Canyon Creek Compression Company

First Revised Volume No. 1A

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Effective Date: 05/01/1991, Docket: RP91-123-000, Status: Effective

Original Sheet No. 16 Original Sheet No. 16 : Superseded

 

RATE SCHEDULE FCS

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5.7 CREDIT INFORMATION

 

(a) Acceptance of a request is contingent upon a

satisfactory credit appraisal by Canyon.

 

Such a credit appraisal shall be performed in

accordance with the following criteria:

 

(1) Customer shall provide current financial

statements, annual reports, 10-K reports or other filings with

regulatory agencies, a list of all corporate Affiliates, parent

companies and subsidiaries, and any reports from credit reporting

agencies which are available. Canyon shall apply consistent

evaluation practices to determine the acceptability of the

Customer's overall financial condition, working capital, and

profitability trends.

 

(2) A bank reference and at least two (2) trade

references must be provided by Customer. The results of reference

checks and any credit reports submitted in subsection 5.7(a)(1)

hereof must show that Customer's obligations are being paid on a

reasonably prompt basis.

 

(3) Customer must not be operating under any

chapter of the bankruptcy laws and must not be 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

Customer who is a debtor in possession operating under Chapter XI of

the Federal Bankruptcy Act but only with adequate assurances that

the transportation billing will be paid promptly as cost of

administration under the federal court's jurisdiction.

 

(4) Customer should not be subject to the

uncertainty of pending liquidation or regulatory proceedings in

state or federal courts which could cause a substantial

deterioration in its financial condition, which could cause a

condition of insolvency, or impair the ability to exist as an

ongoing business entity.

 

(5) If Customer has an ongoing business

relationship with Canyon, no delinquent balances should be

consistently outstanding for natural gas sales or transportation

services made previously by Canyon and Customer may have paid its