10-Q

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549
FORM 10-Q
	[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2004 OR [   ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission File Number	Exact name of registrants as specified in their charters, State of Organization, address of principal executive offices and registrants' telephone number	IRS Employer Identification Number
33-87902	ESI TRACTEBEL FUNDING CORP. (a Delaware corporation)	04-3255377
33-87902-02	NORTHEAST ENERGY ASSOCIATES, A LIMITED PARTNERSHIP (a Massachusetts limited partnership)	04-2955642
33-87902-01	NORTH JERSEY ENERGY ASSOCIATES, A LIMITED PARTNERSHIP (a New Jersey limited partnership)	04-2955646
333-52397	ESI TRACTEBEL ACQUISITION CORP. (a Delaware corporation)	65-0827005
333-52397-01	NORTHEAST ENERGY, LP (a Delaware limited partnership)	65-0811248
c/o FPL Energy, LLC 700 Universe Boulevard Juno Beach, Florida 33408 (561) 691-7171
Indicate by check mark whether the registrants (1) have filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months and (2) have been subject to such filing requirements for the past 90 days. Yes [X] No [   ]
Indicate by check mark whether the registrants are accelerated filers as defined in Rule 12b-2 of the Securities Exchange Act of 1934. Yes  [   ]    No  [X]
APPLICABLE ONLY TO CORPORATE ISSUERS:
As of April 30, 2004, there were issued and outstanding 10,000 shares of ESI Tractebel Funding Corp.'s common stock. As of April 30, 2004, there were issued and outstanding 20 shares of ESI Tractebel Acquisition Corp.'s common stock.
This combined Form 10-Q represents separate filings by ESI Tractebel Funding Corp., Northeast Energy Associates, a limited partnership, North Jersey Energy Associates, a limited partnership, ESI Tractebel Acquisition Corp. and Northeast Energy, LP. Information contained herein relating to an individual registrant is filed by that registrant on its own behalf. Each registrant makes representations only as to itself and makes no representations whatsoever as to any other registrant.

CAUTIONARY STATEMENTS AND RISK FACTORS THAT MAY AFFECT FUTURE RESULTS
In connection with the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 (Reform Act), ESI Tractebel Funding Corp. (Funding Corp.), Northeast Energy Associates, a limited partnership (NEA) and North Jersey Energy Associates, a limited partnership (NJEA) (collectively, the Partnerships), ESI Tractebel Acquisition Corp. (Acquisition Corp.) and Northeast Energy, LP (NE LP) (all five entities collectively, the registrants) are hereby filing cautionary statements identifying important factors that could cause the registrants' actual results to differ materially from those projected in forward-looking statements (as such term is defined in the Reform Act) made by or on behalf of the registrants in this combined Form 10-Q, in presentations, in response to questions or otherwise. Any statements that express, or involve discussions as to expectations, beliefs, plans, objectives, assumptions or future events or performance (often, but not always, through the use of words or phrases su ch as "will likely result," "are expected to," "will continue," "is anticipated," "believe," "could," "estimated," "may," "plan," "potential," "projection," "target," "outlook") are not statements of historical facts and may be forward-looking. Forward-looking statements involve estimates, assumptions and uncertainties. Accordingly, any such statements are qualified in their entirety by reference to, and are accompanied by, the following important factors (in addition to any assumptions and other factors referred to specifically in connection with such forward-looking statements) that could cause the registrants' actual results to differ materially from those contained in forward-looking statements made by or on behalf of any of the registrants.
Any forward-looking statement speaks only as of the date on which such statement is made, and the registrants undertake no obligation to update any forward-looking statement to reflect events or circumstances after the date on which such statement is made or to reflect the occurrence of unanticipated events. New factors emerge from time to time, and it is not possible for management to predict all of such factors, nor can it assess the impact of each such factor on the business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statement.
The following are some important factors that could have a significant impact on the registrants' operations and financial results, and could cause the registrants' actual results or outcomes to differ materially from those discussed in the forward-looking statements:
·	The registrants are subject to changes in laws or regulations, including the Public Utility Regulatory Policies Act of 1978, as amended (PURPA), changing governmental policies and regulatory actions, including those of the Federal Energy Regulatory Commission (FERC), with respect to, but not limited to, acquisition and disposal of assets and facilities, and present or prospective competition.
·	The registrants are subject to extensive federal, state and local environmental statutes, rules and regulations relating to air quality, water quality, waste management, natural resources and health and safety that could, among other things, restrict or limit the output of certain facilities or the use of certain fuels required for the production of electricity and/or increase costs. There are significant capital, operating and other costs associated with compliance with these environmental statutes, rules and regulations, and those costs could be even more significant in the future.
·	The registrants operate in a changing market environment influenced by various legislative and regulatory initiatives regarding deregulation, regulation or restructuring of the energy industry, including deregulation of the production and sale of electricity. The registrants will need to adapt to these changes and may face increasing competitive pressure.
·	The Partnerships were developed and operated as qualifying facilities (QFs) under PURPA and the regulations promulgated thereunder by the FERC. However, in December 2003, an amended and restated power purchase agreement of NJEA became effective and NJEA no longer operates as a QF. NEA continues to operate as a QF. FERC regulations require that at least 5% of a QF's total energy output be useful thermal energy. To meet the QF requirement, NEA sells steam under a long-term sales agreement to an unrelated third party for use in a gas and chemical processing facility to maintain NEA's QF status. NEA is dependent upon the on-going operations of this facility. Loss of QF status would entitle one power purchaser to renegotiate the price provisions of its power purchase agreement.
·	A substantial portion of the output from the Partnerships' power generation facilities is sold under long-term power purchase agreements to four regulated utilities, two of which are under common control. The limited number of power purchasers creates a concentration of counterparty risk. The remaining output from the power generation facilities is sold, from time to time, in the merchant markets. In addition, it is expected that upon expiration of the power purchase agreements, the residual portion of the electrical output will be sold in the merchant market. Merchant plants sell power based on market conditions at the time of sale. The amount and timing of revenues to be received from the merchant markets in the future is uncertain. In December 2003, an amended and restated power purchase agreement between NJEA and a New Jersey utility became effective. The agreement provides for, among other things, the ability to deliver electricity to the New Jersey utility from sources other than the NJEA facility.
·	The operation of power generation facilities involves many risks, including start up risks, breakdown or failure of equipment, transmission lines or pipelines, use of new technology, the dependence on a specific fuel source or the impact of unusual or adverse weather conditions (including natural disasters), as well as the risk of performance below expected or contracted levels of output or efficiency. This could result in lost revenues and/or increased expenses. Insurance, warranties or performance guarantees may not cover any or all of the lost revenues or increased expenses, including the cost of replacement power. Breakdown or failure of an operating facility may prevent the facility from performing under applicable power sales agreements which, in certain situations, could result in termination of the agreement or payment of liquidated damages.
·	The registrants use derivative instruments, such as swaps and options, to manage their commodity and financial market risks. The registrants could recognize financial losses as a result of volatility in the market values of these contracts, or if a counterparty fails to perform. In the absence of actively quoted market prices and pricing information from external sources, the valuation of these derivative instruments involves management's judgment or use of estimates. As a result, changes in the underlying assumptions or use of alternative valuation methods could affect the value of the reported fair value of these contracts.
·	In addition to risks discussed elsewhere, risk factors specifically affecting the registrants' success include the ability to efficiently operate generating assets, the successful and timely completion of project restructuring activities, the price and supply of fuel, transmission constraints, competition from new sources of generation, excess generation capacity and demand for power. There can be significant volatility in market prices for fuel, and there are other financial, counterparty and market risks that are beyond the control of the registrants. The registrants' inability or failure to effectively hedge their assets or positions against changes in commodity prices, interest rates, counterparty credit risk or other risk measures could significantly impair their future financial results.
·	The registrants' results of operations can be affected by changes in the weather. Severe weather can be destructive, causing outages and/or property damage, which could require additional costs to be incurred.
·	The registrants are subject to costs and other effects of legal and administrative proceedings, settlements, investigations and claims, as well as the effect of new, or changes in, tax rates or policies, rates of inflation, accounting standards, securities laws or corporate governance requirements.
·	The registrants are subject to direct and indirect effects of terrorist threats and activities. Generation and transmission facilities, in general, have been identified as potential targets. The effects of terrorist threats and activities include, among other things, terrorist actions or responses to such actions or threats, the inability to generate, purchase or transmit power, the risk of a significant slowdown in growth or a decline in the U.S. economy, delay in economic recovery in the U.S., and the increased cost and adequacy of security and insurance.
·	The registrants' ability to obtain insurance, and the cost of and coverage provided by such insurance, could be affected by national events as well as registrant-specific events.
·	The registrants are substantially leveraged. The ability of the registrants to make interest and principal payments and fund capital expenditures is dependent on the future performance of the Partnerships. Future performance is subject to general economic, financial, competitive, legislative, regulatory and other factors that are beyond the control of the registrants. The registrants are also subject to restrictive covenants under their debt agreements that will limit the ability to borrow additional funds.
·	All obligations of the Partnerships are non-recourse to the direct and indirect owners of the registrants. Following any default by the Partnerships, security is limited to the owners' economic interests in the Partnerships. The owners have no meaningful revenues other than the distributions they receive from the Partnerships. In the event of default, the ability of the owners to satisfy any obligations will be limited to amounts payable by the Partnerships as distributions.
The issues and associated risks and uncertainties described above are not the only ones the registrants may face. Additional issues may arise or become material as the energy industry evolves. The risks and uncertainties associated with these additional issues could impair the registrants' businesses in the future.

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements

NORTHEAST ENERGY, LP (A PARTNERSHIP) AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Thousands of Dollars)
(Unaudited)

						March 31, 2004		December 31, 2003
ASSETS
Current assets:
	Cash and cash equivalents					$	109,087	$	58,907
	Accounts receivable						25,002		33,957
	Due from related party						4,552		3,237
	Spare parts inventories						4,298		3,055
	Fuel inventories						1,508		10,362
	Prepaid expenses and other current assets						10,639		2,784
				Total current assets			155,086		112,302
Non-current assets:
		Deferred debt issuance costs (net of accumulated amortization of $3,809 and $3,666, respectively)					3,151		3,294
		Land					4,712		4,712
		Cogeneration facilities and carbon dioxide facility (net of accumulated depreciation of $133,450 and $128,494, respectively)					386,053		391,108
		Power purchase agreements (net of accumulated amortization of $333,863 and $318,743, respectively)					581,081		596,201
		Other assets					42,013		9,602
					Total non-current assets		1,017,010		1,004,917
TOTAL ASSETS						$	1,172,096	$	1,117,219
LIABILITIES AND PARTNERS' EQUITY
Current liabilities:
	Current portion of notes payable - the Funding Corp.					$	28,564	$	28,564
	Current portion of notes payable - the Acquisition Corp.						8,800		8,800
	Current portion of note payable - affiliate						2,605		2,605
	Accrued interest payable						12,999		48
	Accounts payable						9,406		13,959
	Due to related parties						17,525		11,840
	Other accrued expenses						16,535		12,405
			Total current liabilities				96,434		78,221
Non-current liabilities:
		Deferred credit - fuel contracts					-		108,274
		Notes payable - the Funding Corp.					323,650		323,650
		Notes payable - the Acquisition Corp.					193,600		193,600
		Note payable - affiliate					23,583		23,583
		Energy bank and other liabilities					111,525		108,582
		Lease payable					815		815
					Total non-current liabilities		653,173		758,504
COMMITMENTS AND CONTINGENCIES
Partners' equity:
	General partners						8,281		5,431
	Limited partners						412,686		273,044
	Accumulated other comprehensive income						1,522		2,019
			Total partners' equity				422,489		280,494
TOTAL LIABILITIES AND PARTNERS' EQUITY						$	1,172,096	$	1,117,219

This report should be read in conjunction with the Notes to Condensed Consolidated Financial Statements herein and the Notes to Consolidated and Combined Financial Statements appearing in the combined Annual Report on Form 10-K for the fiscal year ended December 31, 2003 (2003 Form 10-K) for NE LP and Subsidiaries.

NORTHEAST ENERGY, LP (A PARTNERSHIP) AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Thousands of Dollars)
(Unaudited)

				Three Months Ended March 31,
					2004			2003
REVENUES				$	119,116		$	108,221
COSTS AND EXPENSES (INCOME):
	Fuel				32,638			54,818
	Operations and maintenance				3,433			3,361
	Depreciation and amortization				20,096			19,249
	General and administrative				1,954			2,619
	Gain on energy bank settlement				-			(11,112	)
		Net gain on restructuring of contracts			(103,176	)		-
			Total costs and expenses/(income)		(45,055	)		68,935
OPERATING INCOME					164,171			39,286
OTHER EXPENSE (INCOME):
		Amortization of debt issuance costs			143			148
		Interest expense			15,784			16,428
		Interest income			(90	)		(125	)
		Other (income)/expense			842			(105	)
			Total other expense - net		16,679			16,346
NET INCOME				$	147,492		$	22,940

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Thousands of Dollars)
(Unaudited)

			Three Months Ended March 31,
				2004			2003
NET CASH PROVIDED BY OPERATING ACTIVITIES			$	55,180		$	26,944
CASH FLOWS FROM INVESTING ACTIVITIES:
	Capital expenditures			-			-
		Net cash used in investing activities		-			-
CASH FLOWS FROM FINANCING ACTIVITIES:
	Distributions to partners			(5,000	)		-
		Net cash used in financing activities		(5,000	)		-
Net increase in cash and cash equivalents				50,180			26,944
Cash and cash equivalents at beginning of period				58,907			45,878
Cash and cash equivalents at end of period			$	109,087		$	72,822

This report should be read in conjunction with the Notes to Condensed Consolidated Financial Statements herein and the Notes to Consolidated and Combined Financial Statements appearing in the 2003 Form 10-K for NE LP and Subsidiaries.

NORTHEAST ENERGY ASSOCIATES, A LIMITED PARTNERSHIP AND
NORTH JERSEY ENERGY ASSOCIATES, A LIMITED PARTNERSHIP
CONDENSED COMBINED BALANCE SHEETS
(Thousands of Dollars)
(Unaudited)

						March 31, 2004		December 31, 2003
ASSETS
Current assets:
	Cash and cash equivalents					$	108,266	$	58,092
	Accounts receivable						24,995		33,944
	Due from related party						4,552		3,237
	Spare parts inventories						4,298		3,055
	Fuel inventories						1,508		10,362
	Prepaid expenses and other current assets						10,639		2,784
				Total current assets			154,258		111,474
Non-current assets:
		Land					4,712		4,712
		Cogeneration facilities and carbon dioxide facility (net of accumulated depreciation of $133,450 and $128,494, respectively)					386,053		391,108
		Power purchase agreements (net of accumulated amortization of $333,863 and $318,743, respectively)					581,081		596,201
		Other assets					42,013		9,602
					Total non-current assets		1,013,859		1,001,623
TOTAL ASSETS						$	1,168,117	$	1,113,097
LIABILITIES AND PARTNERS' EQUITY
Current liabilities:
	Current portion of notes payable - the Funding Corp.					$	28,564	$	28,564
	Accrued interest payable						8,400		-
	Accounts payable						9,406		13,959
	Due to related parties						17,150		11,517
	Other accrued expenses						16,535		12,405
			Total current liabilities				80,055		66,445
Non-current liabilities:
		Deferred credit - fuel contracts					-		108,274
		Notes payable - the Funding Corp.					323,650		323,650
		Energy bank and other liabilities					111,372		108,430
		Lease payable					815		815
					Total non-current liabilities		435,837		541,169
COMMITMENTS AND CONTINGENCIES
Partners' equity:
	General partners						6,507		5,035
	Limited partners						644,196		498,429
	Accumulated other comprehensive income						1,522		2,019
			Total partners' equity				652,225		505,483
TOTAL LIABILITIES AND PARTNERS' EQUITY						$	1,168,117	$	1,113,097

This report should be read in conjunction with the Notes to Condensed Combined Financial Statements herein and the Notes to Consolidated and Combined Financial Statements appearing in the 2003 Form 10-K for NEA and NJEA.

NORTHEAST ENERGY ASSOCIATES, A LIMITED PARTNERSHIP AND
NORTH JERSEY ENERGY ASSOCIATES, A LIMITED PARTNERSHIP

CONDENSED COMBINED STATEMENTS OF OPERATIONS
(Thousands of Dollars)
(Unaudited)

				Three Months Ended March 31,
				2004			2003
REVENUES				$	119,166		$	108,221
COSTS AND EXPENSES (INCOME):
	Fuel				32,638			54,818
	Operations and maintenance				3,433			3,361
	Depreciation and amortization				20,096			19,249
	General and administrative				1,954			2,619
	Gain on energy bank settlement				-			(11,112	)
		Net gain on restructuring of contracts			(103,176	)		-
			Total costs and expenses/(income)		(45,055	)		68,935
OPERATING INCOME					164,221			39,286
OTHER EXPENSE (INCOME):
		Interest expense			11,230			12,209
		Interest income			(90	)		(125	)
		Other (income)/expense			842			(108	)
			Total other expense - net		11,982			11,976
NET INCOME				$	152,239		$	27,310

CONDENSED COMBINED STATEMENTS OF CASH FLOWS
(Thousands of Dollars)
(Unaudited)

			Three Months Ended March 31,
			2004			2003
NET CASH PROVIDED BY OPERATING ACTIVITIES			$	55,174		$	26,935
CASH FLOWS FROM INVESTING ACTIVITIES:
	Capital expenditures			-			-
		Net cash used in investing activities		-			-
CASH FLOWS FROM FINANCING ACTIVITIES:
	Distributions to partners			(5,000	)		-
		Net cash used in financing activities		(5,000	)		-
Net increase in cash and cash equivalents				50,174			26,935
Cash and cash equivalents at beginning of period				58,092			44,943
Cash and cash equivalents at end of period			$	108,266		$	71,878

This report should be read in conjunction with the Notes to Condensed Combined Financial Statements herein and the Notes to Consolidated and Combined Financial Statements appearing in the 2003 Form 10-K for NEA and NJEA.

ESI TRACTEBEL FUNDING CORP.

CONDENSED BALANCE SHEETS
(Thousands of Dollars)
(Unaudited)

			March 31, 2004		December 31, 2003
ASSETS
Current assets:
	Cash		$	1	$	1
	Interest receivable from the Partnerships			8,400		-
	Current portion of notes receivable from the Partnerships			28,564		28,564
		Total current assets		36,965		28,565
Notes receivable from the Partnerships				323,650		323,650
TOTAL ASSETS			$	360,615	$	352,215
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
	Current portion of debt securities payable		$	28,564	$	28,564
	Accrued interest payable			8,400		-
		Total current liabilities		36,964		28,564
Debt securities payable				323,650		323,650
COMMITMENTS AND CONTINGENCIES
Stockholders' equity:
	Common stock, no par value, 10,000 shares authorized, issued and outstanding			1		1
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY			$	360,615	$	352,215

CONDENSED STATEMENTS OF OPERATIONS
(Thousands of Dollars)
(Unaudited)

	Three Months Ended March 31,
	2004			2003
Interest income	$	8,400		$	8,955
Interest expense		(8,400	)		(8,955	)
NET INCOME	$	-		$	-

These reports should be read in conjunction with the Notes to Condensed Financial Statements herein and the Notes to Financial Statements appearing in the 2003 Form 10-K for the Funding Corp.

ESI TRACTEBEL ACQUISITION CORP.

CONDENSED BALANCE SHEETS
(Thousands of Dollars)
(Unaudited)

				March 31, 2004		December 31, 2003
ASSETS
Current assets:
	Interest receivable from NE LP			$	4,043	$	-
	Current portion of note receivable from NE LP				8,800		8,800
			Total current assets		12,843		8,800
Non-current assets:
	Due from NE LP				152		152
	Note receivable from NE LP				193,600		193,600
			Total non-current assets		193,752		193,752
TOTAL ASSETS				$	206,595	$	202,552
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
	Income taxes payable			$	28	$	27
	Current portion of debt securities payable				8,800		8,800
	Accrued interest payable				4,043		-
		Total current liabilities			12,871		8,827
Non-current liabilities:
	Debt securities payable				193,600		193,600
	Other				69		72
			Total non-current liabilities		193,669		193,672
TOTAL LIABILITIES					206,540		202,499
COMMITMENTS AND CONTINGENCIES
Stockholders' equity:
	Common stock, $.10 par value, 100 shares authorized, 20 shares issued and outstanding				-		-
	Retained earnings				55		53
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY				$	206,595	$	202,552

CONDENSED STATEMENTS OF OPERATIONS
(Thousands of Dollars)
(Unaudited)

	Three Months Ended March 31,
	2004			2003
Interest income	$	4,043		$	4,219
Interest expense		(4,040	)		(4,216	)
Income before income taxes		3			3
Income tax expense		(1	)		(1	)
NET INCOME	$	2		$	2

These reports should be read in conjunction with the Notes to Condensed Financial Statements herein and the Notes to Financial Statements appearing in the 2003 Form 10-K for the Acquisition Corp.

NORTHEAST ENERGY, LP (A PARTNERSHIP) AND SUBSIDIARIES
NORTHEAST ENERGY ASSOCIATES, A LIMITED PARTNERSHIP AND
NORTH JERSEY ENERGY ASSOCIATES, A LIMITED PARTNERSHIP
ESI TRACTEBEL FUNDING CORP.
ESI TRACTEBEL ACQUISITION CORP.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
NOTES TO CONDENSED COMBINED FINANCIAL STATEMENTS
NOTES TO CONDENSED FINANCIAL STATEMENTS
(Unaudited)

The accompanying Condensed Consolidated Financial Statements, Condensed Combined Financial Statements and Condensed Financial Statements should be read in conjunction with the 2003 Form 10-K for the registrants. In the opinion of the registrants' management, all adjustments (consisting of normal recurring accruals) considered necessary for fair financial statement presentation have been made. Certain amounts included in the prior year's consolidated and combined financial statements have been reclassified to conform to the current year's presentation. The Funding Corp. and the Acquisition Corp. had no cash transactions for the three months ended March 31, 2004 and 2003 and therefore have not presented a statement of cash flows. The results of operations for an interim period may not give a true indication of results for the year.

1. Combined Statement of Partners' Equity

NEA's and NJEA's general partner (GP) and limited partner (LP) equity balances are comprised of the following:

	NEA						NJEA						Combined
	GP		LP		Total		GP		LP		Total		GP		LP		Total
	(Thousands of Dollars)
Balances, December 31, 2003	$	1,717	$	170,049	$	171,766	$	3,318	$	328,380	$	331,698	$	5,035	$	498,429	$	503,464	(a)
Balances, March 31, 2004	$	2,917	$	288,863	$	291,780	$	3,590	$	355,333	$	358,923	$	6,507	$	644,196	$	650,703	(b)

(a)	Exclusive of accumulated other comprehensive income of $2,019.
(b)	Exclusive of accumulated other comprehensive income of $1,522.

2. Accounting for Derivative Instruments and Hedging Activities

Accumulated other comprehensive income is separately displayed in NE LP's and the Partnerships' balance sheets. Included in NE LP's and the Partnerships' accumulated other comprehensive income at March 31, 2004 is approximately $1.5 million of net unrealized gains associated with cash flow hedges of forecasted fuel purchases through December 2004, all of which are expected to be reclassified into earnings within the next twelve months. NE LP and the Partnerships reclassified a net gain of approximately $0.5 million and $6.1 million into earnings from accumulated other comprehensive income for the three months ended March 31, 2004 and 2003, respectively. The effective portion of the net gain/loss on cash flow hedges included within other comprehensive income was a net gain of approximately $8 thousand and approximately $13.8 million for the three months ended March 31, 2004 and 2003, respectively.

Unrealized mark-to-market gains and losses on derivative transactions represent the net unrealized effect of derivative transactions entered into as economic hedges (but which do not qualify for hedge accounting under Statement of Financial Accounting Standards No. (FAS) 133, "Accounting for Derivative Instruments and Hedging Activities," as amended) and the ineffective portion of transactions accounted for as cash flow hedges. These transactions have been entered into to reduce NE LP and the Partnerships' aggregate fuel cost and purchased power price risk. Changes in the derivatives' fair value for power purchases are recognized in operating revenues and fuel purchases are recognized in fuel expense in NE LP and the Partnerships' condensed consolidated and combined statements of operations, unless hedge accounting is applied.

3. Comprehensive Income

Comprehensive income below includes net income and net unrealized gains (losses) on cash flow hedges of forecasted fuel purchases for both NE LP and the Partnerships of approximately $(0.5) million and $7.6 million for the periods ended March 31, 2004 and 2003, respectively.

	Three Months Ended March 31,
	2004		2003
	(Thousands of Dollars)
NE LP	$	146,995	$	30,574
The Partnerships	$	151,742	$	34,944

4. Commitments and Contingencies

The long-term contractual obligations of NE LP and the Partnerships at March 31, 2004 are as follows:

NE LP AND THE PARTNERSHIPS
March 31, 2004
(Thousands of Dollars)

			2004		2005 - 06		2007 - 08		Thereafter		Total
CONTRACTUAL OBLIGATIONS
The Partnerships:
	Long-term debt		$	28,564	$	97,990	$	105,821	$	119,839	$	352,214
	Operating leases			198		558		606		1,086		2,448
	Other long-term obligations:
	Energy bank liability			-		-		-		96,379		96,379
	Administrative agreement(a)			450		1,200		1,200		5,400		8,250
	O&M agreement(a)			1,125		3,000		3,000		10,500		17,625
	Fuel management agreement(a)			675		1,800		1,800		12,600		16,875
	Steam sales termination agreement			2,557		6,789		3,395		-		12,741
Total Partnerships				33,569		111,337		115,822		245,804		506,532
NE LP:
	Acquisition Corp. debt			8,800		22,000		44,000		127,600		202,400
	Affiliate debt			2,605		5,981		7,036		10,566		26,188
Total NE LP				11,405		27,981		51,036		138,166		228,588
Total contractual obligations			$	44,974	$	139,318	$	166,858	$	383,970	$	735,120
(a)		Represents the minimum obligation under the terms of the agreement. The minimum obligation is subject to an annual inflation factor adjustment, which is excluded from the minimum obligation included in the table.

5. Power Purchase Agreements, Fuel Supply Agreements and Steam Agreements

In December 2003, an agreement between NJEA and a New Jersey utility became effective to amend and restate the power purchase agreement in order to realize cost savings by sourcing power from the wholesale market rather than NJEA's facility during periods when market prices are lower than generation costs. In connection with this agreement, NJEA entered into two off-peak power purchase contracts with FPL Energy, LLC's power marketing subsidiary, FPL Energy Power Marketing, Inc. (PMI) and Tractebel Energy Marketing, Inc. (TEMI), which were effective in January 2004, each for the purchase of up to 125 megawatts (mw) per off-peak hour at a fixed price to supply power to the New Jersey utility under the amended and restated power purchase agreement. Under the terms of these contracts, PMI and TEMI will purchase power from the wholesale market to be sold to NJEA. The pricing in the NJEA power purchase agreement with the New Jersey utility is based on a gas index, thus NJEA's purchase of off-peak power at a f ixed price from PMI and TEMI and sale to the New Jersey utility at a gas indexed price exposes NJEA to decreases in the price of natural gas. Total power purchased under these contracts in the first quarter of 2004 was $7.4 million.

In order to hedge the Partnerships' exposure to natural gas prices relating to the amended and restated power purchase agreement, a Partial Termination Agreement between NEA and one of its fuel suppliers became effective in January 2004. Prior to the partial termination, the supplier provided 35,418 mmbtu/day to NEA, and now supplies 12,507 mmbtu/day or approximately 21% of NEA's daily fuel requirements, at a fixed price. The reduction in NEA's volume of fixed price gas exposes NEA to increases in the price of natural gas. When combined, NJEA's and NEA's exposures to changes in natural gas prices are expected to be minimized. The partial termination resulted in the fuel supplier paying the partnership $5.0 million, the removal of a $108.1 million liability representing the unamortized deferred credit as of the termination date, the addition of a $2.0 million asset representing the value of the remaining contract, and recognition of a $115.1 million gain.

To replace the remaining fuel requirements, NEA entered into two additional replacement long-term gas supply agreements with PMI and TEMI which became effective in January 2004 and provide the partnership with gas indexed pricing. Fuel purchased under agreements between NEA and PMI and TEMI were $20.9 million in the first quarter of 2004.

In connection with the amended and restated power purchase agreement, in March 2004, NJEA exercised its option to terminate its steam sales contract since the NJEA facility is no longer operating as a base load facility. This resulted in the recognition of an $11.9 million loss representing the net present value of future payments to the steam offtaker. Under the terms of the termination agreement NJEA will no longer supply steam to the steam offtaker and NJEA is obligated to pay the offtaker a monthly fee of approximately $0.4 million through December 2007.

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

This discussion should be read in conjunction with the Notes to Condensed Consolidated Financial Statements, Notes to Condensed Combined Financial Statements and Notes to Condensed Financial Statements contained herein (the Notes) and Management's Discussion and Analysis of Financial Condition and Results of Operations appearing in the 2003 Form 10-K for the registrants. All periods presented have been reclassified to reflect the guidance of Emerging Issues Task Force Issue No. (EITF) 03-11 and the SEC staff which were adopted by NE LP and the Partnerships effective October 1, 2003. This guidance relates to the reporting of realized gains and losses on derivative contracts and on the realized and unrealized effects of derivative instruments not accounted for as hedges. The results of operations for an interim period may not give a true indication of results for the year. In the following discussion, all comparisons are with the corresponding items in the prior year period.

Results of Operations

NE LP and the Partnerships - NE LP's net income for the first quarter of 2004 was $147.5 million compared to $22.9 million for the same period in 2003 and the Partnerships' net income for the first quarter of 2004 was $152.2 million compared to $27.3 for the same period in 2003. Net income reflects the following items which increased (decreased) reported results:

	2004		2003
	(in thousands)
Net gain on restructuring of contracts	$	103,176	$	- -
Unrealized gains (losses) on derivative instruments	$	35,997	$	(2,567	)
Gain on energy bank settlement	$	-	$	11,112

NE LP and the Partnership's management uses earnings excluding these items (adjusted earnings) internally for financial planning and reporting of results to partners. Management of NE LP and the Partnership's believes adjusted earnings provide a more meaningful representation of the registrants' fundamental earnings power. Although the excluded items are properly included in the determination of net income in accordance with generally accepted accounting principles, both the size and nature of such items make period to period comparisons of operations difficult and potentially confusing. Results for the first quarter of 2004 compared to the same period in 2003 were negatively affected by unfavorable pricing under one of the power purchase agreements and an increase in the use of market priced gas. The volume of fuel purchased during the first quarter of 2004 decreased since the NJEA facility did not operate during that time. Revenue increased for the first quarter of 2004 compared to the same perio d in 2003 primarily due to the unrealized gain on derivative instruments of approximately $36.0 million due to an increase in forward power prices, a decrease in utility energy bank balances of $3.1 million and an increase in power sold to utilities of $7.7 million (83.8 mw).

The net gain on restructurings of contracts in the first quarter of 2004 consists of a gain of $115.1 million recognized on the effective date of a partial termination agreement between NEA and one of its fuel suppliers, partially offset by a loss of $11.9 million recognized on the exercise date of NJEA's option to terminate its steam sales contract.

In December 2003, an agreement between NJEA and a New Jersey utility became effective to amend and restate the power purchase agreement in order to realize cost savings by sourcing power from the wholesale market rather than NJEA's facility during periods when market prices are lower than generation costs. In connection with this agreement, NJEA entered into two off-peak power purchase contracts with FPL Energy, LLC's power marketing subsidiary, FPL Energy Power Marketing, Inc. (PMI) and Tractebel Energy Marketing, Inc. (TEMI), which were effective in January 2004, each for the purchase of up to 125 mw per off-peak hour at a fixed price to supply power to the New Jersey utility under the amended and restated power purchase agreement. Under the terms of these contracts, PMI and TEMI will purchase power from the wholesale market to be sold to NJEA. The pricing in the NJEA power purchase agreement with the New Jersey utility is based on a gas index, thus NJEA's purchase of off-peak power at a fixed price f rom PMI and TEMI and sale to the New Jersey utility at a gas indexed price exposes NJEA to decreases in the price of natural gas.

In order to hedge the Partnerships' exposure to natural gas prices relating to the amended and restated power purchase agreement, a Partial Termination Agreement between NEA and one of its fuel suppliers became effective in January 2004. Prior to the partial termination, the supplier provided 35,418 mmbtu/day to NEA, and now supplies 12,507 mmbtu/day or approximately 21% of NEA's daily fuel requirements, at a fixed price. The reduction in NEA's volume of fixed price gas exposes NEA to increases in the price of natural gas. When combined, NJEA's and NEA's exposures to changes in natural gas prices are expected to be minimized. The partial termination resulted in the fuel supplier paying the partnership $5.0 million, the removal of a $108.1 million liability representing the unamortized deferred credit as of the termination date, the addition of a $2.0 million asset representing the value of the remaining contract, and recognition of a $115.1 million gain.

To replace the remaining fuel requirements, NEA entered into two additional replacement long-term gas supply agreements with PMI and TEMI which became effective in January 2004 and provide the partnership with gas indexed pricing.

In connection with the amended and restated power purchase agreement, in March 2004, NJEA exercised its option to terminate its steam sales contract since the NJEA facility is no longer operating as a base load facility. This resulted in the recognition of an $11.9 million loss representing the net present value of future payments to the steam offtaker. Under the terms of the termination agreement NJEA will no longer supply steam to the steam offtaker and NJEA is obligated to pay the offtaker a monthly fee of approximately $0.4 million through December 2007.

Revenue increased for the first quarter of 2004 compared to the same period in 2003 primarily due to the unrealized gain on derivative instruments of approximately $36.0 million due to an increase in forward power prices, a decrease in utility energy bank balances of $3.1 million and an increase in power sold to utilities of $7.7 million (83.8 mw). This increase in revenue was partially offset by purchased power of $22.4 million and decreased revenue resulting from unfavorable pricing under one of the power purchase agreements due to lower fuel costs. Revenues for the three months ended March 31, 2004 and 2003 were comprised of $118.9 million and $107.4 million of power sales to utilities and $0.2 million and $0.8 million of steam sales, respectively. Power sales to utilities for the three months ended March 31, 2004 and 2003 reflect a decrease in utility energy bank balances which increased reported revenues by $10.6 million and $7.5 million, respectively. The decrease in the energy bank balances is determined in accordance with scheduled or specified rates under a certain power purchase agreement.

Fuel expense for the three months ended March 31, 2004 decreased primarily as a result of the amended and restated power purchase agreement between NJEA and a New Jersey utility. Under the terms of the agreement, NJEA has the option to supply power from the market rather than the NJEA facility. During the first quarter of 2004, all of the power sold to the New Jersey utility was provided by the market and the NJEA facility did not operate, resulting in a decrease in fuel cost of approximately $27.7 million. Additionally, fuel sales increased in 2004 by $7.5 million primarily due to the sale of fuel held in storage at the NJEA facility. This decrease in fuel cost at NJEA was partially offset by the increased cost of market priced gas at the NEA facility due to the termination of certain fixed price fuel supply contracts and increased volume. Fuel costs for the three months ended March 2003, were partly offset by $3.7 million of deferred credit amortization for fuel contracts which were terminated in Augu st 2003 and January 2004.

Interest expense for NE LP and the Partnerships decreased as a result of decreasing principal balances on their outstanding debt to the Acquisition Corp. and Funding Corp., respectively.

On March 31, 2003, an energy bank was terminated resulting in an $11.1 million gain for NEA. In connection with the termination, the energy bank balance of $22.2 million was eliminated, and NE LP paid approximately $11.1 million plus interest in June 2003.

The Funding Corp. and the Acquisition Corp. - Both the Funding Corp. and the Acquisition Corp. use interest income and principal payments received from the notes receivable from the Partnerships and NE LP, respectively, to make scheduled interest and principal payments on their outstanding debt. Both entities are scheduled to make semi-annual principal and interest payments on June 30 and December 30. Interest expense for both the Funding Corp. and Acquisition Corp. decreased in 2004 as a result of decreasing principal balances on their outstanding debt.

Liquidity and Capital Resources

NE LP and the Partnerships - The changes in net cash provided by operating activities for NE LP and the Partnerships for the three months ended March 31, 2004 compared to the three months ended March 31, 2003 were primarily due to lower operating costs incurred in 2004 as a result of the amended and restated power purchase agreement discussed above.

Each of NE LP and the Partnerships make scheduled interest and principal payments on their outstanding debt. Each are scheduled to make semi-annual principal and interest payments on June 30 and December 30.

NE LP and the Partnerships' long-term contractual obligations at March 31, 2004 are shown in Note 4.

Guarantees in the amount of $5.0 million each were made by a subsidiary of FPL Group and a subsidiary of Tractebel, Inc. The guarantor unconditionally and irrevocably guarantees the payments to be made under the amended long-term gas supply agreement executed in December 2003 between NJEA and a fuel supplier.

Market Risk Sensitivity

Commodity price risk - The prices received by the Partnerships for power sales under their long-term contracts do not move precisely in tandem with the prices paid by the Partnerships for natural gas. To manage the price risk associated with purchases of natural gas and, beginning in December 2003, purchases of power, the Partnerships may, from time to time, enter into certain transactions either through public exchanges or by means of over-the-counter transactions with specific counterparties. The Partnerships manage their risk associated with purchases of natural gas and power through the use of natural gas and power swap agreements and options. The swap agreements require the Partnerships to pay a fixed price (absolutely or within a specified range) in return for a variable price on specified notional quantities of natural gas and power. The options consist of purchased call options to establish a maximum price for natural gas and power, and written put options are executed to offset the cost of th e purchased call options.

