Freebird Gas Storage, L.L.C.

First Revised Volume No. 1

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Effective Date: 10/01/2008, Docket: RP08-304-000, Status: Effective

Original Sheet No. 112 Original Sheet No. 112 : Suspended

 

Such credit appraisal shall consist of Freebird’s

evaluation of the overall financial condition of Potential Shipper or

Shipper’s Credit Support Provider, if applicable, based on the following

information and credit criteria:

 

(1) Potential Shipper (or Credit Support Provider, if applicable) shall

provide current financial statements, annual reports, 10-K reports or other

filings with regulatory agencies which discuss the Potential Shipper’s (or

Credit Support Provider’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;

 

(2) Potential Shipper (or Credit Support Provider, if applicable) shall

provide a bank reference and at least two trade references. The results of

reference checks and any credit reports submitted must show that Shipper’s

obligations are being paid on a reasonably prompt

basis;

 

(3) Potential Shipper (or Credit Support Provider, if applicable) shall

confirm in writing that it 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

Potential Shipper 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) Potential Shipper (or Credit Support Provider, if applicable) shall

confirm in writing that it 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; and

 

(5) Potential Shipper (or Credit Support Provider, if applicable) 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.

 

(i) In the event Potential Shipper cannot provide the information in Section

3.5(h) above, it shall, if applicable, cause its parent company to provide

such information.

 

(j) Freebird shall not be required to perform or to continue service under

any Rate Schedule on behalf of any Shipper or Potential Shipper which is or has

become insolvent, or which, at Freebird’s request, fails within a reasonable

period to demonstrate creditworthiness in accordance with this Section 3.4;

provided, however, that such Shipper or Potential Shipper may receive service

under any Rate Schedule if such party provides performance assurance

("Performance Assurance") in one of the following forms: cash collateral (in

U.S. dollars) for such service, a standby irrevocable letter of credit issued

by a Qualified Institution, or a guarantee (acceptable to Freebird) by a

Credit Support Provider that satisfies the credit requirements of Freebird, or

another form of assurance satisfactory to Freebird in its reasonable