Discovery Gas Transmission LLC

Original Volume No. 1

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Effective Date: 11/10/1997, Docket: CP96-712-002, Status: Effective

Original Sheet No. 149 Original Sheet No. 149 : Effective

 

 

10.5 CREDITWORTHINESS OF SHIPPER - Transporter shall not be

required to perform Transportation service under this

FERC Gas Tariff or any Effective Service Agreement on

behalf of any Shipper who is or who has become insolvent

or who, at Transporter's request, fails within a

reasonable period to demonstrate creditworthiness.

Shipper's creditworthiness will be determined based upon

(i) a current credit rating of investment grade, defined

as a rating of at least "BBB-" or higher by Standard &

Poor's or a rating of at least "Baa3" or higher by

Moody's Investors Service, Inc. or (ii) by the evaluation

of the Shipper's latest overall financial condition,

including, but not limited to working capital, cash flow

analysis, debt levels, and profitability trends.

 

At Transporter's request, Shipper shall provide

Transporter the following information in order for

Transporter to analyze Shipper's creditworthiness:

Shipper's latest audited financial statements, including

income and cash flow statements; annual report, if

applicable; Form 10-K; a list of affiliates, parent

companies, or subsidiaries; three credit and trade

references; and credit bureau reports and information as

to pending litigation, collection actions, or judgments

that could cause a substantial deterioration in financial

condition. For purposes of this FERC Gas Tariff, the

insolvency of a Shipper will be evidenced by:

 

a. The filing by such Shipper, or parent entity

thereof, of a voluntary petition in bankruptcy; or

 

b. The entry of a decree or order by a court having

jurisdiction in the premises adjudging the Shipper

as bankrupt or insolvent. An exception can be made

for a Shipper who is a debtor in possession

operating under Chapter XI of the Federal Bankruptcy

Act, but only with adequate assurances that billing

hereunder will be paid promptly as a cost of

administration under the federal court's

jurisdiction; or