The Partnerships use a value-at-risk (VaR) model to measure market risk in their mark-to-market portfolios. The VaR is the estimated loss based on a one-day holding period at a 95% confidence level using an historical simulation methodology. As of March 31, 2004 and December 31, 2003, the VaR figures for hedges in Accumulated Other Comprehensive Income (in thousands) are as follows:

December 31, 2003	$	46
March 31, 2004	$	1,260
Average for the period ended March 31, 2004	$	939

Item 3. Quantitative and Qualitative Disclosures About Market Risk
See Management's Discussion and Analysis of Financial Condition and Results of Operations - Market Risk Sensitivity.
Item 4. Controls and Procedures
(a)	Evaluation of Disclosure Controls and Procedures
	As of March 31, 2004, each of the registrants had performed an evaluation, under the supervision and with the participation of its management, including the chief executive officer and chief financial officer of each of the registrants, or their equivalent (Principal Officers), of the effectiveness of the design and operation of the registrants' disclosure controls and procedures (as defined in Exchange Act Rule 13a-15(e) or 15d-15(e)). Based upon that evaluation, the Principal Officers concluded that the registrants' disclosure controls and procedures are effective in timely alerting them to material information relating to the registrants required to be included in the registrants' reports filed or submitted under the Exchange Act. The registrants have a Disclosure Committee, which is made up of several key management employees and reports directly to the Principal Officers of each of the registrants to monitor and evaluate these disclosure controls and procedures. Due to the inherent limitations of t he effectiveness of any established disclosure controls and procedures, management of the registrants cannot provide absolute assurance that the objectives of their disclosure controls and procedures will be met.
(b)	Changes in Internal Controls
	The registrants are continuously seeking to improve the efficiency and effectiveness of their operations and of their internal controls. This results in refinements to processes. However, there has been no change in the registrants' internal control over financial reporting that occurred during the registrants' most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrants' internal control over financial reporting.

PART II - OTHER INFORMATION
Item 5. Other Information
(a)	Reference is made to Item 10 - Directors and Executive Officers of the Registrants - Management Committee of NE LP and the Partnerships in the 2003 Form 10-K for the registrants.
	In March 2004, William C. Harper, a former member of the Management Committee of NE LP and the Partnerships was replaced by Geert Peeters. Mr. Peeters, 40, joined Tractebel North America, Inc. in November 2002 as Vice President Finance. He was named Senior Vice President and Chief Financial Officer of Tractebel North America, Inc. in April 2003. He was vice president, construction management at the Gulf Total Tractebel Company from October 2001 to November 2002. Prior to that, he held a variety of positions at Suez-Tractebel S.A. since 1996 in finance and project management in Europe and Latin America. Mr. Peeters was appointed to the NE LP and Partnerships' management committee by Tractebel G.P.
Item 6. Exhibits and Reports on Form 8-K

(a)	Exhibits
	Exhibit Number	Description
	10(a)	Termination Agreement dated as of October 21, 2003 between Hercules Incorporated and NJEA
	10(b)	Letter Agreement dated October 9, 2003 by and between Public Service Electric and Gas Company and NJEA
	10(c)	Power Purchase Agreement dated as of January 1, 2004 by and between NJEA and TEMI
	10(d)	Power Purchase Agreement dated as of January 1, 2004 by and between NJEA and PMI
	10(e)	Base Contract for Sale and Purchase of Natural Gas dated January 1, 2004 between NEA and PMI
	10(f)	Base Contract for Sale and Purchase of Natural Gas dated January 1, 2004 between NEA and TEMI
	31(a)	Rule 13a-14(a)/15d-14(a) Certification of President (equivalent to the Chief Executive Officer) of ESI Tractebel Funding Corp.
	31(b)	Rule 13a-14(a)/15d-14(a) Certification of Treasurer (equivalent to the Chief Financial Officer) of ESI Tractebel Funding Corp.
	31(c)	Rule 13a-14(a)/15d-14(a) Certification of President (equivalent to the Chief Executive Officer) of ESI Tractebel Acquisition Corp.
	31(d)	Rule 13a-14(a)/15d-14(a) Certification of Treasurer (equivalent to the Chief Financial Officer) of ESI Tractebel Acquisition Corp.
	31(e)	Rule 13a-14(a)/15d-14(a) Certification of President (equivalent to the Chief Executive Officer) of ESI Northeast Energy GP, Inc. as Administrative General Partner of Northeast Energy Associates, a limited partnership
	31(f)	Rule 13a-14(a)/15d-14(a) Certification of Vice President and Treasurer (equivalent to the Chief Financial Officer) of ESI Northeast Energy GP, Inc. as Administrative General Partner of Northeast Energy Associates, a limited partnership
	31(g)	Rule 13a-14(a)/15d-14(a) Certification of President (equivalent to the Chief Executive Officer) of ESI Northeast Energy GP, Inc. as Administrative General Partner of North Jersey Energy Associates, a limited partnership
	31(h)	Rule 13a-14(a)/15d-14(a) Certification of Vice President and Treasurer (equivalent to the Chief Financial Officer) of ESI Northeast Energy GP, Inc. as Administrative General Partner of North Jersey Energy Associates, a limited partnership
	31(i)	Rule 13a-14(a)/15d-14(a) Certification of President (equivalent to the Chief Executive Officer) of ESI Northeast Energy GP, Inc. as Administrative General Partner of Northeast Energy, LP
	31(j)	Rule 13a-14(a)/15d-14(a) Certification of Vice President and Treasurer (equivalent to the Chief Financial Officer) of ESI Northeast Energy GP, Inc. as Administrative General Partner of Northeast Energy, LP
	32(a)	Section 1350 Certification of President (equivalent to the Chief Executive Officer) and Treasurer (equivalent to the Chief Financial Officer) of ESI Tractebel Funding Corp.
	32(b)	Section 1350 Certification of President (equivalent to the Chief Executive Officer) and Treasurer (equivalent to the Chief Financial Officer) of ESI Tractebel Acquisition Corp.
	32(c)	Section 1350 Certification of President (equivalent to the Chief Executive Officer) and Vice President and Treasurer (equivalent to the Chief Financial Officer) of ESI Northeast Energy GP, Inc. as Administrative General Partner of Northeast Energy Associates, a limited partnership
	32(d)	Section 1350 Certification of President (equivalent to the Chief Executive Officer) and Vice President and Treasurer (equivalent to the Chief Financial Officer) of ESI Northeast Energy GP, Inc. as Administrative General Partner of North Jersey Energy Associates, a limited partnership
	32(e)	Section 1350 Certification of President (equivalent to the Chief Executive Officer) and Vice President and Treasurer (equivalent to the Chief Financial Officer) of ESI Northeast Energy GP, Inc. as Administrative General Partner of Northeast Energy, LP
(b)	Reports on Form 8-K - None.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrants have duly caused this report to be signed on their behalf by the undersigned, thereunto duly authorized.

	NORTHEAST ENERGY ASSOCIATES, A LIMITED PARTNERSHIP (ESI Northeast Energy GP, Inc. as Administrative General Partner) NORTH JERSEY ENERGY ASSOCIATES, A LIMITED PARTNERSHIP (ESI Northeast Energy GP, Inc. as Administrative General Partner) NORTHEAST ENERGY, LP (ESI Northeast Energy GP, Inc. as Administrative General Partner) ESI TRACTEBEL FUNDING CORP. ESI TRACTEBEL ACQUISITION CORP. (Registrants)
Date: May 12, 2004
	MARK R. SORENSEN
	Mark R. Sorensen Vice President and Treasurer of ESI Northeast Energy GP, Inc. Treasurer of ESI Tractebel Funding Corp. Treasurer of ESI Tractebel Acquisition Corp. (Principal Financial and Principal Accounting Officer of the Registrants)

EX-10

Exhibit 10(a)

Termination
Agreement





between






Hercules Incorporated


and


North Jersey Energy Associates,
A Limited Partnership






Dated as of October 21, 2003

TERMINATION AGREEMENT

THIS TERMINATION AGREEMENT (the "Agreement") is made as of this 21st day of October, 2003 (the "Effective Date") by and between HERCULES INCORPORATED ("Hercules") and NORTH JERSEY ENERGY ASSOCIATES, A LIMITED PARTNERSHIP, a New Jersey limited partnership ("NJEA") (each a "Party", and collectively the "Parties").

WITNESSETH:

WHEREAS, NJEA and Hercules are parties to an Industrial Steam Sales Contract (the "Steam Contract") dated June 5, 1989 pursuant to which NJEA sells steam generated at its natural gas-fired electrical and steam generation facility located in Sayreville, New Jersey (the "Facility") to Hercules for consumption at Hercules' chemical manufacturing facility located in Parlin, New Jersey (the "Hercules Facility");

WHEREAS, Hercules resells a portion of the steam it purchases from NJEA under the Steam Contract to its lessee, Green Tree Chemical Technologies Inc. ("Green Tree"), which is engaged in the production of nitrocellulose and other chemicals at its facilities (the "Nitrocellulose Facility");

WHEREAS, NJEA is restructuring its power purchase agreement with Jersey Central Power & Light Company ("JCP&L") and has entered into an Amended and Restated Power Purchase Agreement with JCP&L dated as of May 16, 2003, as amended by that First Amendment to Amended and Restated Power Purchase Agreement dated as of October 21, 2003 (the "Amended and Restated Power Purchase Agreement") pursuant to which NJEA sells the electrical output of the Facility to JCP&L, and in connection therewith, a filing has been made with the New Jersey Board of Public Utilities ("NJBPU") seeking approval of the restructuring transaction (the "Restructuring"); and

WHEREAS, in connection with the foregoing, the Parties have agreed to terminate the Steam Contract prior to the expiration of the term thereof pursuant to the terms and conditions set forth herein.

NOW, THEREFORE, in consideration of the mutual covenants and agreements contained herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereby agree as follows:

1. DEFINITIONS; TERM; APPENDICES

In addition to terms defined in the recitals hereto, the following terms shall have the meanings set forth below. Capitalized terms used and not otherwise defined herein shall have the meanings set forth in the Steam Contract.

1.1 Defined Terms.

"Approvals" has the meaning set forth in Section 13(f).

"Business Day" means Monday through Friday, excluding any day on which banks in New York, New York (U.S.A.) are closed for business.

"Cessation of Operations" shall be deemed to have occurred at either the Hercules Facility or the Nitrocellulose Facility on the 30th consecutive calendar day on which (i) the number of full-time employees (A) at the Hercules Facility, falls below forty (40) or (B) at the Nitrocellulose Facility, falls below one hundred (100) during calendar years 2004 and 2005, ninety (90) during calendar year 2006, or eighty (80) during calendar year 2007 or any year thereafter (if applicable) or (ii) there has been a cessation of substantially all of the manufacturing and production operations at either such Facility.

"Cure Period" has the meaning set forth in Section 3.2(c).

"Effective Date" has the meaning set forth in the Preamble hereto.

"Expiration Date" has the meaning set forth in Section 2.3.

"Facility" means either the Hercules Facility or the Nitrocellulose Facility, as the context requires.

"Final Order" has the meaning set forth in Section 2.6(a).

"Final Payment" has the meaning set forth in Section 2.2(a)(iii).

"First Component" means $251,570 per month.

"Force Majeure" means circumstances beyond the control of the party concerned and resulting in or causing a failure or substantial interference in the operation of the Hercules Facility or the Nitrocellulose Facility, as the case may be, which circumstances cannot be overcome by the exercise of due diligence by the party concerned. Subject to the foregoing, such circumstances may include riots, wars (declared or undeclared), insurrections, sabotage, rebellions, terrorist acts, civil disturbances, acts of God, explosions, fires, major equipment failures beyond the control of the party affected, and interruptions beyond the control of the party affected of fuel supply, power, water, utilities, wastewater disposal, feedstock, or product distribution; provided, however, that (a) any lack of money, (b) changes in market conditions, or (c) strikes, lockouts or other labor difficulties involving personnel of Hercules (or its Affiliates or successors or assigns) or the Green Tree (or its Affili ates or successors or assigns) shall not constitute Force Majeure.

"Hercules Stipulation" means the motion to intervene in the Restructuring and Stipulation of Settlement filed or to be filed by Hercules with the NJBPU in the Matter of the Application of Jersey Central Power & Light Company for the Approval of an Amendment and Restatement of the Power Purchase Agreement Currently Existing Between It and North Jersey Energy Associates, A Limited Partnership, NJBPU Docket No. EM03060438, pursuant to which Hercules agrees to the terms and conditions of this Termination Agreement.

"Hercules Waiver and Release" has the meaning set forth in Section 4.2.

"Incentive Payments" means the Initial Payment, the Monthly Employment Incentive Payments and the Final Payment.

"Initial Payment" has the meaning set forth in Section 2.2(a)(i).

"Monthly Certificate" has the meaning set forth in Section 3.3.

"Monthly Employment Incentive Payment" has the meaning set forth in Section 2.2(a)(ii).

"NJEA Waiver and Release" has the meaning set forth in Section 4.1.

"Pro Rata Factor" has the meaning set forth in Section 3.2(b).

"PSEG" means Public Service Electric and Gas Company, a New Jersey corporation, and its successors and assigns.

"PSEG Amendment" means that Amendment to Gas Purchase and Sales Agreement between PSE&G and NJEA dated as of August 20, 2003, amending that Gas Purchase and Sales Agreement dated as of May 4, 1989.

"Required Levels" has the meaning set forth in Section 3.2(c).

"Restructuring Effective Date" shall mean the later of: the "Effective Date" under and as defined in the Amended and Restated Power Purchase Agreement and the "Effective Date" under and as defined in the PSEG Amendment.

"Second Component" means $188,679 per month.

"Termination Date" has the meaning set forth in Section 3.1.

"Utilities Agreement" means the Utilities Agreement dated as of June 16, 2000 by and between Green Tree and the Aqualon Company, a division of Hercules.

2. TERMINATION; CONDITIONS PRECEDENT.

2.1 Termination of Steam Contract.

Subject to the terms and conditions set forth below and provided that the Termination Date occurs on or prior to the Expiration Date, the Parties agree to terminate the Steam Contract as of 11:59 p.m. (Eastern time) on the Termination Date, and agree to execute and deliver on the Termination Date to each other a written acknowledgement of such termination. Effective as of 11:59 p.m. on the Termination Date, the Steam Contract shall be of no further force and effect and thereafter neither of the Parties shall have any rights or obligations thereunder, excepting only the obligation of Hercules to pay for steam delivered through and up to 11:59 p.m. on the Termination Date for which payment had not been received, which obligation shall survive the termination of the Steam Contract.

Section 2.2 Initial Payment; Monthly Employment Incentive Payments; Final Payment.

(a) In consideration for Hercules' agreement to terminate the Steam Contract, which termination shall be effective as of 11:59 p.m. on the Termination Date, and subject to the satisfaction or waiver of the conditions set forth in Section 2.5 or Section 2.6 hereof (as applicable), NJEA shall pay to Hercules in immediately available funds, by wire transfer as provided in Section 2.2(b) below, forty-nine payments, as follows:

(i) on the last business day of the month during which the Termination Date occurs, the Monthly Employment Incentive Payment, as prorated for a partial month if the Termination Date occurs on any date other than the last day of the month. Such payment as prorated shall equal the Monthly Employment Incentive Payment multiplied by a fraction, the numerator of which is the number of days in such month occurring on and after the Termination Date and the denominator of which is the total number of days in such month (the "Initial Payment"); and

(ii) on the last business day of each month beginning with the month following the Termination Month and continuing for forty-seven months, the sum of the First Component and the Second Component (together, the "Monthly Employment Incentive Payments"), subject to reduction or elimination of such amount pursuant to Section 3.2; and

(iii) on the last business day of the forty-eighth month following the Termination Month, an amount equal to the difference between the Monthly Employment Incentive Payment minus the Initial Payment (the "Final Payment").

(b) Wire Transfer Instructions. Wire transfer payments to Hercules shall be made as follows:

Mellon Bank N.A.
Pittsburgh, Pennsylvania
ABA # 043000261
Credit Hercules Incorporated
Acct # 124-3768

or to such other banking institution designated in writing by Hercules at least two Business Days prior to the Termination Date. Such funds shall be timely wired so as to be received and confirmed on or before the close of business on the Termination Date of the receiving banking institution designated by Hercules in accordance with the previous sentence.

2.3 Termination of this Agreement This Agreement shall be effective as of the Effective Date. If the Termination Date does not occur on or prior to December 15, 2003 (or such later date as extended by mutual written agreement of the Parties) (the "Expiration Date"), this Agreement shall terminate at 11:59 p.m. on the Expiration Date, and in the event of a termination of this Agreement pursuant to this Section 2.3, the Steam Contract shall continue unamended and unaffected by virtue of this Agreement.

2.4 Intentionally Omitted.

2.5 Conditions Precedent to Obligations of Hercules. Hercules' obligation to effect the transactions set forth herein is subject to the satisfaction at or before the Termination Date of the following conditions (any of which Hercules may waive at its option and in its sole discretion, and only in a writing signed by its duly authorized officer):

(a) Representations and Warranties. All of the representations and warranties of NJEA in Section 14 shall be true and correct in all material respects as though made on and as of the Termination Date, and NJEA shall have delivered a certificate, duly executed by an authorized officer, with respect to such representations and warranties. NJEA shall have performed, or caused to be performed, all of the agreements and covenants to be performed by it under this Agreement as of the Termination Date.

(b) No Legal Restraint. Neither Party shall be subject to any order, decree, injunction, or other legal restraint or prohibition of a court or agency of competent jurisdiction which enjoins, prohibits or materially interferes with the termination of the Steam Contract on the Termination Date.

(c) NJEA Waiver and Release. The NJEA Waiver and Release shall have been executed and delivered by NJEA and shall be in full force and effect.

(d) Termination Acknowledgement. NJEA shall have executed and delivered its termination acknowledgement contemplated in Section 2.1.

2.6 Conditions Precedent to Obligations of NJEA. NJEA's obligation to effect the transactions set forth herein is subject to the satisfaction at or before the Termination Date of the following conditions (any of which NJEA may waive):

(a) Hercules Stipulation; NJBPU Final Order. The Hercules Stipulation shall have been submitted on or before October 30, 2003, and the NJBPU shall have approved the Restructuring, including (without limitation) the Amended and Restated Power Purchase Agreement, pursuant to a non-appealable order in form and substance acceptable to NJEA (the "Final Order") on or before December 15, 2003. NJEA may terminate this Agreement (i) on November 1, 2003 if the Hercules Stipulation has not been filed prior to such date or (ii) on December 6, 2003 if the Final Order has not been issued prior to such date.

(b) Effectiveness of Restructured Agreements. In order to effectuate an orderly and simultaneous closing of all components of the Restructuring, it shall be a condition precedent to the closing under this Agreement that the "Effective Date" under each of the Amended and Restated Power Purchase Agreement and the PSEG Amendment shall have occurred, and each such agreement shall be in full force and effect.

(c) Representations and Warranties. All of the representations and warranties of Hercules in Section 13 shall be true and correct in all material respects as though made on and as of the Termination Date, and Hercules shall have delivered a certificate, duly executed by an authorized officer, with respect to such representations and warranties. Hercules shall have performed, or caused to be performed, all of the agreements and covenants to be performed by it under this Agreement as of the Termination Date.

(d) No Legal Restraint. Neither Party shall be subject to any order, decree, injunction, or other legal restraint or prohibition of a court or agency of competent jurisdiction which enjoins, prohibits or materially interferes with the termination of the Steam Contract on the Termination Date.

(e) Hercules Waiver and Release. Hercules shall have executed and delivered to NJEA the Hercules Waiver and Release.

(f) Termination Acknowledgement. Hercules shall have executed and delivered to NJEA the termination acknowledgement contemplated in Section 2.1.

3. NOTICE OF TERMINATION DATE; REDUCTION OR ELIMINATION OF MONTHLY EMPLOYMENT INCENTIVE PAYMENTS.

3.1 Termination Date.

As soon as reasonably practicable, NJEA shall deliver to Hercules a written notice containing the date on which NJEA anticipates that the Restructuring Effective Date will occur. The Restructuring Effective Date shall be the "Termination Date" under this Agreement. On the Termination Date, NJEA shall become obligated to pay the Initial Payment, Monthly Employment Incentive Payments, and the Final Payments as and to the extent due pursuant to Section 2.2.

3.2 Reduction or Elimination of Incentive Payments; JCP&L Default.

(a) Acknowledgement of Purpose of Incentive Payments. The Parties acknowledge that the primary purposes of NJEA's payment of the Incentive Payments is to promote the continuation of employment at the Hercules Facility and the Nitrocellulose Facility and to mitigate the increased costs of steam due to the Restructuring. The Parties further acknowledge that if either the Hercules Facility or the Nitrocellulose Facility ceases operation, the facility that remains in operation will incur additional costs as a result of lost operational efficiencies. Accordingly, if a Cessation of Operations occurs at either the Hercules Facility or the Nitrocellulose Facility, the Monthly Employment Incentive Payment will be reduced or eliminated as set forth in Section 3.2(b).

(b) Reduction or Elimination of Incentive Payments. The Incentive Payments may be reduced or eliminated as follows:

(i) If a Cessation of Operations occurs at the Hercules Facility, then the Second Component shall be reduced by 20% beginning on the last business day of the month during which the Cessation of Operations occurs; or

(ii) If a Cessation of Operations occurs at the Nitrocellulose Facility, the Second Component shall be reduced by 50% beginning on the last business day of the month during which the Cessation of Operations occurs; or

(iii) If a Cessation of Operations occurs at both Facilities, then the Monthly Employment Incentive Payment shall be eliminated effective immediately on the date or dates on which the Cessation of Operations occurs.

(c) Cure Period for Cessation of Operations. Hercules shall have a period of one hundred and eighty-three (183) days from the date of inception of the Cessation of Operations to cure or overcome the cause of a Cessation of Operations and reinstate employment levels or production and manufacturing levels so that a Cessation of Operations no longer exists (the "Required Levels"); provided, however, such 183-day period shall be extended day-for-day during the occurrence of an event of Force Majeure so long as the party affected is diligently seeking to remedy the effects of such Force Majeure, provided, further, that in no event shall such extension exceed 180 days (as the case may be, the "Cure Period"). During the Cure Period, NJEA shall have no obligation to make (i) partial Monthly Employment Incentive Payments with respect to the Facility that has experienced a Cessation of Operations (provided, NJEA shall continue to make paymen ts in respect of the Facility that has not experienced a Cessation of Operations, which reduced payments shall be calculated as set forth in Section 3.2(b)) or (ii) any Monthly Employment Incentive Payments at all if both Facilities have experienced a Cessation of Operations, as applicable. Payments that would have otherwise been payable hereunder during such period but for the Cessation of Operations at one or both Facilities shall be permanently and irrevocably forfeited by Hercules. If the Required Levels are re-attained within the Cure Period, then Hercules shall promptly so notify NJEA in writing with appropriate detail and supporting information (including the date on which the Required Levels were re-attained), and the Monthly Employment Incentive Payments (or portion thereof in the case of a reduction) shall be reinstated from that date forward, with the first such payment following the Cessation of Operations being prorated for any partial month.

(d) Failure to Cure. If the Required Levels at either or both of the Hercules Facility and/or the Nitrocellulose Facility are not re-attained within the Cure Period, Hercules shall promptly so notify NJEA in writing and the Cessation of Operations shall be considered permanent, and NJEA's obligation to make the Monthly Employment Incentive Payments hereunder shall be irrevocably reduced or eliminated as described in Section 3.2(b), as the case may be.

(e) JCP&L Failure to Provide for Payment of Second Component. The Second Component shall (i) in the event of a shortfall in any monthly payment from JCP&L under the Amended and Restated Power Purchase Agreement, be reduced by the product of the Second Component times the Pro Rata Factor, or (ii) be eliminated upon a termination of the Amended and Restated Power Purchase Agreement for any reason other than due to the occurrence and continuance of an Event of Default of NJEA; provided, however, there shall be no reduction or elimination of the Second Component hereunder to the extent that JCP&L fails to make payments to NJEA under the Amended and Restated Power Purchase Agreement due to an Event of Default of NJEA under such agreement; provided, further, that to the extent that NJEA later recovers all or a portion of any payment shortfalls from JCP&L, NJEA shall re-calculate the Pro Rata Factor for the applicable period and shall pay to Hercules an amount equal to the difference between the amount originally paid pursuant to Section 3.2(b)(i) above and the amount payable following such recalculation. "Pro Rata Factor" shall mean the fraction, the numerator of which is the shortfall in the amount paid by JCP&L under the Amended and Restated Power Purchase Agreement for the applicable period and the denominator of which is the amount properly invoiced by NJEA under such agreement for the applicable period.

3.3 Provision of Information by Hercules.

On the fifth day of each month (or if such day falls on a day other than a business day, on the business day immediately following) beginning on November 5, 2003, Hercules shall provide to NJEA a certificate of an authorized representative of Hercules substantially in the form set forth as Exhibit C hereto (the "Monthly Certificate"). If Hercules fails to deliver such certificate, NJEA shall have until the fifteenth day of such month (or if such day falls on a day other than a business day, on the business day immediately following) to deliver a written request to Hercules requesting delivery of such certificate. If Hercules fails to respond to NJEA's request by delivering such Monthly Certificate on or before the twenty-fifth day of such month (or if such day falls on a day other than a business day, on the business day immediately following), a Cessation of Operations with respect to both the Hercules Facility and the Nitrocellulose Facility shall be deemed to have occurred f or thirty consecutive days and NJEA shall have the right to withhold payment of the Monthly Employment Incentive Payment for such month and any subsequent month until a Monthly Certificate certifying that no Cessation of Operations has occurred has been delivered.

4. MUTUAL RELEASES AND GREEN TREE WAIVER.

4.1 On the Termination Date, NJEA shall execute and deliver to Hercules a waiver and release in the form attached hereto as Exhibit A (the "NJEA Waiver and Release").

4.2 On the Termination Date, Hercules shall execute and deliver to NJEA a release in the form attached hereto as Exhibit B. (the "Hercules Waiver and Release").

5. NOTICES.

Any notice from one Party to the other shall be given in writing and shall be deemed to be given (1) as of the date transmitted by facsimile and received in full prior to the close of normal business hours of the recipient, (2) the day after the date sent by overnight courier or other means of next day personal delivery, or (3) the date of delivery by hand. For the purposes of this Section 5, such notices shall be mailed to the following respective addresses or the following respective facsimile numbers or to such others as may be hereafter designated by either Party:

If to NJEA:

North Jersey Energy Associates, A Limited Partnership
c/o Northeast Energy, LP
FPL Energy, LLC
700 Universe Blvd.
P.O. Box 14000
Juno Beach, FL 33408
Attention: Nathan E. Hanson, Business Manager
Phone: 561-304-5121
Facsimile: 561-304-5161

If to Hercules:

Hercules Incorporated
Hercules Plaza
1313 North Market Street
Wilmington, DE 19894-0001
Attention: Chief Counsel, Aqualon Division
Tel.: (302) 594-7006
Fax: (302) 594-6676

6. FURTHER ASSURANCES.

At any time and from time to time, upon the reasonable request of a Party, the other Party shall promptly execute and deliver any and all further instruments and documents and take such further action as the requesting Party may reasonably request in order to fully perform and carry out the terms of this Agreement.

7. NON-WAIVER.

No failure by either Party or any of its agents to exercise, no course of dealing with respect to, and no delay in exercising, any right, power or remedy hereunder shall operate as a waiver thereof, and, in addition, no provision of this Agreement shall be considered waived by either Party except when such waiver is given in writing. The failure of either Party to insist in any one or more instances upon strict performance of any of the provisions of this Agreement or to take advantage of any of its rights hereunder shall not be construed as a waiver of any such provisions or the relinquishment of any such rights for the future, but the same shall continue and remain in full force and effect.

8. ASSIGNMENT OR TRANSFER OF INTEREST.

This Agreement shall be binding upon and inure to the benefit of the respective, representatives, successors and permitted assigns of the Parties hereto; provided, however, that neither Party may assign, sell, transfer or in any other way convey its or his rights, duties or obligations under this Agreement, either in whole or in part, without the prior written consent of the other Party (which consent shall not be unreasonably conditioned, withheld or delayed) and any such attempted assignment shall be void. Notwithstanding the foregoing, Hercules may assign its rights and obligations hereunder to an affiliate, or to any purchaser of the Hercules Facility or Nitrocellulose Facilities, provided such assignment shall not be effective until Hercules has provided to NJEA written notice of such assignment and the name, address, phone number and wire transfer instructions for its assignee and such assignee shall have assumed in writing the rights and obligations of Hercules hereunder. No assignment by Hercules of its rights and obligations under this Agreement shall relieve Hercules of any liability to NJEA accrued prior to the date of such assignment.

9. NO THIRD PARTY BENEFICIARIES.

The Parties do not intend to create rights in, or grant remedies to, any third party as a beneficiary of this Agreement or of any duty, covenant, obligation or understanding established under this Agreement.

10. EFFECT OF SECTION HEADINGS.

Section headings appearing in this Agreement are inserted for convenience only, and shall not be construed as interpretations of text.

11. GOVERNING LAW.

This Agreement shall be interpreted, governed and construed under the laws of the State of New Jersey (without giving effect to its conflict of laws provisions which could apply the law of another jurisdiction). All disputes arising between the Parties concerning the construction or enforcement of this Agreement that the Parties are unable to settle between themselves shall be submitted to a trial by judge. The Parties hereby waive any rights to a trial by jury. All proceedings shall be held in the State of New Jersey. The Parties hereby consent to jurisdiction in the State of New Jersey and agree that the State of New Jersey is a convenient venue for any proceedings between the Parties.

12. SEVERABILITY

If any term or provision of this Agreement or the interpretation or application of any term or provision to any prior circumstance is held to be unenforceable, illegal or invalid by a court or agency of competent jurisdiction, the remainder of this Agreement and the interpretation or application of all other terms or provisions other than those which are unenforceable, illegal or invalid shall not be affected thereby, and each term and provision shall be valid and be enforced to the fullest extent permitted by law.

13. REPRESENTATIONS AND WARRANTIES OF HERCULES.

Hercules makes no representations and warranties except as expressly stated herein. Hercules represents and warrants to NJEA as of the date hereof as follows:

(a) Hercules is a corporation duly organized, validly existing and in good standing under the laws of Delaware and is duly qualified to transact business and is in good standing in each jurisdiction where failure to so qualify would have a material adverse effect on the performance by Hercules of its obligations under this Agreement. Hercules has all requisite corporate power and authority to execute and deliver this Agreement and to consummate the transactions contemplated hereby. The execution and delivery of, and subject to the satisfaction of conditions precedent set forth in Section 2.5 hereof, the performance by Hercules of its obligations under this Agreement have been duly and validly authorized by all necessary corporate action of Hercules. This Agreement has been duly and validly executed and delivered by Hercules and constitutes its valid legal and binding obligation, enforceable against Hercules in accordance with its terms (except to the extent that enforcement may be limited by applicable bankruptcy, insolvency, moratorium, reorganization or similar laws from time to time in effect that affect creditors' rights generally and subject to the qualification that general equitable principles may limit the enforcement of certain remedies).

(b) The execution and delivery of this Agreement by Hercules, the fulfillment of and the compliance by Hercules with this Agreement, and, subject to the satisfaction of conditions precedent set forth in Section 2.5 hereof, the consummation by Hercules of the transactions described herein, do not and will not (i) violate or conflict with any provisions of Hercules' Articles of Incorporation, Bylaws, or any other governing documents, (ii) violate, conflict with or result in the breach or termination of any agreement or instrument to which Hercules is a party or is bound by and which could have an adverse effect on the consummation or performance or consummation and performance by Hercules of the transactions contemplated by this Agreement, or (iii) violate or conflict with any law, rule, ordinance, regulation, judgment, order, injunction, decree or award that applies to or binds Hercules or any of its assets.

(c) (i) Hercules has good, valid and marketable title to the Steam Contract and (ii) Hercules has not assigned or otherwise transferred to any third party any of its rights, duties, liabilities or obligations under this Agreement or the Steam Contract.

(d) There is no action, suit, claim, arbitration, proceeding, investigation or litigation pending against Hercules or, to the best of Hercules' knowledge, threatened against or involving Hercules, its property, the Steam Contract, or this Agreement or any of the transactions contemplated herein or therein, at law or in equity, before or by any court, arbitrator or governmental authority, which could have an adverse effect on the consummation and/or performance by Hercules of the transactions contemplated by this Agreement, including without limitation the termination of the Steam Contract. No governmental agency or authority has at any time given notice of intention to commence or, to the best of Hercules' knowledge, commenced any investigation relating to the legal right of Hercules to perform its obligations under this Agreement, which could have an adverse effect on the consummation and/or performance by Hercules of the transactions contemplated by this Agreement, including without limitation the termina tion of the Steam Contract.

(e) Prior to the date hereof, the Steam Contract has not been amended and is in full force and effect, and constitutes a valid and binding obligation of, and is legally enforceable in accordance with its terms against Hercules. Hercules has complied in all material respect with the Steam Contract and is not in default thereunder, and there has not occurred any event which (whether with or without notice, lapse of time or both) would constitute such a default under the Steam Contract by Hercules.

(f) Hercules has obtained all permits, licenses, approvals, consents and exemptions (collectively, "Approvals") required for Hercules to perform its obligations under this Agreement and to terminate the Steam Contract, required by applicable laws, statutes, rules and regulations in effect as of the date hereof, and (i) each such Approval was duly obtained, validly issued, and is in full force and effect and all applicable appeal periods with respect thereto have expired or the right to appeal by all parties entitled to appeal has been irrevocably waived, (ii) Hercules has complied with all material conditions stated in such Approvals which are required to have been complied with as of the date hereof and (iii) Hercules is not in default of any provision of such Approvals and no basis exists for invalidating, revoking or terminating any such Approval.

(g) No finder, broker or agent has been employed, appointed or authorized to act on Hercules' behalf in connection with the transactions contemplated by this Agreement.

14. REPRESENTATIONS AND WARRANTIES OF NJEA.

NJEA makes no representations and warranties except as expressly stated herein. NJEA represents and warrants to Hercules as of the date hereof as follows:

(a) NJEA is a limited partnership validly existing and in good standing under the laws of the State of New Jersey, and is duly qualified to transact business and is in good standing in each jurisdiction where failure to so qualify would have a material adverse effect on the performance by NJEA of its obligations under this Agreement. NJEA has all requisite limited partnership power and authority under its limited partnership agreement and other governing documents to execute and deliver this Agreement and to consummate the transactions contemplated hereby and thereby. The execution and delivery of, and, subject to the satisfaction of conditions precedent set forth in Section 2.6 hereof, the performance by NJEA of its obligations under this Agreement have been duly and validly authorized by all necessary limited partnership action of NJEA. This Agreement has been duly and validly executed and delivered by NJEA and constitutes its valid and binding obligation, enforceable against NJEA in accordance with its terms (except to the extent that enforcement may be limited by applicable bankruptcy, insolvency, moratorium, reorganization or similar laws from time to time in effect that affect creditors' rights generally and subject to the qualification that general equitable principles may limit the enforcement of certain remedies).

(b) The execution and delivery of this Agreement by NJEA, the fulfillment of and the compliance by NJEA with the respective terms and provisions of this Agreement, and, subject to the satisfaction of conditions precedent set forth in Section 2.6 hereof, the consummation by NJEA of the transactions described herein do not and will not (i) violate or conflict with any provisions of NJEA's limited partnership agreement or other governing documents, (ii) conflict with or result in the breach or termination of any agreement or instrument to which NJEA is a party or is bound by and which could have an adverse effect on the consummation or performance, or consummation and performance, by NJEA of the transactions contemplated by this Agreement, or (iii) violate or conflict with any law, rule, ordinance, regulation, judgment, order, injunction, decree or award that applies to or binds NJEA or any of its assets.

(c) NJEA has good, valid and marketable title to the Steam Contract and, except as otherwise contemplated in or permitted under the Steam Contract, NJEA has not assigned (except for collateral assignments made in connection with any financing or refinancing of the Facility) or otherwise transferred to any third party any of its rights, duties, liabilities or obligations under this Agreement or the Steam Contract.

(d) There is no action, suit, claim, arbitration, proceeding, investigation or litigation pending against NJEA or, to the best of NJEA's knowledge, threatened against or involving NJEA, its property, the Steam Contract, or this Agreement or any of the transactions contemplated herein or therein, at law or in equity, before or by any court, arbitrator or governmental authority, which could have an adverse effect on the consummation and/or performance by NJEA of the transactions contemplated by this Agreement, including without limitation the termination of the Steam Contract. No governmental agency or authority has at any time given notice of intention to commence or, to the best of NJEA's knowledge, commenced any investigation relating to the legal right of NJEA to perform its obligations under this Agreement, which could have an adverse effect on the consummation and/or performance by NJEA of the transactions contemplated by this Agreement, including without limitation the termination of the Steam Contract .

(e) Prior to the date hereof the Steam Contract has not been amended and is in full force and effect, and constitutes a valid and binding obligation of, and is legally enforceable in accordance with its terms against NJEA. NJEA has complied in all material respects with the Steam Contract and is not in default thereunder, and there has not occurred any event which (whether with or without notice, lapse of time or both) would constitute such a default under the Steam Contract by NJEA.

(f) No finder, broker or agent has been employed, appointed or authorized to act on NJEA's behalf in connection with the transactions contemplated by this Agreement.

