter of an indemnity, and the resulting losses, damages, expenses, attorneys= fees and court costs, whether incurred by settlement or otherwise, and whether such claims or actions are threatened or filed prior to or after the termination of this Agreement.

1.7	"Confirmation" has the meaning set forth in Section 3.3.

1.8	AContract Price@ means the price in $U.S. per unit of Product(unless otherwise provided for) to be paid by Buyer to Seller for the purchase of the Product, as specified in any Transaction.

1.9	ACosts@ means, with respect to the Non‑Defaulting Party, brokerage fees, commissions and other similar third party transaction costs and expenses reasonably incurred by such Party either in terminating any arrangement pursuant to which it has hedged its obligations or entering into new arrangements which replace a Terminated Transaction; and all reasonable attorneys= fees and expenses incurred by the Non‑Defaulting Party in connection with the termination of a Transaction.

1.10	ACredit Rating@ means, with respect to any entity, the rating then assigned to such entity=s unsecured, senior long‑term debt or deposit obligations (not supported by third party credit enhancements) by S&P, Moody=s or any other rating agency agreed by the Parties as set forth in the Cover Sheet.
 
1.11	ACross Default Amount@ shall mean the cross default amount, if any, set forth in the Cover Sheet for a Party.

1.12	ADefaulting Party@ has the meaning set forth in Section 5.1.

1.13.

ADelivery Period@ means the period of delivery for a Transaction, as specified in the Confirmation.

Transaction.

1.14	ADelivery Point@ means the point at which the Product will be delivered, which may be designated in any Transaction by referring to a Delivery Point.

AEffective Date@ means the date first written above.

 and received, as specified in any Transaction.

1.15	ADowngrade Event@ has the meaning set forth on the Cover Sheet.

1.16	AEarly Termination Date@ has the meaning set forth in Section 5.2.

1.17	AEffective Date@ has the meaning set forth on the Cover Sheet.

1.18	AEstimated Duration (FM)@ has the meaning set forth in Section 3.3.

1.19	AEvent of Default@ has the meaning set forth in Section 5.1.

1.20	AFERC@ means the Federal Energy Regulatory Commission or any successor government agency.

AGuarantee@ shall mean a guarantee issued by a parent company or another entity which benefits from providing such credit support to a Party, in a form satisfactory to the requesting Party, guaranteeing responsibility for all financial obligations associated with this Agreement and/or with respect to a particular Transaction 1.21	AForce Majeure@ means an event or circumstance which prevents one Party from performing its obligations under one or more Transactions, which event or circumstance was not anticipated as of the date the Transaction was agreed to, which is not within the reasonable control of, or the result of the negligence of, the Party claiming Force Majeure (the AClaiming Party@), and which, by the exercise of due diligence, the Claiming Party is unable to overcome or avoid or cause to be avoided.  Force Majeure shall not be based on (i) the loss of Buyer's markets; (ii) Buyer's inability economically to use or resell the Product purchased hereunder; (iii) the loss or failure of Seller=s supply; or (iv) Seller=s ability to sell the Product at a more advantageous price.  Neither Party may raise a claim of Force Majuere based in whole or in part on interruption by a Transmission Provider unless (i) such Party has contracted for firm transmission with a Transmission Provider for transmission of the Product to be delivered to or received at the Delivery Point and (ii) such interruption is due to Aforce majeure@ or Auncontrollable force@ or a similar term as defined under the Transmission Provider=s tariff; provided, however, that said guarantor shall either (i) be rated a minimum of BBB or Baa2 by Standard & Poor=s or Moody=s, respectively, or (ii) be acceptable to the requesting Party.

existence of the foregoing factors shall not be sufficient to demonstrate the existence of a Force Majuere unless other facts and circumstances of such event establish that the Claiming Party=s performance was prevented thereby. 

1.22	AGains@ means, with respect to any Party, an amount equal to the present value of the economic benefit to it, if any (exclusive of Costs), resulting from the termination of its obligations with respect to a Terminated Transaction, determined in a commercially reasonable manner. 

1.23	AGuarantor@ means, with respect to a Party, the guarantor, if any, specified for such Party on the Cover Sheet. 

1.24	AInterest Rate@ means, for any date, the lesser of (a) two (2) percent over the per annum rate of interest equal to the prime lending rate as may from time to time be published in the The Wall Street Journal under AMoney Rates@ on such day (or if not published on such day on the most recent preceding day on which published), plus two percent (2%) and (b) the maximum rate permitted by applicable law. 

ALetter 1.25	ALetter(s) of Credit@ shall mean an means one or more irrevocable, transferable, standby letter letters of credit, issued by a U.S. commercial bank with such bank having a credit rating of at least A‑ from S&P or A3 from Moody=s, in a form acceptable to the Party that is requesting said letter of credit. in whose favor the letter of credit is issued.

APrice@ means the price to be paid by Buyer to Seller for the purchase of the Product. 1.26	ALosses@ means, with respect to any Party, an amount equal to the present value of the economic loss to it, if any (exclusive of Costs),  resulting from the termination of its obligations with respect to a Terminated Transaction, determined in a commercially reasonable manner.  

AProduct@ means the product bought and sold pursuant to any Transaction, which may be designated in any Transaction by referring 1.27	"Master Agreement" has the meaning set forth on the Cover Sheet.  	

1.28	AMoody=s@ means Moody=s Investor Services, Inc. or its successor.  

1.29	ANon‑Defaulting Party@ has the meaning set forth in Section 5.2.

1.30	AOption Buyer@ shall mean the Party specified in a Transaction as the purchaser of an Option.

1.31	AOption Seller@ shall mean the Party specified in a Transaction as the seller of an Option.

1.32	AParty A Exposure Amount@ shall mean the exposure amount, if any, set forth in the Cover Sheet for Party A.

1.33	AParty B Exposure Amount@ shall mean the exposure amount, if any, set forth in the Cover Sheet for Party B.

1.34	AParty A Tariff@ means the tariff specified in the Cover Sheet for Party A.

1.35	AParty B Tariff@ means the tariff specified in the Cover Sheet for Party B.

1.36	APerformance Assurance@ means collateral in the form of either cash, Letter(s) of Credit,  or other security acceptable to the requesting Party.  

1.37	APotential Event of Default@ means an event which with notice or passage of time or both would constitute an Event Of Default.

1.38	AProduct@ means electric energy or other product(s) related thereto which are the subject of a Transaction as specified in a Transaction by reference to a Product listed in Schedule P ‑ Products attached hereto, or as may be agreed otherwise specified by the Parties in any Transaction.

1.39	AQuantity@ means that quantity of the Product that Seller agrees to make available or sell and deliver, or cause to be delivered, to Buyer, and that Buyer agrees to purchase and receive, or cause to be received, from Seller pursuant to the terms of a Transaction.

1.40	ARecording@ has the meaning set forth in Section 2.4.   

1.41	AReplacement Price@ means the price at which Buyer, acting in a commercially reasonable manner, purchases a substitute for any Product not delivered by Seller (plus or minus any increase or decrease in amounts reasonably incurred by Buyer in purchasing such substitute Product including additional transmission charges, if any, incurred by Buyer to the Delivery Point) or, absent such a purchase at Buyer=s option, the market price for such Quantity Product not delivered to at the Delivery Point as determined by Buyer in a commercially reasonable manner; provided however, in no event shall such price include any penalties, ratcheted demand or similar charges. For the purposes of this definition, Buyer shall be considered to have purchased substitute Product to the extent Buyer shall have entered into one or more arrangements in a commercially reasonable manner whereby Buyer repurchases, its obligation to sell and deliver the Product at the Delivery Point.

1.42	ARounding Amount@ means the amount set forth in the Cover Sheet.

1.43	AS&P@ means the Standard & Poor=s Rating Group (a division of McGraw‑Hill, Inc.) or its successor.  

1.44.

ASales Price@ means the price at which Seller, acting in a commercially reasonable manner, resells the Product not accepted by Buyer (including any Product not received by Buyer (excluding costs reasonably incurred by Seller in reselling such Product, and excluding additional transmission charges, if any, incurred by Seller in delivering such Product to the third party purchasers) or, absent such a resale at Seller=s option, the market price for such Quantity delivered to Product not received at the Delivery Point as determined by Seller in a commercially reasonable manner; provided however, in no event shall such price include any penalties, ratcheted demand or similar charges, nor shall a Party be required to utilize or change its utilization of its owned or controlled assets, including contractual assets, or market positions to minimize the other Party=s liability for damages.  For purposes of this definition, Seller shall be considered to have resold such Product to the extent Seller shall have entered into one or more arrangements in a commercially reasonable manner whereby Seller repurchases its obligation to purchase and receive the Product at the Delivery Point.

1.45.

ASchedule@ or AScheduling@ means the acts actions of Seller, Buyer and/or their designated representatives, including each Party=s Transmission Providers, if applicable, of notifying, requesting and confirming to each other the quantity and type of Product to be delivered on any given day or days during the Period of Delivery Period at a specified Delivery Point.

1.46	ASeller@ means the Party to a Transaction that is obligated to sell and deliver, or cause to be delivered, the Product.

1.47	ASettlement Amount@ shall mean, with respect to a Transaction and the Non‑Defaulting Party, the losses and costs (or gains) Loss or Gain, and Costs, expressed in U.S. Dollars, which such party incurs as a result of the liquidation, including, but not limited to, losses and costs (or gains) based upon the then current replacement value of such Transaction together with, at the Non‑Defaulting Party's option, but without duplication, [all brokerage fees, commissions and other similar transaction costs and expenses reasonably incurred by such Party either in terminating any arrangement pursuant to which it has hedged its obligations or entering into new arrangements which replace a terminated Transaction]; reasonable attorneys= fees, if any, incurred in connection with enforcing its rights under this Agreement; and all losses and costs which such party incurs [to modify its use of owned or controlled generation assets as a result of the termination of such Transaction]. In calculating a Settlement Amount, the Non‑Defaulting Party shall discount to present value (in a commercially reasonable manner based on the Interest Rate for the applicable period) any amount which would otherwise have been due at a date later than the Early Termination Date and shall add interest at the Interest Rate to any amount due prior to the Early Termination Date.

 of a Terminated Transaction pursuant to Section 5.2.

1.48	ATerminated Transaction@ has the meaning set forth in Section 5.2.

1.49	ATermination Payment@ has the meaning set forth in Section 5.3.

1.50	ATransaction@ means a particular transaction agreed to by the Parties relating to the sale and purchase of  Product pursuant to this Master Agreement.

1.51	ATransmission Provider@ means any entity or entities transmitting or transporting the Product on behalf of Seller or Buyer to or from the Delivery Point in a particular Transaction.

