EXHIBIT 10.2

Execution Version

REGISTRATION RIGHTS AGREEMENT

among

CSI COMPRESSCO LP

and

THE PURCHASERS NAMED ON SCHEDULE A HERETO

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TABLE OF CONTENTS

 

          Page  

ARTICLE I DEFINITIONS

     1   

Section 1.01

  

Definitions

     1   

Section 1.02

  

Registrable Securities

     4   

ARTICLE II REGISTRATION RIGHTS

     4   

Section 2.01

  

Shelf Registration

     4   

Section 2.02

  

Further Obligations

     7   

Section 2.03

  

Cooperation by Holders

     11   

Section 2.04

  

Expenses

     11   

Section 2.05

  

Indemnification

     12   

Section 2.06

  

Rule 144 Reporting

     14   

Section 2.07

  

Transfer or Assignment of Registration Rights

     15   

ARTICLE III MISCELLANEOUS

     15   

Section 3.01

  

Communications

     15   

Section 3.02

  

Binding Effect

     16   

Section 3.03

  

Assignment of Rights

     16   

Section 3.04

  

Recapitalization, Exchanges, Etc.

     16   

Section 3.05

  

Aggregation of Registrable Securities

     17   

Section 3.06

  

Specific Performance

     17   

Section 3.07

  

Counterparts

     17   

Section 3.08

  

Governing Law, Submission to Jurisdiction

     17   

Section 3.09

  

Waiver of Jury Trial

     17   

Section 3.10

  

Entire Agreement

     18   

Section 3.11

  

Amendment

     18   

Section 3.12

  

No Presumption

     18   

Section 3.13

  

Obligations Limited to Parties to Agreement

     18   

Section 3.14

  

Interpretation

     19   

Section 3.15

  

Severability

     19   

 

SCHEDULE A — Purchaser Name; Notice and Contact Information EXHIBIT A — Selling
Holders; Plan of Distribution

 

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REGISTRATION RIGHTS AGREEMENT

This REGISTRATION RIGHTS AGREEMENT, dated as of August 8, 2016 (this
“Agreement”) is entered into by and among CSI COMPRESSCO LP, a Delaware limited
partnership (the “Partnership”), and each of the Persons set forth on Schedule A
hereto (the “Purchasers”).

WHEREAS, this Agreement is made in connection with the closing of the issuance
and sale of the Purchased Units pursuant to the Series A Preferred Unit Purchase
Agreement, dated as of August 8, 2016 (the date of such closing, the “Closing
Date”), by and among the Partnership and the Purchasers (the “Purchase
Agreement”); and

WHEREAS, the Partnership has agreed to provide the registration and other rights
set forth in this Agreement for the benefit of the Purchasers pursuant to the
Purchase 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:

ARTICLE I

DEFINITIONS

Section 1.01 Definitions. As used in this Agreement, the following terms have
the meanings indicated:

“Affiliate” means, with respect to any Person, any other Person that directly or
indirectly through one or more intermediaries controls, is controlled by or is
under common control with, the Person in question. As used herein, the term
“control” (including, with correlative meanings, “controlled by” and “under
common control with”) means the possession, direct or indirect, of the power to
direct or cause the direction of the management and policies of a Person,
whether through ownership of voting securities, by contract or otherwise. For
the avoidance of doubt, for purposes of this Agreement, (a) the Partnership
Entities and the General Partner, on the one hand, and any Purchaser, on the
other, shall not be considered Affiliates and (b) any fund or account managed,
advised or subadvised, directly or indirectly, by a Purchaser or its Affiliates,
shall be considered an Affiliate of such Purchaser.

“Agreement” has the meaning set forth in the introductory paragraph of this
Agreement.

“Allowable Grace Period” has the meaning specified in section 2.01(d).

“Business Day” means any day other than a Saturday, Sunday, any federal legal
holiday or day on which banking institutions in the State of New York or State
of Texas are authorized or required by law or other governmental action to
close.

“Closing Date” has the meaning set forth in the Recitals of this Agreement.