(g) NJEA has obtained all Approvals required for NJEA to perform its obligations under this Agreement and to terminate the Steam Contract required by applicable laws, statutes, rules and regulations in effect as of the date hereof, and (i) each such Approval was duly obtained, validly issued, and is in full force and effect and all applicable appeal periods with respect thereto have expired or the right to appeal by all Parties entitled to appeal has been irrevocably waived, (ii) NJEA has complied with all material conditions stated in such Approvals which are required to have been complied with as of the date hereof and (iii) NJEA is not in default of any provision of such Approvals and no basis exists for invalidating, revoking or terminating any such Approval.

15. COUNTERPART EXECUTION.

This Agreement may be executed in counterpart, no one copy of which need be executed by both NJEA and Hercules. A valid and binding contract shall arise if and when counterpart execution pages are executed and delivered by NJEA and Hercules.

16. CONTRACT VALIDITY.

Neither Party shall initiate or assert in any regulatory, judicial, arbitral or administrative proceeding that (1) it has been damaged due to the termination of the Steam Contract as of the Termination Date or (2) it acted imprudently in its agreement to terminate the Steam Contract.

17. AMENDMENT.

This Agreement may be amended, modified or supplemented only by written agreement signed by both Parties.

18. CONFIDENTIALITY.

Hercules and NJEA each agree not to disclose to any Person and to keep confidential, and to cause and instruct its Affiliates, officers, directors, employees, members and representatives not to disclose to any Person and to keep confidential, any and all of the following information relating to this Agreement and the transactions contemplated hereby: the terms and provisions of this Agreement and all documents relating thereto, together with all drafts thereof and correspondence related thereto. Notwithstanding the foregoing, any such information may be disclosed: (A) in connection with approval of the Restructuring by the NJBPU and the submission by Hercules of the Hercules Stipulation, provided, however, that copies filed and available for public inspection shall be redacted as mutually agreed by the Parties to remove financial terms and information; (B) to the extent required by applicable laws and regulations or by any subpoena or similar legal process of any court or agency of federal, state o r local government so long as the disclosing party gives the non-disclosing party written notice at least ten (10) business days prior to such disclosure, if practicable and if not, then within such time as is reasonable under the circumstances, (C)  o any lenders or potential lenders to the parties hereto, but only if such disclosure requires them to keep confidential such information so disclosed to them, (D) to agents, trustees, advisors, rating agencies, independent consultants, and accountants of the parties hereto and to the lenders or potential lenders to the parties hereto, but only if such disclosure requires them to keep confidential such information so disclosed to them, and (E) to the extent the non-disclosing party shall have consented in writing prior to any such disclosure, which consent may be withheld for any reason. This Section 18 shall supersede any prior confidentiality agreement relating to the transactions between the parties hereto. Information (1) of a confid ential nature which has become public other than as a result of a breach of this Section 18, (2) which was known to the disclosing party prior to the commencement of negotiations relating to this Agreement, which the Parties stipulate and agree was September 16, 2003 or (3) which was received by the disclosing party from another source who in turn disclosed the information to the disclosing party without violating legal restrictions, shall not be subject to this Section 18. For purposes of this Section, "disclosing party" means the Party to this Agreement seeking to make a disclosure of confidential information and "non-disclosing party" means, with respect to that disclosure, the other party to this Agreement.

IN WITNESS WHEREOF, the undersigned have consented and caused this Agreement to be executed as of the date first indicated above.
	NORTH JERSEY ENERGY ASSOCIATES, A LIMITED PARTNERSHIP
	By:	Northeast Energy, LP Its General Partner
	By:	ESI Northeast Energy GP, Inc. Its Administrative General Partner
	By:	NATHAN E. HANSON
		Nathan E. Hanson Director
	HERCULES INCORPORATED
	By:	CRAIG A. ROGERSON
		Craig A. Rogerson Vice President & CEO

EXHIBIT A NJEA WAIVER AND RELEASE
WAIVER AND RELEASE
Reference is made to that certain Termination Agreement, dated as of October 21, 2003 (the "Termination Agreement"), by and between North Jersey Energy Associates, A Limited Partnership ("NJEA") and Hercules Incorporated ("Hercules"). Capitalized terms not defined herein shall have the meanings set forth in the Termination Agreement.
NJEA hereby on behalf of itself and any and all of its predecessors and successors in interest to the Steam Contract and the mutual rights and obligations thereunder or contemplated therein, and effective as of the date hereof, releases and forever discharges Hercules and any and all of their present, former and future directors, managers, officers, trustees, representatives, employees, attorneys, advisors, agents, stockholders, partners, members, affiliates, predecessors, legal representatives, successors and assigns from any and all claims, actions, complaints, causes of action, judgments, liabilities, obligations, damages, debts, demands or suits (collectively, "Claims"), at law or in equity, known or unknown, that NJEA ever had, now has or hereafter can, shall or may have against Hercules arising out of or in connection with the execution, performance or nonperformance of the Steam Contract. Without in any way limiting the generality of the foregoing, the Waiver and Release includes and applies to any Claims based on contractual, tort, fiduciary duty, or other theories, at law or in equity, known or unknown, that NJEA ever had, now has or hereafter can, shall or may have against Hercules arising out of or in connection with any business or activities of Hercules relating to the Steam Contract; provided, however, that nothing in this release shall release Hercules from its obligation to pay for steam delivered in accordance with the terms of the Steam Contract through 11:59 p.m. on the Termination Date but for which invoices have not been rendered and paid, or for which invoices have been rendered but payment not yet received.
IN WITNESS WHEREOF, NJEA has executed this Waiver and Release on this ___ day of ________ 2003.
	NORTH JERSEY ENERGY ASSOCIATES, A LIMITED PARTNERSHIP
	By:	Northeast Energy, LP, Its General Partner
	By:	ESI Northeast Energy GP, Inc. Its Administrative General Partner
	By:
		Name: Title:

EXHIBIT B HERCULES WAIVER AND RELEASE
WAIVER AND RELEASE
Reference is made to that certain Termination Agreement, dated as of October 21, 2003 (the "Termination Agreement"), by and between North Jersey Energy Associates, A Limited Partnership ("NJEA") and Hercules Incorporated ("Hercules"). Capitalized terms not defined herein shall have the meanings set forth in the Termination Agreement.
Hercules hereby on behalf of itself and any and all of its predecessors and successors in interest to the Steam Contract and the mutual rights and obligations thereunder or contemplated therein, and effective as of the date hereof, releases and forever discharges NJEA and any and all of its present, former and future directors, managers, officers, trustees, representatives, employees, attorneys, advisors, agents, stockholders, partners, members, affiliates, predecessors, legal representatives, successors and assigns from any and all claims, actions, complaints, causes of action, judgments, liabilities, obligations, damages, debts, demands or suits (collectively, "Claims"), at law or in equity, known or unknown, that Hercules ever had, now has or hereafter can, shall or may have against NJEA arising out of or in connection with the execution, performance or nonperformance of the Steam Contract . Without in any way limiting the generality of the foregoing, the Waiver and Release includes and applies to any Claims based on contractual, tort, fiduciary duty, or other theories, at law or in equity, known or unknown, that Hercules ever had, now has or hereafter can, shall or may have against NJEA arising out of or in connection with any business or activities of NJEA relating to the Steam Contract; provided, however, that nothing in this release shall release NJEA from its obligation to make the Incentive Payments as and to the extent payable pursuant to the Termination Agreement.
IN WITNESS WHEREOF, Hercules has executed this Waiver and Release on this ___ day of ________ 2003.
	HERCULES INCORPORATED
	By:
		Name: Title:

EXHIBIT C FORM OF MONTHLY CERTIFICATE
MONTHLY CERTIFICATE OF HERCULES INCORPORATED
North Jersey Energy Associates, A Limited Partnership c/o Northeast Energy, LP FPL Energy, LLC 700 Universe Blvd. P.O. Box 14000 Juno Beach, FL 33408 Attention: Nathan E. Hanson, Business Manager
Reference is made to that certain Termination Agreement, dated as of October 21, 2003 (the "Termination Agreement"), by and between North Jersey Energy Associates, A Limited Partnership ("NJEA") and Hercules Incorporated ("Hercules"). Capitalized terms not defined herein shall have the meanings set forth in the Termination Agreement.
I am an authorized representative of Hercules Incorporated and have the authority to deliver this certificate and am familiar with the operations at the Hercules Facility and the Nitrocellulose Facility. I hereby certify, that as of the date hereof:
1. The number of full-time employees employed at the Hercules Facility is _____. If the number reported above is less than 40, state the date on which the number of employees at the Hercules Facility dropped below 40: ______________, 200_.
2. The number of full-time employees employed at the Nitrocellulose Facility is _____. If the number reported above is less than one hundred (100) during calendar years 2004 and 2005, ninety (90) during calendar year 2006, or eighty (80) during calendar year 2007 or any year thereafter (if applicable), state the date on which the number of employees at the Nitrocellulose Facility dropped below the required level for such year: ______________, 200_.
3. A cessation of substantially all of the manufacturing and production operations [HAS] [HAS NOT] (select one) occurred at the Hercules Facility. If so, state the date on which such cessation occurred: _______________, 2003.
4. A cessation of substantially all of the manufacturing and production operations [HAS] [HAS NOT] (select one) occurred at the Nitrocellulose Facility. If so, state the date on which such cessation occurred: _______________, 2003.
IN WITNESS WHEREOF, Hercules has executed this Monthly Certificate on this ___ day of ________ 2003.
	HERCULES INCORPORATED
	By:
		Name: Title:

EX-10

Exhibit 10(b)
LETTER AGREEMENT BETWEEN PUBLIC SERVICE ELECTRIC AND GAS COMPANY AND NORTH JERSEY ENERGY ASSOCIATES
This Letter Agreement (the "Letter Agreement") is entered into this 9th day of October, 2003 by and between Public Service Electric and Gas Company ("PSE&G) and North Jersey Energy Associates, A Limited Partnership ("NJEA"), collectively referred to herein as the "Parties".
WITNESSETH
WHEREAS, the Parties have entered into a Gas Purchase and Sales Agreement dated May 4, 1989, as amended through the Effective Date (the "Agreement"); and
WHEREAS, the Parties have entered into an Amendment to Gas Purchase and Sales Agreement dated August 20, 2003 (the "Amendment); and
WHEREAS, NJEA and PSEG Energy Trade & Resources LLC ("ER&T") have entered into that certain Capacity Transfer Agreement providing for the permanent release, assignment or other transfer of NJEA's rights and obligations under the transportation and storage contracts described therein (the "Capacity Transfer Agreement"); and
WHEREAS, in anticipation of the effectiveness of the Amendment and the Capacity Transfer Agreement, the Parties desire to enter into this Letter Agreement to provide for a peaking service to PSE&G as described herein; and
NOW, THEREFORE, in consideration of the mutual covenants and agreements contained herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereby agree as follows:
Section 1. Effective Date.
Section 1.1. This Letter Agreement shall become effective simultaneously with the Amendment on the "Effective Date" thereunder (the "Effective Date"); provided that if the Effective Date has not occurred by December 15, 2003, either Party may at its option notify the other Party of its election to terminate this Letter Agreement and upon receipt of such notice, this Letter Agreement shall be terminated.
Section 2. Peaking Service
Section 2.1. For the period (the "Peak Period") commencing on the Effective Date and ending on the earlier of (a) February 29, 2004 or (b) the date upon which the last of the Capacity Entitlement Agreements described in Sections 1.1(c), 1.1(d), and 1.2 of the Capacity Transfer Agreement is transferred to ER&T in accordance with the terms therein, NJEA shall provide PSE&G with the right to call upon a volume of gas equal to 10,508 Dth/day (the "Call Volume") on any Gas Day (as defined in the Agreement) during the Peak Period that the Mean Daily Temperature Forecast for Newark, New Jersey is 14 degrees Fahrenheit or less ("Call Day"). If PSE&G desires to utilize the foregoing service (hereinafter referred to as the "Peaking Service") on any Call Day, then PSE&G shall provide NJEA with irrevocable notice to that effect (the "Notice") by 9 am (Eastern Prevailing Time) on the Business Day immediately preceding the Call Day. Each Notice shall include documentation verifying that the Mean Daily Temperature Forecast for Newark, New Jersey (issued within twenty four hours of the Notice and based on the then most current readings and data) for such Call Day is 14 degrees Fahrenheit or less. Upon receipt of the Notice (together with the required supporting documentation), NJEA shall deliver to PSE&G's gate stations on the Transcontinental Gas Pipe Line Corporation pipeline or the Texas Eastern Transmission Corporation pipeline, at NJEA's election, and sell to PSE&G, and PSE&G shall purchase from NJEA, the Call Volume specified in the Notice; provided, however, that NJEA shall have no obligation to deliver the Call Volume if NJEA previously provided the Call Volume to PSE&G (1) on any three days during the calendar month in which the Notice is provided (or in the case of any partial calendar month consisting of (A) one through ten days, any one day, (B) eleven through twenty days, any two days and (C) twenty one through 30 days, any three days) or (2) on any nine days during the Peak Pe riod. For purposes of this Section 2.1, (i) "Mean Daily Temperature Forecast" means the mean temperature at Newark International Airport as projected by Weather Services Corporation or such other weather service as may be retained by PSE&G and (ii) "Business Day" means any day other than a Saturday, a Sunday or a day on which commercial banks in New Jersey are required or authorized to be closed.
Section 2.2. NJEA shall invoice PSE&G for an amount equal to the sum of all Call Day Amounts for each calendar month during which the Peaking Service has been utilized pursuant to Section 2.1, and PSE&G shall pay such invoice, each in accordance with Sections 9.1.3, 9.1.4, 9.2, 9.4 and 9.5 of the Agreement. The "Call Day Amount" for any Call Day shall be an amount equal to (a) the Call Volume delivered and sold to PSE&G on such Call Day multiplied by (b) the applicable Gas Daily Price for such Call Day. For purposes of this Section 2.2, "Gas Daily Price" shall mean the arithmetic average of (1) the daily "Midpoint" gas prices published by Platts in The Gas Daily Price Guide, "Daily Price Survey" under "City Gates", "Texas Eastern, zone M-3" on the applicable Call Day and (2) the daily "Midpoint" gas prices published by Platts in The Gas Daily Price Guide "Daily Price Survey" under "City Gates", "Transco, zone 6 N.Y." on the applicable Call Day.
Section 2.3. In the event NJEA fails to deliver any of the Call Volume that it is obligated to deliver hereunder (such undelivered Call Volume hereinafter referred to as the "Call Volume Shortfall"), then PSE&G shall invoice NJEA for the associated Cover Damages in accordance with Sections 9.1.3, 9.1.4, 9.2, 9.4 and 9.5 of the Agreement. "Cover Damages" for any Call Volume Shortfall means an amount equal to the positive difference, if any, between (a) the Replacement Price ($/Dth) multiplied by the Call Volume Shortfall (in Dth), minus (b) the amount that PSE&G would have paid pursuant to Section 2.2 had the Call Volume Shortfall been delivered. For purposes of this Section 2.3, (1) if PSE&G purchases replacement gas in the amount of the Call Volume Shortfall ("the Replacement Call Volume"), then the "Replacement Price" means the price ($/Dth) at which PSE&G, acting in a commercially reasonable manner, purchases the Replacement Call Volume, plus transaction and other administra tive costs reasonably incurred by PSE&G in purchasing such Replacement Call Volume and (2) if PSE&G does not purchase Replacement Call Volume for any reason, then the "Replacement Price" means the daily "Midpoint" gas prices published by Platts in The Gas Daily Price Guide "Daily Price Survey" under "City Gates", "Transco, zone 6 N.Y." on the applicable Call Day. The damages provided in this Section 2.3 shall be the sole and exclusive remedy of PSE&G for any Call Volume Shortfall. The monthly invoice for Cover Damages with respect to a Call Volume Shortfall shall include a written statement detailing the volume, source and Replacement Price of all Replacement Call Volume.
IN WITNESS WHEREOF, the Parties have caused this Letter Agreement to be executed by their duly authorized officers or agents, as applicable, as of the day and year first written above.
	Public Service Electric And Gas Company
	By:	FREDERICK W. LARK
		Name: Frederick W. Lark Title: Vice President - Business Analysis
	North Jersey Energy Associates, A Limited Partnership
	By:	Northeast Energy, LP, its general partner
	By:	ESI Northeast Energy GP, Inc., Its administrative general partner
	By:	NATHAN E. HANSON
		Nathan E. Hanson Director

EX-10

Exhibit 10(c)

POWER PURCHASE AGREEMENT




dated as of

January 1, 2004


By and Between


NORTH JERSEY ENERGY ASSOCIATES, A LIMITED PARTNERSHIP


and


TRACTEBEL ENERGY MARKETING, INC.