ARTICLE TWO:
TRANSACTION TERMS AND CONDITIONS

2.1	Transactions.  A Transaction shall be entered into upon agreement of the Parties orally or, if expressly required by either Party with respect to a particular Transaction, in writing, including an electronic means of communication.  Each Party agrees not to contest, or assert any defense to, the validity or enforceability of an oral any Transaction entered into in accordance with this Master Agreement under laws relating to (i) whether certain(i) based on any law requiring agreements are to be in writing or signed by the Party to be thereby bound, or (ii) its authority or the parties, or (ii) based on any lack of authority of the Party or any lack of authority of any employee of the Party to enter into a Transaction.

2.2	Governing Terms.  Unless otherwise specifically agreed, each Transaction between the Parties shall be governed by this Master Agreement.  This Master Agreement (including all exhibits and schedules), schedules and any written supplements hereto), the Party A Tariff, if any, and the Party B Tariff, if any, any collateral, credit support or margin agreement or similar arrangement between the Parties and all Transactions shall form a single integrated agreement between the Parties(hereinafter referred to as the AAgreement@).  Any inconsistency between any terms of this Master Agreement and any terms of any Transaction shall be resolved in favor of the terms of such Transaction.  

2.3	Confirmation.  Seller may confirm a Transaction by forwarding to Buyer by facsimile within three (3) Business Days after the date the Transaction is entered into a confirmation (AConfirmation@) substantially in the form of Exhibit A, which shall be executed by Buyer and returned to Seller within two (2) Business Days of Buyer's receipt of it.  If Buyer objects to any term(s) of such Confirmation, Buyer shall notify Seller in writing of such objections within two (2) Business Days of Buyer's receipt thereof, failing which Buyer shall be deemed to have accepted the terms as sent.  If Seller fails to send a Confirmation within three (3) Business Days of after the date the Transaction is entered into, a Confirmation forwarded by Buyer, substantially in the form of Exhibit A, shall be executed by Seller and returned to Buyer within two (2) Business Days of Seller's receipt of it, but not more than five (5) Business Days after the Transaction may be forwarded by Buyer to Seller.  If Seller objects to any term(s) of such Confirmation, Seller shall notify Buyer of such objections within two (2) Business Days of Seller's receipt thereof, failing which Seller shall be deemed to have accepted the terms as sent.  If Seller and Buyer each send a Confirmation and neither Party objects to the other Party=s Confirmation within two (2) Business Days of receipt, Seller=s Confirmation shall be deemed to be accepted and shall be the controlling Confirmation, unless (i) Seller=s Confirmation was sent more than three (3) Business Days after the Transaction was entered into and (ii) Buyer=s Confirmation was sent prior to Seller=s Confirmation, in which case Buyer=s Confirmation shall be deemed to be accepted and shall be the controlling Confirmation.  Failure by either Party to send or either Party to return an executed Confirmation or any objection by either Party shall not invalidate any Transaction agreed by the Parties. If Seller and Buyer each send a Confirmation and neither Party objects to the other Party=s Confirmation within two (2) Business Days of receipt, Seller=s Confirmation shall be deemed to be accepted and shall be the controlling Confirmation, unless (i) Seller=s Confirmation was sent more than three (3) Business Days after the Transaction was agreed and (ii) Buyer=s Confirmation was sent prior to Seller=s Confirmation, in which case Buyer=s Confirmation shall be deemed to be accepted and shall be the controlling Confirmation.

2.4	Recording.  Each Party acknowledges and agrees that either Party may create a tape or electronic recording (ARecording@) of conversations between the Parties to this Master Agreement, and that any such Recordings will be retained in confidence, secured from improper access, and may be submitted in evidence in any proceeding or action relating to this Agreement.  Each Party waives any further notice of such monitoring or recording, and agrees to notify its officers and employees of such monitoring or recording and to obtain any necessary consent of such officers and employees.  The Recording, and the terms and conditions described therein, if admissible, shall be the controlling evidence for the Parties= agreement with respect to a particular Transaction in the event a Confirmation is not fully executed (or deemed accepted) by both Parties.  Upon full execution (or deemed acceptance) of a Confirmation, such Confirmation shall control in the event of any conflict with the terms of a Recording, or in the event of any conflict with the terms of this Master Agreement. 

ARTICLE THREE:
OBLIGATIONS AND DELIVERIES

3.1	Seller's and Buyer's Obligations.  With respect to each Transaction, Seller shall sell and deliver, or cause to be delivered, and Buyer shall purchase and receive, or cause to be received, at the Delivery Point the Quantity of the Product, and Buyer shall pay Seller the Price. The Parties= obligations to perform are subject to Article Five Contract Price; provided, however, with respect to Options, the obligations set forth in the preceding sentence shall only arise if the Option Buyer exercises its Option in accordance with its terms.  Seller shall be responsible for any costs or charges imposed on or associated with the Product or its delivery of the Product up to the Delivery Point.  Buyer shall be responsible for any costs or charges imposed on or associated with the Product or its receipt at and from the Delivery Point.  

3.2	Transmission and Scheduling.  Seller shall arrange and be responsible for transmission service to the Delivery Point and shall Schedule or arrange for Scheduling services with its Transmission Providers to deliver the Quantity of , as specified by the Parties in the Transaction, or in the absence thereof,  in accordance with the practice of the Transmission Providers, to deliver the Product to the Delivery Point.  Buyer shall arrange and be responsible for transmission service at and from the Delivery Point and shall Schedule or arrange for Scheduling services with its Transmission Providers to receive the Quantity of the Product at the Delivery Point.  Each Party shall designate authorized representatives to effect the Scheduling of the delivery of the Quantity of the Product. Product.  

3.3	Force Majeure.  To the extent either Party is prevented by Force Majeure from carrying out, in whole or part, its obligations under any Transaction and such Party (the AClaiming Party@) gives notice and details of the Force Majeure to the other Party as soon as practicable, then, unless the terms of the Product specify otherwise, the Claiming Party shall be excused from the performance of its obligations (other than the obligation to make payments then due or becoming due with respect to performance prior to the Force Majeure).  The Claiming Party shall remedy the Force Majeure with all reasonable dispatch. [If requested by the non‑claiming Party, the Claiming Party shall provide the non‑claiming Party notice of the Claiming Party=s best estimate of the duration of the Force Majeure (AEstimated Duration (FM)@).  During the Estimated Duration (FM), the non‑claiming Party shall not be required to perform or resume performance of its obligations to the Claiming Party corresponding to the obligations of the Claiming Party excused by Force Majeure.  Notwithstanding the foregoing, as soon as the Claiming Party shall be able, in whole or in part, to resume performance, the Claiming Party shall notify the non‑claiming Party who shall have the option to require the Claiming Party to resume all or part of its obligations under the Transaction prior to the expiration of the Estimated Duration (FM).  The Parties shall resume performance of their obligations under the Transaction upon the expiration of the Estimated Duration (FM) except to the extent the Claiming Party shall continue to be prevented from performing by such Force Majeure.  To the extent the Claiming Party continues to be prevented by such Force Majeure from performing its obligations beyond the Estimated Duration (FM), then the non‑claiming Party may take any action it deems commercially reasonable under the circumstances.]  

ARTICLE FOUR:
REMEDIES FOR FAILURE TO DELIVER/RECEIVE

4.1	Seller Failure.  If Seller fails to schedule and/or deliver all or part of the Product pursuant to a Transaction, and such failure is not excused by Force Majeure or otherwise under the terms of the Product or by Buyer=s failure to perform, then Seller shall pay Buyer, on the date payment would otherwise be due in respect of the month in which the failure occurred or, if demanded by Buyer [and when costs determined under this Section exceed $_______] AAccelerated Payment of Damages@ is specified on the Cover Sheet, within five (5) Business Days of invoice receipt, an amount for such deficiency equal to the positive difference, if any, obtained by subtracting the Contract Price from the Replacement Price.  The invoice for such amount shall include a written statement explaining in reasonable detail the calculation of such amount.

4.2	Buyer Failure.  If Buyer fails to schedule and/or receive all or part of the Product pursuant to a Transaction and such failure is not excused by Force Majeure or under the terms of the Product or by Seller=s failure to perform, then Buyer shall pay Seller, on the date payment would otherwise be due in respect of the month in which the failure occurred or, if demanded by Sellers [and when costs determined under this Section exceed $_____] AAccelerated Payment of Damages@ is specified on the Cover Sheet, within five (5) Business Days of invoice receipt, an amount for each Quantity unit of such Product of such deficiency equal to the positive difference, if any, obtained by subtracting the Sales Price from the Contract Price.  The invoice for such amount shall include a written statement explaining in reasonable detail the calculation of such amount.

ARTICLE FIVE
EVENTS OF DEFAULT; REMEDIES

5.1	Events of Default.  An AEvent of Default@ shall mean, with respect to a Party ((a ADefaulting Party@), the occurrence of any of the following:

(a)	the failure to make, when due, any payment required pursuant to this Agreement if such failure is not remedied within three (3) Business Days after written notice of such failure is given by the other Party and provided the payment is not the subject of a good faith dispute;

(b)	any representation or warranty made by the Defaulting a Party herein shall be false or misleading in any material respect when made or when deemed to be repeated;

(c)	the failure to perform any material covenant or obligation set forth in this Agreement (other than the events that are otherwise specifically covered as(except to the extent constituting a separate Event of Default, or and except for a Party=s obligations to deliver or receive the Product, the exclusive remedy for which is provided in Article Four in which event timely payment of damages set forth in Article Four constitutes performance) and such failure is not ) if such failure shall not be cured within three (3) Business Days after written notice of such failure is given by the other Party;;

(d) the Defaulting(d)	a Party shall be Bankrupt;

(e)	the failure of a Party to meet satisfy the creditworthiness/collateral requirements as set forth in agreed to pursuant to Article Eight hereof;

[(f) a Party or any guarantor of such Party consolidates or amalgamates with, or merges with or into, or transfers(f)	a Party shall consolidate or amalgamate with, or merge  with or into, or transfer all or substantially all of its assets to, another entity and, at the time of such consolidation, amalgamation, merger or transfer, B 

(i) the resulting, surviving or transferee entity fails shall fail to assume all the obligations of such Party or such guarantor under this Master Agreement to which it or its predecessor was a party by operation of law and or pursuant to an agreement reasonably satisfactory to the other Party; 

or (g)	if Cross Default is specified in the Cover Sheet as applying to a Party, the occurrence and continuation of (i) a default, event of default or other similar condition or event in respect to such Party or any other party specified in the Cover Sheet under one or more agreements or instruments, individually or collectively, relating to indebtedness for borrowed money in an aggregate amount of not less than the applicable Cross Default Amount (as specified in the Cover Sheet), which results in such indebtedness becoming, or becoming capable at such time of being declared, immediately due and payable or (ii) a default by such Party or any other party specified in the Cover Sheet in making on the due date therefor one or more payments, individually or collectively, in an aggregate amount of not less than the applicable Cross Default Amount (as specified in the Cover Sheet);

(ii) the benefits of the guarantor of a Party fail to extend (without the(h)	with respect to a Party's Guarantor, if any:

(i)	if any representation or warranty made by a Guarantor shall be false or misleading in any material respect when made or when deemed to be repeated in any guaranty made in connection with this Master Agreement;

(ii)	the failure of a Guarantor to make any payment required or to perform any other material covenant or obligation in any guaranty made in connection with this Master Agreement and such failure shall not be cured within three (3) Business Days after written notice;

(iii)	a Guarantor shall be Bankrupt; 

(iv)	the failure of a Guarantor to meet the creditworthiness/collateral requirements as set forth in Article Eight hereof;

(v)	the failure of a Guarntor=s guaranty to be in full force and effect for purposes of this Master Agreement (other than in accordance with its terms) prior to the satisfaction of all obligations of such Party under each Transaction to which such guaranty shall relate without the written consent of the other Party) to the performance by such resulting, surviving or transferee entity of its obligations under this Agreement];; or

(g) Cross‑Default (Language to be provided) or(vi)	a Guarantor shall repudiate, disaffirm, disclaim, or reject, in whole or in part, or challenge the validity of any guaranty. 

