Freebird Gas Storage, L.L.C.

First Revised Volume No. 1

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Effective Date: 10/01/2008, Docket: RP08-304-002, Status: Effective

Substitute Original Sheet No. 113 Substitute Original Sheet No. 113

Superseding: Superseding Original Sheet No. 113

 

discretion, in the following amount: (A) within five (5) Days of

Freebird's written request for Performance Assurance, an amount

equivalent to one month (or the duration of the Service Agreement,

whichever is shorter) of estimated fees and service charges, and

(B) within thirty (30) Days of such request, an amount equal to (1) in the

case of Firm storage services, three (3) months or the duration of the

Shipper's bid or Service Agreement, whichever is shorter, of Storage

Reservation Charges at the rate specified in Shipper's bid for service or

Service Agreement; or (2) in the case of Interruptible services, three (3)

months or the duration of the Shipper's Service Agreement, whichever is

shorter, of the Interruptible charge(s) calculated on a one hundred percent

(100%) load factor basis, plus the market value (at the time of the request

for such Performance Assurance) of any quantities of Gas loaned to the Shipper

pursuant to the Hub Services Agreement (and for a Shipper who previously

posted security for Gas loaned to such Shipper, if the market value of such

Gas increases by ten percent (10%) or more, such Shipper shall deliver

additional Performance Assurance to cover such increase in market value within

two (2) business days of Freebird's request for same). If

Shipper chooses to provide cash collateral in the amount set forth

above, Shipper may earn interest on such cash collateral by (i)

designating a segregated interest-bearing (for Shipper's benefit)

escrow account to hold such cash collateral, in the name of

Shipper and pledged to Freebird pursuant to an account control agreement,

pursuant to which Freebird shall have unrestricted access to such account; or

(ii) directing Freebird to hold such cash collateral in escrow, in which case,

Freebird must pay Shipper interest on such cash collateral calculated in

accordance with Section 154.501(d) of the Commission's regulations. If

Shipper does not provide the required Performance Assurance within the time

period set forth in this Section, Freebird may immediately after such time

period suspend service and may, upon thirty (30) calendar Days notice to

Shipper and the FERC, terminate all or any of Shipper's current Service

Agreements. For purposes herein, the insolvency of a Shipper or Potential

Shipper shall be conclusively demonstrated by the filing by Shipper or

Potential Shipper, or any parent entity or Credit Support Provider thereof, of

a voluntary petition in bankruptcy or the entry of a decree or order by a

court having jurisdiction in the premises adjudging the Shipper or Potential

Shipper, or any parent entity or Credit Support Provider thereof, bankrupt or

insolvent, or approving, as properly filed, a petition seeking reorganization,

arrangement, adjustment or composition of or in respect of the Shipper or

Potential Shipper, or any parent entity or Credit Support Provider thereof,

under the Federal Bankruptcy Act or any other applicable federal or state law,

or appointing a receiver, liquidator, assignee, trustee, sequestrator (or

other similar official) of the Shipper or Potential Shipper, or any parent

entity or Credit Support Provider thereof, or of any substantial part of their

assets, or the ordering of the winding-up or liquidation of their affairs, with

said order or decree continuing unstayed and in effect for a period of sixty

(60) consecutive days.

 

3.5 Lack Of Creditworthiness. If at any time Freebird reasonably determines

based on adequate information available to it that a Shipper or Potential

Shipper is not creditworthy under Section 3.4 of these General Terms and

Conditions, Freebird shall notify such Shipper in writing within ten (10) days

of its determination that Freebird has determined that such Shipper is not

creditworthy and the reasons for such determination.

 

3.6 Reevaluation Of Creditworthiness Determination. A Shipper which Freebird

has determined to be noncreditworthy may at any time request that its credit

status be reevaluated by providing Freebird with additional or updated

information. Such reevaluation shall be performed consistent with Section

3.4(h) of these General Terms and Conditions. If Shipper has provided

Freebird with all the information required under said Section 3.4(h), Freebird

shall give an initial response to Shipper's request within five (5) Business

Days and shall complete its reevaluation within twenty (20) Business Days. If

Freebird determines that the Shipper is now creditworthy, any security

requirement under Section 3.4(j) of these General Terms and Conditions shall

be terminated and any collateral held for security (including any applicable

interest) released to Shipper from escrow within ten (10) Business Days after

such determination.