POWER PURCHASE AGREEMENT
THIS POWER PURCHASE AGREEMENT (the "Agreement") is entered into as of January 1, 2004, by and between North Jersey Energy Associates, A Limited Partnership, a New Jersey limited partnership ("NJEA"), and Tractebel Energy Marketing, Inc, a Delaware corporation ("TEMI"). NJEA and TEMI are individually referred to herein as a "Party" and are collectively referred to herein as the "Parties".
RECITALS
WHEREAS, NJEA owns a nominal 300 MW natural gas-fired electricity and steam generating plant located in the borough of Sayreville, New Jersey (the "Facility").
WHEREAS, Jersey Central Power & Light Company ("JCP&L") and NJEA are parties to a Power Purchase Agreement dated as of October 22, 1987, as amended to date (the "Existing PPA"), pursuant to which JCP&L purchases from NJEA contract capacity of not less than 250 MW and the associated electricity of the Facility.
WHEREAS, NJEA and JCP&L have entered into an Amended and Restated Power Purchase Agreement dated May 16, 2003, as amended to date (collectively, the "Amended PPA") that amends and restates the Existing PPA and provides NJEA with the option of supplying Contract Energy from sources other than the Facility.
WHEREAS, in connection with the effectiveness of the Amended PPA, NJEA and TEMI desire to enter into this Agreement in order to provide NJEA with the right to purchase from TEMI fifty percent (50%) of NJEA's remaining delivery obligations to JCP&L during Off-Peak Hours under the Amended PPA after accounting for Facility dispatch, up to the Maximum Nomination Quantity.
WHEREAS, in connection with the effectiveness of the Amended PPA and this Agreement, NJEA and FPL Energy Power Marketing, Inc. ("PMI") are entering into an agreement (the "PMI PPA") on substantially similar terms and conditions as this Agreement in order to provide NJEA with the right to purchase from PMI the other fifty percent (50%) of NJEA's remaining delivery obligations to JCP&L during Off-Peak Hours under the Amended PPA after accounting for Facility dispatch, up to the Maximum Nomination Quantity.
NOW, THEREFORE, in consideration of the premises and of the mutual agreements contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereby agree as follows:
1. DEFINITIONS
1.1 Defined Terms.
Capitalized terms used in this Agreement that are not defined herein shall have the respective meanings given in Amended PPA. In addition to terms defined elsewhere in this Agreement, the following terms are defined as follows:
"Alternate Delivery Point" means (i) any nodal point included within the JCP&L Zone, (ii) the JCP&L Zone or (iii) any other delivery point mutually agreed to by the Parties. In the event PJM or its successor no longer recognizes a nodal point that was part of the JCP&L Zone on the date of execution of this Agreement, such nodal point shall be an Alternate Delivery Point for purpose of this Agreement notwithstanding its subsequent exclusion from the nodal points included in the JCP&L Zone by PJM.
"Ancillary Termination Damages" shall mean penalties assessed by PJM against the terminating Party (and/or JCP&L, in the case of NJEA as the Terminating Party) and all reasonable fees and expenses incurred by the terminating Party in connection with the termination of this Agreement pursuant to Section 5.2 hereof.
"Contract Rate" means $28.00/MWh.
"Energy" means firm electricity having the characteristics described in Section 3.2 of the Amended PPA.
"Nomination Quantity" means the quantity of Energy specified in the Call Notice, which amount shall equal fifty percent (50%) of (i) the maximum amount of Energy (in MWs per hour expressed as a whole number) that NJEA is permitted to deliver to JCP&L under the Amended PPA during Off-Peak Hours occurring during such day less (ii) the amount of electricity (in MWs per hour expressed as a whole number) that the Facility is expected to generate for sale to JCP&L under the Amended PPA during Off-Peak Hours occurring during such day.
"Maximum Nomination Quantity" means (i) 125 MWs per Off-Peak Hour for the months of December through March and June through September and (ii) 100 MWs per Off-Peak Hour for the months of April, May, October and November.
"Replacement Period" shall mean the period beginning on the date this Agreement is terminated pursuant to Section 5.2 hereof and ending at 11:59 p.m. August 13, 2011.
"Replacement Power" means electricity purchased by NJEA as replacement for any Delivery Shortfall. Replacement Power shall not include Energy delivered to NJEA on behalf of TEMI pursuant to Section 3.1(a).
"Replacement Price" means the lesser of (A) the price at which NJEA (or any other Person acting on its behalf), acting in a commercially reasonable manner, purchases Replacement Power, plus (i) transaction and other administrative costs reasonably incurred by NJEA (or any other Person acting on its behalf) in purchasing such Replacement Power and (ii) additional transmission charges, if any, reasonably incurred by NJEA (or any other Person acting on its behalf) to transmit Replacement Power to the Delivery Point, or (B) the LMP at the Delivery Point for such Replacement Power; provided, however, that in no event shall such price include any penalties, ratcheted demand or similar charges, nor shall NJEA be required to utilize or change its utilization of its owned or controlled assets or market positions to minimize TEMI's liability.
"Resale Price" shall mean, without duplication, (i) the price at which TEMI, acting in a commercially reasonable manner, sells or is paid for Rejected Power, plus (ii) transaction and other administrative costs reasonably incurred by TEMI in re-selling such Rejected Power; provided, however, that in no event shall TEMI be required to utilize or change its utilization of its other assets or market positions in order to minimize NJEA's liability for Rejected Power.
1.2 Rules of Interpretation.
In this Agreement, unless a clear contrary intention appears:
(i) the singular number includes the plural number and vice versa;
(ii) reference to any Person includes such Person's successors and assigns but, if applicable, only if such successors and assigns are permitted by this Agreement, and reference to a Person in a particular capacity excludes such Person in any other capacity or individually;
(iii) reference to any gender includes the other gender;
(iv) reference to any agreement, document or instrument means such agreement, document or instrument as amended or modified and in effect from time to time in accordance with the terms thereof; and
(v) in connection with capitalized terms hereunder that are defined in the Amended PPA, where appropriate, references to JCP&L as the purchaser of Contract Energy under the Amended PPA shall mean NJEA as the purchaser of Energy under this Agreement and references to NJEA as the Seller of Contract Energy under the Amended PPA shall mean TEMI as the Seller of Energy under this Agreement.
2. TERM; TERMINATION
2.1 Term.
This Agreement shall become effective on the "Partial Termination Date" under the Partial Termination Agreement dated as of July 11, 2003, between NJEA and ProGas Limited (the "Effective Date") and shall continue in full force and effect until the date and time of the termination of the Amended PPA, unless this Agreement is terminated sooner pursuant to Section 2.2. The period during which this Agreement is in effect is herein referred to as the "Term".
2.2 Termination.
NJEA may terminate this Agreement without cause and for convenience upon five (5) Business Days' notice to TEMI, if NJEA determines (in its sole discretion) that it is in its own best interests to so terminate the Agreement. NJEA shall incur no additional liability to TEMI as a result of its termination of this Agreement pursuant to this Section 2.2; provided, however, that unless NJEA is exercising its termination right pursuant to this Section 2.2 as a result of performance deficiencies by TEMI, NJEA shall not exercise its termination right pursuant to this Section 2.2 unless it simultaneously exercises its right to terminate the PMI PPA pursuant to Section 2.2 of the PMI PPA.
2.3 Effect of Termination.
Upon the expiration of this Agreement in accordance with its terms, the Parties shall no longer be bound by the terms and provisions hereof, except (i) to the extent necessary to provide invoices and make payments with respect to deliveries and purchases hereunder prior to such termination or expiration, (ii) to the extent necessary to enforce the rights and the obligations of the Parties arising under this Agreement before such termination or expiration and (iii) the obligations of the Parties hereunder with respect to confidentiality and indemnification, which shall survive the expiration or termination of this Agreement and shall continue for a period of two (2) calendar years following such expiration or termination.
3. RIGHTS AND OBLIGATIONS OF PARTIES
3.1 Obligation to Purchase and Sell Energy.
(a) TEMI shall deliver and sell, and NJEA shall receive and purchase, the Nomination Quantity for such day specified in the Call Notice, as adjusted pursuant to Section 3.3(c), but in no event more than the Maximum Nomination Quantity, all in accordance with the terms of this Agreement. Notwithstanding the foregoing, TEMI shall deliver and sell and NJEA shall receive and purchase the Maximum Nomination Quantity on the Effective Date without delivery of a Call Notice to TEMI. Energy delivered to NJEA hereunder by TEMI or on behalf of TEMI by TEMI's suppliers, designees or any other Person (including, without limitation, PJM) shall be deemed delivered by TEMI hereunder and TEMI shall be solely responsible for any costs payable to its suppliers for such delivery.
(b) In order to satisfy NJEA's delivery obligations to JCP&L during Off-Peak Hours under the Amended PPA, NJEA shall first purchase NJEA's electricity requirements ratably from (i) TEMI pursuant to this Agreement and (ii) PMI pursuant to the PMI PPA. NJEA may also purchase electricity from third parties during Off-Peak Hours (1) to obtain Replacement Power, (2) to the extent that NJEA's requirements for electricity exceed the Maximum Nomination Quantity and (3) to the extent that TEMI or PMI, as applicable, is unable to increase its deliveries to NJEA in connection with an intra-day amendment delivered pursuant to Section 3.3(c) below or Section 3.3(c) of the PMI PPA, respectively.
(c) If deliveries of electricity from NJEA, or on behalf of NJEA under the Amended PPA, are curtailed for any reason, NJEA shall have the right to curtail deliveries of Energy hereunder, provided that deliveries of Energy hereunder and deliveries of "Energy" from PMI under the PMI PPA shall be curtailed ratably, and such curtailment (hereunder and under the PMI PPA) shall not occur until all other deliveries of electricity (except for deliveries from the Facility) to NJEA have been curtailed.
(d) NJEA will not treat TEMI less favorably hereunder than it does PMI under the PMI PPA. NJEA shall not deliver an intra-day amendment pursuant to Section 3.3(c) that (i) increases the Nomination Quantity provided in the Call Notice for such day unless it also delivers an intra-day amendment to PMI pursuant to Section 3.3(c) of the PMI PPA that increases the Nomination Quantity provided in the Call Notice to PMI for such day by an equal amount or (ii) decreases the Nomination Quantity provided in the Call Notice for such day unless it also delivers an intra-day amendment to PMI pursuant to Section 3.3(c) of the PMI PPA that decreases the Nomination Quantity provided in the Call Notice to PMI for such day by an equal amount. If PMI is unable to increase its deliveries of Energy by the amount requested in an intra-day amendment delivered pursuant to Section 3.3(c) of the PMI PPA despite its commercially reasonable efforts, then NJEA may increase its Nomina tion Quantity to TEMI for such day pursuant to Section 3.3(c) by an amount equal to the requested increase in the intra-day amendment provided to PMI that PMI is unable to deliver. Notwithstanding any provision contained herein to the contrary, in order to accommodate the need to express Energy amounts in whole numbers, the Nomination Quantity provided to TEMI hereunder for any day and the Nomination Quantity provided to PMI under the PMI PPA for such day may vary by 1 MW. To the extent any such variations occur, NJEA shall use good faith efforts to provide equal Nomination Quantities from each of TEMI and PMI for each month during the Term.
3.2 Delivery Parameters.
(a) Subject to Section 3.2(b), all Energy sold or delivered under this Agreement by TEMI to NJEA will be delivered to the Facility Bus.
(b) If TEMI is unable to deliver Energy to the Facility Bus in accordance with Section 3.2(a) due to the unavailability of transmission service or transmission service interruptions or due to an event of force majeure that prevents its supplier from delivering electricity to the Facility Bus, then NJEA shall use reasonable efforts to cause JCP&L to accept delivery of Energy at an Alternate Delivery Point provided that NJEA shall not be in default hereunder or incur any liability to TEMI if JCP&L does not accept or agree to the use of any proposed delivery location as an Alternate Delivery Point. Provided that JCP&L consent has been obtained pursuant to this Section 3.2(b), TEMI may deliver Energy to one or more Alternate Delivery Points for so long as one or more of the conditions described above in this Section 3.2(b) continues and for so long as JCP&L's consent to the use of the Alternate Delivery Point remains in effect; provided that TEMI shall reimbur se NJEA all costs and expenses (including any costs and expenses owed by NJEA to JCP&L under the Amended PPA) arising in connection with the use of such Alternate Delivery Point. TEMI shall use commercially reasonable efforts to provide NJEA with reasonable prior and/or contemporaneous notice of the expected duration of the conditions described above.
(c) TEMI shall be responsible for all transmission charges, including, if any, applicable ancillary service charges, line losses, congestion charges and other PJM or applicable system costs or charges associated with transmission incurred, in each case, in connection with the delivery of Energy to the Facility Bus or to any Alternate Delivery Point.
(d) TEMI shall not be responsible for any transmission charges, ancillary services charges, line losses, congestion charges and other PJM or applicable system costs or charges associated with transmission, incurred, in each case, in connection with the transmission of Energy delivered under this Agreement by or on behalf of TEMI to JCP&L on behalf of NJEA from and after the delivery of such Energy to the Facility Bus or an Alternate Delivery Point (as the case may be) and the acceptance thereof by JCP&L, to any other location.
(e) Deliveries of Energy by TEMI hereunder on any delivery day shall be at a constant hourly rate during Off-Peak Hours occurring during such day.
3.3 Schedules; Bidding; Metering; Operations and Interconnection.
(a) (i) TEMI shall schedule and bid deliveries of Energy delivered hereunder with PJM in accordance with all PJM requirements applicable thereto. NJEA or its agent shall cooperate with TEMI in connection with any such scheduling and bidding and shall promptly provide telemetering data and other information reasonably requested by TEMI for the purpose of assisting TEMI with its scheduling and bidding obligations hereunder. In accordance with current PJM scheduling requirements, TEMI shall submit all final schedules for Energy via the PJM eSchedule system and NJEA or its agent shall confirm all such schedules, in each case, before the PJM deadline applicable thereto.
(ii) TEMI shall schedule Energy deliveries and designate the Facility Bus as the delivery point unless TEMI has requested an Alternate Delivery Point in accordance with Section 3.2(b).
(b) The Parties agree to use commercially reasonable efforts to comply with all applicable PJM Practices in connection with the scheduling and delivery of Energy hereunder.
(c) Except with respect to the delivery of the Maximum Nomination Quantity on the Effective Date in accordance with Section 3.1(a), NJEA shall provide TEMI with a written notice (the "Call Notice") of its intent to call upon and purchase Energy no later than 10 a.m. (Eastern Prevailing Time) on the Business Day before delivery (or such other time as mutually agreed upon by the Parties) and shall specify the Nomination Quantity (which amount shall not exceed the Maximum Nomination Quantity) therein. Each Call Notice may designate deliveries of Nomination Quantities for a period of up to seven (7) days. The Nomination Quantities contained in each Call Notice shall equal the Nomination Quantities contained in the Call Notice delivered to PMI for such period under the PMI PPA. NJEA may alter its Nomination Quantities up until 10 a.m. (Eastern Prevailing Time) on the day before such delivery (or such other time as mutually agreed upon by the Parties) provided that it makes the same alterations to its Nomination Quantities to PMI under the PMI PPA. Notwithstanding the delivery of a final Call Notice pursuant to the preceding sentence, if, on any day, NJEA is operating the Facility to generate more or less electricity than contemplated in the Call Notice, then, subject to Section 3.1(d), NJEA may make intra-day amendments to the Call Notice and (i) if such intra-day amendment decreases the Nomination Quantity provided in the Call Notice, then TEMI shall decrease its deliveries accordingly and NJEA shall not be obligated to purchase Energy in excess of the revised Nomination Quantity set forth in such intra-day amendment and (ii) if such intra-day amendment increases the Nomination Quantity provided in the Call Notice, then TEMI shall use commercially reasonable efforts to increase its deliveries hereunder accordingly.
3.4 Title to Energy; Sales for Resale
(a) All Energy delivered hereunder by TEMI or on behalf of TEMI by TEMI's suppliers, designees or any other Person (including, without limitation, PJM) shall be deliveries to NJEA for immediate redelivery to JCP&L, which redelivery may be made by NJEA at any Delivery Point or Alternate Delivery Point under the Amended PPA.
(b) All Energy delivered hereunder by TEMI or by any other Person on its behalf shall be sales for resale, with NJEA immediately reselling such Energy. NJEA shall provide TEMI with any certificates reasonably requested by TEMI to evidence that the deliveries of Energy hereunder are sales for resale, including without limitation evidence that NJEA or its agent is authorized by FERC to engage in wholesale power sales.
3.5 Failure of TEMI to Deliver Scheduled Energy; Cover Damages.
(a) In the event TEMI fails to deliver Energy it is obligated to deliver hereunder and such failure is not excused under the terms of this Agreement (such undelivered Energy to be referred to herein as the "Delivery Shortfall"), then TEMI shall pay NJEA, on the date payment would otherwise be due in respect of the month in which the failure occurred, an amount for such deficiency equal to the Cover Damages. "Cover Damages" means an amount equal to (A) the positive difference, if any, between (i) the Replacement Price ($/MWh) multiplied by the quantity (in MWh) of the Delivery Shortfall, minus (ii) the Contract Rate ($/MWh) multiplied by the quantity (in MWh) of the Delivery Shortfall, plus (B) any applicable penalties assessed by PJM against NJEA and/or JCP&L as a direct result of TEMI's failure to deliver such Energy. Except as otherwise provided in Section 5.2, the damages provided in this Section 3.5 shall be the sole and exclusi ve remedy of NJEA for any failure of TEMI to deliver Energy that it is obligated to deliver hereunder.
(b) All Cover Damages payable by TEMI pursuant to this Section 3.5 shall be paid by netting such amounts against amounts otherwise payable by NJEA to TEMI hereunder. Each Party reserves to itself all rights, counterclaims and, except as provided in Sections 3.5(a) and 3.6(a), other remedies and defenses consistent with this Agreement which such Party has or may be entitled to arising from or out of this Agreement.
3.6 Failure to Accept Delivery of Schedule Energy; Resale Damages
If NJEA fails to accept all or part of the Energy delivered to it by TEMI pursuant to and in accordance with this Agreement, and such failure to accept is not excused under the terms of this Agreement (such Energy is referred to herein as "Rejected Power"), then NJEA shall pay TEMI, on the date payment would otherwise be due in respect of the month in which the failure occurred, an amount for such deficiency equal to the Resale Damages. "Resale Damages" means an amount equal to (i) the positive difference, if any, between (x) the Contract Rate ($/MWh) multiplied by the quantity (in MWh) of Rejected Power, minus (y) the Resale Price ($/MWh) multiplied by the quantity (in MWh) of Rejected Power resold by TEMI, plus (ii) any applicable penalties assessed by PJM against TEMI as a direct result of NJEA failure to accept such Energy. Except as otherwise provided in Section 5.2, the damages provided in this Section 3.6 shall be the sole and exc lusive remedy of TEMI for any failure of NJEA to accept delivery of Energy tendered to it by TEMI pursuant to and in accordance with this Agreement.
3.7 Payment for Energy.
(a) All Energy delivered by TEMI pursuant to and in accordance with this Agreement shall be purchased by NJEA at the Contract Rate. Beginning on the Effective Date and continuing for the Term, NJEA shall pay TEMI a monthly payment for Energy delivered during such month in an amount equal to (1) the product of the total Energy (in MWh) delivered by TEMI pursuant to and in accordance with this Agreement during such month multiplied by the per-MWh Contract Rate for each MWh of such delivered Energy, plus (2) any applicable Resale Damages for such month, less (3) any applicable Cover Damages for such month, plus or minus (4) any applicable costs and expenses for deliveries to an Alternate Delivery Point during such month pursuant to Section 3.2(b), plus or minus (5) any PJM Reconciliation Amount for such month.
(b) For each month during the Term, NJEA shall prepare and present to TEMI, on or before the twenty fifth (25th) day of the subsequent month, a statement (in $/kWh) for Energy delivered to NJEA during such month in accordance with Section 3. Such statement shall indicate (1) the total MWhs of Energy delivered or supplied by TEMI pursuant to and in accordance with this Agreement during the month and the calculation of the payment due pursuant to Section 3.7(a), (2) any costs and expenses in connection with deliveries to an Alternate Delivery Point during the month pursuant to Section 3.2(b) and (3) the PJM Reconciliation Amount.
3.8 Payment and Disputes; Reconciliation with PJM.
(a) Unless otherwise agreed by the Parties, payment of amounts reflected in a statement rendered pursuant to Section 3.7(b) hereof shall be due and payable on or before the second Business Day after the last Business Day of the month in which the statement is delivered to TEMI. Payments shall be made by wire transfer to an account designated by TEMI in a notice delivered to NJEA, or in the case of a payment due to NJEA, to an account designated by NJEA in the statement or in a written notice delivered to TEMI.
(b) In the event TEMI disputes all or any part of a statement delivered to it pursuant to Section 3.7(b), TEMI shall notify NJEA of the basis for the dispute in writing, accompanied by supporting documentation, within a twenty (20) day period from receipt of such statement. Upon receipt of notice of the dispute and supporting documentation, NJEA shall have thirty (30) days from receipt of such notice to resolve any dispute with TEMI. In the event the dispute is not resolved within the thirty (30) day period, either Party may submit the matter to arbitration for resolution in accordance with this Agreement; provided, however, that TEMI agrees that at the request of NJEA, TEMI shall participate with or reasonably assist NJEA in the conduct of dispute resolution proceedings against JCP&L under the Amended PPA as and to the extent the same facts or occurrences are the basis of the disputes under both this Agreement and the Amended PPA. In the event of any dispute regarding a statement, the undis puted portion thereof shall be paid when due as if there were no dispute, and the disputed portion shall not be due until the dispute is resolved in favor of the Party claiming entitlement to payment. The disputed amount of any statement shall accrue interest at the Late Payment Rate from the date payment of such amount would have been due absent the dispute with respect to such amount until the date payment is made.
(c) In the event that PJM billing and reconciliation statements issued pursuant to the PJM Agreement contain information relating to deliveries of Energy hereunder that differ from the information for the same period contained in statements generated by NJEA pursuant to Section 3.7(b), then the dollar amount of such difference (the "PJM Reconciliation Amount") shall be added to or subtracted from (as appropriate) the payment calculated pursuant to Section 3.7(a) for the next billing month. Upon request by TEMI, NJEA shall promptly provide to TEMI any PJM reconciliation statements, notices, invoices, and other records as are reasonably necessary to provide written substantiation of the quantities, prices, calculations and other pertinent data used by NJEA in rendering the monthly statements pursuant to Section 3.7(b) hereof.
3.9 Interest on Late Payment.
If a payment is not received when due under this Agreement, the delinquent Party shall pay to the other Party interest on such unpaid amount which shall accrue from the due date until the date upon which payment in full is made at the prime lending rate as may from time to time be published in The Wall Street Journal under "Money Rates" on such day (or if not published on such day on the most recent preceding day on which published), plus two percent (2%) (the "Late Payment Rate").
4 REPRESENTATIONS AND WARRANTIES
4.1 Representations and Warranties of TEMI.
TEMI hereby represents and warrants to NJEA as of the Effective Date as follows:
(a) Organization and Good Standing; Power and Authority. TEMI is a corporation, validly existing and in good standing under the laws of the State of Delaware and is duly authorized to transact business as a foreign corporation and is in good standing in each jurisdiction required in order to perform its obligations under this Agreement. TEMI has all requisite corporate power and authority to execute, deliver, and perform its obligations under this Agreement.
(b) Due Authorization; No Conflicts. The execution and delivery by TEMI of this Agreement, and the performance by TEMI of its obligations hereunder, have been duly authorized by all necessary actions on the part of TEMI and do not and, under existing facts and law, will not: (i) contravene its articles of incorporation or any other governing documents; (ii) conflict with, result in a breach of, or constitute a default under any note, bond, mortgage, indenture, deed of trust, license, contract or other agreement to which it is a party or by which any of its properties may be bound or affected; (iii) violate any order, writ, injunction, decree, judgment, award, statute, law, rule, regulation or ordinance of any governmental authority or agency applicable to it or any of its properties; or (iv) result in the creation of any lien, charge or encumbrance upon any of its properties pursuant to any of the foregoing.
(c) Binding Agreement. This Agreement has been duly executed and delivered on behalf of TEMI and, assuming the due execution hereof and performance hereunder by NJEA, constitutes a legal, valid and binding obligation of TEMI, enforceable against it in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors' rights generally and by the application of principles of equity.
(d) No Proceedings. There are no actions, suits or other proceedings, at law or in equity, by or before any governmental authority or agency or any other body pending or, to the best of its knowledge, threatened against or affecting TEMI or any of its properties (including, without limitation, this Agreement) which relate in any manner to this Agreement or any transaction contemplated hereby, or which TEMI reasonably expects to lead to a material adverse effect on (i) the validity or enforceability of this Agreement or (ii) TEMI 's ability to perform its obligations under this Agreement.
(e) Consents and Approvals. The execution, delivery and performance by TEMI of its obligations under this Agreement does not and, under existing facts and law, will not, require any approval, consent, permit, license or other authorization of, or filing or registration with, or any other action by, any Person which has not been duly obtained, made or taken, and all such approvals, consents, permits, licenses, authorizations, filings (except for informational filings with FERC), registrations and actions are in full force and effect, final and non-appealable.
(f) Negotiations. The terms and provisions of this Agreement are the result of arm's length and good faith negotiations on the part of TEMI.
4.2 Representations and Warranties of NJEA.
NJEA hereby represents and warrants to TEMI as of the Effective Date as follows:
(a) Organization and Good Standing; Power and Authority. NJEA is a limited partnership validly existing and in good standing under the laws of the State of New Jersey and is duly authorized to transact business as a foreign limited partnership in each jurisdiction required in order to perform its obligations under this Agreement. NJEA has all requisite limited partnership power and authority to execute, deliver and perform its obligations under this Agreement.
(b) Due Authorization; No Conflicts. The execution and delivery by NJEA of this Agreement and the performance by NJEA of its obligations hereunder have been duly authorized by all necessary actions on the part of NJEA and its partners and do not and, under existing facts and law, will not: (i) contravene its partnership agreement or any other governing documents; (ii) conflict with, result in a breach of, or constitute a default under any note, bond, mortgage, indenture, deed of trust, license, contract or other agreement to which it is a party or by which any of its properties may be bound or affected; (iii) violate any order, writ, injunction, decree, judgment, award, statute, law, rule, regulation or ordinance of any governmental authority or agency applicable to it or any of its properties; or (iv) result in the creation of any lien, charge or encumbrance upon any of its properties pursuant to any of the foregoing.
(c) Binding Agreement. This Agreement has been duly executed and delivered on behalf of NJEA and assuming the due execution hereof and performance hereunder by TEMI, constitutes a legal, valid and binding obligation of NJEA, enforceable against it in accordance with its terms, except as such enforceability may be limited by law or principles of equity.
(d) No Proceedings. Other than the BPU proceedings in connection with the Final Decision, there are no actions, suits or other proceedings, at law or in equity, by or before any governmental authority or agency or any other body pending or, to the best of its knowledge, threatened against or affecting NJEA or this Agreement.
(e) Consents and Approvals. The execution, delivery and performance by NJEA of its obligations under this Agreement do not and, under existing facts and law, will not, require any approval, consent, permit, license or other authorization of, or filing (except for informational filings with the Federal Energy Regulatory Commission) or registration with, or any other action by, any Person which has not been duly obtained, made or taken, and all such approvals, consents, permits, licenses, authorizations, filings, registrations and actions are in full force and effect, final and non-appealable. NJEA is authorized by FERC to engage in wholesale power sales, including the purchase and sale of all Energy contemplated under this Agreement.
(f) Negotiations. The terms and provisions of this Agreement are the result of arm's length and good faith negotiations on the part of NJEA.
5. BREACHES; REMEDIES
5.1 Events of Default; Cure Rights.
It shall constitute an event of default ("Event of Default") hereunder if:
(a) Representation or Warranty. Any representation or warranty set forth herein is not accurate and complete in all material respects as of the date made, unless such inaccuracy or incompleteness is capable of cure by the payment of money and is cured within thirty (30) days after written notice thereof is given by the non-defaulting Party to the breaching party, or unless such inaccuracy or incompleteness is not capable of cure by the payment of money, but is otherwise capable of cure, and the Party in default promptly begins and diligently and continuously pursues such cure activity.
(b) Payment Obligations. Any payment due and payable by either Party to the other Party hereunder is not made on the date due, and such failure continues for more than five (5) Business Days after notice thereof is given to the defaulting Party by the non-defaulting Party.
(c) Bankruptcy. Either party either (a) is adjudged bankrupt or files a petition in voluntary bankruptcy under any provision of any bankruptcy law or consents to the filing of any bankruptcy or reorganization petition against such Party under any such law, or (without limiting the generality of the foregoing) files a petition to reorganize such Party pursuant to 11 U.S.C. Subsection 101 or any similar statute applicable to such Party, as now or hereinafter in effect, or (b) makes an assignment for the benefit of creditors, or admits in writing an inability to pay its debts generally as they become due, or consents to the appointment of a receiver or liquidator or trustee or assignee in bankruptcy or insolvency of such Party, or (c) is subject to an order of a court of competent jurisdiction appointing a receiver or liquidator or custodian or trustee of such Party or of a major part of its property.
(d) Other Covenants. Subject to Section 3.6, a Party fails to perform, observe or otherwise to comply with any obligation hereunder (other than as described in Section 5.1(b),) and such failure continues for more than thirty (30) days after notice thereof is given by the non-defaulting Party to the defaulting Party, or if such default is not capable of cure within thirty (30) days, the Party in default promptly begins such cure activity within such thirty (30) day period and diligently and continuously pursues the cure activity such that the failure is cured within ninety (90) days after notice thereof is given by the non-defaulting Party to the defaulting Party.
5.2 Termination; Termination Payment.
(a) If an Event of Default as described in Section 5.1(b) hereof (payment default) pursuant to which the payment default exceeds $100,000.00 unless disputed in good faith and in accordance with Section 7, is continuing on the sixtieth (60th) day following the receipt by the defaulting Party of written notice provided by the non-defaulting Party to the defaulting Party of such Event of Default, then the non-defaulting Party may at any time after the expiration of the sixty (60) day cure period described above during which such Event of Default remains uncured terminate this Agreement by giving written notice thereof to the defaulting Party; provided, however, that any such termination by the non-defaulting Party shall not diminish nor discharge the payment obligation of the defaulting Party which gives rise to such termination. Upon any such termination of this Agreement, TEMI shall have the right to sell or otherwise dispose of the Energy that was otherwise to be delivered under this Agreement to by or on behalf of TEMI to JCP&L on behalf of NJEA in any manner it sees fit, free of any NJEA interest therein. Except as provided in this Section 5.2(a), neither Party shall be entitled to terminate this Agreement due to an Event of Default by the other Party.
(b) If NJEA terminates this Agreement pursuant to Section 5.2(a) due to an Event of Default by TEMI, then TEMI shall pay liquidated damages to NJEA (the "TEMI Termination Payment"), which shall consist of (A) the mark-to-market value, if any, of the terminated Energy payment obligation, as determined in a commercially reasonable manner, with the reference contract price being the Contract Rate hereunder, reasonably adjusted to reflect changes in the expected Facility dispatch factor caused by changes in projected market prices and the market consisting of a reasonable estimation of the sum of the amounts that would be payable by NJEA for electricity during the Replacement Period from a replacement supplier in the amounts that would have been required to be delivered to JCP&L on behalf of NJEA hereunder absent termination of this Agreement; plus (B) the total amount of Ancillary Termination Damages payable to NJEA due to the termination. NJEA shall provide TEMI wit h an invoice for the damages calculated in accordance with this Section 5.2(b) plus any additional amount owed to NJEA in connection with such termination as described in Section 5.2(d) hereof which invoice shall set forth the calculation and substantiation for such amounts. TEMI shall pay the undisputed amount set forth in such invoice within thirty (30) days by wire transfer to an account designated by NJEA in the invoice or in a written notice delivered to TEMI and, with respect to any disputed amount of such invoice, pursue dispute resolution proceedings as described in Section 3.8(b) and Section 7 hereof. Such liquidated damages, which the Parties agree are reasonable, shall be payable on account of the substantial consideration received by TEMI as a result of this Agreement. The Parties agree, and shall take all necessary action to establish before any court or arbitral tribunal, that damages suffered by NJEA as a result of an Event of Default on the part of TEMI hereunder and termination of this Agreement are reasonable and necessary to justly compensate NJEA for its damages resulting from such Events of Default and termination of this Agreement.
(c) If TEMI terminates this Agreement pursuant to Section 5.2(a) hereof due to an Event of Default by NJEA, then NJEA shall pay liquidated damages to TEMI (the "NJEA Termination Payment"), which shall consist of (A) the mark-to-market value, if any, of the terminated Energy payment obligation, as determined in a commercially reasonable manner, with the reference contract price being the Contract Rate hereunder, reasonably adjusted to reflect changes in the expected Facility dispatch factor caused by changes in projected market prices and the market consisting of a reasonable estimation of the sum of the amounts that would be payable to TEMI for the sale of electricity during the Replacement Period to a replacement purchaser in the amounts that would have been required to be accepted by JCP&L as deliveries on behalf of NJEA tendered to it by TEMI pursuant to and in accordance with this Agreement absent termination of this Agreement; plus (B) the total amount of Anc illary Termination Damages payable to TEMI due to the termination. TEMI shall provide NJEA with an invoice for the damages calculated in accordance with this Section 5.2(c) plus any additional amount owed to TEMI in connection with such termination as described in Section 5.2(d) hereof which invoice shall set forth the calculation and substantiation for such amounts. NJEA shall pay the undisputed amount set forth in such invoice within thirty (30) days by wire transfer to an account designated by TEMI in the invoice or in a written notice delivered to NJEA and, with respect to any disputed amount of such invoice, pursue dispute resolution proceedings as described in Section 3.8(b) and Section 7 hereof. Such liquidated damages, which the Parties agree are reasonable, shall be payable on account of the substantial consideration received by NJEA as a result of this Agreement. The Parties agree, and shall take all necessary action to establish before any court or arbitral tribunal, that damages suffered by TEMI as a result of an Event of Default on the part of NJEA hereunder and termination of this Agreement are reasonable and necessary to justly compensate TEMI for its damages resulting from such Event of Default and termination of this Agreement.
(d) In connection with the termination of this Agreement pursuant to Section 5.2(a) hereof each Party shall pay any amounts owed to the other Party under this Agreement as of the date of such termination (without duplication of the amounts set forth in the preceding paragraphs of this Section 5.2) on or before the date required for payment of the amounts described in Sections 5.2(b) or (c) above.
5.3 Remedies.
(a) Damages. Subject to Section 5.3(c) and to the extent not covered by Section 3.5, Section 3.6 or Section 5.2 hereof each defaulting Party shall be liable to the non-defaulting Party for any and all costs, expenses, damages and losses suffered or incurred by such non-defaulting Party in connection with an Event of Default on the part of the breaching Party.
(b) Other Remedies. In addition to the rights and remedies following an Event of Default as set forth herein, each of the Parties shall also have available to it all of the rights, powers and remedies available to it at law or in equity.
(c) Consequential Damages. Notwithstanding anything otherwise contained in this Agreement to the contrary, neither NJEA nor TEMI shall be liable to the other for any indirect, consequential, incidental, punitive or exemplary damages. The provisions of this Section 5.3(c) shall not affect or diminish the damage amounts payable pursuant to Sections 3.5 and 3.6.
(d) Suspension of Deliveries. In the event of any payment default by NJEA pursuant to Section 5.1(b) hereof (which by its terms includes a five (5) Business Day cure period), then upon at least five (5) days' prior written notice (which notice may not be delivered prior to the expiration of the five (5) Business Day cure period described in Section 5.1(b) hereof), TEMI may, but shall not be obligated to, suspend deliveries of Energy under this Agreement until such payment default has been cured. In the event of such suspension of deliveries to NJEA pursuant to this Section 5.3(d), TEMI shall be relieved of all of its delivery obligations hereunder for the duration of such suspension.
6. FORCE MAJEURE
6.1 Force Majeure.
The term "Force Majeure" means an event or circumstance which prevents a Party from performing its obligations hereunder (other than the obligation to make payments then due or becoming due with respect to performance prior to the Force Majeure), which event or circumstance was not anticipated and which is not within the reasonable control of, or the result of the fault or negligence of, the claiming Party, and which, by the exercise of due diligence (which may include obtaining replacement power, to the extent obtainable on commercially reasonable terms), the claiming Party is unable to overcome or avoid or cause to be avoided on commercially reasonable terms and conditions. Notwithstanding the foregoing, Force Majeure shall not be based on (i) the loss of NJEA's markets; (ii) NJEA's inability economically to use or resell the Energy purchased hereunder; (iii) the loss or failure of TEMI's supply of electric energy unless due to a failure of the transmission or distribution syst em which adversely affects all or substantially all of the suppliers delivering or transmitting Energy across such system or (iv) TEMI's ability to sell Energy at a price greater than the Contract Rate.
Subject to the satisfaction of the criteria set forth in the preceding paragraph, Force Majeure events shall include, without limitation, action of a court or regulatory authority, a Change in Law, catastrophic physical failures or disruptions of the PJM transmission system; provided, however, that for purposes of this Agreement, Force Majeure shall not include (i) any event that results solely in an increase in TEMI's or its suppliers' costs to perform obligations to deliver Energy to TEMI or on behalf of TEMI hereunder or (ii) any increase in the cost of electricity supplies or transmission or (iii) any congestion costs.
6.2 Notice and Excuse of Performance.
(a) Following a Force Majeure event, if either Party believes that such event will, or is reasonably likely to, adversely affect the performance of its obligations under this Agreement, then as early as commercially practicable but in no event later than two (2) Business Days after the initial occurrence of such event and for contingency planning purposes, such Party shall provide preliminary telephonic notice of the occurrence of a Force Majeure to the other Party promptly followed by written notice on or before the tenth (10th) Business Day after the initial occurrence of such event. Such written notice shall specify the nature and, if known, cause of the Force Majeure, its anticipated effect on the ability of such Party to perform obligations under this Agreement and the estimated duration of any interruption in service or other adverse effects resulting from such Force Majeure and shall be updated or supplemented as necessary to keep the other Party advised of the effect and remedial measures being unde rtaken to overcome the Force Majeure.
For the purposes of this Section 6.2, notification given to the schedulers for the Parties and JCP&L shall be sufficient delivery of notice.
(b) Effect of Force Majeure on Performance of Obligations. To the extent either Party is prevented by Force Majeure from carrying out, in whole or part, its obligations under this Agreement and such Party (the "Claiming Party") gives notice and details of the Force Majeure to the other Party as soon as practicable, then the Claiming Party shall be excused from the performance of its obligations with respect to such 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. The non-Claiming Party shall not be required to perform its obligations to the Claiming Party corresponding to the obligations of the Claiming Party excused by Force Majeure.
7. DISPUTE RESOLUTION
(a) Any controversy, dispute or claim between the Parties to this Agreement which is based upon acts or occurrence that also give rise to a controversy, dispute or claim by either NJEA or JCP&L under the Amended PPA shall be resolved pursuant to the dispute resolution proceedings set forth in the Amended PPA; provided, that if TEMI will bear the economic consequences of any such decision or dispute resolution under the Amended PPA then to the fullest extent possible, NJEA shall allow TEMI to participate in and/or control NJEA's conduct in such negotiations or proceedings.
(b) Any controversy, dispute or claim between the Parties that is not described in Section 7(a) above and which the Parties are unable to resolve by negotiation shall be settled by arbitration in accordance with the Commercial Arbitration Rules of the AAA, then in effect, and the provisions of this Section 7. No suit at law that seeks to resolve any controversy, dispute or claim between the Parties shall be instituted by either Party hereto, except where such suit is instituted to confirm an arbitration award received pursuant to this Section 7. However, nothing contained herein shall deprive either Party of any right to: (i) obtain injunctive or other equitable relief in any court in the State of New Jersey, on an interim basis pending disposition of the arbitration of any controversy, dispute or claim if such relief is available under applicable principles of law and equity (provided, however, that the arbitrators selected pursuant to Section 7(e) hereo f shall not regard as dispositive any such award of injunctive or equitable relief when considering a dispute); and/or (ii) assert any cross-claim, or third-party claim in any suit at law instituted by a third party; and/or (iii) file and prosecute any complaint at and with the regulatory agency having jurisdiction or make and prosecute any claim or position in any filing made with such regulatory agency by either Party or some third party.
(c) Any controversy, dispute or claim submitted to arbitration pursuant to Section 7(b) shall be settled by arbitration to be conducted in New York, New York. Any award entered pursuant to such arbitration shall be binding on both Parties and judgment upon the award rendered or received may be entered in the Superior Court of the State of New Jersey pursuant to N.J.S.A. 2A:24-1 et seq.
(d) Exclusive jurisdiction relative to the entry of judgment on any arbitration award relative to any controversy or claim between the Parties resolved pursuant to Section 7(b) shall be in any court of appropriate subject matter jurisdiction located in New Jersey, and the Parties to this Agreement expressly subject themselves hereby to the personal jurisdiction of said court for entry of any such judgment and for the resolution of any dispute, action, or suit arising in connection with the entry of such judgment.
(e) The controversy or claim to be arbitrated pursuant to Section 7(b) shall be referred to three (3) arbitrators, one to be selected by each Party and the third to be selected by the AAA. The selections to be made by the Parties shall be made from the list of the National Panel of Arbitrators maintained by the AAA. The arbitrator to be selected by the AAA shall be qualified to pass on any technical or engineering matters and shall be independent of both TEMI and NJEA. All decisions and awards shall be made by a majority of the arbitrators, except for decisions relating to discovery as set forth herein.
(f) In the event any arbitrator dies, or refuses to act, or becomes incapable, incompetent or unfit to act before hearings have been completed and/or before an award has been rendered, a successor arbitrator may be selected by the Party who originally made the selection. The selection of the successor arbitrator shall be made consistent with the selection procedure set forth in the preceding paragraph.
(g) The arbitrators selected pursuant to this Agreement shall be governed by and apply the laws of the State of New Jersey and federal law, as applicable, in conducting any arbitration proceeding and/or in making any award.
(h) Notice of a demand for arbitration of any controversy or dispute between the Parties shall be filed in writing with the AAA by the Party seeking arbitration and a copy of same shall be served contemporaneously with such filing on the other Party. The notice shall state, with specificity, the nature of the dispute and the remedy sought. After such notice has been filed, the Parties may make discovery of any matter relevant to such dispute before the hearing, to the extent and in the manner provided by the Rules Governing Civil Practice in the Superior Court contained in the Rules Governing the Courts of the State of New Jersey. Any question that may arise with respect to the obligations of the Parties relative to discovery and/or relative to the protection of the discovery materials shall be referred solely to the arbitrator selected by the AAA. His determination shall be final and conclusive. Discovery shall be completed not later than ninety (90) days after filing of the notice of arbitration unless su ch period for discovery is extended by the arbitrator selected by the AAA, upon a showing of good cause by the Party requesting the extension.
(i) The arbitrators may consider any material that is relevant to the subject matter of any such controversy even if such material might also be relevant to an issue or issues not subject to arbitration hereunder. A stenographic record shall be made of any arbitration hearing.
(j) Any costs associated with any arbitration under this Section 7, including but not limited to attorney fees and witness expenses, shall be paid by the Party against whom an award is entered unless the arbitrators by their award otherwise provide.
(k) Arbitration may not be utilized and the arbitrators selected in accordance with Section 7(b) through (k) shall not possess the authority or power to alter, amend or modify any of the terms or conditions or charges set forth in this Agreement, and further, the arbitrators may not enter any award which alters, amends or modifies such terms, conditions or charges in any form or manner.
8. CONFIDENTIALITY
(a) TEMI and NJEA each agree not to disclose to any Person and to keep confidential, and to cause and instruct its Affiliates, officers, directors, employees, partners and representatives not to disclose to any Person and to keep confidential, any and all of the following information: (i) the terms and provisions of this Agreement, (ii) any financial, pricing or supply quantity information relating to the Energy to be supplied by TEMI hereunder, the Facility or NJEA and (iii) any information that is clearly marked or identified as "Confidential". Notwithstanding the foregoing, any such information may be disclosed: (A) to the extent required by applicable laws and regulations or by any subpoena or similar legal process of any court or agency of federal, state or local government so long as the receiving Party gives the non-disclosing Party written notice at least three (3) Business Days prior to such disclosure, if practicable, (B) to lenders and potential lenders to TEMI or to lend ers to NJEA or other Person(s) in connection with the implementation of the Restructuring and to financial advisors, rating agencies, and any other Persons involved in the acquisition, marketing or sale or placement of such debt, (C) to agents, trustees, advisors and accountants of the Parties or their Affiliates involved in the financings described in clause (B) above, (D) to potential assignees of TEMI or NJEA or other Persons in connection with such proposed assignment and to financial advisors, rating agencies, and any other Persons involved in the marketing, placement or rating of such assignment, (E) to agents, trustees, advisors and accountants of the Parties or their Affiliates or agents, trustees, advisors and accountants of Persons involved in the potential assignment described in clause (D) above or (F) to the extent the non-disclosing Party shall have consented in writing prior to any such disclosure. With respect to the Restructuring, this Section 8 shall supersede any prior confidentiality agreement between NJEA and TEMI or its Affiliates. Information (1) of a confidential nature which has become public other than as a result of a breach of this Section 8, (2) which was known to the disclosing Party prior to the execution of this Agreement, or (3) which was received by the disclosing Party from another source who in turn disclosed the information without violating legal restrictions, will not be subject to the confidentiality obligations set forth herein with respect to such information. Nothing in this Section 8(a) shall limit or otherwise restrict the disclosure of information regarding the Restructuring to the BPU or other governmental or regulatory entity or other party thereto in connection with the satisfaction of requirements for regulatory approvals required in connection with the transactions contemplated hereby or in connection with any other NJEA proceeding before the BPU; provided, however, that the Parties shall use the ir best efforts to cause all such submitted information to be treated on a confidential basis by such government or regulatory entities or other party and to prohibit, to the extent possible, the public distribution of such information.
(b) No public statement, press release or other voluntary publication regarding this Agreement or the Restructuring or any of the transactions contemplated hereby shall be made or issued without the prior consent of the other Party, which consent shall not be unreasonably withheld.
(c) Notwithstanding anything to the contrary, each Party (and each employee, representative, or other agent of each Party for so long as they remain an employee, representative or agent) may disclose to any and all Persons, without limitation of any kind, the tax treatment and tax structure of the transactions contemplated by this Agreement and all materials of any kind (including opinions or other tax analyses) that are provided to each Party relating to such tax treatment and tax structure. The preceding sentence shall be effective immediately upon commencement of discussions between the Parties (whether such discussions commenced verbally, in writing, or otherwise) that are related to the terms of this Agreement
9. INDEMNIFICATION AND INDEMNIFICATION PROCEDURES
9.1 Indemnification.
Each Party ("Indemnifying Party") shall indemnify, defend and hold the other Party ("Indemnified Party") and its partners, shareholders, partners, directors, officers, employees and agents (including, but not limited to, Affiliates and contractors and their employees), harmless from and against all liabilities, damages, losses, penalties, claims, demands, suits and proceedings of any nature whatsoever suffered or incurred by such Indemnified Party arising out of the Indemnifying Party's gross negligence or willful misconduct (including, without limitation, any breach of this Agreement resulting from gross negligence or willful misconduct). In the event injury or damage results from the joint or concurrent grossly negligent or willful misconduct of the Parties, each Party shall be liable under this indemnification in proportion to its relative degree of fault. Such duty to indemnify shall not apply to any claims which arise or are first asserted more than two (2) years after t he termination of this Agreement. Such indemnity shall not include or compensate for indirect, punitive, exemplary, incidental or consequential damages incurred by either Party.
9.2 Indemnification Procedures.
Each Indemnified Party shall promptly notify the Indemnifying Party of any claim in respect of which the Indemnified Party is entitled to be indemnified under this Section 9. Such notice shall be given as soon as is reasonably practicable after the Indemnified Party becomes aware of each claim; provided, however, that failure to give prompt notice shall not adversely affect any claim for indemnification hereunder except to the extent the Indemnifying Party's ability to contest any claim by any third party is materially adversely affected. The Indemnifying Party shall have the right, but not the obligation, at its expense, to contest, defend, litigate and settle, and to control the contest, defense, litigation and/or settlement of, any claim by any third party alleged or asserted against any Indemnified Party arising out of any matter in respect of which such Indemnified Party is entitled to be indemnified hereunder. The Indemnifying Party shall promptly notify such Indemnified Party of its intent ion to exercise such right set forth in the immediately preceding sentence and shall reimburse the Indemnified Party for the reasonable costs and expenses paid or incurred by it prior to the assumption of such contest, defense or litigation by the Indemnifying Party. The Indemnifying Party shall have the right to select legal counsel to defend a claim for which the Indemnified Party is seeking indemnification pursuant to this Section 9.2, subject to the consent of the Indemnified Party, which shall not be unreasonably delayed or withheld. If the Indemnifying Party exercises such right in accordance with the provisions of this Section 9 and any Indemnified Party notifies the Indemnifying Party that it desires to retain separate counsel in order to participate in or proceed independently with such contest, defense or litigation, such Indemnified Party may do so at its own expense. If the Indemnifying Party fails to exercise it rights set forth in the third sentence of this Section&nb sp;9.2, then the Indemnifying Party will reimburse the Indemnified Party for its reasonable costs and expenses incurred in connection with the contest, defense or litigation of such claim. No Indemnified Party shall settle or compromise any claim in respect of which the Indemnified Party is entitled to be indemnified under this Section 9 without the prior written consent of the Indemnifying Party; provided, however, that such consent shall not be unreasonably withheld by the Indemnifying Party.
10. ASSIGNMENT
10.1 Prohibition on Assignment.
Except as provided in Section 10.2 hereof, this Agreement may not be assigned by either Party without the prior written consent of the other Party, which may not be unreasonably withheld. Any attempted or purported assignment of this Agreement that is not expressly permitted pursuant to Section 10.2 hereof, shall be null and void and shall have no effect on or with respect to the rights and obligations of the Parties hereunder.
10.2 Permitted Assignment.
(a) In addition to its rights set forth in Section 10.2(b) hereof, either Party shall have the right to assign all or any portion of its rights or obligations under this Agreement without the consent of the other Party, for collateral security purposes, to existing and any future lenders, including existing and any future lenders of partners or affiliates. In connection with the exercise of remedies under the security documents relating to such financing(s), the lender(s) or trustee(s) shall be entitled to assign this Agreement to any third-party transferee designated by such lender(s) or trustee(s).
(b) If either Party assigns this Agreement as provided in this Section 10.2, then such Party shall cause to be delivered to the other Party an assumption agreement (in form and substance reasonably satisfactory to the non-assigning Party) of all of the obligations of the assigning Party hereunder by such assignee.
(c) An assignment of this Agreement pursuant to this Section 10.2 shall not release or discharge the assignor from its obligations hereunder unless the assignee executes a written assumption agreement in accordance with Section 10.2(b) hereof.
11. NOTICES
Any notice or communication given pursuant hereto shall be in writing and (1) delivered personally (personally delivered notices shall be deemed given upon written acknowledgment of receipt after delivery to the address specified or upon refusal of receipt); (2) mailed by registered or certified mail, postage prepaid (mailed notices shall be deemed given on the actual date of delivery, as set forth in the return receipt, or upon refusal of receipt); (3) delivered by facsimile (notices by facsimile shall be deemed given at the time it is confirmed as delivered, but in any event no later than one (1) Business Day after dispatch) or (4) delivered in full by telecopy (telecopied notices shall be deemed given upon actual receipt), in either case addressed or telecopied as follows or to such other addresses or telecopy numbers as may hereafter be designed by either Party to the other in writing:
If to TEMI:	General correspondence:
	Tractebel Energy Marketing, Inc. 1990 Post Oak Blvd Suite 1900 Houston, TX 77056 Attention: General Counsel Phone: 713-636-0000 Facsimile: 713-636-1800
	Scheduling notices:
	Tractebel Energy Marketing, Inc. 1990 Post Oak Blvd. Suite 1900 Houston, TX 77056 Attn: Manager, Real Time Desk Phone: 877-350-8420 Fax: 713-636-1894
If to NJEA	North Jersey Energy Associates, A Limited Partnership c/o Northeast Energy, LP c/o ESI Northeast Energy GP, Inc. Its General Partner 700 Universe Blvd. P.O. Box 14000 Juno Beach, FL 33408 Attention: Business Manager Phone: 561-304-5107 Facsimile: 561-304-5161
12. WAIVER AND MODIFICATION
12.1 Modification or Waiver.
This Agreement may be amended and its provisions and the effects thereof waived only by a writing executed by the Parties, and no subsequent conduct of any Party or course of dealings between the Parties shall effect or be deemed to effect any such amendment or waiver. No waiver of any of the provisions of this Agreement shall be deemed or shall constitute a waiver of any other provision hereof (whether or not similar), nor shall such waiver constitute a continuing waiver unless otherwise expressly provided. The failure of either Party to enforce any provision of this Agreement shall not be construed as a waiver of or an acquiescence in or to such provision.
13. INTERPRETATION
13.1 Choice of Law.
Interpretation and performance of this Agreement shall be in accordance with, and shall be controlled by, the laws of the State of New Jersey (without regard to its principles of conflicts of law).
13.2 Headings.
Article and Section headings are for convenience only and shall not affect the interpretation of this Agreement. References to articles, sections and appendices, and schedules are, unless the context otherwise requires, references to articles, sections, appendices, and schedules of this Agreement. The words "hereof" and "hereunder" shall refer to this Agreement as a whole and not to any particular provision of this Agreement.
14. COUNTERPARTS
Any number of counterparts of this Agreement may be executed, and each shall have the same force and effect as an original.
15. NO DUTY TO THIRD PARTIES
Except as provided in any consent to assignment as specified in the other provisions of this Agreement, nothing in this Agreement nor any action taken hereunder shall be construed to create any duty, liability or standard of care to any Person not a Party to this Agreement.
16. SEVERABILITY
If any term or provision of this Agreement or the interpretation or application of any term or provision to any prior circumstance is held to be unenforceable, illegal or invalid by a court or agency of competent jurisdiction, the remainder of this Agreement and the interpretation or application of all other terms or provisions to Persons or circumstances other than those which are unenforceable, illegal or invalid shall not be affected thereby, and each term and provision shall be valid and be enforced to the fullest extent permitted by law.
17. ENTIRE AGREEMENT
Upon the Effective Date, this Agreement, together with the agreements executed or delivered on the Effective Date in connection herewith, shall constitute the entire agreement and understanding between the Parties hereto and shall supersede all prior agreements and understandings relating to the subject matter hereof.
[SIGNATURES APPEAR ON FOLLOWING PAGE]

IN WITNESS WHEREOF, each of TEMI and NJEA has caused this Agreement to be duly executed on its behalf as of the date first above written.
	NORTH JERSEY ENERGY ASSOCIATES, A LIMITED PARTNERSHIP
	By:	Northeast Energy, LP, its general partner
	By:	ESI Northeast Energy GP, Inc., its administrative general partner
	By:	NATHAN E. HANSON
		Nathan E. Hanson Director
	TRACTEBEL ENERGY MARKETING, INC.
	By:	SAM HENRY
		Sam Henry Executive Vice President

EX-10

Exhibit 10(d)

POWER PURCHASE AGREEMENT




dated as of

January 1, 2004


By and Between


NORTH JERSEY ENERGY ASSOCIATES, A LIMITED PARTNERSHIP


and


FPL ENERGY POWER MARKETING, INC.