“Commission” means the United States Securities and Exchange Commission.

 

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“Common Units” means the common units representing limited partner interests in
the Partnership and having the rights and obligations specified in the
Partnership Agreement.

“Effective Date” means the date of effectiveness of any Registration Statement.

“Effectiveness Period” has the meaning specified in Section 1.02.

“Eligible Market” means The New York Stock Exchange, Inc., the NYSE MKT LLC, The
NASDAQ Global Select Market, The NASDAQ Capital Market or The NASDAQ Global
Market.

“Exchange Act” means the Securities Exchange Act of 1934, as amended from time
to time, and the rules and regulations of the Commission promulgated thereunder.

“General Partner” means CSI Compressco GP Inc., a Delaware corporation and the
general partner of the Partnership.

“Grace Period” has the meaning specified in section 2.01(d).

“Holder” means the record holder of any Registrable Securities.

“Holder Underwriter Registration Statement” has the meaning specified in Section
2.02(p).

“Lead Investor” means HBC MLP LLC or its designee.

“Liquidated Damages” has the meaning specified therefor in Section 2.01(b).

“Liquidated Damages Multiplier” means the product of (i) the Purchased Unit
Price and (ii) the number of Registrable Securities then held by the applicable
Holder.

“Losses” has the meaning specified in Section 2.05(a).

“NASDAQ” means the Nasdaq Global Market.

“Partnership” has the meaning set forth in the introductory paragraph of this
Agreement.

“Partnership Agreement” means the Second Amended and Restated Agreement of
Limited Partnership of the Partnership, dated as of the date hereof, as amended.

“Partnership Entities” means, collectively the Partnership and the Partnership’s
majority owned Subsidiaries.

“Person” means any individual, corporation, company, voluntary association,
partnership, joint venture, trust, limited liability company, unincorporated
organization, government or any agency, instrumentality or political subdivision
thereof or any other form of entity.

 

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“PIK Units” means additional Series A Preferred Units issued by the Partnership
to the Purchasers as in-kind distributions pursuant to the terms of the
Partnership Agreement.

“Purchase Agreement” has the meaning set forth in the Recitals of this
Agreement.

“Purchase Price” has the meaning set forth in the Purchase Agreement.

“Purchased Units” means the Series A Preferred Units to be issued and sold to
the Purchasers pursuant to the Purchase Agreement.

“Purchasers” has the meaning set forth in the introductory paragraph of this
Agreement.

“Registration” means any registration pursuant to this Agreement, including
pursuant to a Registration Statement.

“Registrable Securities” means 130% of the Common Units issuable upon conversion
of the Purchased Units and the PIK Units (without regard to any limitation or
conversion included in the Partnership Agreement), all of which are subject to
the rights provided herein until such time as such securities cease to be
Registrable Securities pursuant to Section 1.02.

“Registration Expenses” has the meaning specified in Section 2.04(a).

“Registration Statement” has the meaning specified in Section 2.01(a).

“Required Holders” means the Holders of at least a majority of the Registrable
Securities and shall include the Lead Investor so long as the Lead Investor or
any of its Affiliates holds any Registrable Securities.

“Securities Act” means the Securities Act of 1933, as amended from time to time,
and the rules and regulations of the Commission promulgated thereunder.

“Selling Expenses” has the meaning specified in Section 2.04(a).

“Selling Holder” means a Holder who is selling Registrable Securities pursuant
to a registration statement.

“Selling Holder Indemnified Persons” has the meaning specified in Section
2.05(a).

“Series A Conversion Dates” means the date on which all of the Purchased Units
are convertible into Common Units pursuant to the terms of the Partnership
Agreement.

“Series A Conversion Rate” has the meaning specified in the Partnership
Agreement.

“Series A Preferred Units” means the Series A Preferred Units representing
limited partner interests in the Partnership and having the rights and
obligations specified in the Partnership Agreement.

