Kinder Morgan Louisiana Pipeline LLC

Original Volume No. 1

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Effective Date: 03/01/2009, Docket: RP09-257-000, Status: Effective

Original Sheet No. 165 Original Sheet No. 165

 

GENERAL TERMS AND CONDITIONS

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restructuring costs, and other intangible assets. Only actual

tangible assets are included in KMLP's assessment of

creditworthiness. In comparing the overall value of a Shipper's

contract to tangible net worth for credit evaluation purposes, KMLP

will compare the net present value of the demand or reservation

charge obligations under such contracts to Shipper's current

tangible net worth. If a Shipper has multiple service agreements

with KMLP, then the total potential fees and charges of all such

service agreements shall be considered in determining

creditworthiness.

 

(3) If Shipper does not meet the criteria

described above, then Shipper may request that KMLP evaluate its

creditworthiness based upon the level of service requested relative

to the Shipper's current and future ability to meet its obligations.

Further, any FTS Agreement may include a provision that if Shipper's

creditworthiness does not meet any of the foregoing criteria,

Shipper will be considered creditworthy for the primary term and any

extended term of the FTS Agreement if Shipper maintains and delivers

to KMLP an irrevocable guaranty of payment, executed by Shipper's

parent company which satisfies the credit requirements of this

Section 12.1, or an irrevocable letter of credit from a financial

institution rated at least A- by S&P or at least A3 by Moody's, in a

form acceptable to KMLP, in either case, in the amount equal to

three (3) Years and six (6) Months of reservation fees and commodity

fees. Additionally, for purposes of this Section 12.1 and for any

evaluation under Section 12.2 (relating to deterioration of credit),

an Anchor Shipper that does not meet the criteria described above

will be considered creditworthy for the primary term and any

extended term of its FTS Agreement if Anchor Shipper maintains and

delivers to KMLP an irrevocable guaranty of payment, executed by

Shipper's parent company or an affiliate of Shipper's parent company

with respect to which the sum of reservation fees, commodity fees

and any other associated fees and charges for the FTS Agreement's

term is less than 15% of tangible net worth, or an irrevocable

letter of credit from a financial institution rated at least A- by

S&P or at least A3 by Moody's, in a form acceptable to KMLP, or

other substitute credit support mutually agreed upon, in any such

case, in the amount equal to three (3) Years and six (6) Months of

reservation and commodity fees. The obligation to maintain such

credit assurance shall extend until such time as Shipper or Anchor

Shipper is deemed creditworthy as defined in this Section 12.1.

Shipper or Anchor Shipper shall provide the parent company guarantee