Dow Invoice

I have reviewed the Dow Agreement wrt to the Dow Invoice Dated November 29, 2001 and have found the following

1. 2Q Lease Fee - $115,000
3Q Lease Fee - $195,500.

Section 3.3 of the Agreement (as amended) provides for a lease fee of $25,000 per BCF based on 4.6 BCF until the date that gas injections begin in Enron's well (which was July 31, 2001) and a fee of $50,000 per BCF based on 4.6 BCF thereafter. The fees are assessed per calendar quarter. The above fees look to be OK.

2. Final Mining Fee - $23,362.40
Final Land Purchase Offset - ($47,013.75)

Section 6.5 through 6.8 of the Agreement provide for a detailed calculation of the Brine Fee due Dow based on the amount of salt removed from Enron's new well and a corresponding credit back to Enron for the conveyance of a 57.865 acres tract of land to Dow from Enron. The credit is also based on the amount of Salt removed from Enron's new well. Dow should provide detail on the salt removed and someone would need to go through the calcs in 6.5 through 6.8 to verify the above charges.

3. Power Credit Adjustment - $16,500

I find no basis for this in the contract.

Under Schedule 3 to the Bridgeline Holdings, L.P. partnership agreement, Bridgline is obligated to bear all obligations under the Dow Agreement up to a maximum of $1,000,000 per year. So Bridgeline should be paying these costs, assuming they haven't already paid up to $1,000,000.

Let me know if you have any questions.