“Subsidiary” means, as to any Person, any corporation or other entity of which:
(a) such Person or a Subsidiary of such Person is a general partner or, in the
case of a limited liability

 

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company, the managing member or manager thereof; (b) at least a majority of the
outstanding equity interest having by the terms thereof ordinary voting power to
elect a majority of the board of directors or similar governing body of such
corporation or other entity (irrespective of whether or not at the time any
equity interest of any other class or classes of such corporation or other
entity shall have or might have voting power by reason of the happening of any
contingency) is at the time directly or indirectly owned or controlled by such
Person or one or more of its Subsidiaries; or (c) any corporation or other
entity as to which such Person consolidates for accounting purposes.

“Target Effective Date” has the meaning specified therefor in Section 2.01(a).

“Trading Day” means any day on which the Common Units are traded on the NASDAQ,
or, if the NASDAQ is not the principal trading market for the Common Units, then
on the principal securities exchange or securities market on which the Common
Units are then traded; provided that “Trading Day” shall not include any day on
which the Common Units are scheduled to trade on such exchange or market for
less than 4.5 hours or any day that the Common Units are suspended from trading
during the final hour of trading on such exchange or market (or if such exchange
or market does not designate in advance the closing time of trading on such
exchange or market, then during the hour ending at 4:00:00 p.m., New York time).

Section 1.02 Registrable Securities. Any Registrable Security will cease to be a
Registrable Security upon the earliest to occur of the following: (a) when a
registration statement covering such Registrable Security becomes or has been
declared effective by the Commission and such Registrable Security has been sold
or disposed of pursuant to such effective registration statement, (b) when such
Registrable Security has been disposed of (excluding transfers or assignments by
a Holder to an Affiliate or to another Holder or any of its Affiliates or to any
assignee or transferee to whom the rights under this Agreement have been
transferred pursuant to Section 2.07) pursuant to any section of Rule 144 (or
any similar provision then in effect) under the Securities Act, (c) when such
Registrable Security is held by the Partnership or one of its direct or indirect
Subsidiaries, (d) when such Registrable Security has been sold or disposed of in
a private transaction in which the transferor’s rights under this Agreement are
not assigned to the transferee of such securities pursuant to Section 2.07 and
(e) when such Holder may sell all of the Registrable Securities without
restriction or limitation pursuant to Rule 144 and without the requirement to be
in compliance with Rule 144(c)(1) (or any successor thereto) promulgated under
the Securities Act (the “Effectiveness Period”).

ARTICLE II

REGISTRATION RIGHTS

Section 2.01 Shelf Registration.

(a) Shelf Registration. The Partnership shall use its commercially reasonable
efforts to (i) prepare and file within 90 days after the Closing Date an initial
registration statement under the Securities Act to permit the public resale of
Registrable Securities from time to time as permitted by Rule 415 (or any
similar provision adopted by the Commission then in effect) of the Securities
Act (a “Registration Statement”) and (ii) cause such initial Registration
Statement to become effective no later than 180 days after the Closing Date (the
“Target Effective Date”).

 

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The Partnership will use its commercially reasonable efforts to cause such
initial Registration Statement filed pursuant to this Section 2.01(a) to be
continuously effective under the Securities Act, with respect to any Holder,
until the expiration of the Effectiveness Period. A Registration Statement filed
pursuant to this Section 2.01(a) shall be on such appropriate registration form
of the Commission as shall be selected by the Partnership; provided that, if the
Partnership is then eligible, it shall file such Registration Statement on Form
S-3, provided further, that if the Partnership files a Registration Statement on
Form S-1 and it is declared effective, the Partnership shall maintain the
effectiveness of the Registration Statement then in effect until such time as a
Registration Statement on Form S-3 covering the Registrable Securities has been
declared effective by the Commission. A Registration Statement when declared
effective (including the documents incorporated therein by reference) will
comply as to form in all material respects with all applicable requirements of
the Securities Act and the Exchange Act and such Registration Statement (and, in
the case of any prospectus contained in such Registration Statement, in the
light of the circumstances under which a statement is made) will not contain an
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not
misleading. The Registration Statement shall contain (except if otherwise
directed by the Required Holders) the “Selling Holders” and “Plan of
Distribution” sections in substantially the form attached hereto as Exhibit
A. As soon as practicable following the Effective Date, but in any event within
two (2) Trading Days of such date, the Partnership shall provide the Holders
with written notice of the effectiveness of a Registration Statement. By 9:30
a.m. New York time on the Business Day following the Effective Date of any
Registration Statement required to be filed pursuant to this Agreement, the
Partnership shall file with the Commission in accordance with Rule 424 under the
Securities Act the final prospectus to be used in connection with sales pursuant
to such Registration Statement.

