Exhibit 10.1

 

Execution Version

 

BOARD REPRESENTATION AGREEMENT

 

This BOARD REPRESENTATION AGREEMENT (this “Agreement”), dated as of January 7,
2016, is entered into by and among EnLink Midstream GP, LLC, a Delaware limited
liability company (the “General Partner”), EnLink Midstream Partners, LP, a
Delaware limited partnership (the “Partnership”), EnLink Midstream, Inc., a
Delaware corporation (“EMI” and, together with the General Partner and the
Partnership, the “EnLink Entities”), and TPG VII Management, LLC, a Delaware
limited liability company (the “Investor”).  Capitalized terms used but not
defined herein are used as defined in the Convertible Preferred Unit Purchase
Agreement, dated as of December 6, 2015 (the “Purchase Agreement”), by and
between the Partnership and the Enfield Holdings, L.P., a Delaware limited
partnership (the “Purchaser”).

 

RECITALS:

 

A.                                    EMI is the sole member of the General
Partner, which is the general partner of the Partnership.

 

B.                                    Pursuant to the Purchase Agreement, the
Partnership has agreed to sell to the Purchaser Series B Preferred Units.

 

C.                                    To induce the Purchaser to enter into the
transactions evidenced by the Purchase Agreement, each of the EnLink Entities is
required to deliver this Agreement, duly executed by each of the EnLink
Entities, to the Purchaser contemporaneously with the Closing of the
transactions contemplated by the Purchase Agreement.

 

D.                                    The investment by the Purchaser in the
Partnership is reasonably expected to benefit, directly or indirectly, each of
the EnLink Entities, and the Board of Directors of EMI and the Board of
Directors of the General Partner have determined that entering into and
executing this Agreement is in the best interest of the respective EnLink
Entities.

 

AGREEMENT:

 

NOW, THEREFORE, in consideration of the mutual covenants and agreements set
forth herein and for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereby agree as
follows:

 

Section 1.                   Board Representation.

 

(a)                                             Each of the EnLink Entities
shall take all actions necessary or advisable to cause one director serving on
the board of directors (or other applicable governing body of the general
partner of the Partnership, which as of the date of this Agreement is the
General Partner) (such governing body, the “Board”) to be designated by the
Investor, in its sole discretion (the “Investor Designated Director”), at all
times from the date of this Agreement until the occurrence of a Designation
Right Termination Event (as defined below), at which time the right of the
Investor under this Agreement to designate a member of the Board shall
terminate; provided, however, that such Investor Designated Director shall have
the requisite skill and experience to serve as a director of a public company
and such Investor Designated Director shall not be prohibited from serving as a
director of the

 

--------------------------------------------------------------------------------

 

General Partner pursuant to any rule or regulation of the Commission or the
NYSE.  Prior to a Designation Right Termination Event, any Investor Designated
Director may be removed by the Investor at any time, with or without “cause” (as
defined below), and by a majority of the other director(s) then serving on the
Board only for “cause” (as defined below), but not by any other party, and any
vacancy in such position shall be filled solely by the Investor.  As used
herein, “cause” means that the Investor Designated Director (i) is prohibited
from serving as a director of the General Partner under any rule or regulation
of the Commission or the NYSE, (ii) has been convicted of a felony or
misdemeanor involving moral turpitude, (iii) has engaged in acts or omissions
against the Partnership constituting dishonesty, breach of fiduciary obligation,
or intentional wrongdoing or misfeasance, or (iv) has acted intentionally or in
bad faith in a manner that results in a material detriment to the assets,
business or prospects of the Partnership and its direct or indirect
subsidiaries.  Any action by the Investor to designate, remove or replace an
Investor Designated Director shall be evidenced in writing furnished to the
General Partner, shall include a statement that the action has been approved by
all requisite partnership action of the Investor and shall be executed by or on
behalf of the Investor.  None of the EnLink Entities shall take any action which
would, or would be reasonably likely to, lessen, restrict, prevent or otherwise
have an adverse effect upon the foregoing rights of the Investor to designate an
Investor Designated Director. The EnLink Entities shall not permit the
replacement of the General Partner as the general partner of the Partnership
unless such new general partner first agrees in writing to be bound by the
provisions of this Agreement as an “EnLink Entity”. The Investor agrees upon the
Partnership’s request to, and to use its commercially reasonable efforts to
cause the Investor Designated Director to, timely provide the Partnership with
accurate and complete information relating to the Investor Designated Director
as may be required to be disclosed by the Partnership under the Securities
Exchange Act of 1934, as amended (the “Exchange Act”) and the rules and
regulations promulgated thereunder.  The Investor further agrees to use its
commercially reasonable efforts to cause the Investor Designated Director to
comply with any applicable Section 16 filing obligations under the Exchange Act.
Commencing as of Closing, the Investor Designated Director is Christopher
Ortega.

