PetroLogistics Natural Gas Storage LLC

Original Volume No. 1

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Effective Date: 06/03/2009, Docket: RP09-577-000, Status: Effective

Original Sheet No. 106 Original Sheet No. 106

 

(2) For a Shipper or Potential Shipper that is not a public entity or whose ultimate parent

company is not a public entity, Potential Shipper shall provide initially, and Shipper shall provide

on a continuing basis: (i) the most recent available interim financial statements, with an

attestation by its CFO that such statements constitute a true, correct and fair representation of

financial condition prepared in accordance with GAAP or equivalent; or (ii) an existing sworn filing,

including the most recent available interim financial statements and annual financial reports filed

with the respective regulatory authority (if applicable), showing Shipper's current financial condition.

(3) Potential Shipper shall confirm in writing initially and any Shipper that fails to satisfy the

minimum acceptable credit standard set forth in Section 2.3(b)(1) shall confirm in writing within

ten (10) Business Days of receipt of a written request from PetroLogistics, that: (i) Potential

Shipper/Shipper is not operating under any chapter of the bankruptcy laws; (ii) Potential Shipper/

Shipper 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; (iii) no

significant collection lawsuits or judgments are outstanding that would materially affect Potential

Shipper/Shipper's ability to remain solvent as a business entity; and (iv) no receiver, custodian,

trustee, or similar person has been appointed for a material portion of Shipper's assets. If

Shipper's status changes so that Shipper's prior confirmation is no longer accurate, Shipper shall

notify PetroLogistics in writing within ten (10) Business Days of the change. Failure of Potential

Shipper/Shipper to satisfy the condition set forth in clause (i) of this Section 2.3(a)(3) shall not

result in Potential Shipper/Shipper being deemed non-creditworthy if Potential Shipper/Shipper is a

debtor in possession operating under Chapter 11 of the Federal Bankruptcy Code and PetroLogistics

receives adequate assurance that Potential Shipper/Shipper's liabilities to PetroLogistics will be

paid promptly as a cost of administration under the Federal Bankruptcy Court's jurisdiction.

(4) In the event Shipper cannot provide the information specified in 2.3(a)(1)-(3) above, Shipper

shall provide, if applicable, that information for its parent company.

(b) Minimum Acceptable Credit Standard.

(1) Potential Shipper or Shipper will be deemed creditworthy if its unenhanced long-term senior

unsecured debt is rated, or if its issuer credit rating is, at least "BBB-" by Standard & Poor's

("S&P") or "Baa3" by Moody's ("Moody's) ("Minimum Acceptable Credit Rating") (provided that, in

the event that such ratings by S&P and Moody's vary by more than one "notch," the middle rating

between the two actual ratings (rounded upwards if there are an even number of ratings notches between

the two actual ratings) shall be used for purposes of determining whether Shipper has achieved the

"Minimum Acceptable Credit Rating"). The applicable credit rating shall be a "foreign currency"

rating if Shipper is domiciled outside of the United States. "Local currency" ratings are

unacceptable unless Potential Shipper/Shipper's local currency is US Dollars.

(2) If Potential Shipper/Shipper's debt is not rated by S&P or Moody's, Potential Shipper/Shipper

may elect to obtain an equivalent credit rating to establish its creditworthiness. Such equivalent

credit rating must meet the minimum rating