(b) Effect of Failures. If (A) a Registration Statement required by Section
2.01(a) covering all Registrable Securities does not become or is not declared
effective by the Target Effective Date, (B) on any date after the Target
Effective Date sales of all of the Registrable Securities cannot be made (other
than during an Allowable Grace Period) pursuant to such Registration Statement
(including, without limitation, because of a failure to keep such Registration
Statement effective, a failure to disclose such information as is necessary for
sales to be made pursuant to such Registration Statement or a failure to
register a sufficient number of Common Units) or (C) at any time during the
period commencing from the six (6) month anniversary of the Closing Date and
ending at such time that all of the Registrable Securities, if a Registration
Statement is not available for the resale of all of the Registrable Securities,
may be sold without restriction or limitation pursuant to Rule 144 and without
the requirement to be in compliance with Rule 144(c)(1), if the Partnership
shall (i) fail for any reason to satisfy the requirements of Rule 144(c)(1),
including, without limitation, the failure to satisfy the current public
information requirements under Rule 144(c) or (ii) if the Partnership has ever
been an issuer described in Rule 144(i)(1)(i) or becomes such an issuer in the
future, and the Partnership shall fail to satisfy any condition set forth in
Rule 144(i)(2) (collectively, the “Obligation Failures”), then each Holder shall
be entitled to a payment (with respect to each of the Holder’s Registrable
Securities), as sole monetary remedy for the damages to any Holder by reason of
any such delay in or reduction of its ability to sell the Registrable Securities
(which remedy shall not be exclusive of any other remedies available in equity,
including, without limitation, specific performance), as liquidated damages and
not as a penalty, (i) for each non-overlapping 30-day

 

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period for the first 60 days following the Target Effective Date, an amount
equal to 0.25% per annum of the Liquidated Damages Multiplier, which shall
accrue daily, and (ii) for each non-overlapping 30-day period beginning on the
61st day following the Target Effective Date, an amount equal to the amount set
forth in clause (i) plus an additional 0.25% per annum of the Liquidated Damages
Multiplier for each subsequent 60 days (i.e., 0.5% for 61-120 days, 0.75% for
121-180 days, and 1.0% thereafter), which shall accrue daily, up to a maximum
amount equal to 1.0% of the Liquidated Damages Multiplier per non-overlapping 30
day period (the “Liquidated Damages”), until such time as such Obligation
Failure has been cured in full, and any payment of Liquidated Damages shall be
prorated for any period of less than 30 days in which the payment of Liquidated
Damages ceases. The Liquidated Damages shall be payable within 10 Business Days
after the end of each such 30 day period in immediately available funds to the
account or accounts specified by the applicable Holders in writing. Any amount
of Liquidated Damages shall be prorated for any period of less than 30 days
accruing during any period for which a Holder is entitled to Liquidated Damages
hereunder. In the event the Partnership fails to pay any Liquidated Damages in a
timely manner, such Liquidated Damages shall bear interest at the rate of one
and one-half percent (1.5%) per month (prorated for partial months) until paid
in full. Notwithstanding the foregoing, if the Partnership certifies that it is
unable to pay Liquidated Damages (including, without limitation, any accrued
interest thereon) in cash because such payment would result in a breach under
the Partnership’s Compressco Credit Facility (as defined in the Purchase
Agreement) as existing on the date hereof (without any amendment, change or
modification thereof on or after the date hereof), then the Partnership may pay
the Liquidated Damages in kind in the form of the issuance of additional PIK
Units, which amount of Liquidated Damages (including, without limitation, any
accrued interest thereon) due pursuant to this Section 2.01(b) shall increase
the dollar amount underlying the Series A Preferred Units held by such Holder.