(h) Guarantor Cross‑Default (Language to be provided).]

5.2 Identification 5.2	Declaration of an Early Termination Date and Calculation of Settlement Amounts.  After the occurrence of If an Event of Default with respect to a Defaulting Party shall have occurred and be continuing, the other Party (the ANon‑Defaulting Party@) shall have the right, (i) to designate a day, no earlier than the day such notice is effective and no more later than 20 days after an Event of Default occurs, such notice is effective as an early termination date (AEarly Termination Date@) to liquidate and terminate all, but not less than all, of the Transactions then outstanding between the Parties Transactions (each referred to as a ATerminated Transaction@) between the Parties, and (ii) withhold any payments due to the Defaulting Party under this Agreement.  The Non‑Defaulting Party shall calculate, in a commercially reasonable manner, a Settlement Amount for each such Terminated Transaction as of the Early Termination Date (or, to the extent that in the good faith reasonable opinion of the Non‑Defaulting Party certain of such Terminated Transactions are commercially impracticable to close out and liquidate and terminate or may not be closed out and liquidated and terminated under applicable law on the Early Termination Date, as soon thereafter as is reasonably practicable).

5.3	[Set Off/Net Net Out ] of Settlement Amounts.  The Non‑Defaulting Party shall [set off/net out] (a) all such aggregate all Settlement Amounts into a single amount by:  netting out (a) all Settlement Amounts that are due to the Defaulting Party, plus any cash or other form of security then available to, at the option of the Non‑Defaulting Party, any cash or other form of security then available to the Non‑Defaulting Party pursuant to Article Eight, plus (at the Non‑Defaulting Party's election) any or all other amounts due (whether to the Defaulting Party under the this Agreement or otherwise and whether or not due) against (b) all such Settlement Amounts that are due to the Non‑Defaulting Party, plus any cash or other form of security then available to the Defaulting Party pursuant to Article Eight, plus (at the Non‑Defaulting Party's election) any or all other amounts due (whether to the Non‑Defaulting Party under the this Agreement or otherwise and whether or not due), so that all such amounts shall be netted out to a single liquidated amount (the ATermination Payment@) payable by one party Party to the other.  The Settlement Amount Termination Payment shall be due to or due from the Non‑Defaulting Party as appropriate.

5.4	Notice of Payment of Termination Payment.  Notice that a liquidation and [set off/net out] have occurred pursuant to this Article Five As soon as practicable after a liquidation, notice shall be given by the Non‑Defaulting Party to the Defaulting Party before the close of business on the Business Day following such liquidation and [set off/net out], provided that failure to give such notice shall not affect the validity or enforceability of the liquidation and [set off/net out] or give rise to any claim by the Defaulting Party against of the amount of the Termination Payment and whether the Termination Payment is due to or due from the Non‑Defaulting Party.  The notice shall specify the amount of the Termination Payment and whether it is owed by or to the Defaulting Party include a written statement explaining in reasonable detail the calculation of such amount.  The Termination Payment shall be made by the Party that owes it within two (2) Business Days after such notice is given.

5.5	Disputes With Respect to Termination Payment.  If the Defaulting Party disputes the Non‑Defaulting Party's calculation of the Termination Payment, in whole or in part, the Defaulting Party shall, within two (2) Business Days of receipt of Non‑Defaulting Party's calculation of the Termination Payment, provide to the Non‑Defaulting Party a detailed written explanation of the basis for such dispute; provided, however, that if the Termination Payment is due from the Defaulting Party, the Defaulting Party shall first transfer collateral (of a type and in a form acceptable Performance Assurance to the Non‑Defaulting Party) to the Non‑Defaulting Party in an amount equal to the Termination Payment. 

If the Parties cannot resolve such dispute within three (3) Business Days of the Non‑Defaulting Party's receipt of the Defaulting Party's written explanation, then either Party may submit such dispute to arbitration in accordance with the arbitration procedures set forth in Article Nine hereof. Any payment that is due as a result of the arbitrator's award shall be paid in full, along with interest accrued at the Interest Rate from the Early Termination Date until the date paid, by the Party that owes it within two (2) Business Days after the award is rendered. 5.6	Setoffs.  

5.6 Setoffs. Without limiting its rights under this Article Five or otherwise, after an Event of Default Option A: After calculation of a liquidation amount in accordance with Section 5.3,  if the Defaulting Party would be owed the Termination Payment, the Non‑Defaulting Party may from time to time [set off/net out] any or all amounts which shall be entitled, at its option and in its discretion, to (i) set off against such amount any amounts payable by the Defaulting Party owes to it (whether under the Agreement or otherwise and whether or not then due) against any or all amounts which it owes to to the Non‑Defaulting Party under this Agreement or under any other agreements, instruments or undertakings between the Defaulting Party (whether under the Agreement or otherwise and whether or not then due), provided that any amount not then due which is included in such [set off/net out] shall be discounted to present value (in the manner specified in Article 5.2) as at the time of [set off/net out] (to take account of the period between the date of [set off/net out] and the date on which such amount would have otherwise been due). and the Non‑Defaulting Party and/or (ii) to the extent any Transactions are not yet liquidated in accordance with Section 5.2, withhold payment of the Termination Payment to the Defaulting Party.  The remedy provided for in this Section shall be without prejudice and in addition to any right of setoff, combination of accounts, lien or other right to which any Party is at any time otherwise entitled (whether by operation of law, contract or otherwise). 

Option B: After calculation of a liquidation amount in accordance with Section 5.3,  if the Defaulting Party would be owed the Termination Payment, the Non‑Defaulting Party shall be entitled, at its option and in its discretion, to (i) set off against such amount any amounts payable by the Defaulting Party to the Non‑Defaulting Party  or any of its Affiliates under this Agreement or under any other agreements, instruments or undertakings between the Defaulting Party and the Non‑Defaulting Party or any of its Affiliates and/or (ii) to the extent any Transactions are not yet liquidated in accordance with Section 5.2, withhold payment of the Termination Payment to the Defaulting Party.  The remedy provided for in this Section shall be without prejudice and in addition to any right of setoff, combination of accounts, lien or other right to which any Party is at any time otherwise entitled (whether by operation of law, contract or otherwise). 

Option C: No Setoffs.

5.7	Suspension of Performance.  Notwithstanding any other provision of this Master Agreement, after the occurrence of (a) an Event of Default, or an event which, with the giving of notice or the passage of time or both, would constitute an Event of Default, with respect to a Party, the other Party  so long as the Event of Default is continuing and has not been cured or (b) a Potential Event of Default, the Non‑Defaulting Party, upon written notice to the Defaulting Party, shall have the right (1) to suspend performance under any or all Transactions; provided, however, in no event shall any such suspension continue for longer than ten (10) Business Days with respect to any single Transaction unless notice pursuant to Section 5.2 has been given, and (2) to exercise any remedy available at law or in equity. 

ARTICLE SIX:
PAYMENT AND NETTING

6.1	Billing Period.  Unless otherwise specifically agreed upon by the Parties in a Transaction, the calendar month shall be the standard period for all payments (other than Termination Payments ) and, if AAccelerated Payment of Damages@ is specified by the Parties in the Cover Sheet, payments pursuant to Section 4.1 or 4.2) under this Agreement.  As soon as practicable after the end of each month, each Party will render to the other Party an invoice for the payment obligations, if any, incurred hereunder during the preceding month.

6.2	Timeliness of Payment.  Unless otherwise specifically agreed upon by the Parties in a Transaction, all invoices for service under this Agreement shall be rendered as soon as practicable after the end of each month and under this Master Agreement shall be due and payable, unless otherwise agreed upon, in accordance with each Party=s invoice instructions on or before the later of the twentieth (20th) day of each month, or ten (10) days tenth (10th) day after receipt of the invoice or, if such day is not a Business Day, then on the next Business Day.  Each Party will make payments by wire transfer, or by other mutually agreeable method(s), to the account designated by the other Party.  Any amounts, both principal and interest, not paid by the due date will be deemed delinquent and will accrue interest at the Interest Rate, such interest to be calculated from the due date to the date the unpaid amount is paid in full.

6.3	Disputes and Adjustments of Invoices.  A Party may, in good faith, challenge dispute the correctness of any invoice or adjustment to an invoice rendered under the this Agreement or adjust any invoice for any arithmetic or computational error within twelve (12) months of the date the invoice or adjustment to an invoice was rendered.  In the event an invoice or portion thereof, or any other claim or adjustment arising hereunder, is challenged disputed, payment of the undisputed portion of the invoice shall be required to be made when due, with notice of the objection given to the other Party at the time.  Any billing challenge dispute or billing adjustment shall be in writing and shall state the specific basis for the challenge or adjustment. basis for the dispute or adjustment.  Payment of the disputed amount shall not be required until the dispute is resolved.  If it is determined that an adjustment to the invoice is appropriate, then such payment shall be required to be made within two (2) Business Days of such determination along with interest accrued at the Interest Rate from the due date until the date paid.  Inadvertent overpayments shall be returned by Seller upon request or deducted by Seller the Party receiving such overpayment from subsequent payments, with interest accrued at the Interest Rate from the date of such overpayment until the date repaid or deducted by Seller. An invoice rendered under the Agreement shall be binding unless challenged the Party receiving such overpayment.  Any dispute with respect to an invoice is waived unless the other Party is notified in accordance with this Section 6.3 within  twelve (12) months after the invoice is rendered or any specific adjustment to the invoice made by such Party prior to such time. is made.

6.4 o Check, if applicable. 6.4	Netting of Payments.  The Parties hereby agree that they shall discharge mutual debts and payment obligations due and owing to each other on the same date pursuant to the all Transactions through netting, in which case all amounts owed by each Party to the other Party for the purchase of the Product and sale of Products during the monthly billing period under this Master Agreement, including any related damages calculated pursuant to Article Three Four (unless one of the Parties elects to accelerate payment of such amounts as permitted by Article Three) Four) interest, and payments or credits, shall be netted so that only the excess amount remaining due shall be paid by the Party who owes it.  