POWER PURCHASE AGREEMENT
THIS POWER PURCHASE AGREEMENT (the "Agreement") is entered into as of January 1, 2004, by and between North Jersey Energy Associates, A Limited Partnership, a New Jersey limited partnership ("NJEA"), and FPL Energy Power Marketing, Inc, a Florida corporation ("PMI"). NJEA and PMI are individually referred to herein as a "Party" and are collectively referred to herein as the "Parties".
RECITALS
WHEREAS, NJEA owns a nominal 300 MW natural gas-fired electricity and steam generating plant located in the borough of Sayreville, New Jersey (the "Facility").
WHEREAS, Jersey Central Power & Light Company ("JCP&L") and NJEA are parties to a Power Purchase Agreement dated as of October 22, 1987, as amended to date (the "Existing PPA"), pursuant to which JCP&L purchases from NJEA contract capacity of not less than 250 MW and the associated electricity of the Facility.
WHEREAS, NJEA and JCP&L have entered into an Amended and Restated Power Purchase Agreement dated May 16, 2003, as amended to date (collectively, the "Amended PPA") that amends and restates the Existing PPA and provides NJEA with the option of supplying Contract Energy from sources other than the Facility.
WHEREAS, in connection with the effectiveness of the Amended PPA, NJEA and PMI desire to enter into this Agreement in order to provide NJEA with the right to purchase from PMI fifty percent (50%) of NJEA's remaining delivery obligations to JCP&L during Off-Peak Hours under the Amended PPA after accounting for Facility dispatch, up to the Maximum Nomination Quantity.
WHEREAS, in connection with the effectiveness of the Amended PPA and this Agreement, NJEA and Tractebel Energy Marketing, Inc. ("TEMI") are entering into an agreement (the "TEMI PPA") on substantially similar terms and conditions as this Agreement in order to provide NJEA with the right to purchase from TEMI the other fifty percent (50%) of NJEA's remaining delivery obligations to JCP&L during Off-Peak Hours under the Amended PPA after accounting for Facility dispatch, up to the Maximum Nomination Quantity.
NOW, THEREFORE, in consideration of the premises and of the mutual agreements contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereby agree as follows:
1. DEFINITIONS
1.1 Defined Terms.
Capitalized terms used in this Agreement that are not defined herein shall have the respective meanings given in Amended PPA. In addition to terms defined elsewhere in this Agreement, the following terms are defined as follows:
"Alternate Delivery Point" means (i) any nodal point included within the JCP&L Zone, (ii) the JCP&L Zone or (iii) any other delivery point mutually agreed to by the Parties. In the event PJM or its successor no longer recognizes a nodal point that was part of the JCP&L Zone on the date of execution of this Agreement, such nodal point shall be an Alternate Delivery Point for purpose of this Agreement notwithstanding its subsequent exclusion from the nodal points included in the JCP&L Zone by PJM.
"Ancillary Termination Damages" shall mean penalties assessed by PJM against the terminating Party (and/or JCP&L, in the case of NJEA as the Terminating Party) and all reasonable fees and expenses incurred by the terminating Party in connection with the termination of this Agreement pursuant to Section 5.2 hereof.
"Contract Rate" means $28.00/MWh.
"Energy" means firm electricity having the characteristics described in Section 3.2 of the Amended PPA.
"Nomination Quantity" means the quantity of Energy specified in the Call Notice, which amount shall equal fifty percent (50%) of (i) the maximum amount of Energy (in MWs per hour expressed as a whole number) that NJEA is permitted to deliver to JCP&L under the Amended PPA during Off-Peak Hours occurring during such day less (ii) the amount of electricity (in MWs per hour expressed as a whole number) that the Facility is expected to generate for sale to JCP&L under the Amended PPA during Off-Peak Hours occurring during such day.
"Maximum Nomination Quantity" means (i) 125 MWs per Off-Peak Hour for the months of December through March and June through September and (ii) 100 MWs per Off-Peak Hour for the months of April, May, October and November.
"Replacement Period" shall mean the period beginning on the date this Agreement is terminated pursuant to Section 5.2 hereof and ending at 11:59 p.m. August 13, 2011.
"Replacement Power" means electricity purchased by NJEA as replacement for any Delivery Shortfall. Replacement Power shall not include Energy delivered to NJEA on behalf of PMI pursuant to Section 3.1(a).
"Replacement Price" means the lesser of (A) the price at which NJEA (or any other Person acting on its behalf), acting in a commercially reasonable manner, purchases Replacement Power, plus (i) transaction and other administrative costs reasonably incurred by NJEA (or any other Person acting on its behalf) in purchasing such Replacement Power and (ii) additional transmission charges, if any, reasonably incurred by NJEA (or any other Person acting on its behalf) to transmit Replacement Power to the Delivery Point, or (B) the LMP at the Delivery Point for such Replacement Power; provided, however, that in no event shall such price include any penalties, ratcheted demand or similar charges, nor shall NJEA be required to utilize or change its utilization of its owned or controlled assets or market positions to minimize PMI's liability.
"Resale Price" shall mean, without duplication, (i) the price at which PMI, acting in a commercially reasonable manner, sells or is paid for Rejected Power, plus (ii) transaction and other administrative costs reasonably incurred by PMI in re-selling such Rejected Power; provided, however, that in no event shall PMI be required to utilize or change its utilization of its other assets or market positions in order to minimize NJEA's liability for Rejected Power.
1.2 Rules of Interpretation.
In this Agreement, unless a clear contrary intention appears:
(i) the singular number includes the plural number and vice versa;
(ii) reference to any Person includes such Person's successors and assigns but, if applicable, only if such successors and assigns are permitted by this Agreement, and reference to a Person in a particular capacity excludes such Person in any other capacity or individually;
(iii) reference to any gender includes the other gender;
(iv) reference to any agreement, document or instrument means such agreement, document or instrument as amended or modified and in effect from time to time in accordance with the terms thereof; and
(v) in connection with capitalized terms hereunder that are defined in the Amended PPA, where appropriate, references to JCP&L as the purchaser of Contract Energy under the Amended PPA shall mean NJEA as the purchaser of Energy under this Agreement and references to NJEA as the Seller of Contract Energy under the Amended PPA shall mean PMI as the Seller of Energy under this Agreement.
2. TERM; TERMINATION
2.1 Term.
This Agreement shall become effective on the "Partial Termination Date" under the Partial Termination Agreement dated as of July 11, 2003, between NJEA and ProGas Limited (the "Effective Date") and shall continue in full force and effect until the date and time of the termination of the Amended PPA, unless this Agreement is terminated sooner pursuant to Section 2.2. The period during which this Agreement is in effect is herein referred to as the "Term".
2.2 Termination.
NJEA may terminate this Agreement without cause and for convenience upon five (5) Business Days' notice to PMI, if NJEA determines (in its sole discretion) that it is in its own best interests to so terminate the Agreement. NJEA shall incur no additional liability to PMI as a result of its termination of this Agreement pursuant to this Section 2.2; provided, however, that unless NJEA is exercising its termination right pursuant to this Section 2.2 as a result of performance deficiencies by PMI, NJEA shall not exercise its termination right pursuant to this Section 2.2 unless it simultaneously exercises its right to terminate the TEMI PPA pursuant to Section 2.2 of the TEMI PPA.
2.3 Effect of Termination.
Upon the expiration of this Agreement in accordance with its terms, the Parties shall no longer be bound by the terms and provisions hereof, except (i) to the extent necessary to provide invoices and make payments with respect to deliveries and purchases hereunder prior to such termination or expiration, (ii) to the extent necessary to enforce the rights and the obligations of the Parties arising under this Agreement before such termination or expiration and (iii) the obligations of the Parties hereunder with respect to confidentiality and indemnification, which shall survive the expiration or termination of this Agreement and shall continue for a period of two (2) calendar years following such expiration or termination.
3. RIGHTS AND OBLIGATIONS OF PARTIES
3.1 Obligation to Purchase and Sell Energy.
(a) PMI shall deliver and sell, and NJEA shall receive and purchase, the Nomination Quantity for such day specified in the Call Notice, as adjusted pursuant to Section 3.3(c), but in no event more than the Maximum Nomination Quantity, all in accordance with the terms of this Agreement. Notwithstanding the foregoing, PMI shall deliver and sell and NJEA shall receive and purchase the Maximum Nomination Quantity on the Effective Date without delivery of a Call Notice to PMI. Energy delivered to NJEA hereunder by PMI or on behalf of PMI by PMI's suppliers, designees or any other Person (including, without limitation, PJM) shall be deemed delivered by PMI hereunder and PMI shall be solely responsible for any costs payable to its suppliers for such delivery.
(b) In order to satisfy NJEA's delivery obligations to JCP&L during Off-Peak Hours under the Amended PPA, NJEA shall first purchase NJEA's electricity requirements ratably from (i) PMI pursuant to this Agreement and (ii) TEMI pursuant to the TEMI PPA. NJEA may also purchase electricity from third parties during Off-Peak Hours (1) to obtain Replacement Power, (2) to the extent that NJEA's requirements for electricity exceed the Maximum Nomination Quantity and (3) to the extent that PMI or TEMI, as applicable, is unable to increase its deliveries to NJEA in connection with an intra-day amendment delivered pursuant to Section 3.3(c) below or Section 3.3(c) of the TEMI PPA, respectively.
(c) If deliveries of electricity from NJEA, or on behalf of NJEA under the Amended PPA, are curtailed for any reason, NJEA shall have the right to curtail deliveries of Energy hereunder, provided that deliveries of Energy hereunder and deliveries of "Energy" from TEMI under the TEMI PPA shall be curtailed ratably, and such curtailment (hereunder and under the TEMI PPA) shall not occur until all other deliveries of electricity (except for deliveries from the Facility) to NJEA have been curtailed.
(d) NJEA will not treat PMI less favorably hereunder than it does TEMI under the TEMI PPA. NJEA shall not deliver an intra-day amendment pursuant to Section 3.3(c) that (i) increases the Nomination Quantity provided in the Call Notice for such day unless it also delivers an intra-day amendment to TEMI pursuant to Section 3.3(c) of the TEMI PPA that increases the Nomination Quantity provided in the Call Notice to TEMI for such day by an equal amount or (ii) decreases the Nomination Quantity provided in the Call Notice for such day unless it also delivers an intra-day amendment to TEMI pursuant to Section 3.3(c) of the TEMI PPA that decreases the Nomination Quantity provided in the Call Notice to TEMI for such day by an equal amount. If TEMI is unable to increase its deliveries of Energy by the amount requested in an intra-day amendment delivered pursuant to Section 3.3(c) of the TEMI PPA despite its commercially reasonable efforts, then NJEA may incre ase its Nomination Quantity to PMI for such day pursuant to Section 3.3(c) by an amount equal to the requested increase in the intra-day amendment provided to TEMI that TEMI is unable to deliver. Notwithstanding any provision contained herein to the contrary, in order to accommodate the need to express Energy amounts in whole numbers, the Nomination Quantity provided to PMI hereunder for any day and the Nomination Quantity provided to TEMI under the TEMI PPA for such day may vary by 1 MW. To the extent any such variations occur, NJEA shall use good faith efforts to provide equal Nomination Quantities from each of PMI and TEMI for each month during the Term.
3.2 Delivery Parameters.
(a) Subject to Section 3.2(b), all Energy sold or delivered under this Agreement by PMI to NJEA will be delivered to the Facility Bus.
(b) If PMI is unable to deliver Energy to the Facility Bus in accordance with Section 3.2(a) due to the unavailability of transmission service or transmission service interruptions or due to an event of force majeure that prevents its supplier from delivering electricity to the Facility Bus, then NJEA shall use reasonable efforts to cause JCP&L to accept delivery of Energy at an Alternate Delivery Point provided that NJEA shall not be in default hereunder or incur any liability to PMI if JCP&L does not accept or agree to the use of any proposed delivery location as an Alternate Delivery Point. Provided that JCP&L consent has been obtained pursuant to this Section 3.2(b), PMI may deliver Energy to one or more Alternate Delivery Points for so long as one or more of the conditions described above in this Section 3.2(b) continues and for so long as JCP&L's consent to the use of the Alternate Delivery Point remains in effect; provided that PM I shall reimburse NJEA all costs and expenses (including any costs and expenses owed by NJEA to JCP&L under the Amended PPA) arising in connection with the use of such Alternate Delivery Point. PMI shall use commercially reasonable efforts to provide NJEA with reasonable prior and/or contemporaneous notice of the expected duration of the conditions described above.
(c) PMI shall be responsible for all transmission charges, including, if any, applicable ancillary service charges, line losses, congestion charges and other PJM or applicable system costs or charges associated with transmission incurred, in each case, in connection with the delivery of Energy to the Facility Bus or to any Alternate Delivery Point.
(d) PMI shall not be responsible for any transmission charges, ancillary services charges, line losses, congestion charges and other PJM or applicable system costs or charges associated with transmission, incurred, in each case, in connection with the transmission of Energy delivered under this Agreement by or on behalf of PMI to JCP&L on behalf of NJEA from and after the delivery of such Energy to the Facility Bus or an Alternate Delivery Point (as the case may be) and the acceptance thereof by JCP&L, to any other location.
(e) Deliveries of Energy by PMI hereunder on any delivery day shall be at a constant hourly rate during Off-Peak Hours occurring during such day.
3.3 Schedules; Bidding; Metering; Operations and Interconnection.
(a) (i) PMI shall schedule and bid deliveries of Energy delivered hereunder with PJM in accordance with all PJM requirements applicable thereto. NJEA or its agent shall cooperate with PMI in connection with any such scheduling and bidding and shall promptly provide telemetering data and other information reasonably requested by PMI for the purpose of assisting PMI with its scheduling and bidding obligations hereunder. In accordance with current PJM scheduling requirements, PMI shall submit all final schedules for Energy via the PJM eSchedule system and NJEA or its agent shall confirm all such schedules, in each case, before the PJM deadline applicable thereto.
(ii) PMI shall schedule Energy deliveries and designate the Facility Bus as the delivery point unless PMI has requested an Alternate Delivery Point in accordance with Section 3.2(b).
(b) The Parties agree to use commercially reasonable efforts to comply with all applicable PJM Practices in connection with the scheduling and delivery of Energy hereunder.
(c) Except with respect to the delivery of the Maximum Nomination Quantity on the Effective Date in accordance with Section 3.1(a), NJEA shall provide PMI with a written notice (the "Call Notice") of its intent to call upon and purchase Energy no later than 10 a.m. (Eastern Prevailing Time) on the Business Day before delivery (or such other time as mutually agreed upon by the Parties) and shall specify the Nomination Quantity (which amount shall not exceed the Maximum Nomination Quantity) therein. Each Call Notice may designate deliveries of Nomination Quantities for a period of up to seven (7) days. The Nomination Quantities contained in each Call Notice shall equal the Nomination Quantities contained in the Call Notice delivered to TEMI for such period under the TEMI PPA. NJEA may alter its Nomination Quantities up until 10 a.m. (Eastern Prevailing Time) on the day before such delivery (or such other time as mutually agreed upon by the Parties) provided that it makes th e same alterations to its Nomination Quantities to TEMI under the TEMI PPA. Notwithstanding the delivery of a final Call Notice pursuant to the preceding sentence, if, on any day, NJEA is operating the Facility to generate more or less electricity than contemplated in the Call Notice, then, subject to Section 3.1(d), NJEA may make intra-day amendments to the Call Notice and (i) if such intra-day amendment decreases the Nomination Quantity provided in the Call Notice, then PMI shall decrease its deliveries accordingly and NJEA shall not be obligated to purchase Energy in excess of the revised Nomination Quantity set forth in such intra-day amendment and (ii) if such intra-day amendment increases the Nomination Quantity provided in the Call Notice, then PMI shall use commercially reasonable efforts to increase its deliveries hereunder accordingly.
3.4 Title to Energy; Sales for Resale
(a) All Energy delivered hereunder by PMI or on behalf of PMI by PMI's suppliers, designees or any other Person (including, without limitation, PJM) shall be deliveries to NJEA for immediate redelivery to JCP&L, which redelivery may be made by NJEA at any Delivery Point or Alternate Delivery Point under the Amended PPA.
(b) All Energy delivered hereunder by PMI or by any other Person on its behalf shall be sales for resale, with NJEA immediately reselling such Energy. NJEA shall provide PMI with any certificates reasonably requested by PMI to evidence that the deliveries of Energy hereunder are sales for resale, including without limitation evidence that NJEA or its agent is authorized by FERC to engage in wholesale power sales.
3.5 Failure of PMI to Deliver Scheduled Energy; Cover Damages.
(a) In the event PMI fails to deliver Energy it is obligated to deliver hereunder and such failure is not excused under the terms of this Agreement (such undelivered Energy to be referred to herein as the "Delivery Shortfall"), then PMI shall pay NJEA, on the date payment would otherwise be due in respect of the month in which the failure occurred, an amount for such deficiency equal to the Cover Damages. "Cover Damages" means an amount equal to (A) the positive difference, if any, between (i) the Replacement Price ($/MWh) multiplied by the quantity (in MWh) of the Delivery Shortfall, minus (ii) the Contract Rate ($/MWh) multiplied by the quantity (in MWh) of the Delivery Shortfall, plus (B) any applicable penalties assessed by PJM against NJEA and/or JCP&L as a direct result of PMI's failure to deliver such Energy. Except as otherwise provided in Section 5.2, the damages provided in this Section 3.5 shall be the sole and exclusive remed y of NJEA for any failure of PMI to deliver Energy that it is obligated to deliver hereunder.
(b) All Cover Damages payable by PMI pursuant to this Section 3.5 shall be paid by netting such amounts against amounts otherwise payable by NJEA to PMI hereunder. Each Party reserves to itself all rights, counterclaims and, except as provided in Sections 3.5(a) and 3.6(a), other remedies and defenses consistent with this Agreement which such Party has or may be entitled to arising from or out of this Agreement.
3.6 Failure to Accept Delivery of Schedule Energy; Resale Damages
If NJEA fails to accept all or part of the Energy delivered to it by PMI pursuant to and in accordance with this Agreement, and such failure to accept is not excused under the terms of this Agreement (such Energy is referred to herein as "Rejected Power"), then NJEA shall pay PMI, on the date payment would otherwise be due in respect of the month in which the failure occurred, an amount for such deficiency equal to the Resale Damages. "Resale Damages" means an amount equal to (i) the positive difference, if any, between (x) the Contract Rate ($/MWh) multiplied by the quantity (in MWh) of Rejected Power, minus (y) the Resale Price ($/MWh) multiplied by the quantity (in MWh) of Rejected Power resold by PMI, plus (ii) any applicable penalties assessed by PJM against PMI as a direct result of NJEA failure to accept such Energy. Except as otherwise provided in Section 5.2, the damages provided in this Section 3.6 shall be the sole and exclusi ve remedy of PMI for any failure of NJEA to accept delivery of Energy tendered to it by PMI pursuant to and in accordance with this Agreement.
3.7 Payment for Energy.
(a) All Energy delivered by PMI pursuant to and in accordance with this Agreement shall be purchased by NJEA at the Contract Rate. Beginning on the Effective Date and continuing for the Term, NJEA shall pay PMI a monthly payment for Energy delivered during such month in an amount equal to (1) the product of the total Energy (in MWh) delivered by PMI pursuant to and in accordance with this Agreement during such month multiplied by the per-MWh Contract Rate for each MWh of such delivered Energy, plus (2) any applicable Resale Damages for such month, less (3) any applicable Cover Damages for such month, plus or minus (4) any applicable costs and expenses for deliveries to an Alternate Delivery Point during such month pursuant to Section 3.2(b), plus or minus (5) any PJM Reconciliation Amount for such month.
(b) For each month during the Term, NJEA shall prepare and present to PMI, on or before the twenty fifth (25th) day of the subsequent month, a statement (in $/kWh) for Energy delivered to NJEA during such month in accordance with Section 3. Such statement shall indicate (1) the total MWhs of Energy delivered or supplied by PMI pursuant to and in accordance with this Agreement during the month and the calculation of the payment due pursuant to Section 3.7(a), (2) any costs and expenses in connection with deliveries to an Alternate Delivery Point during the month pursuant to Section 3.2(b) and (3) the PJM Reconciliation Amount.
3.8 Payment and Disputes; Reconciliation with PJM.
(a) Unless otherwise agreed by the Parties, payment of amounts reflected in a statement rendered pursuant to Section 3.7(b) hereof shall be due and payable on or before the second Business Day after the last Business Day of the month in which the statement is delivered to PMI. Payments shall be made by wire transfer to an account designated by PMI in a notice delivered to NJEA, or in the case of a payment due to NJEA, to an account designated by NJEA in the statement or in a written notice delivered to PMI.
(b) In the event PMI disputes all or any part of a statement delivered to it pursuant to Section 3.7(b), PMI shall notify NJEA of the basis for the dispute in writing, accompanied by supporting documentation, within a twenty (20) day period from receipt of such statement. Upon receipt of notice of the dispute and supporting documentation, NJEA shall have thirty (30) days from receipt of such notice to resolve any dispute with PMI. In the event the dispute is not resolved within the thirty (30) day period, either Party may submit the matter to arbitration for resolution in accordance with this Agreement; provided, however, that PMI agrees that at the request of NJEA, PMI shall participate with or reasonably assist NJEA in the conduct of dispute resolution proceedings against JCP&L under the Amended PPA as and to the extent the same facts or occurrences are the basis of the disputes under both this Agreement and the Amended PPA. In the event of any dispute regarding a statement, the undisputed portion thereof shall be paid when due as if there were no dispute, and the disputed portion shall not be due until the dispute is resolved in favor of the Party claiming entitlement to payment. The disputed amount of any statement shall accrue interest at the Late Payment Rate from the date payment of such amount would have been due absent the dispute with respect to such amount until the date payment is made.
(c) In the event that PJM billing and reconciliation statements issued pursuant to the PJM Agreement contain information relating to deliveries of Energy hereunder that differ from the information for the same period contained in statements generated by NJEA pursuant to Section 3.7(b), then the dollar amount of such difference (the "PJM Reconciliation Amount") shall be added to or subtracted from (as appropriate) the payment calculated pursuant to Section 3.7(a) for the next billing month. Upon request by PMI, NJEA shall promptly provide to PMI any PJM reconciliation statements, notices, invoices, and other records as are reasonably necessary to provide written substantiation of the quantities, prices, calculations and other pertinent data used by NJEA in rendering the monthly statements pursuant to Section 3.7(b) hereof.
3.9 Interest on Late Payment.
If a payment is not received when due under this Agreement, the delinquent Party shall pay to the other Party interest on such unpaid amount which shall accrue from the due date until the date upon which payment in full is made at the prime lending rate as may from time to time be published in The Wall Street Journal under "Money Rates" on such day (or if not published on such day on the most recent preceding day on which published), plus two percent (2%) (the "Late Payment Rate").
4 REPRESENTATIONS AND WARRANTIES
4.1 Representations and Warranties of PMI.
PMI hereby represents and warrants to NJEA as of the Effective Date as follows:
(a) Organization and Good Standing; Power and Authority. PMI is a corporation, validly existing and in good standing under the laws of the State of Florida and is duly authorized to transact business as a foreign corporation and is in good standing in each jurisdiction required in order to perform its obligations under this Agreement. PMI has all requisite corporate power and authority to execute, deliver, and perform its obligations under this Agreement.
(b) Due Authorization; No Conflicts. The execution and delivery by PMI of this Agreement, and the performance by PMI of its obligations hereunder, have been duly authorized by all necessary actions on the part of PMI and do not and, under existing facts and law, will not: (i) contravene its articles of incorporation or any other governing documents; (ii) conflict with, result in a breach of, or constitute a default under any note, bond, mortgage, indenture, deed of trust, license, contract or other agreement to which it is a party or by which any of its properties may be bound or affected; (iii) violate any order, writ, injunction, decree, judgment, award, statute, law, rule, regulation or ordinance of any governmental authority or agency applicable to it or any of its properties; or (iv) result in the creation of any lien, charge or encumbrance upon any of its properties pursuant to any of the foregoing.
(c) Binding Agreement. This Agreement has been duly executed and delivered on behalf of PMI and, assuming the due execution hereof and performance hereunder by NJEA, constitutes a legal, valid and binding obligation of PMI, enforceable against it in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors' rights generally and by the application of principles of equity.
(d) No Proceedings. There are no actions, suits or other proceedings, at law or in equity, by or before any governmental authority or agency or any other body pending or, to the best of its knowledge, threatened against or affecting PMI or any of its properties (including, without limitation, this Agreement) which relate in any manner to this Agreement or any transaction contemplated hereby, or which PMI reasonably expects to lead to a material adverse effect on (i) the validity or enforceability of this Agreement or (ii) PMI's ability to perform its obligations under this Agreement.
(e) Consents and Approvals. The execution, delivery and performance by PMI of its obligations under this Agreement does not and, under existing facts and law, will not, require any approval, consent, permit, license or other authorization of, or filing or registration with, or any other action by, any Person which has not been duly obtained, made or taken, and all such approvals, consents, permits, licenses, authorizations, filings (except for informational filings with FERC), registrations and actions are in full force and effect, final and non-appealable.
(f) Negotiations. The terms and provisions of this Agreement are the result of arm's length and good faith negotiations on the part of PMI.
4.2 Representations and Warranties of NJEA.
NJEA hereby represents and warrants to PMI as of the Effective Date as follows:
(a) Organization and Good Standing; Power and Authority. NJEA is a limited partnership validly existing and in good standing under the laws of the State of New Jersey and is duly authorized to transact business as a foreign limited partnership in each jurisdiction required in order to perform its obligations under this Agreement. NJEA has all requisite limited partnership power and authority to execute, deliver and perform its obligations under this Agreement.
(b) Due Authorization; No Conflicts. The execution and delivery by NJEA of this Agreement and the performance by NJEA of its obligations hereunder have been duly authorized by all necessary actions on the part of NJEA and its partners and do not and, under existing facts and law, will not: (i) contravene its partnership agreement or any other governing documents; (ii) conflict with, result in a breach of, or constitute a default under any note, bond, mortgage, indenture, deed of trust, license, contract or other agreement to which it is a party or by which any of its properties may be bound or affected; (iii) violate any order, writ, injunction, decree, judgment, award, statute, law, rule, regulation or ordinance of any governmental authority or agency applicable to it or any of its properties; or (iv) result in the creation of any lien, charge or encumbrance upon any of its properties pursuant to any of the foregoing.
(c) Binding Agreement. This Agreement has been duly executed and delivered on behalf of NJEA and assuming the due execution hereof and performance hereunder by PMI, constitutes a legal, valid and binding obligation of NJEA, enforceable against it in accordance with its terms, except as such enforceability may be limited by law or principles of equity.
(d) No Proceedings. Other than the BPU proceedings in connection with the Final Decision, there are no actions, suits or other proceedings, at law or in equity, by or before any governmental authority or agency or any other body pending or, to the best of its knowledge, threatened against or affecting NJEA or this Agreement.
(e) Consents and Approvals. The execution, delivery and performance by NJEA of its obligations under this Agreement do not and, under existing facts and law, will not, require any approval, consent, permit, license or other authorization of, or filing (except for informational filings with the Federal Energy Regulatory Commission) or registration with, or any other action by, any Person which has not been duly obtained, made or taken, and all such approvals, consents, permits, licenses, authorizations, filings, registrations and actions are in full force and effect, final and non-appealable. NJEA is authorized by FERC to engage in wholesale power sales, including the purchase and sale of all Energy contemplated under this Agreement.
(f) Negotiations. The terms and provisions of this Agreement are the result of arm's length and good faith negotiations on the part of NJEA.
5. BREACHES; REMEDIES
5.1 Events of Default; Cure Rights.
It shall constitute an event of default ("Event of Default") hereunder if:
(a) Representation or Warranty. Any representation or warranty set forth herein is not accurate and complete in all material respects as of the date made, unless such inaccuracy or incompleteness is capable of cure by the payment of money and is cured within thirty (30) days after written notice thereof is given by the non-defaulting Party to the breaching party, or unless such inaccuracy or incompleteness is not capable of cure by the payment of money, but is otherwise capable of cure, and the Party in default promptly begins and diligently and continuously pursues such cure activity.
(b) Payment Obligations. Any payment due and payable by either Party to the other Party hereunder is not made on the date due, and such failure continues for more than five (5) Business Days after notice thereof is given to the defaulting Party by the non-defaulting Party.
(c) Bankruptcy. Either party either (a) is adjudged bankrupt or files a petition in voluntary bankruptcy under any provision of any bankruptcy law or consents to the filing of any bankruptcy or reorganization petition against such Party under any such law, or (without limiting the generality of the foregoing) files a petition to reorganize such Party pursuant to 11 U.S.C. Subsection 101 or any similar statute applicable to such Party, as now or hereinafter in effect, or (b) makes an assignment for the benefit of creditors, or admits in writing an inability to pay its debts generally as they become due, or consents to the appointment of a receiver or liquidator or trustee or assignee in bankruptcy or insolvency of such Party, or (c) is subject to an order of a court of competent jurisdiction appointing a receiver or liquidator or custodian or trustee of such Party or of a major part of its property.
(d) Other Covenants. Subject to Section 3.6, a Party fails to perform, observe or otherwise to comply with any obligation hereunder (other than as described in Section 5.1(b),) and such failure continues for more than thirty (30) days after notice thereof is given by the non-defaulting Party to the defaulting Party, or if such default is not capable of cure within thirty (30) days, the Party in default promptly begins such cure activity within such thirty (30) day period and diligently and continuously pursues the cure activity such that the failure is cured within ninety (90) days after notice thereof is given by the non-defaulting Party to the defaulting Party.
5.2 Termination; Termination Payment.
(a) If an Event of Default as described in Section 5.1(b) hereof (payment default) pursuant to which the payment default exceeds $100,000.00 unless disputed in good faith and in accordance with Section 7, is continuing on the sixtieth (60th) day following the receipt by the defaulting Party of written notice provided by the non-defaulting Party to the defaulting Party of such Event of Default, then the non-defaulting Party may at any time after the expiration of the sixty (60) day cure period described above during which such Event of Default remains uncured terminate this Agreement by giving written notice thereof to the defaulting Party; provided, however, that any such termination by the non-defaulting Party shall not diminish nor discharge the payment obligation of the defaulting Party which gives rise to such termination. Upon any such termination of this Agreement, PMI shall have the right to sell or otherwise dispose of the Energy that was otherwise to be delivered under this Agreement to by or on behalf of PMI to JCP&L on behalf of NJEA in any manner it sees fit, free of any NJEA interest therein. Except as provided in this Section 5.2(a), neither Party shall be entitled to terminate this Agreement due to an Event of Default by the other Party.
(b) If NJEA terminates this Agreement pursuant to Section 5.2(a) due to an Event of Default by PMI, then PMI shall pay liquidated damages to NJEA (the "PMI Termination Payment"), which shall consist of (A) the mark-to-market value, if any, of the terminated Energy payment obligation, as determined in a commercially reasonable manner, with the reference contract price being the Contract Rate hereunder, reasonably adjusted to reflect changes in the expected Facility dispatch factor caused by changes in projected market prices and the market consisting of a reasonable estimation of the sum of the amounts that would be payable by NJEA for electricity during the Replacement Period from a replacement supplier in the amounts that would have been required to be delivered to JCP&L on behalf of NJEA hereunder absent termination of this Agreement; plus (B) the total amount of Ancillary Termination Damages payable to NJEA due to the termination. NJEA shall provide P MI with an invoice for the damages calculated in accordance with this Section 5.2(b) plus any additional amount owed to NJEA in connection with such termination as described in Section 5.2(d) hereof which invoice shall set forth the calculation and substantiation for such amounts. PMI shall pay the undisputed amount set forth in such invoice within thirty (30) days by wire transfer to an account designated by NJEA in the invoice or in a written notice delivered to PMI and, with respect to any disputed amount of such invoice, pursue dispute resolution proceedings as described in Section 3.8(b) and Section 7 hereof. Such liquidated damages, which the Parties agree are reasonable, shall be payable on account of the substantial consideration received by PMI as a result of this Agreement. The Parties agree, and shall take all necessary action to establish before any court or arbitral tribunal, that damages suffered by NJEA as a result of an Event of Default on the part of PMI hereunder and termination of this Agreement are reasonable and necessary to justly compensate NJEA for its damages resulting from such Events of Default and termination of this Agreement.
(c) If PMI terminates this Agreement pursuant to Section 5.2(a) hereof due to an Event of Default by NJEA, then NJEA shall pay liquidated damages to PMI (the "NJEA Termination Payment"), which shall consist of (A) the mark-to-market value, if any, of the terminated Energy payment obligation, as determined in a commercially reasonable manner, with the reference contract price being the Contract Rate hereunder, reasonably adjusted to reflect changes in the expected Facility dispatch factor caused by changes in projected market prices and the market consisting of a reasonable estimation of the sum of the amounts that would be payable to PMI for the sale of electricity during the Replacement Period to a replacement purchaser in the amounts that would have been required to be accepted by JCP&L as deliveries on behalf of NJEA tendered to it by PMI pursuant to and in accordance with this Agreement absent termination of this Agreement; plus (B) the total amount of Ancillary Termination Damages payable to PMI due to the termination. PMI shall provide NJEA with an invoice for the damages calculated in accordance with this Section 5.2(c) plus any additional amount owed to PMI in connection with such termination as described in Section 5.2(d) hereof which invoice shall set forth the calculation and substantiation for such amounts. NJEA shall pay the undisputed amount set forth in such invoice within thirty (30) days by wire transfer to an account designated by PMI in the invoice or in a written notice delivered to NJEA and, with respect to any disputed amount of such invoice, pursue dispute resolution proceedings as described in Section 3.8(b) and Section 7 hereof. Such liquidated damages, which the Parties agree are reasonable, shall be payable on account of the substantial consideration received by NJEA as a result of this Agreement. The Parties agree, and shall take all necessary action to establish before any cou rt or arbitral tribunal, that damages suffered by PMI as a result of an Event of Default on the part of NJEA hereunder and termination of this Agreement are reasonable and necessary to justly compensate PMI for its damages resulting from such Event of Default and termination of this Agreement.
(d) In connection with the termination of this Agreement pursuant to Section 5.2(a) hereof each Party shall pay any amounts owed to the other Party under this Agreement as of the date of such termination (without duplication of the amounts set forth in the preceding paragraphs of this Section 5.2) on or before the date required for payment of the amounts described in Sections 5.2(b) or (c) above.
5.3 Remedies.
(a) Damages. Subject to Section 5.3(c) and to the extent not covered by Section 3.5, Section 3.6 or Section 5.2 hereof each defaulting Party shall be liable to the non-defaulting Party for any and all costs, expenses, damages and losses suffered or incurred by such non-defaulting Party in connection with an Event of Default on the part of the breaching Party.
(b) Other Remedies. In addition to the rights and remedies following an Event of Default as set forth herein, each of the Parties shall also have available to it all of the rights, powers and remedies available to it at law or in equity.
(c) Consequential Damages. Notwithstanding anything otherwise contained in this Agreement to the contrary, neither NJEA nor PMI shall be liable to the other for any indirect, consequential, incidental, punitive or exemplary damages. The provisions of this Section 5.3(c) shall not affect or diminish the damage amounts payable pursuant to Sections 3.5 and 3.6.
(d) Suspension of Deliveries. In the event of any payment default by NJEA pursuant to Section 5.1(b) hereof (which by its terms includes a five (5) Business Day cure period), then upon at least five (5) days' prior written notice (which notice may not be delivered prior to the expiration of the five (5) Business Day cure period described in Section 5.1(b) hereof), PMI may, but shall not be obligated to, suspend deliveries of Energy under this Agreement until such payment default has been cured. In the event of such suspension of deliveries to NJEA pursuant to this Section 5.3(d), PMI shall be relieved of all of its delivery obligations hereunder for the duration of such suspension.
6. FORCE MAJEURE
6.1 Force Majeure.
The term "Force Majeure" means an event or circumstance which prevents a Party from performing its obligations hereunder (other than the obligation to make payments then due or becoming due with respect to performance prior to the Force Majeure), which event or circumstance was not anticipated and which is not within the reasonable control of, or the result of the fault or negligence of, the claiming Party, and which, by the exercise of due diligence (which may include obtaining replacement power, to the extent obtainable on commercially reasonable terms), the claiming Party is unable to overcome or avoid or cause to be avoided on commercially reasonable terms and conditions. Notwithstanding the foregoing, Force Majeure shall not be based on (i) the loss of NJEA's markets; (ii) NJEA's inability economically to use or resell the Energy purchased hereunder; (iii) the loss or failure of PMI's supply of electric energy unless due to a failure of the transmission or distribution syste m which adversely affects all or substantially all of the suppliers delivering or transmitting Energy across such system or (iv) PMI's ability to sell Energy at a price greater than the Contract Rate.
Subject to the satisfaction of the criteria set forth in the preceding paragraph, Force Majeure events shall include, without limitation, action of a court or regulatory authority, a Change in Law, catastrophic physical failures or disruptions of the PJM transmission system; provided, however, that for purposes of this Agreement, Force Majeure shall not include (i) any event that results solely in an increase in PMI's or its suppliers' costs to perform obligations to deliver Energy to PMI or on behalf of PMI hereunder or (ii) any increase in the cost of electricity supplies or transmission or (iii) any congestion costs.
6.2 Notice and Excuse of Performance.
(a) Following a Force Majeure event, if either Party believes that such event will, or is reasonably likely to, adversely affect the performance of its obligations under this Agreement, then as early as commercially practicable but in no event later than two (2) Business Days after the initial occurrence of such event and for contingency planning purposes, such Party shall provide preliminary telephonic notice of the occurrence of a Force Majeure to the other Party promptly followed by written notice on or before the tenth (10th) Business Day after the initial occurrence of such event. Such written notice shall specify the nature and, if known, cause of the Force Majeure, its anticipated effect on the ability of such Party to perform obligations under this Agreement and the estimated duration of any interruption in service or other adverse effects resulting from such Force Majeure and shall be updated or supplemented as necessary to keep the other Party advised of the effect and remedial measures being unde rtaken to overcome the Force Majeure.
For the purposes of this Section 6.2, notification given to the schedulers for the Parties and JCP&L shall be sufficient delivery of notice.
(b) Effect of Force Majeure on Performance of Obligations. To the extent either Party is prevented by Force Majeure from carrying out, in whole or part, its obligations under this Agreement and such Party (the "Claiming Party") gives notice and details of the Force Majeure to the other Party as soon as practicable, then the Claiming Party shall be excused from the performance of its obligations with respect to such 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. The non-Claiming Party shall not be required to perform its obligations to the Claiming Party corresponding to the obligations of the Claiming Party excused by Force Majeure.
7. DISPUTE RESOLUTION
(a) Any controversy, dispute or claim between the Parties to this Agreement which is based upon acts or occurrence that also give rise to a controversy, dispute or claim by either NJEA or JCP&L under the Amended PPA shall be resolved pursuant to the dispute resolution proceedings set forth in the Amended PPA; provided, that if PMI will bear the economic consequences of any such decision or dispute resolution under the Amended PPA then to the fullest extent possible, NJEA shall allow PMI to participate in and/or control NJEA's conduct in such negotiations or proceedings.
(b) Any controversy, dispute or claim between the Parties that is not described in Section 7(a) above and which the Parties are unable to resolve by negotiation shall be settled by arbitration in accordance with the Commercial Arbitration Rules of the AAA, then in effect, and the provisions of this Section 7. No suit at law that seeks to resolve any controversy, dispute or claim between the Parties shall be instituted by either Party hereto, except where such suit is instituted to confirm an arbitration award received pursuant to this Section 7. However, nothing contained herein shall deprive either Party of any right to: (i) obtain injunctive or other equitable relief in any court in the State of New Jersey, on an interim basis pending disposition of the arbitration of any controversy, dispute or claim if such relief is available under applicable principles of law and equity (provided, however, that the arbitrators selected pursuant to Section 7(e) hereo f shall not regard as dispositive any such award of injunctive or equitable relief when considering a dispute); and/or (ii) assert any cross-claim, or third-party claim in any suit at law instituted by a third party; and/or (iii) file and prosecute any complaint at and with the regulatory agency having jurisdiction or make and prosecute any claim or position in any filing made with such regulatory agency by either Party or some third party.
(c) Any controversy, dispute or claim submitted to arbitration pursuant to Section 7(b) shall be settled by arbitration to be conducted in New York, New York. Any award entered pursuant to such arbitration shall be binding on both Parties and judgment upon the award rendered or received may be entered in the Superior Court of the State of New Jersey pursuant to N.J.S.A. 2A:24-1 et seq.
(d) Exclusive jurisdiction relative to the entry of judgment on any arbitration award relative to any controversy or claim between the Parties resolved pursuant to Section 7(b) shall be in any court of appropriate subject matter jurisdiction located in New Jersey, and the Parties to this Agreement expressly subject themselves hereby to the personal jurisdiction of said court for entry of any such judgment and for the resolution of any dispute, action, or suit arising in connection with the entry of such judgment.
(e) The controversy or claim to be arbitrated pursuant to Section 7(b) shall be referred to three (3) arbitrators, one to be selected by each Party and the third to be selected by the AAA. The selections to be made by the Parties shall be made from the list of the National Panel of Arbitrators maintained by the AAA. The arbitrator to be selected by the AAA shall be qualified to pass on any technical or engineering matters and shall be independent of both PMI and NJEA. All decisions and awards shall be made by a majority of the arbitrators, except for decisions relating to discovery as set forth herein.
(f) In the event any arbitrator dies, or refuses to act, or becomes incapable, incompetent or unfit to act before hearings have been completed and/or before an award has been rendered, a successor arbitrator may be selected by the Party who originally made the selection. The selection of the successor arbitrator shall be made consistent with the selection procedure set forth in the preceding paragraph.
(g) The arbitrators selected pursuant to this Agreement shall be governed by and apply the laws of the State of New Jersey and federal law, as applicable, in conducting any arbitration proceeding and/or in making any award.
(h) Notice of a demand for arbitration of any controversy or dispute between the Parties shall be filed in writing with the AAA by the Party seeking arbitration and a copy of same shall be served contemporaneously with such filing on the other Party. The notice shall state, with specificity, the nature of the dispute and the remedy sought. After such notice has been filed, the Parties may make discovery of any matter relevant to such dispute before the hearing, to the extent and in the manner provided by the Rules Governing Civil Practice in the Superior Court contained in the Rules Governing the Courts of the State of New Jersey. Any question that may arise with respect to the obligations of the Parties relative to discovery and/or relative to the protection of the discovery materials shall be referred solely to the arbitrator selected by the AAA. His determination shall be final and conclusive. Discovery shall be completed not later than ninety (90) days after filing of the notice of arbitration unless su ch period for discovery is extended by the arbitrator selected by the AAA, upon a showing of good cause by the Party requesting the extension.
(i) The arbitrators may consider any material that is relevant to the subject matter of any such controversy even if such material might also be relevant to an issue or issues not subject to arbitration hereunder. A stenographic record shall be made of any arbitration hearing.
(j) Any costs associated with any arbitration under this Section 7, including but not limited to attorney fees and witness expenses, shall be paid by the Party against whom an award is entered unless the arbitrators by their award otherwise provide.
(k) Arbitration may not be utilized and the arbitrators selected in accordance with Section 7(b) through (k) shall not possess the authority or power to alter, amend or modify any of the terms or conditions or charges set forth in this Agreement, and further, the arbitrators may not enter any award which alters, amends or modifies such terms, conditions or charges in any form or manner.
8. CONFIDENTIALITY
(a) PMI and NJEA each agree not to disclose to any Person and to keep confidential, and to cause and instruct its Affiliates, officers, directors, employees, partners and representatives not to disclose to any Person and to keep confidential, any and all of the following information: (i) the terms and provisions of this Agreement, (ii) any financial, pricing or supply quantity information relating to the Energy to be supplied by PMI hereunder, the Facility or NJEA and (iii) any information that is clearly marked or identified as "Confidential". Notwithstanding the foregoing, any such information may be disclosed: (A) to the extent required by applicable laws and regulations or by any subpoena or similar legal process of any court or agency of federal, state or local government so long as the receiving Party gives the non-disclosing Party written notice at least three (3) Business Days prior to such disclosure, if practicable, (B) to lenders and potential lenders to PMI or to lenders to NJEA or other Person(s) in connection with the implementation of the Restructuring and to financial advisors, rating agencies, and any other Persons involved in the acquisition, marketing or sale or placement of such debt, (C) to agents, trustees, advisors and accountants of the Parties or their Affiliates involved in the financings described in clause (B) above, (D) to potential assignees of PMI or NJEA or other Persons in connection with such proposed assignment and to financial advisors, rating agencies, and any other Persons involved in the marketing, placement or rating of such assignment, (E) to agents, trustees, advisors and accountants of the Parties or their Affiliates or agents, trustees, advisors and accountants of Persons involved in the potential assignment described in clause (D) above or (F) to the extent the non-disclosing Party shall have consented in writing prior to any such disclosure. With respect to the Restructuring, this Section 8 shall supersede an y prior confidentiality agreement between NJEA and PMI or its Affiliates. Information (1) of a confidential nature which has become public other than as a result of a breach of this Section 8, (2) which was known to the disclosing Party prior to the execution of this Agreement, or (3) which was received by the disclosing Party from another source who in turn disclosed the information without violating legal restrictions, will not be subject to the confidentiality obligations set forth herein with respect to such information. Nothing in this Section 8(a) shall limit or otherwise restrict the disclosure of information regarding the Restructuring to the BPU or other governmental or regulatory entity or other party thereto in connection with the satisfaction of requirements for regulatory approvals required in connection with the transactions contemplated hereby or in connection with any other NJEA proceeding before the BPU; provided, however, that the Parties shall use the ir best efforts to cause all such submitted information to be treated on a confidential basis by such government or regulatory entities or other party and to prohibit, to the extent possible, the public distribution of such information.
(b) No public statement, press release or other voluntary publication regarding this Agreement or the Restructuring or any of the transactions contemplated hereby shall be made or issued without the prior consent of the other Party, which consent shall not be unreasonably withheld.
(c) Notwithstanding anything to the contrary, each Party (and each employee, representative, or other agent of each Party for so long as they remain an employee, representative or agent) may disclose to any and all Persons, without limitation of any kind, the tax treatment and tax structure of the transactions contemplated by this Agreement and all materials of any kind (including opinions or other tax analyses) that are provided to each Party relating to such tax treatment and tax structure. The preceding sentence shall be effective immediately upon commencement of discussions between the Parties (whether such discussions commenced verbally, in writing, or otherwise) that are related to the terms of this Agreement.
9. INDEMNIFICATION AND INDEMNIFICATION PROCEDURES
9.1 Indemnification.
Each Party ("Indemnifying Party") shall indemnify, defend and hold the other Party ("Indemnified Party") and its partners, shareholders, partners, directors, officers, employees and agents (including, but not limited to, Affiliates and contractors and their employees), harmless from and against all liabilities, damages, losses, penalties, claims, demands, suits and proceedings of any nature whatsoever suffered or incurred by such Indemnified Party arising out of the Indemnifying Party's gross negligence or willful misconduct (including, without limitation, any breach of this Agreement resulting from gross negligence or willful misconduct). In the event injury or damage results from the joint or concurrent grossly negligent or willful misconduct of the Parties, each Party shall be liable under this indemnification in proportion to its relative degree of fault. Such duty to indemnify shall not apply to any claims which arise or are first asserted more than two (2) years after t he termination of this Agreement. Such indemnity shall not include or compensate for indirect, punitive, exemplary, incidental or consequential damages incurred by either Party.
9.2 Indemnification Procedures.
Each Indemnified Party shall promptly notify the Indemnifying Party of any claim in respect of which the Indemnified Party is entitled to be indemnified under this Section 9. Such notice shall be given as soon as is reasonably practicable after the Indemnified Party becomes aware of each claim; provided, however, that failure to give prompt notice shall not adversely affect any claim for indemnification hereunder except to the extent the Indemnifying Party's ability to contest any claim by any third party is materially adversely affected. The Indemnifying Party shall have the right, but not the obligation, at its expense, to contest, defend, litigate and settle, and to control the contest, defense, litigation and/or settlement of, any claim by any third party alleged or asserted against any Indemnified Party arising out of any matter in respect of which such Indemnified Party is entitled to be indemnified hereunder. The Indemnifying Party shall promptly notify such Indemnified Party of its intent ion to exercise such right set forth in the immediately preceding sentence and shall reimburse the Indemnified Party for the reasonable costs and expenses paid or incurred by it prior to the assumption of such contest, defense or litigation by the Indemnifying Party. The Indemnifying Party shall have the right to select legal counsel to defend a claim for which the Indemnified Party is seeking indemnification pursuant to this Section 9.2, subject to the consent of the Indemnified Party, which shall not be unreasonably delayed or withheld. If the Indemnifying Party exercises such right in accordance with the provisions of this Section 9 and any Indemnified Party notifies the Indemnifying Party that it desires to retain separate counsel in order to participate in or proceed independently with such contest, defense or litigation, such Indemnified Party may do so at its own expense. If the Indemnifying Party fails to exercise it rights set forth in the third sentence of this Section&nb sp;9.2, then the Indemnifying Party will reimburse the Indemnified Party for its reasonable costs and expenses incurred in connection with the contest, defense or litigation of such claim. No Indemnified Party shall settle or compromise any claim in respect of which the Indemnified Party is entitled to be indemnified under this Section 9 without the prior written consent of the Indemnifying Party; provided, however, that such consent shall not be unreasonably withheld by the Indemnifying Party
10. ASSIGNMENT
10.1 Prohibition on Assignment.
Except as provided in Section 10.2 hereof, this Agreement may not be assigned by either Party without the prior written consent of the other Party, which may not be unreasonably withheld. Any attempted or purported assignment of this Agreement that is not expressly permitted pursuant to Section 10.2 hereof, shall be null and void and shall have no effect on or with respect to the rights and obligations of the Parties hereunder.
10.2 Permitted Assignment.
(a) In addition to its rights set forth in Section 10.2(b) hereof, either Party shall have the right to assign all or any portion of its rights or obligations under this Agreement without the consent of the other Party, for collateral security purposes, to existing and any future lenders, including existing and any future lenders of partners or affiliates. In connection with the exercise of remedies under the security documents relating to such financing(s), the lender(s) or trustee(s) shall be entitled to assign this Agreement to any third-party transferee designated by such lender(s) or trustee(s).
(b) If either Party assigns this Agreement as provided in this Section 10.2, then such Party shall cause to be delivered to the other Party an assumption agreement (in form and substance reasonably satisfactory to the non-assigning Party) of all of the obligations of the assigning Party hereunder by such assignee.
(c) An assignment of this Agreement pursuant to this Section 10.2 shall not release or discharge the assignor from its obligations hereunder unless the assignee executes a written assumption agreement in accordance with Section 10.2(b) hereof.
11. NOTICES
Any notice or communication given pursuant hereto shall be in writing and (1) delivered personally (personally delivered notices shall be deemed given upon written acknowledgment of receipt after delivery to the address specified or upon refusal of receipt); (2) mailed by registered or certified mail, postage prepaid (mailed notices shall be deemed given on the actual date of delivery, as set forth in the return receipt, or upon refusal of receipt); (3) delivered by facsimile (notices by facsimile shall be deemed given at the time it is confirmed as delivered, but in any event no later than one (1) Business Day after dispatch) or (4) delivered in full by telecopy (telecopied notices shall be deemed given upon actual receipt), in either case addressed or telecopied as follows or to such other addresses or telecopy numbers as may hereafter be designed by either Party to the other in writing:
If to PMI:	FPL Energy Power Marketing, Inc. 700 Universe Blvd. P.O. Box 14000 Juno Beach, FL 33408 Attention: Business Manager Telephone: 561-304-5107 Facsimile: 561-304-5161
If to NJEA:	North Jersey Energy Associates, A Limited Partnership c/o Northeast Energy, LP c/o ESI Northeast Energy GP, Inc. Its General Partner 700 Universe Blvd. P.O. Box 14000 Juno Beach, FL 33408 Attention: Business Manager Phone: 561-304-5107 Facsimile: 561-304-5161
12. WAIVER AND MODIFICATION
12.1 Modification or Waiver.
This Agreement may be amended and its provisions and the effects thereof waived only by a writing executed by the Parties, and no subsequent conduct of any Party or course of dealings between the Parties shall effect or be deemed to effect any such amendment or waiver. No waiver of any of the provisions of this Agreement shall be deemed or shall constitute a waiver of any other provision hereof (whether or not similar), nor shall such waiver constitute a continuing waiver unless otherwise expressly provided. The failure of either Party to enforce any provision of this Agreement shall not be construed as a waiver of or an acquiescence in or to such provision.
13. INTERPRETATION
13.1 Choice of Law.
Interpretation and performance of this Agreement shall be in accordance with, and shall be controlled by, the laws of the State of New Jersey (without regard to its principles of conflicts of law).
13.2 Headings.
Article and Section headings are for convenience only and shall not affect the interpretation of this Agreement. References to articles, sections and appendices, and schedules are, unless the context otherwise requires, references to articles, sections, appendices, and schedules of this Agreement. The words "hereof" and "hereunder" shall refer to this Agreement as a whole and not to any particular provision of this Agreement.
14. COUNTERPARTS
Any number of counterparts of this Agreement may be executed, and each shall have the same force and effect as an original.
15. NO DUTY TO THIRD PARTIES
Except as provided in any consent to assignment as specified in the other provisions of this Agreement, nothing in this Agreement nor any action taken hereunder shall be construed to create any duty, liability or standard of care to any Person not a Party to this Agreement.
16. SEVERABILITY
If any term or provision of this Agreement or the interpretation or application of any term or provision to any prior circumstance is held to be unenforceable, illegal or invalid by a court or agency of competent jurisdiction, the remainder of this Agreement and the interpretation or application of all other terms or provisions to Persons or circumstances other than those which are unenforceable, illegal or invalid shall not be affected thereby, and each term and provision shall be valid and be enforced to the fullest extent permitted by law.
17. ENTIRE AGREEMENT
Upon the Effective Date, this Agreement, together with the agreements executed or delivered on the Effective Date in connection herewith, shall constitute the entire agreement and understanding between the Parties hereto and shall supersede all prior agreements and understandings relating to the subject matter hereof.
[SIGNATURES APPEAR ON FOLLOWING PAGE]