(c) Waiver of Liquidated Damages. If the Partnership is unable to cause a
Registration Statement to become effective on or before the Target Effective
Date, then the Partnership may request a waiver of the Liquidated Damages, which
may be granted by the consent of the Holders of at least 75% of the Registrable
Securities and shall include the Lead Investor so long as the Lead Investor or
any of its Affiliates holds any Registrable Securities, in their sole
discretion, and which such waiver shall apply to all Holders of Registrable
Securities included in such Registration Statement.

(d) Delay Rights. Notwithstanding anything to the contrary contained herein, at
any time after the Effective Date, the Partnership may, upon written notice to
any Selling Holder whose Registrable Securities are included in a Registration
Statement (a “Delay Notice”), suspend such Selling Holder’s use of any
prospectus which is a part of such Registration Statement (in which event the
Selling Holder shall suspend sales of the Registrable Securities pursuant to
such Registration Statement) if (i) the Partnership is pursuing an acquisition,
merger, reorganization, disposition or other similar transaction and the
Partnership determines in good faith and on the advice of counsel that the
Partnership’s ability to pursue or consummate such a transaction would be
materially and adversely affected by any required disclosure of such transaction
in such Registration Statement or (ii) the Partnership has experienced some
other material non-public event, the disclosure of which at such time, in the
good faith judgment of the Partnership and its counsel, would materially and
adversely affect the Partnership (each, a “Grace Period”); provided, however,
that in no event shall any Grace Period exceed thirty (30)

 

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consecutive Trading Days, or an aggregate of sixty (60) Trading Days during any
three hundred sixty five (365) day period and the first day of any Grace Period
must be at least five (5) Trading Days after the last day of any prior Grace
Period (each, an “Allowable Grace Period”). Each Delay Notice shall notify the
Holders of the existence of material, non-public information giving rise to the
delay rights being exercised pursuant to this Section 2.01(d) (provided that in
each Delay Notice the Partnership will not disclose the content of such
material, non-public information to the Purchasers), and notify the Holders the
dates on which the Grace Period begins. Upon disclosure of such information or
the termination of the condition described above, the Partnership shall provide
prompt written notice to the Selling Holders whose Registrable Securities are
included in such Registration Statement, and shall promptly terminate any
suspension of sales it has put into effect and shall take such other actions
necessary or appropriate to permit registered sales of Registrable Securities as
contemplated in this Agreement. For purposes of determining the length of a
Grace Period above, the Grace Period shall begin on and include the date the
Holders receive the Delay Notice and shall end on and include the later of the
date the Holders receive a written notice of the end of such Grace Period
pursuant to the immediately preceding sentence and the date referred to in such
notice. Notwithstanding anything to the contrary, the Partnership shall cause
its transfer agent to deliver unlegended Common Units to a transferee of a
Holder in connection with any sale of Registrable Securities with respect to
which a Holder has entered into a contract for sale, prior to such Holder’s
receipt of the Delay Notice and for which such Purchaser has not yet settled,
unless the Partnership and its counsel determine that such sale may violate the
Securities Act.

(e) Legal Counsel. The Required Holders shall have the right to select one legal
counsel to review and oversee any registration pursuant to Section 2.01(a)
(“Legal Counsel”), which shall be Schulte Roth & Zabel LLP or such other counsel
as thereafter designated by the Required Holders. The Partnership and Legal
Counsel shall reasonably cooperate with each other in performing the
Partnership’s obligations under this Agreement.