6.5	Payment Obligation Absent Netting.  If the Parties do not check Section 5.4 as applicable, or if no mutual debts or payment obligations exist and only one Party owes a debt or obligation to the other during the monthly billing period, including, but not limited to, any related damages amounts calculated pursuant to Article Three Four, interest, and payments or credits, that Party shall pay such sum in full when due. 

6.6	Security.  Unless the Party benefiting from a security arrangement benefitting from Performance Assurance or a guaranty notifies the other Party in writing or, and except in connection with a liquidation and termination netting in accordance with Article Four Five, all amounts netted pursuant to this Article Five Six shall not take into account or include any security arrangements, including, but not limited to, Guarantees, Letters of Credit, and escrow or margin accounts, Performance Assurance or guaranty which may be in effect to secure a Party=s performance under the this Master Agreement.

ARTICLE SEVEN:
LIMITATIONS

7.1	Limitation of Remedies, Liability and Damages.  The Parties confirm that the express remedies and measures of damages provided in this Agreement satisfy the essential purposes hereof. For breach of any provision for which an express remedy or measure of damages is provided, such express remedy or measure of damages shall be the sole and exclusive remedy, the obligor's liability shall be limited as set forth in such provision and all other remedies or damages at law or in equity are waived. If no remedy or measure of damages is expressly provided herein or in a Transaction, the obligor's liability shall be limited to direct actual damages only, such direct actual damages shall be the sole and exclusive remedy and all other remedies or damages at law or in equity are waived. Unless expressly herein provided, neither Party shall be liable for consequential, incidental, punitive, exemplary or indirect damages, lost profits or other business interruption damages, by statute, in tort or contract, under any indemnity provision or otherwise. It is the intent of the Parties that the limitations herein imposed on remedies and the measure of damages be without regard to the cause or causes related thereto, including the negligence of any Party, whether such negligence be sole, joint or concurrent, or active or passive. To the extent any damages required to be paid hereunder are liquidated, the Parties acknowledge that the damages are difficult or impossible to determine, otherwise obtaining an adequate remedy is inconvenient and the liquidated damages constitute a reasonable approximation of the harm or loss. THE PARTIES CONFIRM THAT THE EXPRESS REMEDIES AND MEASURES OF DAMAGES PROVIDED IN THIS AGREEMENT  SATISFY THE ESSENTIAL PURPOSES HEREOF.  FOR BREACH OF ANY PROVISION FOR WHICH AN EXPRESS REMEDY OR MEASURE OF DAMAGES IS PROVIDED, SUCH EXPRESS REMEDY OR MEASURE OF DAMAGES SHALL BE THE SOLE AND EXCLUSIVE REMEDY, THE OBLIGOR'S LIABILITY SHALL BE LIMITED AS SET FORTH IN SUCH PROVISION AND ALL OTHER REMEDIES OR DAMAGES AT LAW OR IN EQUITY ARE WAIVED.  IF NO REMEDY OR MEASURE OF DAMAGES IS EXPRESSLY PROVIDED HEREIN OR IN A TRANSACTION, THE OBLIGOR'S LIABILITY SHALL BE LIMITED TO DIRECT ACTUAL DAMAGES ONLY, SUCH DIRECT ACTUAL DAMAGES SHALL BE THE SOLE AND EXCLUSIVE REMEDY AND ALL OTHER REMEDIES OR DAMAGES AT LAW OR IN EQUITY ARE WAIVED.  UNLESS EXPRESSLY HEREIN PROVIDED, NEITHER PARTY SHALL BE LIABLE FOR CONSEQUENTIAL, INCIDENTAL, PUNITIVE, EXEMPLARY OR INDIRECT DAMAGES, LOST PROFITS OR OTHER BUSINESS INTERRUPTION DAMAGES, BY STATUTE, IN TORT OR CONTRACT, UNDER ANY INDEMNITY PROVISION OR OTHERWISE.  IT IS THE INTENT OF THE PARTIES THAT THE LIMITATIONS HEREIN IMPOSED ON REMEDIES AND THE MEASURE OF DAMAGES BE WITHOUT REGARD TO THE CAUSE OR CAUSES RELATED THERETO, INCLUDING THE NEGLIGENCE OF ANY PARTY, WHETHER SUCH NEGLIGENCE BE SOLE, JOINT OR CONCURRENT, OR ACTIVE OR PASSIVE. TO THE EXTENT ANY DAMAGES REQUIRED TO BE PAID HEREUNDER ARE LIQUIDATED, THE PARTIES ACKNOWLEDGE THAT THE DAMAGES ARE DIFFICULT OR IMPOSSIBLE TO DETERMINE, OR OTHERWISE OBTAINING AN ADEQUATE REMEDY IS INCONVENIENT AND THE DAMAGES CALCULATED HEREUNDER CONSTITUTE A REASONABLE APPROXIMATION OF THE HARM OR LOSS.

ARTICLE EIGHT: ARTICLE EIGHT:
CREDITWORTHINESS CREDIT AND COLLATERAL REQUIREMENTS

Check the applicable creditworthiness/collateral requirement. Only one option should be checked The applicable credit information requirement shall be as specified on the Cover Sheet.  If no option is checked, Option A shall apply. C shall apply exclusively.

Option A: o Applicable 8.1	Option A:  Financial Information.  If requested by a Party, the other Party shall deliver (i) within 120 days following the end of each fiscal year, a copy of such Party=s annual report containing audited consolidated financial statements for such fiscal year and (ii) within 60 days after the end of each of its first three fiscal quarters of each fiscal year, a copy of such Party=s quarterly report containing unaudited consolidated financial statements for such fiscal quarter.  In all cases the statements shall be for the most recent accounting period and prepared in accordance with generally accepted accounting principles or such other principles then in effect; provided, however, that should any such statements not be available timely due to a delay in preparation or certification, such delay shall not be an Event of Default so long as such Party diligently pursues the preparation, certification and delivery of the statements.

8.1 Credit Review. For the purpose of determining the financial ability of the other Party to meet its obligations hereunder, a Party may require reasonable credit review procedures which may include, but not be limited to, verification that the other Party is not operating under any state or federal bankruptcy laws, is not subject to the uncertainty of pending liquidation or regulatory proceedings in state or federal courts, and that no significant lawsuits or judgments are outstanding which would seriously affect such other Party's ability to remain solvent. Option B:  Financial Information.  If requested by a Party, the other Party shall deliver (i) within 120 days following the end of each fiscal year, a copy of the annual report containing audited consolidated financial statements for such fiscal year for the party(s) specified  on the Cover Sheet and (ii) within 60 days after the end of each of its first three fiscal quarters of each fiscal year, a copy of  quarterly report containing unaudited consolidated financial statements for such fiscal quarter for the party(s) specified on the Cover Sheet.  In all cases the statements shall be for the most recent accounting period and prepared in accordance with generally accepted accounting principles or such other principles then in effect; provided, however, that  should any such statements not be available timely due to a delay in preparation or certification, such delay shall not be an Event of Default so long as the relevant entity diligently pursues the preparation, certification and delivery of the statements.

Option C:  Financial Information.  A Party may request from the other Party the information specified in the Cover Sheet. 

The applicable creditworthiness/collateral requirements shall be specified in the Cover Sheet.  If no option is checked, Section 8.2 shall apply exclusively.

8.2	Credit Assurances. The Parties may establish credit limits each for the other based on such measures and calculating the Parties= relative exposures under this Agreement as the Parties deem appropriate. If during the term of this Agreement a Party has exceeded its credit limit as established by the Parties, or if If a Party (ARequesting Party@) has commercially reasonable grounds to believe, in its sole discretion, that the other Party's creditworthiness, financial responsibility or performance has under this Agreement has or may become unsatisfactory, the Requesting Party will provide the other Party with written notice of the problem requesting Performance Assurance in an amount reasonably determined by the Requesting Party.  Upon receipt of such notice the other Party shall have three (3) Business Days to remedy the situation by either (a) posting a letter of credit, (b) providing a cash prepayment, or (c) providing other acceptable form of security providing Performance Assurance to the Requesting Party (ACredit Assurances@) in an amount reasonably determined by the Requesting Party.  In the event that the other Party fails to provide such Credit Assurances Performance Assurance, or a guaranty or other credit assurance acceptable to the Requesting Party within three (3) Business Days of receipt of notice, then an Event of Default under Article Four Five will be deemed to have occurred and the Requesting Party will be entitled to the remedies set forth in Article Four of this Agreement..

Option B: o Applicable 

8.1 Creditworthiness. It shall be an Event of Default if a Party fails to, or can no longer, demonstrate its creditworthiness to the other Party. A Party will be considered creditworthy if (a) a Party=s long‑term unsecured debt securities are, and remain, rated a minimum of BBB or Baa2 by Standard & Poor=s or Moodys, respectively, (b) a Party either prepays for service or provides an irrevocable standby Letter of Credit in full amount of its payment obligation, (c) a Party has, as determined by the other Party in its sole discretion, a qualified long‑term payment history with the other Party, (d) a Party arranges for the issuance of a Guarantee in an amount satisfactory to the other Party, or (e) a Party otherwise demonstrates, to the other Party=s satisfaction, that it is creditworthy. Unless otherwise mutually agreed, each Party shall be responsible for providing the information specified in this Article Seven on or before the Effective Date.

8.2 Credit Assurances. If during the term of this Agreement a Party has exceeded its credit limit as established by the Parties, or if a Party (ARequesting Party@) has commercially reasonable grounds to believe, in its sole discretion, that the other Party's creditworthiness, financial responsibility or performance has become unsatisfactory, the Requesting Party will provide the other Party with written notice of the problem. Upon receipt of such notice the other Party shall have three (3) Business Days to remedy the situation by either (a) posting a letter of credit, (b) providing a cash prepayment, or (c) providing other acceptable form of security to the Requesting Party (ACredit Assurances@). In the event that the other Party fails to provide such Credit Assurances within three (3) Business Days of receipt of notice, then 8.3 	Grant of Security Interest/Remedies.  To secure its obligations under this Agreement  and to the extent either or both Parties deliver Performance Assurance hereunder, each Party hereby grants to the other Party a present and continuing security interest in, and lien on (and right of setoff against), and assignment of, all cash collateral and cash equivalent collateral and any and all proceeds resulting therefrom or the liquidation thereof, whether now or hereafter held by, on behalf of, or for the benefit of, such other Party, and each Party agrees to take such action as the other Party reasonably requires in order to perfect the other Party=s first‑priority security interest in, and lien on (and right of setoff against), such collateral and any and all proceeds resulting therefrom or from the liquidation thereof.  Upon or any time after the occurrence or deemed occurrence and during the continuation of an Event of Default under Article Four will be deemed to have occurred and the Requesting Party will be entitled to the remedies set forth in Article Four of this Agreement. or an Early Termination Date, the Non‑Defaulting Party may do any one or more of the following:  (i) exercise any of the rights and remedies of a secured party with respect to all Performance Assurance, including any such rights and remedies under law then in effect; (ii) exercise its rights of setoff against any and all property of the Defaulting Party in the possession of the Non‑Defaulting Party or its agent; (iii) draw on any outstanding Letter of Credit issued for its benefit; and (iv) liquidate all Performance Assurance then held by or for the benefit of the Secured Party (free from any claim or right of any nature whatsoever of the Defaulting Party, including any equity or right of purchase or redemption by the Defaulting Party.