IN WITNESS WHEREOF, each of PMI and NJEA has caused this Agreement to be duly executed on its behalf as of the date first above written.
	NORTH JERSEY ENERGY ASSOCIATES, A LIMITED PARTNERSHIP
	By:	Northeast Energy, LP, its general partner
	By:	ESI Northeast Energy GP, Inc., its administrative general partner
	By:	NATHAN E. HANSON
		Nathan E. Hanson Director
	FPL ENERGY POWER MARKETING, INC.
	By:	MARK MAISTO
		Mark Maisto President

EX-10

Exhibit 10(e)
BASE CONTRACT FOR SALE AND PURCHASE OF NATURAL GAS
THIS Base Contract for Sale and Purchase of Natural Gas ("Base Contract"), made and entered into on this 1st day of January, 2004 by and between Northeast Energy Associates, A Limited Partnership, a Massachusetts limited partnership ("Buyer") and FPL Energy Power Marketing, Inc. ("Seller").
ARTICLE I PURPOSE AND PROCEDURES
1.1 This Base Contract establishes the terms and conditions governing the purchases and sale of Gas between the Seller and Buyer (each a "Party" and collectively, the "Parties") during the Term of this Base Contract. Gas purchased hereunder is intended solely for a portion the operational needs of the Facility and is not intended for resale.
1.2 This Base Contract provides for the delivery of Gas by Seller to Buyer under a Firm Performance Obligation for the entire term of the Contract. The Parties may by mutual agreement, through Confirmations described hereunder, modify the delivery obligations, including (without limitation) changes in the Delivery Point(s), for all or part of the Gas to be delivered hereunder.
1.3.1 The Parties will use the following transaction procedure. The Parties may periodically agree to transactions that modify deliveries under this Base Contract (i) by written document ("Confirmation"), or (ii) a recorded telephone conversation between authorized representatives. When the Parties come to an oral agreement regarding a modification of the deliveries under this Base Contract for a particular delivery period, they shall be legally bound from the time they so agree to transaction terms and each may rely thereon. Any such transaction shall be considered to be in "writing" and to have been "signed." Notwithstanding the foregoing, Seller shall, and Buyer may, confirm a telephonic transaction by sending a Confirmation via facsimile, E-mail or other mutually agreeable electronic means to the other Party by the close of the Business Day following the date of the oral agreement; provided that the failure to send a Confirmation shall not invalidate the oral agreement of the Parties.
1.3.2 If a sending Party's Confirmation is contrary to the receiving Party's understanding of the oral agreement, the receiving Party shall notify the sending Party via facsimile, E-mail or other mutually agreeable electronic means before the close of the second Business Day following receipt if the receiving Party has not previously sent a Confirmation to the sending Party. The receiving Party's failure to so notify the sending Party via facsimile, E-mail or other mutually agreeable electronic means within the aforementioned time period constitutes the receiving Party's agreement to the terms of the transaction modification described in the sending Party's Confirmation.
1.3.3 If both Parties send a Confirmation regarding a single transaction and there are any differences in a material term between Seller's and Buyer's Confirmations, then neither Confirmation shall be binding until or unless such differences are resolved and agreed to in writing.
1.3.4 The Parties may electronically record any telephone conversations between their employees with respect to this Base Contract, without any special or further notice to the other Party. Each Party will obtain any necessary consent of its agents and employees for such recordings. Such recordings may be introduced as evidence of any oral transaction hereunder and the Parties agree not to contest the validity or enforceability of any oral agreement, which is recorded in accordance herewith.
1.4 The entire agreement between the Parties shall be those provisions contained in this Base Contract, any effective Confirmation, and any oral agreement of the Parties pursuant to Section 1.3.1 (collectively, the "Contract"). In the event of a conflict between the terms of (i) an effective Confirmation, (ii) the oral agreement of the Parties pursuant to Section 1.3.1, and (iii) the Base Contract, the terms of the agreement shall govern in the priority listed in this sentence.
ARTICLE II DEFINITIONS
2.1 "Alternate Delivery Point" shall have the meaning set forth in Section 6.1.
2.2 "BTU" shall mean British Thermal Unit.
2.3 "Business Day" shall mean any day except Saturday, Sunday or bank holidays.
2.4 "Commencement Date" shall have the meaning set forth in Section 4.1.
2.5 "Confirmation" shall have the meaning set forth in Article I; provided that a written Confirmation shall be substantially in the form attached in Exhibit A.
2.6 "Contract" shall have the meaning set forth in Section 1.4.
2.7 "Contract Price" shall have the meaning set forth in Section 11.1.
2.8 "Contract Quantity" shall mean 11,455 MMBtu per Day for each Gas Day, unless otherwise modified pursuant to Sections 1.3.1 through 1.3.3.
2.9 "Cover Costs" shall have the meaning set forth in Section 16.1.
2.10 "Cover Standard" shall mean that if there is an unexcused failure to take or deliver any quantity of Gas pursuant to this Base Contract, then the non-defaulting Party shall use commercially reasonable efforts to obtain or sell Gas at a reasonable price for the delivery point.
2.11 "Delivery Point" for any Gas delivery to Buyer shall be the Primary Delivery Point, Alternate Delivery Point(s), or other point(s) as established by Section 6.1.
2.12 "Facility" means the Gas-fired electrical and steam generating plant located in Bellingham, Massachusetts and owned by the Buyer.
2.13 "Firm Performance Obligation" has the meaning given in Section 3.1.
2.14 "Forced Outage" means a partial or full interruption in the generating capability of the Facility due to an unplanned component failure (immediate, delayed, postponed, or startup failure) or other condition that requires the applicable unit to be removed from service, or prevents the unit from going back into service, immediately, within six hours, or before the end of the then next weekend.
2.15 "Fuel Manager" means the Buyer's fuel manager as designated from time to time in a written notice from Buyer to Seller.
2.16 "Gas" shall mean pipeline quality natural gas.
2.17 "Gas Day" shall mean a period of twenty-four (24) consecutive hours, coextensive with a "gas day" as defined in the tariff of the Transporter delivering Gas to the Delivery Point in a particular transaction.
2.18 "Imbalance Charges" shall mean any Scheduling penalties, imbalance penalties, overpull or unauthorized overrun penalties, operational flow order penalties, cash out charges, banking charges, or similar penalties, fees or charges assessed by a Transporter for failure to satisfy the Transporter's balancing and/or Scheduling requirements.
2.19 "Index Price" means the monthly posting (expressed in $/MMBtu) published in Platts Gas Daily Price Guide under "Monthly Contract", "Index", "Market Centers", "Northeast", "Niagara" (as such publication exists as of the date hereof). If such monthly index or such publication ceases to be published, the Parties shall in good faith determine a replacement monthly index to be utilized from the date the foregoing index or publication ceases to be published for the remainder of the term of this Base Contract (subject to further replacement as provided herein in the event that the replacement index ceases to be published), which replacement index shall reflect, to the maximum extent possible, the market cost of natural gas delivered to the Project.
2.20 "Maintenance Outage" means a partial or full interruption in the generating capability of the Facility due to the removal of a unit from service to perform work on specific components that can be deferred beyond the end of the then next weekend, but requires the unit to be removed from service before the next Planned Outage.
2.21 "MMBtu" shall mean one million BTUs.
2.22 "Month" shall mean the period beginning on the first calendar day of the calendar month and ending on the last calendar day of the same calendar month.
2.23 "Nomination" means Buyer's designation to Seller of the amount of Gas to be delivered to a Delivery Point during the Gas Day or Gas Days specified in the Nomination.
2.24 "Outage" shall mean Forced, Planned, or Maintenance Outage.
2.25 "Party" and "Parties" shall have the meanings set forth in Section 1.1.
2.26 "Planned Outage" means a planned partial or full interruption of the operation of the Facility for any reason at Buyer's discretion.
2.27 "Power Purchaser" means any of Boston Edison Company, Commonwealth Electric Company or Montaup Electric Company.
2.28 "Primary Delivery Point" shall have the meaning set forth in Section 6.1.
2.29 "ProGas Contract" means the Gas Purchase Contract between Buyer and ProGas Limited, dated as of May 12, 1988, as amended by an Amending Agreement, dated as of April 17, 1989, and by a Second Amending Agreement, dated as of June 23, 1989, and by a Amending Agreement, dated as of November 1, 1991, and by Amending Agreement and a Letter Agreement, both dated as of July 30, 1993, as amended by an Amending Agreement dated as of March 1, 2003.
2.30 "Receiving Transporter" shall mean the Transporter receiving Gas at a Delivery Point.
2.31 "Schedule," "Scheduling," or "Scheduled" shall refer to the act of Seller, Buyer, and the Transporter(s) notifying, requesting, and confirming to each other the quantity of Gas to be delivered hereunder on any given Gas day. Gas shall be deemed to have been Scheduled when confirmed by Transporter(s).
2.32 "Termination Date" shall have the meaning set forth in Section 4.1.
2.33 "Transporter(s)" shall mean all pipeline companies transporting Gas for Seller or Buyer pursuant to a particular Confirmation.
ARTICLE III FIRM PERFORMANCE OBLIGATION
3.1 "Firm Performance Obligation" means Seller shall be required to sell and Buyer shall be required to purchase the Contract Quantity of Gas set forth herein on each Gas Day. Either Party may interrupt its performance only to the extent that such performance is prevented for reasons of Force Majeure without liability to the other Party.
ARTICLE IV TERM
4.1 This Contract shall remain in effect until the earlier of 9:59 a.m. EST on (i) the date set forth in a notice delivered by Buyer to Seller terminating this Base Contract for Buyer's convenience and without penalty to Buyer (the "Termination Date"), as set forth in a notice delivered by Buyer to Seller at least 5 days prior to the Termination Date and (ii) October 31, 2013. Deliveries of Gas hereunder shall commence at 10 a.m. (Eastern time) on the Partial Termination Date, as such term is defined in the Partial Termination Agreement dated as of July 11, 2003 between Buyer and ProGas Limited (the "Commencement Date"). The rights of both Parties under Section 14.3, the obligations of both Parties to make payments that have accrued prior to termination, the obligation of Seller to indemnify Buyer, and Buyer to indemnify Seller, pursuant hereto and the rights and obligations of the Parties under Section 13.3, Article IV and Article XX (to the extent necessar y to administer the foregoing provisions of this Base Contract following such termination) shall survive the termination or cancellation of the Contract.
4.2 This Contract shall be subject to termination by mutual agreement of the Parties, such agreement not to be unreasonably withheld.
ARTICLE V TRANSPORTATION
5.1 Seller shall have the sole responsibility for transportation of Gas to the Delivery Point. Buyer shall have the sole responsibility for transportation of Gas at and after the Delivery Point.
5.2 In the event that Buyer's Gas requirements for any Gas Day are decreased for any reason, then upon Seller's request Buyer shall use reasonable commercial efforts to implement a transaction to make any of Buyer's unused transportation capacity available to Seller; provided, however, that (a) Seller shall pay Buyer's variable costs including fuel retention for the use of such transportation capacity, (b) the available transportation capacity shall be provided on an "as is" basis and Seller shall hold Buyer harmless in connection with any costs, penalties, liabilities or damages incurred by Seller in connection with the implementation of the provisions of this Section (excluding any demand or fixed costs payable by Buyer to its Transporter or any other Person in connection with the transportation capacity). Seller shall advise Buyer of its intent to use available excess transportation capacity pursuant to this Section promptly after receipt of Buyer's notice of quantity reduction.
ARTICLE VI DELIVERY POINT
6.1 The Delivery Point(s) for all Gas delivered hereunder shall be (i) the Primary Delivery Point (and associated maximum daily quantity) as described in Schedule 1 (the "Primary Delivery Point"), (ii) such other points (and associated maximum daily quantities) (each an "Alternate Delivery Point") listed in Schedule 1, or (iii) any other points as otherwise mutually agreed upon between Seller and Buyer. Upon Buyer's request and agreement by Buyer and Seller of the appropriate price pursuant to a Confirmation implemented in accordance with the procedures set forth in Article I, Seller shall procure and deliver Gas to a Delivery Point (other than the Primary Delivery Point or an Alternate Delivery Point) designated by Buyer for the period specified in Buyer's request and the associated Confirmation.
6.2 Upon Seller's request, Buyer shall accept Gas at an Alternate Delivery Point or other delivery point(s) designated by Seller for the period specified in Seller's request, provided that Seller agrees to pay any incremental cost to Buyer above the Contract Price and that Buyer determines that it has adequate pipeline capacity available to accept Gas at the Alternate Delivery Point or other delivery point(s) designated by Seller.
6.3 Deliveries of Gas at a Delivery Point requested by Seller or Buyer that is not designated as a Primary Delivery Point or Alternate Delivery Point shall be made on a firm basis including without limitation Force Majeure. During the term of this Base Contract, Buyer may not modify receipt or delivery points described in its transportation and storage agreements without the prior written consent of Seller.
ARTICLE VII SCHEDULING
7.1 The Parties shall coordinate their Scheduling requirements by telephone (and, where applicable, by means of Transporter's electronic bulletin board or other electronic data interchange method) with immediate confirmation in writing by facsimile. Ample time must be given to meet the Scheduling deadlines of the affected Transporter(s). Each Party's gas scheduler shall give the other Party's gas scheduler timely prior notice, and each Party's gas scheduler shall make appropriate Scheduling to the Transporter(s) in a timely manner, in each case sufficient to meet the requirements of all Transporter(s) involved in the transportation and delivery of Gas each Gas Day. Notice shall be provided (i) at least twenty-four hours prior to the earliest regularly scheduled Scheduling deadline applicable for each of the Transporter(s) receiving or delivering Gas to be Scheduled for flow on the first Gas Day of a month, and (ii) one hour earlier than such Scheduling deadline(s) for subsequent Scheduling. Should either Party become aware that actual deliveries at the Delivery Point(s) are greater or lesser than the amount of Gas Scheduled for delivery, such Party shall notify immediately the other Party's gas scheduler by telephone.
ARTICLE VIII IMBALANCES
8.1 If the supply or transportation necessary to deliver or receive the Contract Quantity is unavailable for any reason, the Party responsible for or having notice of such interruption shall immediately notify the other Party by telephone. Seller and Buyer shall then cooperate in all reasonable actions to avoid penalties imposed by the Transporter(s).
8.2 The Parties shall use all reasonable efforts to avoid imposition by any Transporter of Imbalance Charges and to minimize such charges if unavoidable. If, during any Month, Buyer or Seller receives an invoice from a Transporter, which includes Imbalance Charges, the Parties shall use their best efforts to promptly determine the validity as well as the cause of such Imbalance Charges. The Party responsible for causing such imbalance(s) shall be liable to the other Party for, if applicable, any associated Transporter penalties or cashout costs and losses incurred as a result of imbalance(s).
ARTICLE IX QUANTITY REDUCTIONS
9.1 In the event that Buyer's Gas requirements for any Gas Day are decreased due to a curtailment by a Power Purchaser, Outages, or other force majeure conditions described herein, then Buyer shall reduce the amount of Gas it receives on such Gas Day in accordance with the following order of reduction priority: (a) First, Gas to be delivered under any Gas storage agreements or arrangements entered into after the date of this Base Contract; (b) Second, Gas to be purchased under other contracts; and (c) Third, Gas to be purchased under this Base Contract and the Base Contract dated as of the date hereof between Buyer and Tractebel Energy Marketing, Inc., ratably on a 50/50 basis. For any Gas Day that Buyer is reducing the Contract Quantity pursuant to this Section, Buyer shall issue a Nomination to Seller designating the reduced Contract Quantity immediately upon receiving information that a quantity reduction is necessary, but in no event later than 9:30 a.m., Eastern Prevailing Time on t he Business Day prior to the Gas Day on which deliveries are to be so reduced. Buyer shall not reduce the amount of Gas it receives for any Gas Day for economic or any other non-operational reasons, except that Buyer shall be entitled to a reduction as a result of a curtailment of the Facility by any Power Purchaser.
9.2 In the event of a Forced Outage, Buyer may request that Seller remarket any Gas that Buyer is required to accept hereunder and Seller shall use commercially reasonable efforts to do so and shall be entitled to Seller's Cover Costs for any such amount. Such requests shall be made pursuant to the Confirmation procedures set forth in Article I above.
9.3 Notwithstanding anything to the contrary in this Base Contract, in the event that the simple average of the daily quantities of Gas purchased by Buyer hereunder each Day during any 12 Month period is less than 75% of the original Contract Quantity, then upon Seller's request, the Parties shall negotiate in good faith to appropriately modify the terms of this Base Contract (including but not limited to the terms related to the Contract Price). If the Parties do not agree on such modifications within 30 Days after Seller's request, then Seller shall have the right to terminate this Base Contract upon giving 30 Days prior written notice to Buyer.
ARTICLE X Quality and MEASUREMENT
10.1 All Gas delivered hereunder shall meet the pressure, quality, heat content and other standards and specifications of the Receiving Transporter.
10.2 The unit of quantity measurement for purposes of this Base Contract shall be on an MMBtu dry basis. Measurement of Gas quantities hereunder shall be in accordance with the tariff of the Receiving Transporter.
ARTICLE XI PRICE
11.1 The "Contract Price" for all Gas delivered hereunder shall be an amount (expressed in $/MMBtu) equal to the Index Price. In the event Buyer and Seller mutually agree, the Contract Price may be adjusted pursuant to a Confirmation implemented in accordance with the procedures set forth in Article I; provided, however, neither Party is obligated to agree to any other pricing and either Party may withhold agreement for any reason.
ARTICLE XII TAXES
12.1 Seller shall pay or cause to be paid, all taxes, fees, levies, penalties, licenses or charges imposed by any government authority ("Taxes") on or with respect to the Gas prior to its delivery at the Delivery Points(s). Buyer shall pay or cause to be paid, all Taxes on or with respect to the Gas at or after its delivery at the Delivery Point(s). If a Party is required to remit or pay Taxes which are the other Party's responsibility hereunder, such Party shall promptly reimburse the other Party for such Taxes. If either Party is entitled to an exemption from any such Taxes or charges, such Party shall furnish the other Party with a copy of the appropriate exemption or resale certificate. The Parties agree to cooperate to mitigate taxes payable by either Party hereunder.
ARTICLE XIII BILLING, PAYMENT AND AUDIT
13.1 On or before the tenth calendar day following the Month of deliveries of Gas hereunder, Seller shall deliver to Buyer an invoice for the preceding Month properly identified as per the Contract (or applicable Confirmation) showing the total quantity of Gas delivered, the amount due, and other pertinent information. If the actual quantity delivered is not available by the contractual billing date, billing will be prepared based on the Scheduled quantities. The Scheduled quantity will then be corrected to the actual quantity on the following Month's billing or as soon thereafter as actual delivery information is available.
13.2 Buyer shall remit by wire transfer the amount due by the later of (i) the 25th calendar day of the Month in which the statement was rendered or (ii) ten days after receipt of the invoice by Buyer; provided that if such due date is not a Business Day, payment is due on the next Business Day following such date. If Buyer fails to remit the full amount payable by it when due, interest on the unpaid portion shall accrue at a rate equal to the lower of (i) the then-effective prime rate of interest published under "Money Rates" by The Wall Street Journal, plus two percent per annum from the date due until the date of payment, or (ii) the maximum applicable lawful interest rate. If Buyer, in good faith, disputes the amount of any such statement or any part thereof, Buyer will pay to Seller such amount as it concedes to be correct, provided, however, if Buyer disputes the amount due, Buyer must, at the earliest available opportunity, provide Seller supporting documentation acceptable in industry practice from Buyer's Transporter (or other appropriate source of documentation). If it is ultimately determined that Buyer owes the disputed amount, Buyer will pay Seller that amount with interest as determined above immediately upon such determination
13.3 The Parties shall have the right, upon reasonable notice and at reasonable times, to examine the books and records of the other Party to the extent reasonably necessary to verify (i) the accuracy of any statement, charge, payment, computation made under the Contract or (ii) any curtailment of service under Section 13.4. Any such audit and any claim based upon errors in any statement or unauthorized curtailment must be made within two years of (i) the date of such statement or any revision thereof or (ii) the last calendar day of the Month during which any such alleged unauthorized curtailment occurs. Following such two-year period, a billing statement as adjusted shall be final. Errors in a Party's favor shall be rectified in full, with interest as calculated above, by such Party within 30 days of notice and substantiation of such inaccuracy.
13.4 When reasonable grounds for insecurity of payment by Seller arise, Buyer may demand adequate assurance of performance from Seller. Adequate assurance shall mean sufficient security in the form and for the term reasonably specified by Buyer, including, but not limited to, a standby irrevocable letter of credit, a prepayment, a security in an asset acceptable to the Buyer or a guarantee by a credit worthy entity.
ARTICLE XIV TITLE, WARRANTY AND INDEMNITY
14.1 Title to the Gas shall pass from Seller to Buyer at the Delivery Points(s). Seller shall have responsibility for and assume any liability with respect to the Gas prior to its delivery to Buyer at the specified Delivery Point(s). Buyer shall have responsibility for and any liability with respect to said Gas at and after its delivery to Buyer at the Delivery Point(s).
14.2 Seller warrants that it will have good and merchantable title to or will have the right to deliver all Gas sold hereunder and delivered by it to Buyer, free and clear of all liens, encumbrances, and claims.
14.3 Seller and Buyer each warrants that it is engaged in the direct commercial use of natural Gas in the ordinary course of its business, as producer, processor, merchant, or consumer or otherwise has knowledge of the practices associated with the purchase or sale of natural Gas. Each further warrants that it has and will maintain all the regulatory authorizations, certificates, and documentation as may be necessary and legally required to transport, buy, or make sales for resale of Gas sold or purchased hereunder.
14.4 Seller agrees to indemnify Buyer and save it harmless from all suits, actions, debts, accounts, damages, costs, losses, liabilities and expenses arising from or out of claims of title, personal injury or property damage from any or all persons to said Gas or other charges thereon which attach before title passes to Buyer. Buyer agrees to indemnify Seller and save it harmless from all suits, actions, debts, accounts, damages, costs losses, liabilities and expenses arising from or out of claims regarding payment, personal injury or property damage from said Gas or other charges thereon which attach at and after title passes to Buyer.
ARTICLE XV NOTICES
15.1 All Confirmations, Nominations, notices, invoices, and other communications ("Notices") made pursuant to the Contract shall be made as follows:
If to Buyer:	Northeast Energy Associates, A Limited Partnership c/o Northeast Energy, LP c/o FPL Energy, LLC 700 Universe Blvd. P.O. Box 14000 Juno Beach, FL 33408 Attention: Nathan E. Hanson, Business Manager Phone (561) 304-5121 Facsimile: (561) 304-5161
If to Seller:
(for Billing and Inquiries)
	FPL Energy Power Marketing, Inc. 700 Universe Blvd. P.O. Box 14000 Juno Beach, FL 33408 Attention: Joanne Fontaine, Senior Fuels Accountant Phone: (561) 304-5822 Facsimile: (561) 625-7663 and Dana Martin, Manager Power & Fuels Accounting Phone: (561) 304-5820 Facsimile: (561) 625-7663
(for Legal Notices)
	FPL Energy Power Marketing, Inc. 700 Universe Blvd. P.O. Box 14000 Juno Beach, FL 33408 Attention: Director of Legal/Regulatory Affairs Telephone: (561) 304-5700 Facsimile: (561) 625-7504
(for Gas Scheduling & Nominations)
	FPL Energy Power Marketing, Inc. 700 Universe Blvd. P.O. Box 14000 Juno Beach, FL 33408 Attention: Manager - Gas Trading Telephone: (561) 625-7081 Facsimile: (561) 304-5849
15.2 All payments shall be made, in immediately available funds, as follows:
FPLE Power Marketing, Inc. Bank of America Acct: # 3751227650 ABA: # 111000012
15.3 Either Party may modify any information specified above by written notice to the other Party.
15.4 All Notices required hereunder may be sent by facsimile, a nationally recognized overnight courier service, first class mail or hand delivered.
15.5 Notices sent by facsimile shall be deemed to have been received upon the sending Party's receipt of its facsimile's confirmation hereof. Notice by overnight mail or courier shall be deemed to have been received on the next Business Day after it was sent or such earlier time as is confirmed by the receiving Party. Notice delivered by hand shall be deemed to be received at the time it is delivered to an officer or to a responsible employee of the receiving Party. Notice via First Class Mail shall be considered delivered two Business Days after mailing.
ARTICLE XVI DEFAULTS AND REMEDIES
16.1 Subject to Sections 9.2, 16.3, and the Cover Standard the exclusive and sole remedy of the Parties in the event of a breach of the Firm Performance Obligation shall be recovery of the following Cover Costs: (a) in the event of a breach by Seller, payment by Seller to Buyer in an amount equal to (i) the difference, if positive, between the purchase price paid by Buyer for replacement Gas and the Contract Price, multiplied by the quantity of Gas agreed upon but not delivered by Seller to Buyer, plus (ii) Buyer's incremental transportation costs, plus (iii) any applicable Imbalance Charges ("Buyer's Cover Costs"); (b) in the event of a breach by Buyer, payment by Buyer to Seller in an amount equal to (i) the difference, if positive, between the Contract Price and the price received by Seller from the resale of such Gas, multiplied by the quantity of Gas not taken by Buyer, plus (ii) reasonable incremental transportation costs required for the resale of such g as, plus (iii) any applicable Imbalance Charges ("Seller's Cover Costs"); (c) in the event that Buyer has used commercially reasonable efforts to replace the Gas or Seller has used commercially reasonable efforts to sell the Gas to a third Party, and no such replacement or sale is available, then the exclusive remedy of the non-breaching Party shall be the difference between the Contract Price and the highest price in the range of the daily postings for the higher of (i) the Gas Day of non-delivery of Gas or (ii) the Gas Day after the Gas Day of non-delivery of Gas, such postings as published by Gas Daily under the heading Daily Price Survey under Citygates for Transco zone 6 non-N.Y. multiplied by the quantity of Gas agreed upon but not delivered by Seller or taken by Buyer, as the case may be; plus any applicable Imbalance Charges.
16.2 In the event either Party shall (i) make an assignment or any general arrangement for the benefit of creditors; (ii) default in the payment of any undisputed amount due to the other Party hereunder, which is not cured within 30 days after receipt of notice thereof; (iii) file a petition or otherwise commence, authorize, or acquiesce in the commencement of a proceeding or cause under any bankruptcy or similar law for the protection of creditors or have such petition filed or proceeding commenced against it, (iv) otherwise become bankrupt or insolvent (however evidenced); (v) be unable to pay its debts as they fall due; or (vi) in the case of Seller, fail to give adequate assurance of its ability to perform its obligations under the Contract within forty-eight (48) hours of a reasonable request by the other Party (each an "Event of Default"), then the non-defaulting Party shall have the right to either withhold and/or suspend deliveries until such Event of Default is cured. If any Event of Default is not cured within 30 days after the non-defaulting Party has given a default notice to the defaulting Party, the non-defaulting Party may terminate the Contract, in addition to any and all other remedies available hereunder. The default notice must be delivered to the defaulting Party after the applicable Event of Default has arisen and state the grounds for the Event of Default in reasonable detail.
16.3 In the event that the non-defaulting Party terminates the Contract under Section 16.2, the non-defaulting Party shall have the right to designate, by written termination notice, an early termination date ("Early Termination Date") as any date on or after the date of its termination notice under Section 16.2. Upon the Early Termination Date, the non-defaulting Party shall have the right to liquidate this Base Contract (including any portion of required deliveries not yet fully made) then outstanding by:
(i) Closing out the Contract at its Market Value, as defined below, so that the Contract is canceled and a settlement payment in an amount equal to the difference between such Market Value and the Contract Value, as defined below, of such Contract shall be due to the Buyer if such Market Value exceeds the Contract Value and to the Seller if the opposite is the case; and
(ii) Discounting each amount then due under clause (i) above to net present value in a commercially reasonable manner as at the time of liquidation (to take account of the period between the date of liquidation and the date on which such amount would have otherwise been due pursuant to the Contract); and
(iii) Setting off or aggregating, as appropriate, any and all settlement payments (discounted as appropriate) and (at the election of the non-defaulting Party) any or all other amounts owing between the Parties under this Base Contract so that all such amounts are aggregated and/or netted to a single liquidated amount payable by one Party to the other. The net amount due any such liquidation shall be paid by the close of business on the third Business Day following the Early Termination Date.
For purposes of this Section, "Contract Value" means the amount of Gas remaining to be delivered or purchased pursuant to the Contract multiplied by the Contract Price per unit, and "Market Value" means the amount of Gas remaining to be delivered or purchased pursuant to the Contract multiplied by the market price per unit determined by the non-defaulting Party in a commercially reasonable manner using the Cover Standard. The rate of interest used in calculating net present value pursuant to (ii) of this Section shall be determined by the non-defaulting Party in a commercially reasonable manner. The Parties agree that the Contract shall constitute a "forward contract" within the meaning of the United States Bankruptcy Code
The non-defaulting Party's rights under this Section and to Cover Costs accrued prior to the termination date are the sole and exclusive remedy of the non-defaulting Party for an Event of Default. The non-defaulting Party shall give notice that a liquidation pursuant to this Section has occurred to the defaulting Party no later than the third Business Day following such liquidation, provided that failure to give such notice shall not affect the validity or enforceability of the liquidation or give rise to any claim by the defaulting Party against the non-defaulting Party.
16.4 Seller may immediately suspend deliveries to Buyer hereunder in the event Buyer has not paid any amount due Seller hereunder on or before the second calendar day following the date such payment is due.
16.5 Each Party reserves to itself all rights, set-offs, counterclaim, and other defenses which it is or may be entitled to arising from or out of the Contract.
16.6 EXCEPT AS EXPRESSLY PROVIDED HEREIN, IN NO EVENT WILL EITHER PARTY BE RESPONSIBLE, EITHER UNDER THIS ARTICLE XVI OR UNDER ANY OTHER TERM OR PROVISION OF THIS CONTRACT, FOR INCIDENTAL, CONSEQUENTIAL, SPECIAL, OR PUNITIVE DAMAGES.
ARTICLE XVII FORCE MAJEURE
17.1 Except with regard to a Party's obligation to make payments due under the Contract, neither Party shall be liable to the other for a failure to perform its obligations hereunder, if such failure was caused by Force Majeure. As used herein, the term "Force Majeure" shall mean an unforeseen occurrence or event beyond the control of the Party claiming excuse which partially or entirely prevents that Party's performance of its obligations, except the obligation to make payments due under any transaction.
17.2 Force Majeure shall include but not be limited to the following: (i) physical events such as acts of God, landslides, lightning, earthquakes, fires, storms or storm warnings which result in evacuation of the affected area, floods, washouts, explosions, breakage, or accident, derate, or necessity of repairs to machinery or equipment including Planned, Maintenance, or Forced Outages ("Outages") of the Facility or lines of pipe, weather related events such as hurricanes or freezing or failure of wells or lines of pipe which affects a significant geographic area; (ii) acts of others such as strikes, riots, sabotage, insurrections or wars; (iii) governmental actions such as necessity for compliance with any court order, law, statute, ordinance, or regulation promulgated by a governmental authority having jurisdiction; and (iv) any other causes, whether of the kind herein enumerated or otherwise not reasonably within the control of the affected Party. Seller and Buyer shall make reasonabl e efforts to avoid Force Majeure and to resolve the event or occurrence once it has occurred in order to resume performance. Force Majeure shall not be based on (i) the loss or change of natural Gas markets; (ii) Buyer's inability economically to use or resell the natural Gas purchased hereunder; (iii) the loss or failure of Seller's supply; or (iv) any economic hardship leading to a breach of firm delivery by Seller, or (v) failure of Seller's non-Firm transportation service.
17.3 The Party whose performance is prevented by Force Majeure must provide notice to the other Party. Initial notice may be given orally; however, written notification with particulars of the event or occurrence is required within twenty-four (24) hours. Upon providing written notification of Force Majeure to the other Party, the affected Party will be relieved of its obligation to make or accept, as the case may be, delivery of Gas to the extent and for the duration of Force Majeure and neither Party shall be deemed to have failed in such obligations to the other during such occurrence or event. Upon notification by Buyer to Seller that such outage has been completed, Buyer's obligation to purchase gas shall be restored.
17.4 Neither Party shall be entitled to the benefit of the provisions of Force Majeure to the extent performance is affected from any or all of the following circumstances: (i) the Party claiming excuse failed to remedy the condition and to resume the performance of such covenants or obligations with reasonable dispatch; or (ii) economic hardship.
17.5 Notwithstanding anything to the contrary herein, the Parties agree that the settlement of strikes, lockouts, or other industrial disturbances shall be entirely within the discretion of the Party experiencing such disturbance.
17.6 In no event shall the failure of firm or other transportation or delivery rights of Seller constitute a Force Majeure hereunder unless such firm transportation and delivery rights are curtailed due to reasons beyond the control, and not the fault of, the Seller. In any such Force Majeure circumstance, Seller shall use reasonable commercial efforts to find an alternative means of transportation or delivery on the most advantageous terms available and shall notify Buyer of such terms, including the price thereof. In the event the use of such alternative means will result in a transportation cost in excess of the transportation costs that would have been incurred by Seller in the absence of such Force Majeure, then Buyer shall have the option to either (i) decline the use of such means in which case Seller shall be relieved of its delivery obligations hereunder so long as and to the extent that it cannot perform its delivery obligations hereunder due to such Force Majeure event or (ii) accept su ch alternative means in which case Buyer shall pay the amount of such increased costs. Upon Buyer's request, Seller shall provide Buyer with documentation supporting its efforts to identify alternative means and any cost increases related to the use of such means.
ARTICLE XVIII GOVERNMENTAL REGULATION
18.1 This Contract and all provisions herein will be subject to all applicable and valid statutes, rules, orders and regulations of any Federal, State, or local governmental authority having jurisdiction over the Parties, their facilities, or Gas supply, this Base Contract or any provisions thereof.
ARTICLE XIX DISPUTE RESOLUTION
19.1 In the event a dispute arises between Buyer and Seller, or the successors or assigns of either of the, regarding the application or interpretation of any provision of this Base Contract, the aggrieved Party shall promptly notify the other Party of its intent to invoke this dispute resolution procedure after such dispute arises. If the Parties shall have failed to resolve the dispute within ten Business Days after delivery of such notice, each Party shall, within five Business Days thereafter nominate a senior officer of its management to meet at a mutually agreed location to resolve the dispute.
19.2 Any controversy under this Base Contract that is not resolved pursuant to Section 19.1 shall be resolved by a board of arbitration, consisting of three (3) members, upon notice of submission given by either Party, which notice shall also name one (1) arbitrator. The Party receiving such notice, shall, by notice to the other Party within ten (10) days thereafter, name the second (2nd) arbitrator, or failing to do so, the Party giving notice of submission shall name the second (2nd) arbitrator. The two (2) arbitrators so appointed shall name a third (3rd) arbitrator
19.3 The arbitrators shall be qualified by education, experience and training in the Gas industry to decide upon the particular question in dispute.
19.4 The arbitrators so appointed, after giving the Parties due notice of the date of a hearing and reasonable opportunity to be heard, shall promptly hear the controversy in New York, New York and shall thereafter render their decision determining said controversy no later than ninety (90) Days after such board has been appointed. Any decision requires the support of a majority of the arbitrators. If the board of arbitration is unable to reach such decision, new arbitrators will be named and shall act under this Base Contract, at the request of either Party, in a like manner as if none had been previously named.
19.5 The decision of the arbitrators shall be rendered in writing and supported by written reasons. The decision of the arbitrators shall be final and binding upon the Parties and will be complied with by the Parties. Each Party shall bear the expenses of its chosen arbitrator, and the expenses of the third (3rd) arbitrator shall be borne equally by the Parties. Each Party shall bear the compensation and expenses of its legal counsel, witnesses, and employees.
ARTICLE XX MISCELLANEOUS
20.1 This Contract shall be binding upon and inure to the benefit of the successors, assigns, personal representatives, and heirs of the respective Parties hereto, and the covenants, conditions, and obligations of this Base Contract shall run for the full term of this Base Contract. No assignment of this Base Contract, in whole or in part, will be made without the prior written consent of the non-assigning Party, which consent will not be unreasonably withheld. Buyer may assign its interests herein to any lender of Buyer or of Buyer's partners or affiliates.
20.2 No waiver of any breach of this Base Contract shall be held to be a waiver of any other or subsequent breach. All remedies afforded in this Base Contract shall be taken and construed as cumulative.
20.3 This Contract sets forth all understandings between the Parties respecting the subject matter of each transaction and any prior contracts, understandings and representations, whether oral or written, representing this subject matter are merged into and superseded by the Base Contract and any effective Confirmation(s). This Contract may only be amended in writing.
20.4 This Contract may be executed in one or more counterparts, each of which shall be deemed an original, and all of which together shall constitute one and the same instrument. As used herein, the singular of any term shall include the plural.
20.5 The interpretation and performance of this Base Contract shall be governed by the laws of New York, excluding, however, any conflict of laws rule which would apply the law of another jurisdiction.
20.6 Compliance with the confirmation procedures of Article I satisfies any "writing" requirements imposed under the Uniform Commercial Code or any other applicable contract law.
20.7 Notwithstanding anything to the contrary, each Party to this Base Contract (and each employee, representative, or other agent of each Party to this Base Contract for so long as they remain an employee, representative or agent) may disclose to any and all persons, without limitation of any kind, the tax treatment and tax structure of the transactions contemplated by this Base Contract and all materials of any kind (including opinions or other tax analyses) that are provided to each Party relating to such tax treatment and tax structure. The preceding sentence shall be effective immediately upon commencement of discussions between the parties (whether such discussions commenced verbally, in writing, or otherwise) that are related to the terms of this Base Contract.