 

(b)                                             If the Partnership and its
subsidiaries plan to engage in any material transaction between the Partnership
and its subsidiaries, on the one hand, and Devon Energy Corporation (“Devon”) or
any of its subsidiaries (other than ENLC, the Partnership and their respective
subsidiaries), on the other hand, at any time when Devon and its subsidiaries
(other than ENLC, the Partnership and their respective subsidiaries)
collectively own less than 20% of the outstanding limited partner interests in
the Partnership, and consideration of such transaction is referred to the
Conflicts Committee of the Board (the “Conflicts Committee”), then any written
materials prepared by or for the Conflicts Committee will be made available on a
confidential basis to the Investor Designated Director.

 

(c)                                              In furtherance of the
foregoing, EMI shall execute concurrently herewith the amendment to the Third
Amended and Restated Limited Liability Company Agreement of the General Partner
set forth on Exhibit A attached hereto.  After the date hereof, EMI and the
General Partner shall not amend, and shall not permit the amendment of, the
limited liability agreement of the General Partner in any manner that would, or
would be

 

2

--------------------------------------------------------------------------------

 

reasonably likely to, have an adverse effect on the board representation rights
granted to the Investor under this Agreement; provided, however, that any
increase or reduction in the size of the Board shall be deemed not to have any
such adverse effect.

 

(d)                                             Upon the occurrence of a
Designation Right Termination Event, the right of the Investor to designate an
Investor Designated Director shall terminate and the Investor Designated
Director then serving on the Board, promptly upon (and in any event within two
Business Days following) receipt of a request from a majority of the other
directors then serving on the Board or EMI, as the sole member of the General
Partner, shall resign as a member of the Board. If the Investor Designated
Director does not resign upon such request, then a majority of the other
directors then serving on the Board or EMI, as the sole member of the General
Partner, may remove the Investor Designated Director as a member of the Board. 
At all times while an Investor Designated Director is serving as a member of the
Board, and following any such Investor Designated Director’s resignation,
removal or other cessation as a director of the Board, each Investor Designated
Director shall be entitled to all rights to indemnification and exculpation as
are then made available to any other member (or former member, as applicable) of
the Board by the EnLink Entities.

 

(e)                                              The EnLink Entities shall
purchase and maintain (or reimburse the Investor Designated Director for the
cost of) insurance (“D&O Insurance”), on behalf of the Investor Designated
Director, against any liability that may be asserted against, or expense that
may be incurred by, such Investor Designated Director in connection with the
EnLink Entities’ activities or such Investor Designated Director’s activities on
behalf of the EnLink Entities, regardless of whether the EnLink Entities would
have the power to indemnify such Investor Designated Director against such
liability under the provisions of the Eighth Amended and Restated Agreement of
Limited Partnership of the Partnership (as it may be amended from time to time)
or the Third Amended and Restated Limited Liability Company Agreement of the
General Partner (as it may be amended from time to time). Such D&O Insurance
shall provide coverage commensurate with that provided to independent members of
the Board and each Investor Designated Director shall be entitled to all rights
to insurance as are then made available to any other member (or former member,
as applicable) of the Board by the EnLink Entities.