Option C: o Applicable

8.1 _________8.4	Option A:  (a) Party B Performance Assurance.  If at any time and from time to time during the term of this Agreement (and notwithstanding whether an Event of Default has occurred), the Termination Payment (as calculated pursuant to Article Four of this Agreement) that would be owed to _________ (A Party A @) exceeds $______________________, the Party B Exposure Amount then Party A, on any Business Day, may request that ______________ (AParty B@) provide either (i) cash, (ii) a Letter of Credit, (iii) a Guarantee or (iv) other security in a form acceptable to Party A, Party B provide Performance Assurance in an amount equal to the amount by which the Termination Payment exceeds $__________________the Party B Exposure Amount (rounding upwards for any fractional amount to the next $250,000.00) Party B Rounding Amount) (AParty B Performance Assurance@).  Such Party B Performance Assurance shall be delivered to Party A within three (3) Business Days of the date of such request. On any Business Day (but no more frequently than weekly with respect to Letters of Credit and daily with respect to cash), Party B, at its sole cost, may request that such Party B Performance Assurance be reduced correspondingly to the amount of such excess Termination Payment (rounding upwards for any fractional amount to the next $250,000.00) Party B Rounding Amount). In the event that Party B fails to provide Party B Performance Assurance pursuant to the terms of this Article Seven Eight, then an Event of Default under Article Four Five shall be deemed to have occurred and  Party A will be entitled to the remedies set forth in Article Four Five of this Master Agreement. 

8.2 Option B:	(b)	Party A Performance Assurance.  If at any time and from time to time during the term of this Agreement (and notwithstanding whether an Event of Default has occurred), the Termination Payment (as calculated pursuant to Article Four of the Agreement) that would be owed to Party B exceeds $_______________the Party A Exposure Amount, then Party B, on any Business Day, may request that Party A provide either (i) cash, (ii) a Letter of Credit, (iii) a Guarantee or (iv) other security in a form acceptable to Party B, Performance Assurance in an amount equal to the amount by which the Termination Payment exceeds $______________the Party A Exposure Amount (rounding upwards for any fractional amount to the next $250,000.00) Party B Rounding Amount) (AParty A Performance Assurance@).  Such Party A Performance Assurance shall be delivered to Party B within three (3) Business Days of the date of such request.  On any Business Day (but no more frequently than weekly with respect to Letters of Credit and daily with respect to cash), Party A, at its sole cost, may request that such Party A Performance Assurance be reduced correspondingly to the amount of such excess Termination Payment (rounding upwards for any fractional amount to the next $250,000.00) Party A Rounding Amount).  In the event that Party A fails to provide  Party A Performance Assurance pursuant to the terms of this Article Seven Eight within three (3) Business Days, then an Event of Default under Article Four Five shall be deemed to have occurred and Party B will be entitled to the remedies set forth in Article Four of this Agreement. Five of this Master Agreement.

Option D: o Applicable(c)	For purposes of Sections 8.4(a) and 8.4(b), the calculation of the Termination Payment shall be calculated by the Party requesting Performance Assurance pursuant to Section 5.3, and in addition thereto, shall include all amounts owed but not yet paid by one Party to the other whether or not such amounts are due, for performance already provided pursuant to any and all Transactions.

8.1 Adequate Assurances. The failure by a Party to provide adequate assurance of its ability to perform all of its outstanding obligations to the other Party (ARequesting Party@) under this Agreement, any Transaction or otherwise within a period not to exceed three (3) Business days of a demand therefor when 8.5	Downgrade Event.  If at any time there shall occur a Downgrade Event in respect of a Party (a "Downgraded Party"), then the other Party ( the "Requesting Party") may require the Downgraded Party to provide  Performance Assurance in an amount reasonably determined by the Requesting Party has reasonable grounds for insecurity shall constitute.  In the event a Downgraded Party shall fail to provide such Performance Assurance or a guaranty or other credit assurance within three (3) Business Days of receipt of notice, then an Event of Default under Article Four and the Requesting Party shall be entitled to the remedies set forth in Article Four of this Agreement.

ARTICLE NINE:
DISPUTE RESOLUTION

Check the dispute resolution provisions to be applicable. Only one of Options A, B or C should be checked. If no option is checked, Option A shall apply.

Option A: o Applicable

9.1 Step Negotiation. In the event of a dispute regarding this Agreement, the Parties shall attempt, in good faith, to resolve the dispute amicably and promptly. If the dispute is not resolved in five (5) days in the normal course of business, the Parties shall attempt to resolve the dispute by appointing a senior representative of each Party to attempt to mutually agree upon a resolution. If the two senior representatives cannot reach a resolution within an additional five (5) day period, the dispute may be set for arbitration as defined herein; provided, however, any dispute which lies within the exclusive jurisdiction of the FERC shall not be submitted to arbitration.

9.2 Arbitration. If the senior representatives of the Parties are unable to resolve the dispute, and adjudication of the dispute is not within the exclusive jurisdiction of the FERC, the dispute may be submitted upon request of either Party to binding arbitration by one arbitrator who has not previously been employed by either Party, and does not have a direct or indirect interest in either Party or the subject matter of the arbitration. Such arbitrator shall either be as mutually agreed by the Parties within thirty (30) days after written notice from either Party requesting arbitration, or failing agreement, shall be selected under the expedited rules of [the Center for Public Resources (ACPR@) or the] American Arbitration Association (the AAAA@). Such arbitration shall be held in alternating locations of the home offices of the Parties or in any other mutually agreed upon location. The rules of [the CPR or] the AAA shall apply to the extent not inconsistent with the rules herein specified. The judgment rendered by the arbitrator may be enforced in any court having jurisdiction of the subject matter and the Parties. All costs of the arbitration shall be paid equally by the Parties, unless the award shall specify a different division of the costs. Each Party shall be responsible for its own expenses, including attorney=s fees. Both Parties shall be afforded adequate opportunity to present information in support of its position on the dispute being arbitrated. The arbitrator may also request additional information from the Parties.

9.3 Arbitration Rules. The arbitrator shall be bound by the terms of this Agreement and may not detract from or add to its terms. The Parties may by mutual agreement specify the rules that are to govern the arbitration proceedings and limit the matters to be considered. The findings and award of the arbitrator shall be final and conclusive and shall be binding upon the Parties, except as otherwise provided by law. Each Party agrees that it will not bring a lawsuit concerning any dispute covered by this arbitration provision. Any monetary award of the arbitrator may be enforced by the Party in whose favor such monetary award is made in any court of competent jurisdiction.

9.4 FERC Jurisdiction. Nothing in this section shall restrict the rights of either Party to file a complaint with the FERC under the relevant provisions of the Federal Power Act and the FERC=s rules and regulations regarding any issue the adjudication of which lies within the exclusive jurisdiction of the FERC. Additionally, this arbitration provision does not affect the jurisdiction of the FERC over this Agreement.

Option B: o Applicable

9.1 Dispute Resolution. In the event of a dispute among the Parties to this Agreement, the Parties shall attempt, in good faith, to resolve the dispute amicably and promptly. If the Parties are unable to resolve the dispute, despite such good faith efforts, the Parties may:

(a) by mutual agreement, submit the dispute to binding arbitration under rules and procedures as they may so agree; or

(b) pursue any legal or equitable remedies that may be available.

Option C (Billing Dispute/Termination Payment Only): o Applicable 

9.1 Arbitration Proceedings. Any dispute or need of interpretation arising out of this Agreement pertaining to the calculation of a Termination Payment or a payment required pursuant to Article Three may be submitted upon request of either Party to binding arbitration by one arbitrator who has not previously been employed by either Party, and does not have a direct or indirect interest in either Party or the subject matter of the arbitration. Such arbitrator shall either be as mutually agreed by the Parties within thirty (30) days after written notice from either Party requesting arbitration, or failing agreement, shall be selected under the expedited rules of [the Center for Public Resources (ACPR@) or the] American Arbitration Association (the AAAA@). Such arbitration shall be held in alternating locations of the home offices of the Parties, or in any other mutually agreed upon location. The rules of [the CPR or] the AAA shall apply to the extent not inconsistent with the rules herein specified. Either Party may initiate arbitration by written notice to the other Party and the arbitration shall be conducted according to the following: (a) not later than seven (7) days prior to the hearing date set by the arbitrator each Party shall submit a brief with a single proposal for settlement, (b) the hearing shall be conducted on a confidential basis without continuance or adjournment, (c) the arbitrator shall be limited to selecting only one of the two proposals submitted by the Parties, (d) each Party shall divide equally the cost of the arbitrator and the hearing and each Party shall be responsible for its own expenses and those of its counsel and representatives and (e) evidence concerning the financial position or organizational make‑up of the Parties, any offer made or the details of any negotiation prior to arbitration and the cost to the Parties of their representatives and counsel shall not be admissible. Each Party agrees that it will not bring a lawsuit concerning any dispute covered by this arbitration provision. Any monetary award of the arbitrator may be enforced by the Party in whose favor such monetary award is made in any court of competent jurisdiction.
ARTICLE TEN:
TAXES
(WHOLE SECTION STILL TO BE DISCUSSED)

10.1 will be deemed to have occurred.

ARTICLE NINE:
TAXES

9.1	Cooperation.  Each Party shall use reasonable efforts to implement the provisions of and to administer this Master Agreement in accordance with their the intent of the parties to minimize Taxes, so long as neither Party is materially adversely affected by such efforts.

Either Party with knowledge of a tax on the purchase, sale, delivery or receipt of the Product(s) that may be applicable to any Transaction under this Agreement shall notify the other Party in advance of entering into such Transaction under this Agreement of the applicability of such tax and shall also notify the other Party of any proposal to implement a new tax or apply an existing tax to the purchase, sale, delivery, or receipt of the Product(s) hereunder. Either Party, upon written request of the other, shall provide a certificate of exemption or other reasonably satisfactory evidence of exemption if either Party is exempt from Taxes and shall use reasonable efforts to obtain and cooperate with obtaining any exemption from or reduction of Tax. Unless and until such certificate(s) is (are) provided, Seller shall add such Tax to Seller=s invoice to Buyer. The Party responsible for paying the Taxes shall also remit the tax to the appropriate taxing authority and file the required returns unless otherwise provided by law or upon agreement of the Parties. In such case the Party otherwise responsible for payment of the tax shall provide to the Party responsible for remitting the tax, all information necessary to make proper and timely payments and to file the required returns.