IN WITNESS WHEREOF, Parties hereto have caused their names to be signed and executed in duplicate on this 1st day of January, 2004.
	NORTHEAST ENERGY ASSOCIATES, A LIMITED PARTNERSHIP
	By:	Northeast Energy, LP Its General Partner
	By:	ESI Northeast Energy GP, Inc. Its Administrative General Partner
	By:	NATHAN E. HANSON
		Nathan E. Hanson Director
	FPL ENERGY POWER MARKETING, INC.
	By:	MARK MAISTO
		Mark Maisto President

SCHEDULE 1 - Primary Delivery Point and Alternate Delivery Points

Primary Delivery Point:

"Located at the U.S. side of the International Boundary in Niagara Falls, Erie County, New York at the point known as the Niagara Import Point, at the interconnection between the facilities of TransCanada Pipeline Ltd. (TCPL) and Dominion Transmission Inc. (DTI)".

DTI via Tennessee Gas Pipeline (TGP)
Contract No.: TGP 33177
MDQ: 11,455 MMBtu/day
Delivery Point Name: Niagara River Purchase
Meter No. 010902
Niagara County, NY

Alternate Delivery Points:

Dominion Transmission Inc.
Contract No.: 200015
MDQ: 11,455 MMBtu/day
Delivery Point Name: Marilla
Meter No. 40113
Erie County, NY

Texas Eastern Transmission Corporation
Contract No.: 330182
MDQ: 7,000 MMBtu/day
Delivery Point Name: Compressor Station 23 (Chambersburg)
Meter No. 79923
Franklin County, PA

Transcontinental Gas Pipeline Corporation
Contract No.: 1044990
MDQ: 11,455 MMBtu/day
Delivery Point Name: Leidy - National Fuel
Meter No. 1007065
Clinton County, PA

Algonquin Gas Transmission
Interconnect: Texas Eastern Transmission Corporation
Lambertville - Meter No. 00210
Contract No.: 913001
MDQ: 7,000 MMBtu/day
Delivery Point Name: Bellingham
Meter No. 00094
Norfolk County, MA

Algonquin Gas Transmission
Interconnect: Transcontinental Gas Pipeline Corporation
Centerville - Meter No. 00220
Contract No.: 913001
MDQ: 11,455 MMBtu/day
Delivery Point Name: Bellingham
Meter No. 00094
Norfolk County, MA

Delivered Bellingham Plant - Assumes Algonquin Gas Transmission via TETCO
Meter No. 00094
MDQ: 11,455 MMBtu/day
Delivery Point Name: Bellingham
Norfolk County, MA

Delivered Bellingham Plant - Assumes Algonquin Gas Transmission via TGPL
Meter No. 00094
MDQ: 11,455 MMBtu/day
Delivery Point Name: Bellingham
Norfolk County, MA

EXHIBIT A CONFIRMATION
NEA Bellingham Facility			Date: ___________________________ Transaction Confirmation #: ________________
This Confirmation is subject to the Base Contract between Seller and Buyer dated January ___, 2004. The terms of this Confirmation are binding as provided in the Base Contract.
SELLER: FPL Energy Power Marketing, Inc. 700 Universe Blvd. P.O. Box 14000 Juno Beach, FL 33408 Attn: Manager - Gas Trading Phone: 561-625-7081 Fax: 561-304-5849 Transporter: __________________________________		BUYER: Northeast Energy Associates, A Limited Partnership c/o Northeast Energy, LP c/o FPL Energy, LLC 700 Universe Blvd. P.O. Box 14000 Juno Beach, FL 33408 Attn: Nathan E. Hanson, Business Manager Phone: 561-304-5121 Fax: 561-304-5161 Transporter: ___________________________________
Contract Price: $ ________/ MMBtu or ________________________________________________________
Delivery Period: Begin: _________________________, ________ End: __________________________, ________
Performance Obligation and Contract Quantity: (Select One)
Firm (Fixed Quantity):	Firm (Variable Quantity):			Interruptible:
_____ MMBtus/day	_____ MMBtus/day Minimum			Up to _____ MMBtus/day
" EFP _____ MMBtus/day Maximum
	subject to Section 4.2 at election of "Buyer or o Seller
Delivery Point(s): _________________________________________ (If a pooling point is used, list a specific geographic and pipeline location):
Special Conditions:
Seller:		Buyer:
By:		By:
Title:		Title:
Date:		Date:

EX-10

Exhibit 10(f)
BASE CONTRACT FOR SALE AND PURCHASE OF NATURAL GAS
THIS Base Contract for Sale and Purchase of Natural Gas ("Base Contract"), made and entered into on this 1st day of January, 2004 by and between Northeast Energy Associates, A Limited Partnership, a Massachusetts limited partnership ("Buyer") and Tractebel Energy Marketing, Inc. ("Seller").
ARTICLE I PURPOSE AND PROCEDURES
1.1 This Base Contract establishes the terms and conditions governing the purchases and sale of Gas between the Seller and Buyer (each a "Party" and collectively, the "Parties") during the Term of this Base Contract. Gas purchased hereunder is intended solely for a portion the operational needs of the Facility and is not intended for resale.
1.2 This Base Contract provides for the delivery of Gas by Seller to Buyer under a Firm Performance Obligation for the entire term of the Contract. The Parties may by mutual agreement, through Confirmations described hereunder, modify the delivery obligations, including (without limitation) changes in the Delivery Point(s), for all or part of the Gas to be delivered hereunder.
1.3.1 The Parties will use the following transaction procedure. The Parties may periodically agree to transactions that modify deliveries under this Base Contract (i) by written document ("Confirmation"), or (ii) a recorded telephone conversation between authorized representatives. When the Parties come to an oral agreement regarding a modification of the deliveries under this Base Contract for a particular delivery period, they shall be legally bound from the time they so agree to transaction terms and each may rely thereon. Any such transaction shall be considered to be in "writing" and to have been "signed." Notwithstanding the foregoing, Seller shall, and Buyer may, confirm a telephonic transaction by sending a Confirmation via facsimile, E-mail or other mutually agreeable electronic means to the other Party by the close of the Business Day following the date of the oral agreement; provided that the failure to send a Confirmation shall not invalidate the oral agreement of the Parties.
1.3.2 If a sending Party's Confirmation is contrary to the receiving Party's understanding of the oral agreement, the receiving Party shall notify the sending Party via facsimile, E-mail or other mutually agreeable electronic means before the close of the second Business Day following receipt if the receiving Party has not previously sent a Confirmation to the sending Party. The receiving Party's failure to so notify the sending Party via facsimile, E-mail or other mutually agreeable electronic means within the aforementioned time period constitutes the receiving Party's agreement to the terms of the transaction modification described in the sending Party's Confirmation.
1.3.3 If both Parties send a Confirmation regarding a single transaction and there are any differences in a material term between Seller's and Buyer's Confirmations, then neither Confirmation shall be binding until or unless such differences are resolved and agreed to in writing.
1.3.4 The Parties may electronically record any telephone conversations between their employees with respect to this Base Contract, without any special or further notice to the other Party. Each Party will obtain any necessary consent of its agents and employees for such recordings. Such recordings may be introduced as evidence of any oral transaction hereunder and the Parties agree not to contest the validity or enforceability of any oral agreement, which is recorded in accordance herewith.
1.4 The entire agreement between the Parties shall be those provisions contained in this Base Contract, any effective Confirmation, and any oral agreement of the Parties pursuant to Section 1.3.1 (collectively, the "Contract"). In the event of a conflict between the terms of (i) an effective Confirmation, (ii) the oral agreement of the Parties pursuant to Section 1.3.1, and (iii) the Base Contract, the terms of the agreement shall govern in the priority listed in this sentence.
ARTICLE II DEFINITIONS
2.1 "Alternate Delivery Point" shall have the meaning set forth in Section 6.1.
2.2 "BTU" shall mean British Thermal Unit.
2.3 "Business Day" shall mean any day except Saturday, Sunday or bank holidays.
2.4 "Commencement Date" shall have the meaning set forth in Section 4.1.
2.5 "Confirmation" shall have the meaning set forth in Article I; provided that a written Confirmation shall be substantially in the form attached in Exhibit A.
2.6 "Contract" shall have the meaning set forth in Section 1.4.
2.7 "Contract Price" shall have the meaning set forth in Section 11.1.
2.8 "Contract Quantity" shall mean 11,456 MMBtu per Day for each Gas Day, unless otherwise modified pursuant to Sections 1.3.1 through 1.3.3.
2.9 "Cover Costs" shall have the meaning set forth in Section 16.1.
2.10 "Cover Standard" shall mean that if there is an unexcused failure to take or deliver any quantity of Gas pursuant to this Base Contract, then the non-defaulting Party shall use commercially reasonable efforts to obtain or sell Gas at a reasonable price for the delivery point.
2.11 "Delivery Point" for any Gas delivery to Buyer shall be the Primary Delivery Point, Alternate Delivery Point(s), or other point(s) as established by Section 6.1.
2.12 "Facility" means the Gas-fired electrical and steam generating plant located in Bellingham, Massachusetts and owned by the Buyer.
2.13 "Firm Performance Obligation" has the meaning given in Section 3.1.
2.14 "Forced Outage" means a partial or full interruption in the generating capability of the Facility due to an unplanned component failure (immediate, delayed, postponed, or startup failure) or other condition that requires the applicable unit to be removed from service, or prevents the unit from going back into service, immediately, within six hours, or before the end of the then next weekend.
2.15 "Fuel Manager" means the Buyer's fuel manager as designated from time to time in a written notice from Buyer to Seller.
2.16 "Gas" shall mean pipeline quality natural gas.
2.17 "Gas Day" shall mean a period of twenty-four (24) consecutive hours, coextensive with a "gas day" as defined in the tariff of the Transporter delivering Gas to the Delivery Point in a particular transaction.
2.18 "Imbalance Charges" shall mean any Scheduling penalties, imbalance penalties, overpull or unauthorized overrun penalties, operational flow order penalties, cash out charges, banking charges, or similar penalties, fees or charges assessed by a Transporter for failure to satisfy the Transporter's balancing and/or Scheduling requirements.
2.19 "Index Price" means the monthly posting (expressed in $/MMBtu) published in Platts Gas Daily Price Guide under "Monthly Contract", "Index", "Market Centers", "Northeast", "Niagara" (as such publication exists as of the date hereof). If such monthly index or such publication ceases to be published, the Parties shall in good faith determine a replacement monthly index to be utilized from the date the foregoing index or publication ceases to be published for the remainder of the term of this Base Contract (subject to further replacement as provided herein in the event that the replacement index ceases to be published), which replacement index shall reflect, to the maximum extent possible, the market cost of natural gas delivered to the Project.
2.20 "Maintenance Outage" means a partial or full interruption in the generating capability of the Facility due to the removal of a unit from service to perform work on specific components that can be deferred beyond the end of the then next weekend, but requires the unit to be removed from service before the next Planned Outage.
2.21 "MMBtu" shall mean one million BTUs.
2.22 "Month" shall mean the period beginning on the first calendar day of the calendar month and ending on the last calendar day of the same calendar month.
2.23 "Nomination" means Buyer's designation to Seller of the amount of Gas to be delivered to a Delivery Point during the Gas Day or Gas Days specified in the Nomination.
2.24 "Outage" shall mean Forced, Planned, or Maintenance Outage.
2.25 "Party" and "Parties" shall have the meanings set forth in Section 1.1.
2.26 "Planned Outage" means a partial or full interruption in the generating capability of the Facility due to the removal of a unit from service to perform work on specific components that is scheduled well in advance and has a predetermined date and estimated duration (such as annual overhauls, inspections, and testing).
2.27 "Power Purchaser" means any of Boston Edison Company, Commonwealth Electric Company or Montaup Electric Company.
2.28 "Primary Delivery Point" shall have the meaning set forth in Section 6.1.
2.29 "ProGas Contract" means the Gas Purchase Contract between Buyer and ProGas Limited, dated as of May 12, 1988, as amended by an Amending Agreement, dated as of April 17, 1989, and by a Second Amending Agreement, dated as of June 23, 1989, and by a Amending Agreement, dated as of November 1, 1991, and by Amending Agreement and a Letter Agreement, both dated as of July 30, 1993, as amended by an Amending Agreement dated as of March 1, 2003.
2.30 "Receiving Transporter" shall mean the Transporter receiving Gas at a Delivery Point.
2.31 "Schedule," "Scheduling," or "Scheduled" shall refer to the act of Seller, Buyer, and the Transporter(s) notifying, requesting, and confirming to each other the quantity of Gas to be delivered hereunder on any given Gas day. Gas shall be deemed to have been Scheduled when confirmed by Transporter(s).
2.32 "Termination Date" shall have the meaning set forth in Section 4.1.
2.33 "Transporter(s)" shall mean all pipeline companies transporting Gas for Seller or Buyer pursuant to a particular Confirmation.
ARTICLE III FIRM PERFORMANCE OBLIGATION
3.1 "Firm Performance Obligation" means Seller shall be required to sell and Buyer shall be required to purchase the Contract Quantity of Gas set forth herein on each Gas Day. Either Party may interrupt its performance only to the extent that such performance is prevented for reasons of Force Majeure without liability to the other Party.
ARTICLE IV TERM
4.1 This Contract shall remain in effect until the earlier of 9:59 a.m. EST on (i) the date set forth in a notice delivered by Buyer to Seller terminating this Base Contract for Buyer's convenience and without penalty to Buyer (the "Termination Date"), as set forth in a notice delivered by Buyer to Seller at least 5 days prior to the Termination Date and (ii) October 31, 2013. Deliveries of Gas hereunder shall commence at 10 a.m. (Eastern time) on the Partial Termination Date, as such term is defined in the Partial Termination Agreement dated as of July 11, 2003 between Buyer and ProGas Limited (the "Commencement Date"). The rights of both Parties under Section 14.3, the obligations of both Parties to make payments that have accrued prior to termination, the obligation of Seller to indemnify Buyer, and Buyer to indemnify Seller, pursuant hereto and the rights and obligations of the Parties under Section 13.3, Article IV and Article XX (to the extent necessar y to administer the foregoing provisions of this Base Contract following such termination) shall survive the termination or cancellation of the Contract.
4.2 This Contract shall be subject to termination by mutual agreement of the Parties, such agreement not to be unreasonably withheld.
ARTICLE V TRANSPORTATION
5.1 Seller shall have the sole responsibility for transportation of Gas to the Delivery Point. Buyer shall have the sole responsibility for transportation of Gas at and after the Delivery Point.
5.2 In the event that Buyer's Gas requirements for any Gas Day are decreased for any reason, then upon Seller's request Buyer shall use reasonable commercial efforts to implement a transaction to make any of Buyer's unused transportation capacity available to Seller; provided, however, that (a) Seller shall pay Buyer's variable costs including fuel retention for the use of such transportation capacity, (b) the available transportation capacity shall be provided on an "as is" basis and Seller shall hold Buyer harmless in connection with any costs, penalties, liabilities or damages incurred by Seller in connection with the implementation of the provisions of this Section (excluding any demand or fixed costs payable by Buyer to its Transporter or any other Person in connection with the transportation capacity). Seller shall advise Buyer of its intent to use available excess transportation capacity pursuant to this Section promptly after receipt of Buyer's notice of quantity reduction.
ARTICLE VI DELIVERY POINT
6.1 The Delivery Point(s) for all Gas delivered hereunder shall be (i) the Primary Delivery Point (and associated maximum daily quantity) as described in Schedule 1 (the "Primary Delivery Point"), (ii) such other points (and associated maximum daily quantities) (each an "Alternate Delivery Point") listed in Schedule 1, or (iii) any other points as otherwise mutually agreed upon between Seller and Buyer. Upon Buyer's request and agreement by Buyer and Seller of the appropriate price pursuant to a Confirmation implemented in accordance with the procedures set forth in Article I, Seller shall procure and deliver Gas to a Delivery Point (other than the Primary Delivery Point or an Alternate Delivery Point) designated by Buyer for the period specified in Buyer's request and the associated Confirmation.
6.2 Upon Seller's request, Buyer shall accept Gas at an Alternate Delivery Point or other delivery point(s) designated by Seller for the period specified in Seller's request, provided that Seller agrees to pay any incremental cost to Buyer above the Contract Price and that Buyer determines that it has adequate pipeline capacity available to accept Gas at the Alternate Delivery Point or other delivery point(s) designated by Seller.
6.3 Deliveries of Gas at a Delivery Point requested by Seller or Buyer that is not designated as a Primary Delivery Point or Alternate Delivery Point shall be made on a firm basis including without limitation Force Majeure. During the term of this Base Contract, Buyer may not modify receipt or delivery points described in its transportation and storage agreements without the prior written consent of Seller.
ARTICLE VII SCHEDULING
7.1 The Parties shall coordinate their Scheduling requirements by telephone (and, where applicable, by means of Transporter's electronic bulletin board or other electronic data interchange method) with immediate confirmation in writing by facsimile. Ample time must be given to meet the Scheduling deadlines of the affected Transporter(s). Each Party's gas scheduler shall give the other Party's gas scheduler timely prior notice, and each Party's gas scheduler shall make appropriate Scheduling to the Transporter(s) in a timely manner, in each case sufficient to meet the requirements of all Transporter(s) involved in the transportation and delivery of Gas each Gas Day. Notice shall be provided (i) at least twenty-four hours prior to the earliest regularly scheduled Scheduling deadline applicable for each of the Transporter(s) receiving or delivering Gas to be Scheduled for flow on the first Gas Day of a month, and (ii) one hour earlier than such Scheduling deadline(s) for subsequent Scheduling. Should either Party become aware that actual deliveries at the Delivery Point(s) are greater or lesser than the amount of Gas Scheduled for delivery, such Party shall notify immediately the other Party's gas scheduler by telephone.
ARTICLE VIII IMBALANCES
8.1 If the supply or transportation necessary to deliver or receive the Contract Quantity is unavailable for any reason, the Party responsible for or having notice of such interruption shall immediately notify the other Party by telephone. Seller and Buyer shall then cooperate in all reasonable actions to avoid penalties imposed by the Transporter(s).
8.2 The Parties shall use all reasonable efforts to avoid imposition by any Transporter of Imbalance Charges and to minimize such charges if unavoidable. If, during any Month, Buyer or Seller receives an invoice from a Transporter, which includes Imbalance Charges, the Parties shall use their best efforts to promptly determine the validity as well as the cause of such Imbalance Charges. The Party responsible for causing such imbalance(s) shall be liable to the other Party for, if applicable, any associated Transporter penalties or cashout costs and losses incurred as a result of imbalance(s).
ARTICLE IX QUANTITY REDUCTIONS
9.1 In the event that Buyer's Gas requirements for any Gas Day are decreased due to a curtailment by a Power Purchaser, Outages, or other force majeure conditions described herein, then Buyer shall reduce the amount of Gas it receives on such Gas Day in accordance with the following order of reduction priority: (a) First, Gas to be delivered under any Gas storage agreements or arrangements entered into after the date of this Base Contract; (b) Second, Gas to be purchased under other contracts; and (c) Third, Gas to be purchased under this Base Contract and the Base Contract dated as of the date hereof between Buyer and FPL Energy Power Marketing, Inc., ratably on a 50/50 basis. For any Gas Day that Buyer is reducing the Contract Quantity pursuant to this Section, Buyer shall issue a Nomination to Seller designating the reduced Contract Quantity immediately upon receiving information that a quantity reduction is necessary, but in no event later than 9:30 a.m., Eastern Prevailing Time on t he Business Day prior to the Gas Day on which deliveries are to be so reduced. Buyer shall not reduce the amount of Gas it receives for any Gas Day for economic or any other non-operational reasons, except that Buyer shall be entitled to a reduction as a result of a curtailment of the Facility by any Power Purchaser.
9.2 Buyer may request that Seller remarket any Gas that Buyer is required to accept hereunder and Seller shall use commercially reasonable efforts to do so and shall be entitled to Seller's Cover Costs for any such amount. Such requests shall be made pursuant to the Confirmation procedures set forth in Article I above.
9.3 Notwithstanding anything to the contrary in this Base Contract, in the event that the simple average of the daily quantities of Gas purchased by Buyer hereunder each Day during any 12 Month period is less than 75% of the original Contract Quantity, then upon Seller's request, the Parties shall negotiate in good faith to appropriately modify the terms of this Base Contract (including but not limited to the terms related to the Contract Price). If the Parties do not agree on such modifications within 30 Days after Seller's request, then Seller shall have the right to terminate this Base Contract upon giving 30 Days prior written notice to Buyer.
ARTICLE X Quality and MEASUREMENT
10.1 All Gas delivered hereunder shall meet the pressure, quality, heat content and other standards and specifications of the Receiving Transporter.
10.2 The unit of quantity measurement for purposes of this Base Contract shall be on an MMBtu dry basis. Measurement of Gas quantities hereunder shall be in accordance with the tariff of the Receiving Transporter.
ARTICLE XI PRICE
11.1 The "Contract Price" for all Gas delivered hereunder shall be an amount (expressed in $/MMBtu) equal to the Index Price. In the event Buyer and Seller mutually agree, the Contract Price may be adjusted pursuant to a Confirmation implemented in accordance with the procedures set forth in Article I; provided, however, neither Party is obligated to agree to any other pricing and either Party may withhold agreement for any reason.
ARTICLE XII TAXES
12.1 Seller shall pay or cause to be paid, all taxes, fees, levies, penalties, licenses or charges imposed by any government authority ("Taxes") on or with respect to the Gas prior to its delivery at the Delivery Points(s). Buyer shall pay or cause to be paid, all Taxes on or with respect to the Gas at or after its delivery at the Delivery Point(s). If a Party is required to remit or pay Taxes which are the other Party's responsibility hereunder, such Party shall promptly reimburse the other Party for such Taxes. If either Party is entitled to an exemption from any such Taxes or charges, such Party shall furnish the other Party with a copy of the appropriate exemption or resale certificate. The Parties agree to cooperate to mitigate taxes payable by either Party hereunder.
ARTICLE XIII BILLING, PAYMENT AND AUDIT
13.1 On or before the tenth calendar day following the Month of deliveries of Gas hereunder, Seller shall deliver to Buyer an invoice for the preceding Month properly identified as per the Contract (or applicable Confirmation) showing the total quantity of Gas delivered, the amount due, and other pertinent information. If the actual quantity delivered is not available by the contractual billing date, billing will be prepared based on the Scheduled quantities. The Scheduled quantity will then be corrected to the actual quantity on the following Month's billing or as soon thereafter as actual delivery information is available.
13.2 Buyer shall remit by wire transfer the amount due by the later of (i) the 25th calendar day of the Month in which the statement was rendered or (ii) ten days after receipt of the invoice by Buyer; provided that if such due date is not a Business Day, payment is due on the next Business Day following such date. If Buyer fails to remit the full amount payable by it when due, interest on the unpaid portion shall accrue at a rate equal to the lower of (i) the then-effective prime rate of interest published under "Money Rates" by The Wall Street Journal, plus two percent per annum from the date due until the date of payment, or (ii) the maximum applicable lawful interest rate. If Buyer, in good faith, disputes the amount of any such statement or any part thereof, Buyer will pay to Seller such amount as it concedes to be correct, provided, however, if Buyer disputes the amount due, Buyer must, at the earliest available opportunity, provide Seller supporting documentation acceptable in industry practice from Buyer's Transporter (or other appropriate source of documentation). If it is ultimately determined that Buyer owes the disputed amount, Buyer will pay Seller that amount with interest as determined above immediately upon such determination.
13.3 The Parties shall have the right, upon reasonable notice and at reasonable times, to examine the books and records of the other Party to the extent reasonably necessary to verify (i) the accuracy of any statement, charge, payment, computation made under the Contract or (ii) any curtailment of service under Section 13.4. Any such audit and any claim based upon errors in any statement or unauthorized curtailment must be made within two years of (i) the date of such statement or any revision thereof or (ii) the last calendar day of the Month during which any such alleged unauthorized curtailment occurs. Following such two-year period, a billing statement as adjusted shall be final. Errors in a Party's favor shall be rectified in full, with interest as calculated above, by such Party within 30 days of notice and substantiation of such inaccuracy.
13.4 When reasonable grounds for insecurity of payment by Seller arise, Buyer may demand adequate assurance of performance from Seller. Adequate assurance shall mean sufficient security in the form and for the term reasonably specified by Buyer, including, but not limited to, a standby irrevocable letter of credit, a prepayment, a security in an asset acceptable to the Buyer or a guarantee by a credit worthy entity.
ARTICLE XIV TITLE, WARRANTY AND INDEMNITY
14.1 Title to the Gas shall pass from Seller to Buyer at the Delivery Points(s). Seller shall have responsibility for and assume any liability with respect to the Gas prior to its delivery to Buyer at the specified Delivery Point(s). Buyer shall have responsibility for and any liability with respect to said Gas at and after its delivery to Buyer at the Delivery Point(s).
14.2 Seller warrants that it will have good and merchantable title to or will have the right to deliver all Gas sold hereunder and delivered by it to Buyer, free and clear of all liens, encumbrances, and claims.
14.3 Seller and Buyer each warrants that it is engaged in the direct commercial use of natural Gas in the ordinary course of its business, as producer, processor, merchant, or consumer or otherwise has knowledge of the practices associated with the purchase or sale of natural Gas. Each further warrants that it has and will maintain all the regulatory authorizations, certificates, and documentation as may be necessary and legally required to transport, buy, or make sales for resale of Gas sold or purchased hereunder.
14.4 Seller agrees to indemnify Buyer and save it harmless from all suits, actions, debts, accounts, damages, costs, losses, liabilities and expenses arising from or out of claims of title, personal injury or property damage from any or all persons to said Gas or other charges thereon which attach before title passes to Buyer. Buyer agrees to indemnify Seller and save it harmless from all suits, actions, debts, accounts, damages, costs losses, liabilities and expenses arising from or out of claims regarding payment, personal injury or property damage from said Gas or other charges thereon which attach at and after title passes to Buyer.
ARTICLE XV NOTICES
15.1 All Confirmations, Nominations, notices, invoices, and other communications ("Notices") made pursuant to the Contract shall be made as follows:
If to Buyer:		Northeast Energy Associates, A Limited Partnership c/o Northeast Energy, LP c/o FPL Energy, LLC 700 Universe Blvd. P.O. Box 14000 Juno Beach, FL 33408 Attention: Nathan E. Hanson, Business Manager Phone (561) 304-5121 Facsimile: (561) 304-5161
If to Seller:	For General Notices:
		Tractebel Energy Marketing, Inc. 1990 Post Oak Blvd Suite 1900 Houston, TX 77056 Attention: Contract Administrator Phone: 713-636-1499 Facsimile: 713-636-1894
	For Scheduling and Confirmation:
		Tractebel Energy Marketing, Inc. 1990 Post Oak Blvd. Suite 1900 Houston, TX  77056 Attn: Manager, Gas Transmission Phone: 713-636-1417 Fax: 713-636-1894
15.2 All payments shall be made, in immediately available funds, as follows:
		Tractebel Energy Marketing, Inc. Chase Bank of Texas, Houston, TX ABA # 113000609 Account #: 00100920447
15.3 Either Party may modify any information specified above by written notice to the other Party.
15.4 All Notices required hereunder may be sent by facsimile, a nationally recognized overnight courier service, first class mail or hand delivered.
15.5 Notices sent by facsimile shall be deemed to have been received upon the sending Party's receipt of its facsimile's confirmation hereof. Notice by overnight mail or courier shall be deemed to have been received on the next Business Day after it was sent or such earlier time as is confirmed by the receiving Party. Notice delivered by hand shall be deemed to be received at the time it is delivered to an officer or to a responsible employee of the receiving Party. Notice via First Class Mail shall be considered delivered two Business Days after mailing.
ARTICLE XVI DEFAULTS AND REMEDIES
16.1 Subject to Sections 9.2, 16.3, and the Cover Standard the exclusive and sole remedy of the Parties in the event of a breach of the Firm Performance Obligation shall be recovery of the following Cover Costs: (a) in the event of a breach by Seller, payment by Seller to Buyer in an amount equal to (i) the difference, if positive, between the purchase price paid by Buyer for replacement Gas and the Contract Price, multiplied by the quantity of Gas agreed upon but not delivered by Seller to Buyer, plus (ii) Buyer's incremental transportation costs, plus (iii) any applicable Imbalance Charges ("Buyer's Cover Costs"); (b) in the event of a breach by Buyer, payment by Buyer to Seller in an amount equal to (i) the difference, if positive, between the Contract Price and the price received by Seller from the resale of such Gas, multiplied by the quantity of Gas not taken by Buyer, plus (ii) reasonable incremental transportation costs required for the resale of such g as, plus (iii) any applicable Imbalance Charges ("Seller's Cover Costs"); (c) in the event that Buyer has used commercially reasonable efforts to replace the Gas or Seller has used commercially reasonable efforts to sell the Gas to a third Party, and no such replacement or sale is available, then the exclusive remedy of the non-breaching Party shall be the difference between the Contract Price and the highest price in the range of the daily postings for the higher of (i) the Gas Day of non-delivery of Gas or (ii) the Gas Day after the Gas Day of non-delivery of Gas, such postings as published by Gas Daily under the heading Daily Price Survey under Citygates for Transco zone 6 non-N.Y. multiplied by the quantity of Gas agreed upon but not delivered by Seller or taken by Buyer, as the case may be; plus any applicable Imbalance Charges.
16.2 In the event either Party shall (i) make an assignment or any general arrangement for the benefit of creditors; (ii) default in the payment of any undisputed amount due to the other Party hereunder, which is not cured within 30 days after receipt of notice thereof; (iii) file a petition or otherwise commence, authorize, or acquiesce in the commencement of a proceeding or cause under any bankruptcy or similar law for the protection of creditors or have such petition filed or proceeding commenced against it, (iv) otherwise become bankrupt or insolvent (however evidenced); (v) be unable to pay its debts as they fall due; or (vi) in the case of Seller, fail to give adequate assurance of its ability to perform its obligations under the Contract within forty-eight (48) hours of a reasonable request by the other Party (each an "Event of Default"), then the non-defaulting Party shall have the right to either withhold and/or suspend deliveries until such Event of Default is cured. If any Event of Default is not cured within 30 days after the non-defaulting Party has given a default notice to the defaulting Party, the non-defaulting Party may terminate the Contract, in addition to any and all other remedies available hereunder. The default notice must be delivered to the defaulting Party after the applicable Event of Default has arisen and state the grounds for the Event of Default in reasonable detail.
16.3 In the event that the non-defaulting Party terminates the Contract under Section 16.2, the non-defaulting Party shall have the right to designate, by written termination notice, an early termination date ("Early Termination Date") as any date on or after the date of its termination notice under Section 16.2. Upon the Early Termination Date, the non-defaulting Party shall have the right to liquidate this Base Contract (including any portion of required deliveries not yet fully made) then outstanding by:
(i) Closing out the Contract at its Market Value, as defined below, so that the Contract is canceled and a settlement payment in an amount equal to the difference between such Market Value and the Contract Value, as defined below, of such Contract shall be due to the Buyer if such Market Value exceeds the Contract Value and to the Seller if the opposite is the case; and
(ii) Discounting each amount then due under clause (i) above to net present value in a commercially reasonable manner as at the time of liquidation (to take account of the period between the date of liquidation and the date on which such amount would have otherwise been due pursuant to the Contract); and
(iii) Setting off or aggregating, as appropriate, any and all settlement payments (discounted as appropriate) and (at the election of the non-defaulting Party) any or all other amounts owing between the Parties under this Base Contract so that all such amounts are aggregated and/or netted to a single liquidated amount payable by one Party to the other. The net amount due any such liquidation shall be paid by the close of business on the third Business Day following the Early Termination Date.
For purposes of this Section, "Contract Value" means the amount of Gas remaining to be delivered or purchased pursuant to the Contract multiplied by the Contract Price per unit, and "Market Value" means the amount of Gas remaining to be delivered or purchased pursuant to the Contract multiplied by the market price per unit determined by the non-defaulting Party in a commercially reasonable manner using the Cover Standard. The rate of interest used in calculating net present value pursuant to (ii) of this Section shall be determined by the non-defaulting Party in a commercially reasonable manner. The Parties agree that the Contract shall constitute a "forward contract" within the meaning of the United States Bankruptcy Code.
The non-defaulting Party's rights under this Section and to Cover Costs accrued prior to the termination date are the sole and exclusive remedy of the non-defaulting Party for an Event of Default. The non-defaulting Party shall give notice that a liquidation pursuant to this Section has occurred to the defaulting Party no later than the third Business Day following such liquidation, provided that failure to give such notice shall not affect the validity or enforceability of the liquidation or give rise to any claim by the defaulting Party against the non-defaulting Party.
16.4 Seller may immediately suspend deliveries to Buyer hereunder in the event Buyer has not paid any amount due Seller hereunder on or before the second calendar day following the date such payment is due.
16.5 Each Party reserves to itself all rights, set-offs, counterclaim, and other defenses which it is or may be entitled to arising from or out of the Contract.
16.6 EXCEPT AS EXPRESSLY PROVIDED HEREIN, IN NO EVENT WILL EITHER PARTY BE RESPONSIBLE, EITHER UNDER THIS ARTICLE XVI OR UNDER ANY OTHER TERM OR PROVISION OF THIS CONTRACT, FOR INCIDENTAL, CONSEQUENTIAL, SPECIAL, OR PUNITIVE DAMAGES.
ARTICLE XVII FORCE MAJEURE
17.1 Except with regard to a Party's obligation to make payments due under the Contract, neither Party shall be liable to the other for a failure to perform its obligations hereunder, if such failure was caused by Force Majeure. As used herein, the term "Force Majeure" shall mean an unforeseen occurrence or event beyond the control of the Party claiming excuse which partially or entirely prevents that Party's performance of its obligations, except the obligation to make payments due under any transaction.
17.2 Force Majeure shall include but not be limited to the following: (i) physical events such as acts of God, landslides, lightning, earthquakes, fires, storms or storm warnings which result in evacuation of the affected area, floods, washouts, explosions, breakage, or accident, derate, or necessity of repairs to machinery or equipment including Planned, Maintenance, or Forced Outages ("Outages") of the Facility or lines of pipe, weather related events such as hurricanes or freezing or failure of wells or lines of pipe which affects a significant geographic area; (ii) acts of others such as strikes, riots, sabotage, insurrections or wars; (iii) governmental actions such as necessity for compliance with any court order, law, statute, ordinance, or regulation promulgated by a governmental authority having jurisdiction; and (iv) any other causes, whether of the kind herein enumerated or otherwise not reasonably within the control of the affected Party. Seller and Buyer shall make reasonabl e efforts to avoid Force Majeure and to resolve the event or occurrence once it has occurred in order to resume performance. Force Majeure shall not be based on (i) the loss or change of natural Gas markets; (ii) Buyer's inability economically to use or resell the natural Gas purchased hereunder; (iii) the loss or failure of Seller's supply; or (iv) any economic hardship leading to a breach of firm delivery by Seller, or (v) failure of Seller's non-Firm transportation service.
17.3 The Party whose performance is prevented by Force Majeure must provide notice to the other Party. Initial notice may be given orally; however, written notification with particulars of the event or occurrence is required within twenty-four (24) hours. Upon providing written notification of Force Majeure to the other Party, the affected Party will be relieved of its obligation to make or accept, as the case may be, delivery of Gas to the extent and for the duration of Force Majeure and neither Party shall be deemed to have failed in such obligations to the other during such occurrence or event. Upon notification by Buyer to Seller that such outage has been completed, Buyer's obligation to purchase gas shall be restored.
17.4 Neither Party shall be entitled to the benefit of the provisions of Force Majeure to the extent performance is affected from any or all of the following circumstances: (i) the Party claiming excuse failed to remedy the condition and to resume the performance of such covenants or obligations with reasonable dispatch; or (ii) economic hardship.
17.5 Notwithstanding anything to the contrary herein, the Parties agree that the settlement of strikes, lockouts, or other industrial disturbances shall be entirely within the discretion of the Party experiencing such disturbance.
17.6 In no event shall the failure of firm or other transportation or delivery rights of Seller constitute a Force Majeure hereunder unless such firm transportation and delivery rights are curtailed due to reasons beyond the control, and not the fault of, the Seller. In any such Force Majeure circumstance, Seller shall use reasonable commercial efforts to find an alternative means of transportation or delivery on the most advantageous terms available and shall notify Buyer of such terms, including the price thereof. In the event the use of such alternative means will result in a transportation cost in excess of the transportation costs that would have been incurred by Seller in the absence of such Force Majeure, then Buyer shall have the option to either (i) decline the use of such means in which case Seller shall be relieved of its delivery obligations hereunder so long as and to the extent that it cannot perform its delivery obligations hereunder due to such Force Majeure event or (ii) accept su ch alternative means in which case Buyer shall pay the amount of such increased costs. Upon Buyer's request, Seller shall provide Buyer with documentation supporting its efforts to identify alternative means and any cost increases related to the use of such means.
ARTICLE XVIII GOVERNMENTAL REGULATION
18.1 This Contract and all provisions herein will be subject to all applicable and valid statutes, rules, orders and regulations of any Federal, State, or local governmental authority having jurisdiction over the Parties, their facilities, or Gas supply, this Base Contract or any provisions thereof.
ARTICLE XIX DISPUTE RESOLUTION
19.1 In the event a dispute arises between Buyer and Seller, or the successors or assigns of either of the, regarding the application or interpretation of any provision of this Base Contract, the aggrieved Party shall promptly notify the other Party of its intent to invoke this dispute resolution procedure after such dispute arises. If the Parties shall have failed to resolve the dispute within ten Business Days after delivery of such notice, each Party shall, within five Business Days thereafter nominate a senior officer of its management to meet at a mutually agreed location to resolve the dispute.
19.2 Any controversy under this Base Contract that is not resolved pursuant to Section 19.1 shall be resolved by a board of arbitration, consisting of three (3) members, upon notice of submission given by either Party, which notice shall also name one (1) arbitrator. The Party receiving such notice, shall, by notice to the other Party within ten (10) days thereafter, name the second (2nd) arbitrator, or failing to do so, the Party giving notice of submission shall name the second (2nd) arbitrator. The two (2) arbitrators so appointed shall name a third (3rd) arbitrator.
19.3 The arbitrators shall be qualified by education, experience and training in the Gas industry to decide upon the particular question in dispute.
19.4 The arbitrators so appointed, after giving the Parties due notice of the date of a hearing and reasonable opportunity to be heard, shall promptly hear the controversy in New York, New York and shall thereafter render their decision determining said controversy no later than ninety (90) Days after such board has been appointed. Any decision requires the support of a majority of the arbitrators. If the board of arbitration is unable to reach such decision, new arbitrators will be named and shall act under this Base Contract, at the request of either Party, in a like manner as if none had been previously named.
19.5 The decision of the arbitrators shall be rendered in writing and supported by written reasons. The decision of the arbitrators shall be final and binding upon the Parties and will be complied with by the Parties. Each Party shall bear the expenses of its chosen arbitrator, and the expenses of the third (3rd) arbitrator shall be borne equally by the Parties. Each Party shall bear the compensation and expenses of its legal counsel, witnesses, and employees.
ARTICLE XX MISCELLANEOUS
20.1 This Contract shall be binding upon and inure to the benefit of the successors, assigns, personal representatives, and heirs of the respective Parties hereto, and the covenants, conditions, and obligations of this Base Contract shall run for the full term of this Base Contract. No assignment of this Base Contract, in whole or in part, will be made without the prior written consent of the non-assigning Party, which consent will not be unreasonably withheld. Buyer may assign its interests herein to any lender of Buyer or of Buyer's partners or affiliates.
20.2 No waiver of any breach of this Base Contract shall be held to be a waiver of any other or subsequent breach. All remedies afforded in this Base Contract shall be taken and construed as cumulative.
20.3 This Contract sets forth all understandings between the Parties respecting the subject matter of each transaction and any prior contracts, understandings and representations, whether oral or written, representing this subject matter are merged into and superseded by the Base Contract and any effective Confirmation(s). This Contract may only be amended in writing.
20.4 This Contract may be executed in one or more counterparts, each of which shall be deemed an original, and all of which together shall constitute one and the same instrument. As used herein, the singular of any term shall include the plural.
20.5 The interpretation and performance of this Base Contract shall be governed by the laws of New York, excluding, however, any conflict of laws rule which would apply the law of another jurisdiction.
20.6 Compliance with the confirmation procedures of Article I satisfies any "writing" requirements imposed under the Uniform Commercial Code or any other applicable contract law.
20.7 Notwithstanding anything to the contrary, each Party to this Base Contract (and each employee, representative, or other agent of each Party to this Base Contract for so long as they remain an employee, representative or agent) may disclose to any and all persons, without limitation of any kind, the tax treatment and tax structure of the transactions contemplated by this Base Contract and all materials of any kind (including opinions or other tax analyses) that are provided to each Party relating to such tax treatment and tax structure. The preceding sentence shall be effective immediately upon commencement of discussions between the parties (whether such discussions commenced verbally, in writing, or otherwise) that are related to the terms of this Base Contract.