 

(f)                                               For the purposes of this
Agreement, a “Designation Right Termination Event” shall occur on the earliest
to occur of (i) the Purchaser and its Affiliates holding a number of Series B
Preferred Units, Conversion Units and Additional Conversion Units that is less
than 25% of the number of Series B Preferred Units initially issued to the
Purchaser pursuant to the Purchase Agreement, (ii) such time as the sum of
(A) the number of Common Units into which the Series B Preferred Units
collectively held by the Purchaser and its Affiliates are convertible and
(B) the aggregate number of Conversion Units and Additional Conversion Units
which are then collectively held by the Purchaser and its Affiliates represent
less than 7.5% of the Common Units then outstanding and (iii) the Purchaser
ceasing to be an Affiliate of TPG Capital, L.P. (“TPG”).  For purposes of this
Section 1(f), each of the limited partners of the Purchaser as of the date
hereof and each of their respective Affiliates will be deemed to be Affiliates
of the Purchaser. For so long as the Purchaser has the right to appoint an
Investor Designated Director pursuant to this

 

3

--------------------------------------------------------------------------------

 

Section 1, the General Partner shall invite the Investor Designated Director to
attend all meetings of each committee of the Board (other than the Audit
Committee, the Conflicts Committee, the Compensation Committee, any pricing
committee established for an offering of securities by the Partnership and any
committee established to deal with conflicts with the Purchaser or its
Affiliates) in a nonvoting observer capacity and, in this respect, shall give
the Investor Designated Director copies of all notices, minutes, consents and
other materials that it provides to such committee members.

 

(g)                                              The option and right to appoint
an Investor Designated Director granted to the Investor by the Partnership under
this Section 1 may not be transferred or assigned by the Investor; provided,
however, that the Investor may assign all (but not less than all) of its rights
under Section 1 to any Affiliate of TPG without the prior written consent of the
Partnership.  Any such permitted assignee, upon and after such assignment, shall
be considered the Investor for all such applicable purposes under this
Agreement.

 

Section 2.                   Miscellaneous.

 

(a)                                             Notwithstanding anything herein
to the contrary, all measurements and references related to Common Unit,
Series B Preferred Unit or Conversion Unit numbers herein shall be, in each
instance, appropriately adjusted for unit splits, unit re-combinations, unit
distributions and the like.

 

(b)                                             This Agreement, the other
Transaction Documents and the other agreements and documents referred to herein
and therein are intended by the parties as a final expression of their agreement
and are intended to be a complete and exclusive statement of the agreement and
understanding of the parties hereto, in respect of the subject matter contained
herein and therein. There are no, and neither the Partnership nor the Investor
has relied upon, restrictions, promises, warranties or undertakings, other than
those set forth or referred to herein or in the other Transaction Documents with
respect to the rights and obligations of the Partnership, the Investor or any of
their respective Affiliates hereunder or thereunder, and each of the Partnership
and the Investor expressly disclaims that it is owed any duties or is entitled
to any remedies not expressly set forth in this Agreement or in the other
Transaction Documents.  This Agreement supersedes all prior and contemporaneous
agreements and understandings between the parties with respect to the subject
matter hereof.

 

(c)                                              All notices and demands
provided for hereunder shall be in writing and shall be given as provided to in
Section 8.06 of the Purchase Agreement (with notices and demands to (i) any of
the EnLink Entities to be sent care of the Partnership and (ii) to the Investor
to be sent care of the Purchaser).

 

(d)                                             Section and Exhibit references
herein refer to sections of, or exhibits to, this Agreement, unless otherwise
specified.  All Exhibits to this Agreement are hereby incorporated and made a
part hereof as if set forth in full herein and are an integral part of this
Agreement.  All references to instruments, documents, contracts, and agreements
are references to such instruments, documents, contracts, and agreements as the
same may be amended, supplemented and otherwise modified from time to time,
unless otherwise

 

