Egan Hub Storage, LLC

First Revised Volume No. 1

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Effective Date: 06/15/2009, Docket: RP09-596-000, Status: Effective

Third Revised Sheet No. 107 Third Revised Sheet No. 107

Superseding: Sub Second Revised Sheet No. 107

 

GENERAL TERMS AND CONDITIONS

(Continued)

 

3.4 Credit Evaluation:

 

(a) Evidence of creditworthiness. Egan Hub's acceptance of a request for new

service or a request resulting in a Billing Amendment under any of Egan Hub's rate schedules is

contingent upon a satisfactory credit appraisal by Egan Hub. Egan Hub shall apply, on a non-

discriminatory basis, consistent financial evaluation standards to determine the acceptability

of Customer's overall financial condition. Egan Hub shall not use any criteria, formula,

ranking system or other methodology that would give any preference or advantage to an affiliate

of Egan Hub. To enable Egan Hub to conduct such credit appraisal, a Customer shall submit the

following; provided, however, that submission of such material shall not be deemed acceptance

of a request for service by Egan Hub, which determination shall be made by Egan Hub only after

submission of the material and information set forth below and a determination by Egan Hub that

Customer is sufficiently creditworthy. In the event Customer cannot provide the information

required by this Section 3.4(a), Customer shall, if applicable, provide such information for

its parent company.

 

(1) Customer shall provide current financial statements, annual reports, 10-K

reports or other filings with regulatory agencies which discuss Customer's

financial status, a list of all corporate affiliates, parent companies and

subsidiaries, and any reports from credit reporting and bond rating

agencies which are available. Egan Hub shall determine the acceptability

of the Customer's overall financial condition;

 

(2) Customer shall provide a bank reference and at least two trade references.

The results of reference checks and any credit reports submitted in

3.4(g)(1) must show that Customer's obligations are being paid on a

reasonably prompt basis;

 

(3) Customer shall confirm in writing that Customer is not operating under any

chapter of the bankruptcy laws and is not subject to liquidation or debt

reduction procedures under state laws, such as an assignment for the

benefit of creditors, or any informal creditors' committee agreement. An

exception can be made for a Customer who is a debtor in possession

operating under Chapter XI of the Federal Bankruptcy Act but only with

adequate assurance that the service billing will be paid promptly as a cost

of administration under the Federal Court's jurisdiction;

 

(4) Customer shall confirm in writing that Customer is not aware of any change

in business conditions which would cause a substantial deterioration in its

financial condition, a condition of insolvency or the inability to exist as

an ongoing business entity;

 

(5) If Customer has an on-going business relationship with Egan Hub, no

delinquent balances should be outstanding for services made previously by

Egan Hub and Customer must have paid its account during the past according

to the established terms and not made deductions or withheld payment for

claims not authorized by contract; and

 

(6) Customer shall confirm in writing that no significant collection lawsuits

or judgments are outstanding which would seriously reflect upon the

business entity's ability to remain solvent.

 

(b) Egan Hub shall not be required to perform or to continue service under any

Rate Schedule on behalf of any Customer who is or has become insolvent or who, at Egan Hub's

request, fails within a reasonable period to demonstrate creditworthiness. Upon notification

by Egan Hub that a Customer has failed to satisfy the credit criteria or subsequently during

the term of the service agreement no longer satisfies the credit criteria, such Customer may

still obtain credit approval by Egan Hub if it pays any outstanding balances due Egan Hub for

service rendered or has complied with Section 14.4 of the General Terms and Conditions with

regard to such balances and elects to provide one of the following security: