Great Lakes Gas Transmission Limited Partner

Second Revised Volume No. 1

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Effective Date: 04/01/2004, Docket: RP04-188-003, Status: Effective

First Revised Sheet No. 50R First Revised Sheet No. 50R : Effective

Superseding: Substitute Original Sheet No. 50R







26.1 Determination of Creditworthiness


(A) For purposes herein, the determination of Shipper's creditworthiness will be based upon Shipper's

credit/financial history and outlook, along with a comparison of the request for credit (defined

as the sum of the reservation fees, utilization fees, and other applicable fees and amounts

calculated for three months of service or the effective period of Shipper's service, whichever is

shorter) to the Shipper's adjusted tangible net worth as defined below in Subsection 26.1(B)(2).

If the Shipper has multiple Agreements with Transporter, the exposure generated by the total

of all such Agreements shall be considered in determining creditworthiness.


(B) Shipper will be deemed creditworthy (on a standalone basis) if:


(1) the Shipper provides verification that the lower of its senior unsecured debt rating or

issuer rating is investment grade or better from each of the major rating agencies (if

applicable), including, but not limited to, Moody's, Standard & Poor's, Fitch, and

Dominion Bond Rating Service; and


(2) the request for credit is less than fifteen percent (15%) of the Shipper's tangible net

worth, as adjusted. "Tangible net worth" is defined as Shipper's total assets,

less total liabilities, less intangible assets, less off-balance sheet obligations. The

fifteen percent (15%) referenced herein will be adjusted as appropriate by the use of key

ratios to reflect issues and trends regarding Shipper's liquidity, asset management,

debt management, debt coverage, capital structure, operational efficiency, and

profitability; and


(3) the Shipper's credit/financial history and outlook is determined to be acceptable by

Transporter. Such determination shall be based upon Transporter's evaluation of (a)

Shipper's financial statements and auditor's notes, Shipper's annual report to

stakeholders, and Shipper's annual report to regulators; (b) whether Shipper has been

placed on credit watch and/or there has been a change in Shipper's credit rating; (c)

bank and trade references or other information obtained that is relevant to Shipper's

current and future financial strength and its ability to pay its obligations in a timely

manner; (d) Shipper's payment history to Transporter for services provided under this

FERC Gas Tariff, Second Revised Volume No. 1; (e) whether Shipper is subject to any

proceedings under any laws pertaining to bankruptcy, insolvency, liquidation, or debt

reduction procedures; and (f) whether Shipper is subject to any recently filed

substantial litigation either against Shipper or affecting Shipper's business prospects.


(C) In the event that Transporter determines an existing Shipper or potential Shipper to be non-

creditworthy, and upon request of such Shipper, Transporter shall provide within five (5) days of

the request a written explanation of the basis for the non-creditworthy determination.


26.2 Service to Non-creditworthy Shippers


(A) Transporter shall not be required to execute or extend an Agreement under any Rate Schedule on

behalf of any Shipper, or to commence or to continue service to any Shipper, who is not deemed

creditworthy pursuant to Transporter's credit standard as set forth in Subsection 26.1. Any

Shipper failing to meet the credit standard may still receive service if Shipper furnishes and

maintains with Transporter one of the following credit enhancements, in an amount determined

pursuant to Subsection 26.2(C), calculated for (3) three months of service or the effective

period of Shipper's service, whichever is shorter:


(1) an unconditional, irrevocable guaranty executed from a party that meets Transporter's

standards for creditworthiness as set forth in subsection 26.1;


(2) a revolving irrevocable standby letter of credit from a creditworthy major U.S. or

Canadian bank or finance company; or


(3) such other form of credit enhancement as may be acceptable to Transporter to assist the

Shipper in meeting Transporter's standards for creditworthiness.