4

--------------------------------------------------------------------------------

 

specified. The word “including” shall mean “including but not limited to.”
Whenever any party has an obligation under this Agreement, the expense of
complying with that obligation shall be an expense of such party unless
otherwise specified. Whenever any determination, consent or approval is to be
made or given by the Investor under this Agreement, such action shall be in such
Investor’s sole discretion, unless otherwise specified in this Agreement. Any
reference in this Agreement to $ shall mean U.S. dollars.  If any provision in
this Agreement is held to be illegal, invalid, not binding, or unenforceable,
such provision shall be fully severable and this Agreement shall be construed
and enforced as if such illegal, invalid, not binding, or unenforceable
provision had never comprised a part hereof, and the remaining provisions shall
remain in full force and effect, and shall be construed so as to effect the
original intent of the parties as closely as possible.  When calculating the
period of time before which, within which or following which any act is to be
done or step taken pursuant to this Agreement, the date that is the reference
date in calculating such period shall be excluded.  If the last day of such
period is a non-Business Day, the period in question shall end on the next
succeeding Business Day.  Any words imparting the singular number only shall
include the plural and vice versa.  Words such as “herein,” hereinafter,”
“hereof” and “hereunder” refer to this Agreement as a whole and not merely to a
subdivision of this Agreement in which such words appear, unless the context
otherwise requires.  Section headings in this Agreement are for convenience of
reference only and shall not affect or be utilized in construing or interpreting
this Agreement.

 

(e)                                              This Agreement and all claims
or causes of action (whether in contract or tort) that may be based upon, arise
out of or relate to this Agreement or the negotiation, execution, termination,
performance or nonperformance of this Agreement (including any claim or cause of
action based upon, arising out of or related to any representation or warranty
made in or in connection with this Agreement or as an inducement to enter into
this Agreement) will be construed in accordance with and governed by the laws of
the State of Delaware without regard to principles of conflicts of laws that
might otherwise require the application of the laws of any other jurisdiction.

 

(f)                                               Any action against any party
relating to the foregoing shall be brought in any federal or state court of
competent jurisdiction located within the State of Delaware, and the parties
hereto hereby irrevocably submit to the non-exclusive jurisdiction of any
federal or state court located within the State of Delaware over any such
action.  The parties hereby irrevocably waive, to the fullest extent permitted
by applicable Law, any objection which they may now or hereafter have to the
laying of venue of any such dispute brought in such court or any defense of
inconvenient forum for the maintenance of such dispute.  Each of the parties
hereto agrees that a judgment in any such dispute may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by Law.

 

(g)                                              Each party to this Agreement
irrevocably waives the right to a trial by jury in connection with any matter
arising out of this Agreement to the fullest extent permitted by applicable law.

 

5

--------------------------------------------------------------------------------

 

(h)                                             No failure or delay on the part
of any party in exercising any right, power or remedy hereunder shall operate as
a waiver thereof, nor shall any single or partial exercise of any such right,
power or remedy preclude any other or further exercise thereof or the exercise
of any other right, power or remedy. The remedies provided for herein are
cumulative and are not exclusive of any remedies that may be available to a
party at law or in equity or otherwise.

 

(i)               Except as otherwise provided herein, no amendment, waiver,
consent, modification or termination of any provision of this Agreement shall be
effective unless signed by each of the parties hereto.  Any amendment,
supplement or modification of or to any provision of this Agreement, any waiver
of any provision of this Agreement, and any consent to any departure by the
Partnership or the Investor from the terms of any provision of this Agreement
shall be effective only in the specific instance and for the specific purpose
for which such amendment, supplement, modification, waiver or consent has been
made or given.  Except where notice is specifically required by this Agreement,
no notice to or demand on any EnLink Entity in any case shall entitle such
EnLink Entity to any other or further notice or demand in similar or other
circumstances.  Any investigation by or on behalf of any party shall not be
deemed to constitute a waiver by the party taking such action of compliance with
any representation, warranty, covenant or agreement contained herein.

 

(j)                                                This Agreement may be
executed in any number of counterparts, each of which counterparts, when so
executed and delivered, shall be deemed to be an original and all of which
counterparts, taken together, shall constitute but one and the same agreement.