10.2 9.2	Taxes.	Seller shall pay or cause to be paid, all taxes, fees, levies, penalties, licenses or charges, imposed by any government authority (ATaxes@) on or with respect to the Product prior to its delivery to Buyer up to and at or a Transaction arising prior to the Delivery Point.  Buyer shall pay or cause to be paid, all Taxes on or with respect to the Product at and from the Delivery Point (other than ad valorem, franchise, or income taxes which are related to the sale of the Product and are, therefore, the responsibility of the Seller.) Seller).  In the event Seller is required by law or regulation to remit or pay Taxes which are Buyer=s responsibility hereunder, Buyer shall promptly reimburse Seller for such Taxes.  If Buyer is required by law or regulation to remit or pay Taxes which are Seller=s responsibility hereunder, Buyer may deduct the amount of any such Taxes from the sums due to Seller hereunder.  Nothing shall obligate or cause a Party to pay or be liable to pay any taxes for which it is exempt under the law.

10.3 New Taxes. 

(a) Notwithstanding any other provision of this Agreement to the contrary, if (i) a Tax is imposed after the Effective Date (a ANew Tax@), and (ii) Buyer or Seller would be responsible for such New Tax and (iii) such New Tax is (as a result of laws, regulations and applicable contracts of Buyer in effect as of the effective date of the New Tax) of the type that, without prior notice or order of any regulatory authority, Buyer can pass directly through to, or be reimbursed by, another person or entity, Buyer shall pay or cause to be paid, or reimburse Seller if Seller has paid, all such New Taxes, and Buyer shall indemnify, defend and hold harmless Seller from any Claims for such New Taxes.

(b) If (i) a New Tax is imposed and (ii) Buyer or Seller would be responsible for paying such New Tax and (iii) Paragraph (1) does not apply, the Party responsible for the New Tax (the AAffected Party@) shall be entitled to declare an Early Termination Date with respect to those Transactions affected by the New Tax (the AAffected Transactions@) in accordance with the provisions of this Agreement subject to the following conditions: (a) the Affected Party must give the other Party (the ANon‑Affected Party@) at least thirty (30) days= prior written notice (the AAgreement Period@) of its intent to declare an Early Termination Date (which notice shall be given no later than ninety (90) days after the later of the enactment or effective date of the relevant New Tax), and prior to the proposed Early Termination Date, Buyer and Seller shall attempt to reach a mutual agreement as to the sharing of the New Tax; (b) if a mutual sharing agreement is not reached, the Non‑Affected Party shall have the right, but not the obligation, upon written notice to the Affected Party within the Agreement Period, to pay the New Tax for any continuous period it so elects on a month‑to‑month basis, and in such case the Affected Party shall not have the right during such continuous period to declare the Early Termination Date on the basis of the New Tax; (c) should the Non‑Affected Party at its election agree to pay the New Tax on a month‑to‑month basis, then upon thirty (30) days= prior written notice to the Affected Party of its election to cease payments of such New Tax, the Affected Party shall then be liable for the payment of the New Tax, and the Parties shall again be subject to this Section 9.2(b)(2) as if the New Tax had an effective date as of the date the Non‑Affected Party ceases payment of the New Tax; (d) for any period of time within the Agreement Period, the Early Termination Date shall take effect and all Affected Transactions must be terminated and be subject to the same Early Termination Date; (e) the Early Termination Date shall be designated as if an Event of Default had occurred; provided, both Seller and Buyer shall calculate in a commercially reasonable manner their net gain (amount of gain after netting losses and costs) or net loss (amount of losses and costs after netting gains) resulting from the termination of all Affected Transactions as if they each were a notifying Party; and provided further, that each Party=s gains and losses shall be determined without taking into effect the impact of the New Taxes; (f)(i) if both Parties have a net gain, the Party with the greater net gain shall pay to the other Party fifty percent (50%) of the difference between the two (2) net gains; (ii) if both Parties have a net loss, the Party with the lesser net loss shall pay to the other Party fifty percent (50%) of the absolute value of the difference between the two (2) net losses; and (iii) if one Party shall have a net gain and the other Party shall have a net loss, the Party with the net gain shall pay to the other Party the lower of:

(A) fifty percent (50%) of the sum of the absolute value of the net gain and the absolute value of the net loss;

(B) the value of the net loss; or

(C) the value of the net gain; and 

(g) such payment shall be payable as provided under Article Five and its calculation shall be subject to alternative dispute resolution procedures in accordance Article Nine of the Agreement. Prior to and including the initial agreement period invoked under this Article 10.3(b), New Taxes shall be allocated as if they were Taxes as provided above in Article (A). In no event, however, shall a Party=s gains, losses or costs include any penalties, ratcheted demand or similar charges or stranded costs. The intent of this Article 10.3(b) is to fairly distribute the burden on any open Transactions that are impacted as a result of New Taxes.

ARTICLE ELEVEN:
MISCELLANEOUS

11.1 Term of ARTICLE TEN:
MISCELLANEOUS

10.1	Term of Master Agreement.  The term of this Master Agreement shall commence on the Effective Date and shall remain in effect until terminated by either Party upon (thirty) 30 days' prior written notice; provided, however, that such termination shall not affect or excuse the performance of either Party under any provision of this Master Agreement that by its terms survives any such termination and, provided further, that this Master Agreement and any other documents executed and delivered hereunder shall remain in effect with respect to any Transaction(s) entered into prior to the effective date of such termination until both Parties have fulfilled all of their obligations with respect to such Transaction(s).

11.2 10.2	Representations and Warranties.  On the Effective Date and the date of entering into each Transaction, each Party represents and warrants to the other Party that: 

(i) it is duly organized, validly existing and in good standing under the laws of the jurisdiction of its formation,;

(ii) it has all regulatory authorizations necessary for it to legally perform its obligations under this Agreement and any other documentation relating to this Agreement or such Transaction to which it is a party, Master Agreement and each Transaction;

(iii) the execution, delivery and performance of this Agreement and any other documentation relating to this Agreement or such Transaction to which it is a party Master Agreement and each Transaction are within its powers, have been duly authorized by all necessary action and do not violate any of the terms and conditions in its governing documents, any contracts to which it is a party or any law, rule, regulation, order or the like applicable to it,;

(iv) this Master Agreement and each other document executed and delivered in accordance with this Master Agreement constitutes its legally valid and binding obligation enforceable against it in accordance with its terms,;

(v) it is not Bankrupt and there are no Bankruptcy Proceedings proceedings pending or being contemplated by it or, to its knowledge, threatened against it, which would result in it being or becoming Bankrupt;

(vi) there is not pending or, to its knowledge, threatened against it or any of its affiliates any legal proceedings that could materially adversely affect its ability to perform its obligations under this Agreement or any other document relating to this Agreement to which it is a party, Master Agreement and each Transaction;

(vii) no Event of Default or event which, absent a cure, with the giving of notice or lapse of time, or both, would constitute an Event of Default with respect to it has occurred and is continuing and no such event or circumstance would occur as a result of its entering into or performing its obligations under this Agreement or any other document relating to this Agreement or any Transaction, Master Agreement and each Transaction;

(viii) it is acting for its own account, has made its own independent decision to enter into this Master Agreement and each Transaction and as to whether this Master Agreement and each such Transaction is appropriate or proper for it based upon its own judgment, is not relying upon the advice or recommendations of the other Party in so doing, and is capable of assessing the merits of and understanding, and understands and accepts, the terms, conditions and risks of each such this Master Agreement and each Transaction,;

(ix) it is a Aforward contract merchant@ within the meaning of the United States Bankruptcy Code,;

(x) it has entered into this Master Agreement and each Transaction in connection with the conduct of its business and it has the capacity or ability to make or take delivery of Energy, [all Products referred to in any Transaction to which it is a Party;

(xi) with respect to each Transaction involving the purchase or sale of Capacity or an Option option, it is a producer, processor, commercial user or merchant handling Energy the Product, and it is entering into such Transaction for purposes related to its business as such],;  and 

(xii) the material economic terms of each Transaction are subject to individual negotiation by the Parties.

11.3 10.3	Title and Risk of Loss.  Title to and risk of loss related to the Product shall transfer from Seller to Buyer at the Delivery Point.  Seller warrants that it will deliver to Buyer the Quantity of the Product free and clear of all liens, claims and encumbrances arising prior to the Delivery Point.  

11.4 10.4	Indemnity.  Each Party shall indemnify, defend and hold harmless the other Party from and against any Claims arising from any or out of any event, circumstance, act or incident first occurring or existing during the period when control and title to Product is vested, as between the Parties as provided in Article 11.3, in the indemnifying Party. "Claims" means all claims or actions, threatened or filed and, whether groundless, false or fraudulent, that directly or indirectly relate to the subject matter of an indemnity, and the resulting losses, damages, expenses, attorneys' fees and court costs, whether incurred by settlement or otherwise, and whether such claims or actions are threatened or filed prior to or after the termination of this Agreement in such Party as provided in Section 10.3.  Each Party shall indemnify, defend and hold harmless the other Party against any Taxes for which such Party is responsible under Article Nine.

11.5 10.5	Assignment.  Neither Party shall assign this Agreement or its rights or obligations hereunder without the prior written consent of the other Party; provided, however, either Party may, without the consent of the other Party (and without relieving itself from liability hereunder), (i) transfer, sell, pledge, encumber or assign this Agreement or the accounts, revenues or proceeds hereof in connection with any financing or other financial arrangements, (ii) transfer or assign this Agreement to an affiliate of such Party which affiliate's affiliate=s creditworthiness is comparable equal to or higher than that of such Party, or (iii) transfer or assign this Agreement to any person or entity succeeding to all or substantially all of the assets of such Party; provided, however, that in each such case, any such assignee shall agree in writing to be bound by the terms and conditions hereof. whose creditworthiness is equal to or higher than that Party.

11.6 Governing Law and Jurisdiction 10.6	Governing Law.  THIS AGREEMENT AND THE RIGHTS AND DUTIES OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY AND CONSTRUED, ENFORCED AND PERFORMED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW.  Each Party waives its respective right to any jury trial with respect to any litigation arising under or in connection with this Agreement or any Transaction. EACH PARTY WAIVES ITS RESPECTIVE RIGHT TO ANY JURY TRIAL WITH RESPECT TO ANY LITIGATION ARISING UNDER OR IN CONNECTION WITH THIS AGREEMENT.

