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Enron Mail |
Janet,
I have reviewed the attached contract and it gives me a lot of concern. First brush, it is one sided in their favor and offers us no breakage protection. Specifically, Section 4.4 --- HPL should be the confirming party. Section 4.5 --- HPl also needs to have the right to call for security. Clause should be balanced. Section 5.5a -- "its best efforts" should be changed to "commercially reasonable efforts". Sections 5.8 & 5.9 -- Need clauses addressing "undertakes by Buyer" and "overtakes by Buyer". Section 6.3b -- 20 days should be changed to 15 days in each location in this section. Section 6.4 --- Needs a lot of explanation. Why is it here? Why would we agree to such? Article 10 - Force Majeure - Need to add Enron language as to items which are not force majeure. Article 11 - Default - Need to add additional Triggering Events, Early Termination, and Termination Damage provisions. Also, need to add provisions for limitation of liability and waiver of consequential damages. Let me know how you would like to proceed. I do not think that they will agree to make any of the changes we would need to do the deal. Would they be willing to contract using the GISB form of agreement? Janet H Wallis 01/04/2001 11:20 AM To: Dan J Hyvl/HOU/ECT@ECT cc: Subject: Austin Energy Gas Supply Agreement See attached contract below. Ignore 4.1 and 4.2, those will have to be changed. Also, keep an eye out in 4.4 - the default language for confirmations; 10.2 - the Force Majeure language; 18.2 - 3 rd party beneficiary; and 10.4 - transportion is not (?) subject to force Majeure? Thanks, J ---------------------- Forwarded by Janet H Wallis/HOU/ECT on 01/04/2001 11:07 AM --------------------------- "Sweeney, Pat" <Pat.Sweeney@austinenergy.com< on 01/04/2001 10:33:27 AM To: "'Janet Wallis - Enron'" <janet.h.wallis@enron.com< cc: "Hadley, Donna" <Donna.Hadley@austinenergy.com< Subject: Austin Energy Gas Supply Agreement <<Contract Template 040500.doc<< Janet, Attached is our "standard" gas enabling agreement that we plan to use with Enron. It is the same agreement we put in place last year when Enron did not submit a bid. If you will provide proper corporate / address information for Enron we will generate an original contract. Please let me know if you have any questions. Pat Sweeney Austin Energy - Contract Template 040500.doc
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