 

(k)                                             This Agreement shall be binding
upon and inure to the benefit of the parties hereto, their respective successors
and permitted assigns, and, solely with respect to Section 1(d), each Investor
Designated Director. Except as expressly provided in this Agreement, this
Agreement shall not be construed so as to confer any right or benefit upon any
Person other than the parties to this Agreement and their respective successors
and permitted assigns.  Except as expressly provided in Section 1(g), neither
this Agreement nor any of the rights, benefits or obligations hereunder may be
assigned or transferred, by operation of law or otherwise, by any party hereto
without the prior written consent of the other party.

 

(l)               Each of the parties acknowledges that it has been represented
by independent counsel of its choice throughout all negotiations that have
preceded the execution of this Agreement and that it has executed the same with
consent and upon the advice of said independent counsel.  Each party and its
counsel cooperated in the drafting and preparation of this Agreement and the
documents referred to herein, and any and all drafts relating thereto will be
deemed the work product of the parties and may not be construed against any
party by reason of its preparation.  Accordingly, any rule of law or any legal
decision that would require interpretation of any ambiguities in this Agreement
against the party that drafted it is of no application and is hereby expressly
waived.

 

(m)                                         Each party hereto acknowledge that
each party would not have an adequate remedy at law for money damages in the
event that this Agreement has not been

 

6

--------------------------------------------------------------------------------

 

performed in accordance with its terms, and therefore agrees that each other
party shall be entitled to seek specific enforcement of the terms hereof in
addition to any other remedy to which it may be entitled, at law or in equity.

 

(n)                                             Each of the parties hereto
agrees that, from time to time and without further consideration, it shall
execute such further instruments and take such other actions as any other party
hereto shall reasonably request in order to fulfill its obligations under this
Agreement and to effectuate the purposes of this Agreement.

 

(o)                                             For the avoidance of doubt, each
Investor Designated Director shall be entitled to and may have business
interests and engage in business activities in addition to those relating to the
EnLink Entities, including business interests and activities in direct
competition with the EnLink Entities. None of the EnLink Entities shall have any
rights by virtue of this Agreement in any business ventures of any Investor
Designated Director.

 

[Signature page follows]

 

7

--------------------------------------------------------------------------------

 

IN WITNESS WHEREOF, the parties hereto have executed this Agreement, effective
as of the date first above written.

 

 

ENLINK ENTITIES

 

 

 

ENLINK MIDSTREAM PARTNERS, LP

 

 

 

By:

EnLink Midstream GP, LLC,

 

 

its general partner

 

 

 

 

 

 

By:

/s/ Michael J. Garberding

 

Name:

Michael J. Garberding

 

Title:

Executive Vice President and Chief Financial Officer

 

 

 

ENLINK MIDSTREAM GP, LLC

 

 

 

 

 

By:

/s/ Michael J. Garberding

 

Name:

Michael J. Garberding

 

Title:

Executive Vice President and Chief Financial Officer

 

 

 

ENLINK MIDSTREAM, INC.

 

 

 

 

 

By:

/s/ Michael J. Garberding

 

Name:

Michael J. Garberding

 

Title:

Executive Vice President and Chief Financial Officer

 

Signature Page to Board Representation Agreement

 

--------------------------------------------------------------------------------

 

 

Investor

 

 

 

TPG VII MANAGEMENT, LLC

 

 

 

 

 

By:

/s/ Clive Bode

 

Name:

Clive Bode

 

Title:

Vice President

 

Signature Page to Board Representation Agreement

 

--------------------------------------------------------------------------------

 

EXHIBIT A

 

[See attached]

 

--------------------------------------------------------------------------------

 

AMENDMENT NO. 1 TO THIRD AMENDED AND RESTATED

LIMITED LIABILITY COMPANY AGREEMENT OF

ENLINK MIDSTREAM GP, LLC

 

AMENDMENT NO. 1 TO THIRD AMENDED AND RESTATED LIMITED LIABILITY COMPANY
AGREEMENT OF ENLINK MIDSTREAM GP, LLC (this “Amendment”), dated as of January 7,
2016, is by and among EnLink Midstream, Inc., a Delaware corporation (the
“Member”) and the sole member of EnLink Midstream GP, LLC, a Delaware limited
liability company (the “Company”).  Capitalized terms used herein and not
otherwise defined shall have their respective meanings as set forth in the Third
Amended and Restated Limited Liability Company Agreement of the Company (the
“LLC Agreement”).