11.7 10.7	Notices.  All notices, requests, statements or payments shall be made as specified below. Notices required to be in writing shall be delivered by letter, facsimile or other documentary form in the Cover Sheet.  Notices (other than scheduling requests) shall, unless otherwise specified herein, be in writing and may be delivered by hand delivery, United States mail, overnight courier service or facsimile.  Notice by facsimile or hand delivery shall be deemed to have been received by the close of the Business Day on which it was transmitted or hand delivered (unless transmitted or hand delivered after close, in which case it shall be deemed received by the close of the next Business Day) effective at the close of business on the day actually received, if received during business hours on a Business Day, and otherwise shall be effective at the close of business on the next Business Day.  Notice by overnight United States mail or courier shall be deemed to have been received effective on the next Business Day after it was sent.  A Party may change its addresses by providing notice of same in accordance herewith:.

To ____________:

NOTICES & CORRESPONDENCE: PAYMENTS:

INVOICES: CREDIT AND COLLECTIONS:

SCHEDULING:

To ______________:

NOTICES & CORRESPONDENCE: PAYMENTS:

INVOICES: CREDIT AND COLLECTIONS:

SCHEDULING:

11.9 General. This 10.8	General.  This Master Agreement (including the Exhibit hereto) and each Transaction exhibits, schedules and any written supplements hereto), the Party A Tariff, if any, the Party B Tariff, if any, and all Transactions constitute the entire agreement between the Parties relating to the subject matter contemplated by this Agreement.  Notwithstanding the foregoing, any collateral, credit support or margin agreement or similar provisions between the Parties shall be deemed part of this Agreement incorporated herein by reference.  This Agreement shall be considered for all purposes as prepared through the joint efforts of the parties and shall not be construed against one party or the other as a result of the preparation, substitution, submission or other event of negotiation, drafting or execution hereof.  No Except to the extent herein provided for, no amendment or modification to this Master Agreement shall be enforceable unless reduced to writing and executed by both Parties.  Each Party agrees that it shall not seek to amend any applicable tariff during the term of this Master Agreement in any way which could affect outstanding Transactions under this Master Agreement without the prior written consent of the other Party.  Each Party further agrees that it will not assert, or defend itself, on the basis that any applicable tariff is inconsistent with this Master Agreement. This Agreement shall not impart any rights enforceable by any third party (other than a permitted successor or assignee bound to this Agreement).  Waiver by a Party of any default by the other Party shall not be construed as a waiver of any other default.  Any provision declared or rendered unlawful by any applicable court of law or regulatory agency or deemed unlawful because of a statutory change (individually or collectively, such events referred to as ARegulatory Event@) will not otherwise affect the remaining lawful obligations that arise under this Agreement; and provided, further, that if a Regulatory Event occurred, the Parties shall use their best efforts to reform this Agreement in order to give effect to the original intention of the Parties.  The term "including" when used in this Agreement shall be by way of example only and shall not be considered in any way to be in limitation.  The headings used herein are for convenience and reference purposes only.  All indemnity and audit rights shall survive the termination of this Agreement for twelve (12) months.  

11.10 10.9	Audit.  Each Party has the right, at its sole expense and during normal working hours, to examine the records of the other Party to the extent reasonably necessary to verify the accuracy of any statement, charge or computation made pursuant to this Master Agreement.  If requested, a Party shall provide to the other Party statements evidencing the Quantity delivered at the Delivery Point.  If any such examination reveals any inaccuracy in any statement, the necessary adjustments in such statement and the payments thereof will be made promptly and shall bear interest calculated at the Interest Rate from the date the overpayment or underpayment was made until paid; provided, however, that no adjustment for any statement or payment will be made unless objection to the accuracy thereof was made prior to the lapse of twelve (12) months from the rendition thereof, and thereafter any objection shall be deemed waived..

11.11 10.10	Forward Contract.  The Parties acknowledge and agree that all Transactions constitute Aforward contracts@ within the meaning of the United States Bankruptcy Code.  

IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed as of the date first above written. 10.11	Confidentiality.  Neither Party shall disclose the terms or conditions of this Agreement to a third party (other than the Party's and its employees, lenders, counsel, accountants or advisors who have a need to know such information and have agreed to keep such terms confidential) except in order to comply with any applicable law, regulation, or any exchange, control area or independent system operator rule; provided, each Party shall, to the extent practicable, notify the other Party of any proceeding of which it is aware which may result in disclosure and use reasonable efforts to prevent or limit the disclosure.  The Parties shall be entitled to all remedies available at law or in equity to enforce, or seek relief in connection with, this confidentiality obligation.

By: By: SCHEDULE M
Name: Name: 

Title: Title: 

SCHEDULE M
(FOLLOW THIS SCHEDULE IF ONE PARTY IS A MUNICIPALITY)
(WHOLE SECTION STILL TO BE DISCUSSED)(THIS SCHEDULE IS INCLUDED IF THE APPROPRIATE BOX ON THE COVER SHEET IS MARKED INDICATING A PARTY IS A GOVERNMENTAL ENTITY)

A.	The Parties agree to add the following definition of AAct@ to the defined terms section: AThe Act means [cite the state enabling statute.]@definitions in Article One.

B. AAct@ means ______________________________.

AGovernmental Entity@ means a municipality, county, governmental board, agency, or other political subdivision or public entity of the United States, any State or territory or any foreign state.

ASpecial Fund@ means a fund or account of the Governmental Entity set aside and or pledged to satisfy the Governmental Entity=s obligations hereunder out of which amounts shall be paid to satisfy all of the Governmental Entity=s obligations under this Master Agreement for the entire Delivery Period.

B.	The following sentence shall be added to the end of the definition of AForce Majeure@ in Article One.

If the Claiming Party is a Governmental Entity, Force Majeure does not include any action taken by the Government Entity in its governmental capacity.

C.	The Parties agree to add the following representations and warranties at the end of the representations and warranties section: to Section 10.2:

Further and with respect to a Party that is a governmental entity (A Governmental Entity@) only, such Government Entity represents and warrants to the other Party continuing throughout the term of this Agreement Master Agreement, with respect to this Master Agreement and each Transaction, as follows: (i) all acts necessary to the valid execution, delivery and performance of this Master Agreement, including the Act, have been duly adopted and all ________________without limitation, competitive bidding, public notice, election, referendum, prior appropriation or other required procedures has or will be taken and performed as required under the Act and the Governmental Entity=s ordinances, bylaws or other regulations, (ii) all persons making up the governing body of Governmental Entity have been are the duly elected or appointed to _____________________incumbents in their positions and hold such positions in good standing in accordance with the Act, (ii) and other applicable law, (iii) with respect to the its contractual obligations hereunder and performance thereof, it the Governmental Entity is not entitled to claim immunity on the grounds of sovereignty or similar grounds with respect to itself or its revenues or assets from (a) suit, (b) jurisdiction of court (including a court located outside the jurisdiction of its organization), (c) relief by way of injunction, order for specific performance or recovery of property, (d) attachment of assets, or (e) execution or enforcement of any judgment, (iii) its obligations to make payments hereunder are unsubordinated obligations and such payments are operating and maintenance costs which enjoy first priority of payment at all times under any and all indentures to which it is a party, its constitutional and(iv) entry into and performance of this Master Agreement by Governmental Entity are for a proper public purpose within the meaning of the Act and all other relevant constitutional, organic or other governing documents and applicable law, and (iv) if(v) the term of this Master Agreement does not extend beyond any applicable limitation regarding (a) the term of office or duration of existence of the governing body of the Governmental Entity, (b) any period during which funds are appropriated for use under this Master Agreement, or (c) any other limitation imposed by the Act or other relevant constitutional, organic or other governing documents and applicable law, (vi) the Governmental Entity=s obligations to make payments hereunder are unsubordinated obligations and such payments are (a) operating and maintenance costs (or similar designation) which enjoy first priority of payment at all times under any and all bond ordinances or indentures to which it is a party, the Act and all other relevant constitutional, organic or other governing documents and applicable law or (b) otherwise not subject to any prior claim under any and all bond ordinances or indentures to which it is a party, the Act and all other relevant constitutional, organic or other governing documents and applicable law and are available without limitation or deduction to satisfy all Governmental Entity=s obligations hereunder and under each Transaction or (c) are to be made solely from a Special Fund, (vii) entry into and performance of this Master Agreement and each Transaction by the Governmental Entity will not adversely affect the exclusion from gross income for federal income tax purposes of interest on any obligation of Governmental Entity otherwise entitled to such exclusion, and (viii) obligations to make payments hereunder do not constitute any kind of indebtedness of Governmental Entity or create any kind of lien on, or security interest in, any property or revenues of Governmental Entity which, in either case, is proscribed by any provision of its the Act or any other relevant constitutional and, organic or other governing documents and applicable law, any order or judgment of any court or other agency of government applicable to it or its assets, or any contractual restriction binding on or affecting it or any of its assets.

C D.	The Parties agree to add the following section to Article Three:

Section 3.4.:

  Governmental Entity=s Obligations Deliveries.  On the Effective Date and as a condition to the obligations of the other Party hereunder, Governmental Entity shall provide ____the other Party hereto (i) certified copies of all ordinances, resolutions, public notices and other documents evidencing the necessary authorizations with respect to the execution, delivery and performance by Governmental Entity of this Master Agreement and (ii) an opinion of counsel for Governmental Entity, in form and substance reasonably satisfactory to the Other Party,  regarding the validity, binding effect and enforceability of this Master Agreement against Governmental Entity in respect of the Act and other applicable law. all other relevant constitutional organic or other governing documents and applicable law.  

E.	If the appropriate box is checked on the Cover Sheet, the Parties agree to add the following section to Article Three:

Section 3.5.  Governmental Entity Security.  With respect to each Transaction, Governmental Entity shall either (i) have created and set aside a special fund pledged to satisfy Governmental Entity=s obligations hereunder (the ASpecial Fund@) out of which funds shall be paid to satisfy all of Governmental Entity=s obligations for the entire Delivery Period Special Fund or (ii) upon execution of this Master Agreement and prior to the commencement of each subsequent fiscal year of Governmental Entity during any Delivery Period, obtain all necessary budgetary approvals and certifications for payment of all of its obligations under this Master Agreement for such fiscal year; any breach of this provision shall be deemed to have arisen during a fiscal period of Governmental Entity for which budgetary approval or certification of its obligations under this Master Agreement is in effect and, notwithstanding anything to the contrary in Article Four, an Early Termination Date shall automatically and without further notice occur hereunder as of such date wherein Governmental Entity shall be treated as the Defaulting Party.  Governmental Entity shall have allocated to the Special Fund or its general funds a revenue base that is adequate to cover Governmental Entity=s payment obligations hereunder throughout the entire Delivery Period.

D. The F.	If the appropriate box is checked on the Cover Sheet, the Parties agree to add the following language to the end of the first sentence of the choice of law section: section to Article Eight:

EXCEPT IN RESPECT OF THE APPLICABILITY OF THE ACT AS HEREIN PROVIDED IN WHICH INSTANCE THE LAWS OF THE STATE OF [insert ______________ SHALL APPLY.

