B-R Pipeline Company

Original Volume No. 1

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Effective Date: 05/01/2004, Docket: RP04-224-000, Status: Effective

Original Sheet No. 48 Original Sheet No. 48 : Effective

 

GENERAL TERMS AND CONDITIONS

(Continued)

 

11. SERVICE AGREEMENT AND CREDITWORTHINESS

 

11.1 Form of Agreement. Transporter and Shipper shall execute a Service

Agreement covering the service contemplated. The executed Service

Agreement, together with the General Terms and Conditions and applicable

Rate Schedule shall constitute the entire agreement between the parties for

service provided therein and shall be modified only in writing.

 

11.2 Creditworthiness. A Shipper seeking service from Transporter under

Rate Schedule FT or IT must provide the following:

(a) A copy of Shipper's most recent audited financial statement and

unaudited quarterly statements certified by the Chief Financial

Officer of the Shipper. Certificate shall state that such unaudited

financial statements fairly represent the financial condition and the

results of the operations of the Shipper for the period indicated and

are prepared in accordance with generally accepted accounting

principles;

(b) Such other documentation as the Transporter shall reasonably request

in connection with the service contemplated;

(c) A list of Shipper's affiliates, including parent and subsidiaries,

if applicable.

 

In the event Shipper cannot provide the information above, Shipper shall,

if applicable, provide that information for its parent company.

 

(d) As security for the payment of amounts due, Shipper agrees to

provide the following:

(i) In the event Shipper maintains a long-term, senior, unsecured

debt rating, not supported by third party credit enhancement, of

at least "BBB" by Standard & Poor's or "Baa2" by Moody's, without

negative implications, no additional security is required.

(ii) In the event Shipper maintains a long-term, senior, unsecured

debt rating, not supported by third party credit enhancement,

less than "BBB" by Standard & Poor's or "Baa2" by Moody's, has

negative implications, or does not maintain a credit rating,

Shipper shall provide:

(1) one or more irrevocable, transferable, standby letters of

credit from a major U.S. commercial bank or a foreign bank with a

U.S. branch office. Such bank shall have a credit rating of at

least "A+" from Standard & Poor's or "A1" from Moody's and $10

Billion in assets. The letter of credit shall be in favor of and

in a form acceptable to Transporter; or

(2) a guaranty in favor of and in a form acceptable to

Transporter from an entity acceptable to Transporter; or

(3) cash prepayment in an amount equal to the cost of the service

provided.