 

WHEREAS, pursuant to the terms of that certain Board Representation Agreement,
dated as of the date hereof, among the Sole Member, the Company, EnLink
Midstream Partners, LP and TPG VII Management, LLC, the Member desires to amend
the LLC Agreement as set forth herein.

 

NOW, THEREFORE, the LLC Agreement is hereby amended as follows:

 

Section 1.                   Amendment.

 

(a)                                             Section 5.02 of the LLC
Agreement is hereby amended and restated in its entirety as follows:

 

5.02                                                Number; Qualification;
Tenure.  The number of directors constituting the Board (the “Directors”) shall
initially be 11, unless otherwise increased or decreased from time to time by
the Member or pursuant to a resolution adopted by the Directors; provided,
however, that the number of Directors shall not be less than two.  Except as
provided in the next succeeding sentence, each such director shall be elected or
approved by the Member and shall serve as a Director of the Company until his or
her death or removal from office or until his or her successor is elected and
qualified.  One director (the “Investor Designated Director”) shall be elected
or approved pursuant to that certain Board Representation Agreement, dated as of
January 7, 2016, to which the Company and the Member are parties (the “Board
Representation Agreement”) and shall serve until his or her death, resignation
or removal from office or until his or her successor is elected and qualified,
as provided in the Board Representation Agreement; provided, however, that upon
the occurrence of a Designation Right Termination Event (as defined in the Board
Representation Agreement), the director then serving as the Investor Designated
Director may be removed by, and will resign upon the request of, the Member or
the determination of a majority of the other Directors.

 

As of the date of Amendment No. 1 to this Agreement, the Directors of the
Company are Barry E. Davis, John Richels, Thomas L. Mitchell, David A. Hager,
Darryl G. Smette, Mary P. Ricciardello, Scott A. Griffiths, Leldon E. Echols,
Kyle D. Vann, Tony D. Vaughn and Christopher Ortega.

 

(b)                                             Section 5.08 of the LLC
Agreement is hereby amended by adding the following proviso at the end of the
last sentence of such Section:

 

--------------------------------------------------------------------------------

 

; provided, however, that prior to a Designation Right Termination Event (as
defined in the Board Representation Agreement) any vacancy by the Investor
Designated Director shall be filled only as provided in the Board Representation
Agreement.

 

(c)                                              Section 5.10 of the LLC
Agreement is hereby amended and restated in its entirety as follows:

 

5.10                                                Removal.  Any Director or
the entire Board may be removed, with or without cause, by the Member; provided,
however, until the occurrence of a Designation Right Termination Event (as
defined in the Board Representation Agreement), the Investor Designated Director
shall be removed only as provided in the Board Representation Agreement.

 

Section 2.                   Ratification of LLC Agreement.  Except as expressly
modified and amended herein, all of the terms and conditions of the LLC
Agreement shall remain in full force and effect.

 

Section 3.                   Governing Law.  This Amendment shall be construed
in accordance with and governed by the laws of the State of Delaware, without
regard to principles of conflicts of laws that would require the application of
the laws of any other jurisdiction.

 

[Signature page follows]

 

2

--------------------------------------------------------------------------------

 

IN WITNESS WHEREOF, the undersigned has executed this Amendment as of the date
first set forth above.

 

 

MEMBER:

 

 

 

ENLINK MIDSTREAM, INC.

 

 

 

 

 

By:

 

 

 

Name:

Michael J. Garberding

 

 

Title:

Executive Vice President and Chief Financial Officer

 

[Signature Page to Amendment No. 1 to Third Amended and Restated Limited
Liability Company Agreement of EnLink Midstream GP, LLC]

 

--------------------------------------------------------------------------------