E. The Parties agree to add the following provision as a separate section at the end of the security section:

Section 8.6.  Governmental Security.  As security for payment and performance of Governmental Entity=s obligations hereunder, Governmental Entity hereby pledges, sets over, assigns and grants to the other Party a security interest in all of Governmental Entity=s right, title and interest in and to all amounts deposited in the Special Fund, including all investments made with such funds and the proceeds thereof.  Governmental Entity hereby authorizes and directs the depository of the Special Fund to hold all such amounts deposited therein as bailee and custodian for the other Party.

G.	The Parties agree to add the following sentence at the end of Section 10.6 ‑Governing Law:

NOTWITHSTANDING THE FOREGOING, IN RESPECT OF THE APPLICABILITY OF THE ACT AS HEREIN PROVIDED, THE LAWS OF THE STATE OF _____________ SHALL APPLY.

SCHEDULE P : PRODUCTS AND RELATED DEFINITIONS

AAncillary Services@ means any of the services identified by a Transmission Provider in its transmission tariff as Aancillary services@ including, but not limited to, regulation and frequency response, energy imbalance, operating reserve‑spinning and operating reserve‑supplemental as may be specified in any Transaction. 

ACall Option@ means an Option entitling, but not obligating, the Option Buyer to purchase and receive the Product from the Option Seller at a price equal to the Strike Price for the Delivery Period for which the Option may be exercised, all as agreed to by the Parties in a Transaction.  Upon proper exercise of the Option by the Option Buyer, the Option Seller will be obligated to sell and deliver the Product for the Delivery Period for which the Option has been exercised.

AEnergy@ means . 

ACapacity@ means the megawatt output level that a generating unit is capable of continuously producing.

AEnergy@ means electric energy in the form of merchantable electricity expressed in megawatt hours and shall be three‑phase, 60‑cycle alternating current electric energy, expressed in megawatt hours. 

AFirm (LD). 

AFinancially Firm@ (No Force Majeure) means, with respect to a Transaction, that if either Party fails to deliver or receive the Quantity of the Product due, the Party to which performance is owed shall be entitled to receive from the Party which failed to deliver/receive an amount calculated as provided in Article Four. No Force Majeure shall excuse performance of a Financially Firm Transaction.

AFirm (LD‑ [Identify System] System Reliability)@ means, with respect to a Transaction, that the Product subject to the Transaction is intended to be supplied from the Seller=s owned or controlled generation assets or pre‑existing purchase obligations. A Party=s failure to deliver the Product under a AFirm (LD‑System Reliability)@ transaction shall be excused and the non‑delivering Party shall not be liable for damages if Seller=s total Firm (LD‑System Reliability) sales, in addition to native load, firm and physically firm sales exceed the Seller=s available physical resources and pre‑existing purchases in accordance with reasonable and Prudent Utility Practice.

AForce Majeure@ means an event or circumstances which prevents one party from performing its obligations under one or more Transactions, which event or circumstances was not anticipated as of the effective date of the Transaction, which is not within the reasonable control of the Party claiming force majeure (the AClaiming Party@), and which, by the exercise of due diligence, the Claiming Party is unable to overcome or avoid or cause to be avoided. Force Majeure includes, but is not restricted to an action or restraint by court order or public or governmental authority (so long as the Claiming Party has not applied for or assisted in the application for such Court or government action). Force Majeure shall not include (i) the loss of Buyer's markets; (ii) Buyer's inability economically to use or resell the Product purchased hereunder; (iii) the loss or failure of Seller=s supply; (iv) Seller=s ability to sell the Product at a more advantageous price. The settlement of strikes, walkouts, lockouts, and other labor disputes shall be entirely within the discretion of the Party involved, and such Party may make settlement at such time and on such terms and conditions as it may deem to be advisable. Interruption by a Transmission Provider shall not be deemed to be an event of Force Majeure unless (i) the Party contracting with such Transmission Provider shall have made arrangements with such Transmission Provider for the firm transmission, as defined under the Transmission Provider's tariff, of the Product to be delivered or received hereunder and (ii) such interruption is due to Aforce majeure@ or Auncontrollable force@ or a similar term as defined under the Transmission Provider's tariff, [and (iii) no other path is available and no other remedy is available].

AInto [Identify Deliver Point]@ means, with respect to a Transaction, that Seller=s obligation to deliver the Product to the Buyer is not relieved because of (1) insufficient available transfer capacity (ATC) between the receiving control area and adjacent control areas, (2) transmission service curtailments at Seller=s designated interface, (3) Seller=s loss of transmission service, or (4) Seller=s loss of generation source. In the event Seller is unable to deliver energy to the Buyer, Seller shall designate an alternate interface or source of generation inside the receiving control area by which Seller=s delivery obligation can be satisfied. This provision is applicable to day ahead and same day transactions. Seller is not released from its delivery obligation to the Buyer if the Buyer is unable to obtain transmission service on the receiving control area=s transmission system. Should transmission service not be available to the Buyer at Seller=s designated interface, Seller shall be required to make one of the following designations to Buyer: (1) an alternate interface for which transmission service is available to Buyer, or (2) a generation source inside the receiving control area for which transmission service is available to the Buyer. 

AFirm (LD‑Marketer)@ means, with respect to a Transaction, that either Party shall be relieved of its obligations to sell and deliver or purchase and receive without liability only to the extent that, and for the period during which, such performance is prevented by Force Majeure.  In the absence of Force Majeure, the Party to which performance is owed shall be entitled to receive from the Party which failed to deliver/receive an amount calculated as provided in Article Three. Four.

AFirm (No Force Majeure)@ means, with respect to a Transaction, that if either Party fails to perform its obligation to sell and deliver or purchase and receive the Product, the Party to which performance is owed shall be entitled to receive from the Party which failed to perform an amount calculated as provided in Article Four.  Force Majeure shall not excuse performance of a Firm (No Force Majeure) Transaction.

AFirm (LD‑System Reliability) means that the Product will be supplied from the owned or controlled generation or pre‑existing purchased power assets of the public utility system specified in any Transaction (the ASystem@).  Seller=s failure to perform its obligations shall be excused and Seller shall not be liable for any damages, including damages under Article Four, by Force Majeure, by Buyer=s failure to perform, or to the extent any failure to deliver shall be necessary to preserve the integrity of, or prevent or limit any instability on, the System [or on any third party=s system,] or to the extent the total load of the System=s Native Load, firm energy sales, and pre‑existing Firm System Reliability Transactions exceed the System=s projected available generation less reserve requirements and pre‑existing Firm purchases, as determined in the System=s reasonable judgment.  [Transmission Contingency for Buyer.]

AInto [Identify Delivery Point Seller=s Daily Choice]" [Draft to be circulated before or at September 24, 1999 meeting.]  
ANative Load@ means the demand imposed on a utility or an entity by the requirements of retail customers located within a franchised service territory that an entity has a statutory obligation to serve.

ANon‑Firm@ means, with respect to a Transaction, that delivery or receipt of the Product may be interrupted for any reason or for no reason, without liability by on the part of  either Party.

AOption@ means an option (the right but not the obligation) to purchase or sell a Product as specified in the Confirmation. The premium amount for the purchase of an Option shall be paid within two (2) Business Days of receipt of an invoice from the Party selling the Option. A Party Option Seller.  An Option Buyer who wishes to exercise an Option must notify the other Party Option Seller by the time specified in the Confirmation. Transaction.

APhysically APut Option@ means an Option entitling, but not obligating, the Option Buyer to sell and deliver the Product to the Option Seller at a price equal to the Strike Price for the Delivery Period for which the option may be exercised, all as agreed to by the Parties in a Transaction.  Upon proper exercise of the Option by the Option Buyer, the Option Seller will be obligated to purchase and receive the Product.

AStrike Price@ means the price to be paid for the purchase of the Product pursuant to an Option.

AUnit Firm@ means, with respect to a Transaction, that either Party shall be relieved of its obligation to deliver or receive the Product (but not of its obligation to make payment then due and becoming due with respect to a Transaction which occurred prior to the event) to the extent that, and for the period during which, performance is prevented by Force Majeure. In the absence of Force Majeure, a Party=s failure to deliver or receive any portion of the Product, as the case may be, shall entitle the Non‑Defaulting Party to terminate the Transaction and recover damages pursuant to Section ___ plus an additional _____% of the amount of such damages to recoup difficult to quantify out‑of‑pocket costs. In addition, the Non‑Defaulting Party may declare an Event of Default with respect to any other Physically Firm Transactions upon which the Non‑Defaulting Party may pursue all other remedies for default hereunder. 

APrudent Utility Practice@ means, with respect to a Transaction, any of the practices, methods, and acts engaged in or approved by a significant portion of the electric utility industry during the relevant time period, or any of the practices, methods, and acts which, in the exercise of reasonable judgment in light of the facts known at the time the decision was made, could have been expected to accomplish the desired result at the lowest reasonable cost consistent with good business practices, reliability, safety, and expedition. Prudent Utility Practice is not intended to be the optimum practice, method, or act, but rather to be a spectrum of acceptable practices, methods, or acts.

AUnit Contingent@ means, with respect to a Transaction, that the Product subject to the Transaction is intended to be supplied from a particular identified generation asset or assets.  A Party=s failure to deliver Product under a AUnit Contingent Firm@ Transaction shall be excused and the non‑delivering Party shall not be deemed in default or be liable for damages if only to the extent that, and for the period during which the identified generation asset or assets is or are unavailable for any reason. as a result of scheduled or forced outages or a Force Majeure affecting the particular identified generation asset or assets.

CONFIRMATION LETTER

This letter shall confirm the Transaction agreed to on ___________, ___ between __________________________ (A[Party]@) and _____________________ (ACounterparty@) regarding the sale/purchase of the Product under the terms and conditions as follows:

Seller:	 	                                                                                        

Buyer:	                                                                                                    

Product:  Energy AND Financially Firm 
Capacity Firm (LD‑Marketer) 
Other Firm LD‑System Reliability 
Unit Contingent 
Other G  Energy                              AND		     Firm (LD)   G
                G  Capacity (Specify: __________)	     Firm (No Force Majeure)  G
                G Ancillary Services (Specify: _________)   Firm (LD‑System Reliability) G
	(Specify Systems:____________)
                G Other					   Unit Firm   G
   Non‑Firm   G

Other Products:                                                                                           

Contract Quantity:                                                                                 

Delivery Point:                                                                                      

Into: 		G Option A
G Option B

Contract Price:                                                                                       

Energy Price:                                                                                	

Demand Charges:                                                                         

Transmission Charges:	                                                               

Other Charges:                                                                             

Delivery Period:	                                                                           

Special Conditions:                                                                               

Scheduling:                                                                                            

Option Buyer:		                                                                           
Option Seller:		                                                                           

Type of Option:	                                                                           

Strike Price:		                                                                           

Premium:		                                                                           

Exercise Period:	                                                                           

337261.2 323171.1

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The bracketed numbers refer to the Page and Paragraph for the start of the paragraph in both the old and the new documents.

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