High Island Offshore System, L.L.C.

Third Revised Volume No. 1

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Effective Date: 04/01/2007, Docket: RP07-575-000, Status: Effective

First Revised Sheet No. 229 First Revised Sheet No. 229 : Effective

Superseding: Substitute Original Sheet No. 229

 

 

NGL BANK AGREEMENT (Continued)

 

 

5.6 Legal Action. Administrator shall, as to any and all shippers owing sums to the

NGL Bank, make all reasonable efforts, including, but not limited to the

institution of legal action or proceedings to collect sums due the NGL Bank,

subject to the approval of the Advisory Group. If Administrator initiates legal

action or proceedings to enforce the obligations of Shipper owing sums to the

 

NGL Bank and prevails in any such action or proceedings, then in addition to any

remedies awarded to Administrator, Administrator shall be entitled to

reimbursement by such Shipper of costs and expenses (including, without

limitation, reasonable attorney's fees and expenses, court costs and filing fees)

incurred in bringing such action or proceeding. If Administrator undertakes to

enforce the obligations of any third party shipper with respect to the NGL Bank,

whether pursuant to the initiation of legal action or proceedings or otherwise,

Shipper agrees to reimburse Administrator, within ten (10) days after Shipper's

receipt of Administrator's invoice, for Shipper's proportionate share of all

costs and expenses (including reasonable attorney's fees and expenses, court

costs, and filing fees) incurred by Administrator in the enforcement of the

obligations of such third party shipper with respect to the NGL Bank, such

proportionate share being equal to a fraction, the numerator of which is one (1)

and the denominator of which is the total number of shippers participating in the

NGL Bank which are not then in Default (as hereinafter defined) under their

respective NGL Bank Agreements with Administrator. To the extent that

Administrator is successful in enforcing the obligations of such third party

shipper with respect to the NGL Bank, Administrator shall reimburse Shipper for

Shipper's proportionate share (determined as provided in the preceding sentence

of this Section 5.6) of any recovery received by Administrator for the costs and

expenses (including, without limitation, attorney's fees and expenses, court

costs, and filing fees) incurred by Administrator in connection with the

enforcement of such obligations.

 

5.7 Default; Remedies. For purposes of this Agreement, the term "Default" means (a)

that Shipper (i) makes an assignment or any general arrangement for the benefit

of creditors; (ii) files a petition or otherwise commences, authorizes, or

acquiesces in the commencement of a proceeding or cause under any bankruptcy or

similar law for the protection of creditors or has such a petition filed or

proceeding commenced against it; or (iii) is unable to pay its debts as they fall

due; (b) the failure by Shipper to make, when due, any payment required under

this Agreement if such failure is not remedied within ten (10) days after notice

of such failure is given by Administrator, provided the payment is not the

subject of a good faith dispute; or (c) the failure by Shipper to perform any

covenant set forth in this Agreement (other than an obligation to make payment),

and such failure is not remedied within ten (10) days after notice thereof by

Administrator. Upon the occurrence of a Default, Administrator will have the

right, subject to the approval of the Advisory Group, to exercise all rights and

remedies available to it under this Agreement, at law, and in equity, including

the rights: (a) to file suit to seek damages or equitable remedies; and (b) to

suspend performance hereunder (including, without limitation, the withholding of

any payments due hereunder) until the relevant Default has been remedied.

 

 

ARTICLE VI - AUDITS

 

6.1 At any time within one (1) year following the end of a calendar year, Shipper,

upon sixty (60) days prior notice to Administrator and all other shippers, shall

have the right, at reasonable times, to inspect and audit the accounts, records,

documents and data of Administrator pertaining to the NGL Bank for that calendar

year provided, however, that any such audit shall be performed within twenty-four

(24) months of the date of such notice. The cost of conducting the audit

(including Administrator's costs) and resolving the exceptions and adjustments

thereto shall be borne solely by the shipper(s) auditing the system records.