IN WITNESS WHEREOF, Parties hereto have caused their names to be signed and executed in duplicate on this 1st day of January, 2004.
	NORTHEAST ENERGY ASSOCIATES, A LIMITED PARTNERSHIP
	By:	Northeast Energy, LP, Its General Partner
	By:	ESI Northeast Energy GP, Inc., Its Administrative General Partner
	By:	NATHAN E. HANSON
		Nathan E. Hanson Director
	TRACTEBEL ENERGY MARKETING, INC.
	By:	SAM HENRY
		Sam Henry Executive Vice President

SCHEDULE 1 - Primary Delivery Point and Alternate Delivery Points

Primary Delivery Point:

"Located at the U.S. side of the International Boundary in Niagara Falls, Erie County, New York at the point known as the Niagara Import Point, at the interconnection between the facilities of TransCanada Pipeline Ltd. (TCPL) and Dominion Transmission Inc. (DTI)".

DTI via Tennessee Gas Pipeline (TGP)
Contract No.: TGP 33177
MDQ: 11,456 MMBtu/day
Delivery Point Name: Niagara River Purchase
Meter No. 010902
Niagara County, NY

Alternate Delivery Points:

Dominion Transmission Inc.
Contract No.: 200015
MDQ: 11,456 MMBtu/day
Delivery Point Name: Marilla
Meter No. 40113
Erie County, NY

Texas Eastern Transmission Corporation
Contract No.: 330182
MDQ: 7,000 MMBtu/day
Delivery Point Name: Compressor Station 23 (Chambersburg)
Meter No. 79923
Franklin County, PA

Transcontinental Gas Pipeline Corporation
Contract No.: 1044990
MDQ: 11,456 MMBtu/day
Delivery Point Name: Leidy - National Fuel
Meter No. 1007065
Clinton County, PA

Algonquin Gas Transmission
Interconnect: Texas Eastern Transmission Corporation
Lambertville - Meter No. 00210
Contract No.: 913001
MDQ: 7,000 MMBtu/day
Delivery Point Name: Bellingham
Meter No. 00094
Norfolk County, MA

Algonquin Gas Transmission
Interconnect: Transcontinental Gas Pipeline Corporation
Centerville - Meter No. 00220
Contract No.: 913001
MDQ: 11,456 MMBtu/day
Delivery Point Name: Bellingham
Meter No. 00094
Norfolk County, MA

Delivered Bellingham Plant - Assumes Algonquin Gas Transmission via TETCO
Meter No. 00094
MDQ: 11,456 MMBtu/day
Delivery Point Name: Bellingham
Norfolk County, MA

Delivered Bellingham Plant - Assumes Algonquin Gas Transmission via TGPL
Meter No. 00094
MDQ: 11,456 MMBtu/day
Delivery Point Name: Bellingham
Norfolk County, MA

EXHIBIT A CONFIRMATION
NEA Bellingham Facility			Date: ___________________________ Transaction Confirmation #: ________________
This Confirmation is subject to the Base Contract between Seller and Buyer dated January ___, 2004. The terms of this Confirmation are binding as provided in the Base Contract.
SELLER: Tractebel Energy Marketing, Inc. 1990 Post Oak Blvd. Suite 1900 Houston, TX 77056 Attn: Manager - Gas Transmission Phone: 713-636-1417 Fax: 713-636-1894 Transporter: __________________________________		BUYER: Northeast Energy Associates, A Limited Partnership c/o Northeast Energy, LP c/o FPL Energy, LLC 700 Universe Blvd. P.O. Box 14000 Juno Beach, FL 33408 Attn: Nathan E. Hanson, Business Manager Phone: 561-304-5121 Fax: 561-304-5161 Transporter: ___________________________________
Contract Price: $ ________/ MMBtu or ________________________________________________________
Delivery Period: Begin: _________________________, ________ End: __________________________, ________
Performance Obligation and Contract Quantity: (Select One)
Firm (Fixed Quantity):	Firm (Variable Quantity):			Interruptible:
_____ MMBtus/day	_____ MMBtus/day Minimum			Up to _____ MMBtus/day
" EFP _____ MMBtus/day Maximum
	subject to Section 4.2 at election of "Buyer or o Seller
Delivery Point(s): _________________________________________ (If a pooling point is used, list a specific geographic and pipeline location):
Special Conditions:
Seller:		Buyer:
By:		By:
Title:		Title:
Date:		Date:

EX-31

Exhibit 31(a)
ESI TRACTEBEL FUNDING CORP. (the registrant) Rule 13a-14(a)/15d-14(a) Certification
I, Michael L. Leighton, President (equivalent to the Chief Executive Officer) of ESI Tractebel Funding Corp., certify that:
1.	I have reviewed the quarterly report on Form 10-Q for the quarterly period ended March 31, 2004 of the registrant;
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.	The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:
	a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
	b)	Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
	c)	Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
5.	The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
	a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
	b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
Date: May 12, 2004
			MICHAEL L. LEIGHTON
			Michael L. Leighton President (equivalent to the Chief Executive Officer) ESI Tractebel Funding Corp.

EX-31

Exhibit 31(b)
ESI TRACTEBEL FUNDING CORP. (the registrant) Rule 13a-14(a)/15d-14(a) Certification
I, Mark R. Sorensen, Treasurer (equivalent to the Chief Financial Officer) of ESI Tractebel Funding Corp., certify that:
1.	I have reviewed the quarterly report on Form 10-Q for the quarterly period ended March 31, 2004 of the registrant;
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.	The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:
	a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
	b)	Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
	c)	Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
5.	The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
	a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
	b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
Date: May 12, 2004
			MARK R. SORENSEN
			Mark R. Sorensen Treasurer (equivalent to the Chief Financial Officer) ESI Tractebel Funding Corp.

EX-31

Exhibit 31(c)
ESI TRACTEBEL ACQUISITION CORP. (the registrant) Rule 13a-14(a)/15d-14(a) Certification
I, Michael L. Leighton, President (equivalent to the Chief Executive Officer) of ESI Tractebel Acquisition Corp., certify that:
1.	I have reviewed the quarterly report on Form 10-Q for the quarterly period ended March 31, 2004 of the registrant;
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.	The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:
	a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
	b)	Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
	c)	Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
5.	The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
	a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
	b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
Date: May 12, 2004
			MICHAEL L. LEIGHTON
			Michael L. Leighton President (equivalent to the Chief Executive Officer) ESI Tractebel Acquisition Corp.

EX-31

Exhibit 31(d)
ESI TRACTEBEL ACQUISITION CORP. (the registrant) Rule 13a-14(a)/15d-14(a) Certification
I, Mark R. Sorensen, Treasurer (equivalent to the Chief Financial Officer) of ESI Tractebel Acquisition Corp., certify that:
1.	I have reviewed the quarterly report on Form 10-Q for the quarterly period ended March 31, 2004 of the registrant;
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.	The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:
	a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
	b)	Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
	c)	Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
5.	The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
	a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
	b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
Date: May 12, 2004
			MARK R. SORENSEN
			Mark R. Sorensen Treasurer (equivalent to the Chief Financial Officer) ESI Tractebel Acquisition Corp.

EX-31

Exhibit 31(e)
NORTHEAST ENERGY ASSOCIATES, A LIMITED PARTNERSHIP (the registrant) Rule 13a-14(a)/15d-14(a) Certification
I, Michael L. Leighton, President of ESI Northeast Energy GP, Inc. (equivalent to the Chief Executive Officer of registrant) as Administrative General Partner of Northeast Energy Associates, a limited partnership, certify that:
1.	I have reviewed the quarterly report on Form 10-Q for the quarterly period ended March 31, 2004 of the registrant;
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.	The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:
	a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
	b)	Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
	c)	Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
5.	The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
	a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
	b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
Date: May 12, 2004
			MICHAEL L. LEIGHTON
			Michael L. Leighton President (equivalent to the Chief Executive Officer) ESI Northeast Energy GP, Inc. as Administrative General Partner of Northeast Energy Associates, a limited partnership

EX-31

Exhibit 31(f)
NORTHEAST ENERGY ASSOCIATES, A LIMITED PARTNERSHIP (the registrant) Rule 13a-14(a)/15d-14(a) Certification
I, Mark R. Sorensen, Vice President and Treasurer of ESI Northeast Energy GP, Inc. (equivalent to the Chief Financial Officer of registrant) as Administrative General Partner of Northeast Energy Associates, a limited partnership, certify that:
1.	I have reviewed the quarterly report on Form 10-Q for the quarterly period ended March 31, 2004 of the registrant;
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.	The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:
	a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
	b)	Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
	c)	Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
5.	The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
	a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
	b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
Date: May 12, 2004
			MARK R. SORENSEN
			Mark R. Sorensen Vice President and Treasurer (equivalent to the Chief Financial Officer) ESI Northeast Energy GP, Inc. as Administrative General Partner of Northeast Energy Associates, a limited partnership

EX-31

Exhibit 31(g)
NORTH JERSEY ENERGY ASSOCIATES, A LIMITED PARTNERSHIP (the registrant) Rule 13a-14(a)/15d-14(a) Certification
I, Michael L. Leighton, President of ESI Northeast Energy GP, Inc. (equivalent to the Chief Executive Officer of registrant) as Administrative General Partner of North Jersey Energy Associates, a limited partnership, certify that:
1.	I have reviewed the quarterly report on Form 10-Q for the quarterly period ended March 31, 2004 of the registrant;
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.	The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:
	a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
	b)	Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
	c)	Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
5.	The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
	a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
	b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
Date: May 12, 2004
			MICHAEL L. LEIGHTON
			Michael L. Leighton President (equivalent to the Chief Executive Officer) ESI Northeast Energy GP, Inc. as Administrative General Partner of North Jersey Energy Associates, a limited partnership

EX-31

Exhibit 31(h)
NORTH JERSEY ENERGY ASSOCIATES, A LIMITED PARTNERSHIP (the registrant) Rule 13a-14(a)/15d-14(a) Certification
I, Mark R. Sorensen, Vice President and Treasurer of ESI Northeast Energy GP, Inc. (equivalent to the Chief Financial Officer of registrant) as Administrative General Partner of North Jersey Energy Associates, a limited partnership, certify that:
1.	I have reviewed the quarterly report on Form 10-Q for the quarterly period ended March 31, 2004 of the registrant;
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.	The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:
	a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
	b)	Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
	c)	Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
5.	The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
	a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
	b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
Date: May 12, 2004
			MARK R. SORENSEN
			Mark R. Sorensen Vice President and Treasurer (equivalent to the Chief Financial Officer) ESI Northeast Energy GP, Inc. as Administrative General Partner of North Jersey Energy Associates, a limited partnership

EX-31

Exhibit 31(i)
NORTHEAST ENERGY, LP (the registrant) Rule 13a-14(a)/15d-14(a) Certification
I, Michael L. Leighton, President of ESI Northeast Energy GP, Inc. (equivalent to the Chief Executive Officer of registrant) as Administrative General Partner of Northeast Energy, LP, certify that:
1.	I have reviewed the quarterly report on Form 10-Q for the quarterly period ended March 31, 2004 of the registrant;
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.	The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:
	a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
	b)	Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
	c)	Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
5.	The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
	a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
	b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
Date: May 12, 2004
			MICHAEL L. LEIGHTON
			Michael L. Leighton President (equivalent to the Chief Executive Officer) ESI Northeast Energy GP, Inc. as Administrative General Partner of Northeast Energy, LP

EX-31

Exhibit 31(j)
NORTHEAST ENERGY, LP (the registrant) Rule 13a-14(a)/15d-14(a) Certification
I, Mark R. Sorensen, Vice President and Treasurer of ESI Northeast Energy GP, Inc. (equivalent to the Chief Financial Officer of registrant) as Administrative General Partner of Northeast Energy, LP, certify that:
1.	I have reviewed the quarterly report on Form 10-Q for the quarterly period ended March 31, 2004 of the registrant;
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.	The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:
	a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
	b)	Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
	c)	Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
5.	The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
	a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
	b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
Date: May 12, 2004
			MARK R. SORENSEN
			Mark R. Sorensen Vice President and Treasurer (equivalent to the Chief Financial Officer) ESI Northeast Energy GP, Inc. as Administrative General Partner of Northeast Energy, LP

EX-32

Exhibit 32(a)
ESI TRACTEBEL FUNDING CORP. (the registrant) Section 1350 Certification
We, Michael L. Leighton, President (equivalent to the Chief Executive Officer) of ESI Tractebel Funding Corp., and Mark R. Sorensen, Treasurer (equivalent to the Chief Financial Officer) of ESI Tractebel Funding Corp., certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:
(1)	The Quarterly Report on Form 10-Q of the registrant for the quarterly period ended March 31, 2004 (Report) fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934; and
(2)	The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the registrant.
Dated: May 12, 2004
		MICHAEL L. LEIGHTON
		Michael L. Leighton President (equivalent to the Chief Executive Officer) ESI Tractebel Funding Corp.

MARK R. SORENSEN

Mark R. Sorensen
Treasurer
(equivalent to the Chief Financial Officer)
ESI Tractebel Funding Corp.

A signed original of this written statement required by Section 906 has been provided to the registrant and will be retained by the registrant and furnished to the Securities and Exchange Commission or its staff upon request.

The foregoing certification is being furnished as an exhibit to the Report pursuant to Item 601(b)(32) of Regulation S-K and Section 906 of the Sarbanes-Oxley Act of 2002 and, accordingly, is not being filed with the Securities and Exchange Commission as part of the Report and is not to be incorporated by reference into any filing of the registrant under the Securities Act of 1933 or the Securities Exchange Act of 1934 (whether made before or after the date of the Report, irrespective of any general incorporation language contained in such filing).

EX-32

Exhibit 32(b)
ESI TRACTEBEL ACQUISITION CORP. (the registrant) Section 1350 Certification
We, Michael L. Leighton, President (equivalent to the Chief Executive Officer) of ESI Tractebel Acquisition Corp., and Mark R. Sorensen, Treasurer (equivalent to the Chief Financial Officer) of ESI Tractebel Acquisition Corp., certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:
(1)	The Quarterly Report on Form 10-Q of the registrant for the quarterly period ended March 31, 2004 (Report) fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934; and
(2)	The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the registrant.
Dated: May 12, 2004
		MICHAEL L. LEIGHTON
		Michael L. Leighton President (equivalent to the Chief Executive Officer) ESI Tractebel Acquisition Corp.

MARK R. SORENSEN

Mark R. Sorensen
Treasurer
(equivalent to the Chief Financial Officer)
ESI Tractebel Acquisition Corp.

A signed original of this written statement required by Section 906 has been provided to the registrant and will be retained by the registrant and furnished to the Securities and Exchange Commission or its staff upon request.

The foregoing certification is being furnished as an exhibit to the Report pursuant to Item 601(b)(32) of Regulation S-K and Section 906 of the Sarbanes-Oxley Act of 2002 and, accordingly, is not being filed with the Securities and Exchange Commission as part of the Report and is not to be incorporated by reference into any filing of the registrant under the Securities Act of 1933 or the Securities Exchange Act of 1934 (whether made before or after the date of the Report, irrespective of any general incorporation language contained in such filing).

EX-32

Exhibit 32(c)
NORTHEAST ENERGY ASSOCIATES, A LIMITED PARTNERSHIP (the registrant) Section 1350 Certification
We, Michael L. Leighton, President of ESI Northeast Energy GP, Inc. (equivalent to the Chief Executive Officer of registrant) as Administrative General Partner of Northeast Energy Associates, a limited partnership, and Mark R. Sorensen, Vice President and Treasurer of ESI Northeast Energy GP, Inc. (equivalent to the Chief Financial Officer of registrant) as Administrative General Partner of Northeast Energy Associates, a limited partnership, certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:
(1)	The Quarterly Report on Form 10-Q of the registrant for the quarterly period ended March 31, 2004 (Report) fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934; and
(2)	The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the registrant.
Dated: May 12, 2004
		MICHAEL L. LEIGHTON
		Michael L. Leighton President (equivalent to the Chief Executive Officer) ESI Northeast Energy GP, Inc. as Administrative General Partner of Northeast Energy Associates, a limited partnership

MARK R. SORENSEN

Mark R. Sorensen
Vice President and Treasurer
(equivalent to the Chief Financial Officer)
ESI Northeast Energy GP, Inc.
as Administrative General Partner of
Northeast Energy Associates,
a limited partnership

A signed original of this written statement required by Section 906 has been provided to the registrant and will be retained by the registrant and furnished to the Securities and Exchange Commission or its staff upon request.

The foregoing certification is being furnished as an exhibit to the Report pursuant to Item 601(b)(32) of Regulation S-K and Section 906 of the Sarbanes-Oxley Act of 2002 and, accordingly, is not being filed with the Securities and Exchange Commission as part of the Report and is not to be incorporated by reference into any filing of the registrant under the Securities Act of 1933 or the Securities Exchange Act of 1934 (whether made before or after the date of the Report, irrespective of any general incorporation language contained in such filing).

EX-32

Exhibit 32(d)
NORTH JERSEY ENERGY ASSOCIATES, A LIMITED PARTNERSHIP (the registrant) Section 1350 Certification
We, Michael L. Leighton, President of ESI Northeast Energy GP, Inc. (equivalent to the Chief Executive Officer of registrant) as Administrative General Partner of North Jersey Energy Associates, a limited partnership, and Mark R. Sorensen, Vice President and Treasurer of ESI Northeast Energy GP, Inc. (equivalent to the Chief Financial Officer of registrant) as Administrative General Partner of North Jersey Energy Associates, a limited partnership, certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:
(1)	The Quarterly Report on Form 10-Q of the registrant for the quarterly period ended March 31, 2004 (Report) fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934; and
(2)	The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the registrant.
Dated: May 12, 2004
		MICHAEL L. LEIGHTON
		Michael L. Leighton President (equivalent to the Chief Executive Officer) ESI Northeast Energy GP, Inc. as Administrative General Partner of North Jersey Energy Associates, a limited partnership

MARK R. SORENSEN

Mark R. Sorensen
Vice President and Treasurer
(equivalent to the Chief Financial Officer)
ESI Northeast Energy GP, Inc.
as Administrative General Partner of
North Jersey Energy Associates,
a limited partnership

A signed original of this written statement required by Section 906 has been provided to the registrant and will be retained by the registrant and furnished to the Securities and Exchange Commission or its staff upon request.

The foregoing certification is being furnished as an exhibit to the Report pursuant to Item 601(b)(32) of Regulation S-K and Section 906 of the Sarbanes-Oxley Act of 2002 and, accordingly, is not being filed with the Securities and Exchange Commission as part of the Report and is not to be incorporated by reference into any filing of the registrant under the Securities Act of 1933 or the Securities Exchange Act of 1934 (whether made before or after the date of the Report, irrespective of any general incorporation language contained in such filing).

EX-32

Exhibit 32(e)
NORTHEAST ENERGY, LP (the registrant) Section 1350 Certification
We, Michael L. Leighton, President of ESI Northeast Energy GP, Inc. (equivalent to the Chief Executive Officer of registrant) as Administrative General Partner of Northeast Energy, LP, and Mark R. Sorensen, Vice President and Treasurer of ESI Northeast Energy GP, Inc. (equivalent to the Chief Financial Officer of registrant) as Administrative General Partner of Northeast Energy, LP, certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:
(1)	The Quarterly Report on Form 10-Q of the registrant for the quarterly period ended March 31, 2004 (Report) fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934; and
(2)	The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the registrant.
Dated: May 12, 2004
		MICHAEL L. LEIGHTON
		Michael L. Leighton President (equivalent to the Chief Executive Officer) ESI Northeast Energy GP, Inc. as Administrative General Partner of Northeast Energy, LP

MARK R. SORENSEN

Mark R. Sorensen
Vice President and Treasurer
(equivalent to the Chief Financial Officer)
ESI Northeast Energy GP, Inc.
as Administrative General Partner of
Northeast Energy, LP

A signed original of this written statement required by Section 906 has been provided to the registrant and will be retained by the registrant and furnished to the Securities and Exchange Commission or its staff upon request.

The foregoing certification is being furnished as an exhibit to the Report pursuant to Item 601(b)(32) of Regulation S-K and Section 906 of the Sarbanes-Oxley Act of 2002 and, accordingly, is not being filed with the Securities and Exchange Commission as part of the Report and is not to be incorporated by reference into any filing of the registrant under the Securities Act of 1933 or the Securities Exchange Act of 1934 (whether made before or after the date of the Report, irrespective of any general incorporation language contained in such filing).