Section 2.02 Further Obligations. In connection with its obligations under this
Article II, the Partnership will:

(a) promptly prepare and file with the Commission such amendments (including
post-effective amendments) and supplements to a Registration Statement and the
prospectus used in connection with such Registration Statement, which prospectus
is to be filed pursuant to Rule 424 promulgated under the Securities Act, as may
be necessary to keep such Registration Statement effective at all times during
the Effectiveness Period, and, during such period, comply with the provisions of
the Securities Act with respect to the disposition of all Registrable Securities
covered by such Registration Statement. In the case of amendments and
supplements to a Registration Statement which are required to be filed pursuant
to this Agreement (including pursuant to this Section 2.02(a)) by reason of the
Partnership filing a report on Form 10-K, Form 10-Q or Form 8-K or any analogous
report under the Exchange Act, the Partnership shall have incorporated such
report by reference into such Registration Statement, if applicable, or shall
use its commercially reasonable efforts to file such amendments or supplements
with the Commission on the same day on which the Exchange Act report is filed
which created the requirement for the Partnership to amend or supplement such
Registration Statement;

 

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(b) furnish to each Selling Holder and Legal Counsel (i) as far in advance as
reasonably practicable, but in any event at least five (5) Business Days, before
filing a Registration Statement or any other registration statement contemplated
by this Agreement or any supplement or amendment thereto, upon request, copies
of reasonably complete drafts of all such documents proposed to be filed
(including exhibits and each document incorporated by reference therein to the
extent then required by the rules and regulations of the Commission), and
provide each such Selling Holder and Legal Counsel the opportunity to object to
any information pertaining to such Selling Holder and its plan of distribution
that is contained therein and, to the extent timely received, make the
corrections reasonably requested by such Selling Holder with respect to such
information prior to filing such Registration Statement or such other
registration statement and the prospectus included therein or any supplement or
amendment thereto, (ii) promptly after the same is prepared and filed with the
Commission, such number of copies of such Registration Statement or such other
registration statement and the prospectus included therein and any supplements
and amendments thereto as such Persons may reasonably request in order to
facilitate the public sale or other disposition of the Registrable Securities
covered by such Registration Statement or other registration statement and (iii)
upon the effectiveness of any Registration Statement, one copy of the prospectus
included in such Registration Statement and all amendments and supplements
thereto;

(c) if applicable, use its commercially reasonable efforts to promptly register
or qualify the Registrable Securities covered by any Registration Statement or
any other registration statement contemplated by this Agreement under the
securities or blue sky laws of such jurisdictions as the Selling Holders shall
reasonably request; provided, however, that the Partnership will not be required
to qualify generally to transact business in any jurisdiction where it is not
then required to so qualify or to take any action that would subject it to
general service of process in any such jurisdiction where it is not then so
subject;

(d) promptly notify each Selling Holder in writing (provided that in no event
shall such notice contain any material, nonpublic information), at any time when
a prospectus relating thereto is required to be delivered by any of them under
the Securities Act, of (i) the filing of a Registration Statement or any other
registration statement contemplated by this Agreement or any prospectus or
prospectus supplement to be used in connection therewith, or any amendment or
supplement thereto, and, with respect to a Registration Statement or any other
registration statement or any post-effective amendment thereto, when the same
has become effective; and (ii) the receipt of any written comments from the
Commission with respect to any filing referred to in clause (i) and any written
request by the Commission for amendments or supplements to any such Registration
Statement or any other registration statement or any prospectus or prospectus
supplement thereto;

(e) promptly notify each Selling Holder in writing (provided that in no event
shall such notice contain any material, nonpublic information), at any time when
a prospectus relating thereto is required to be delivered by any of them under
the Securities Act, of (i) the happening of any event as a result of which the
prospectus or prospectus supplement contained in a Registration Statement or any
other registration statement contemplated by this Agreement, as then in effect,
includes an untrue statement of a material fact or omits to state any material
fact required to be stated therein or necessary to make the statements therein
not misleading (in the case of any prospectus contained therein, in the light of
the circumstances under which a

 

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statement is made); (ii) the issuance or threat of issuance by the Commission of
any stop order suspending the effectiveness of a Registration Statement or any
other registration statement contemplated by this Agreement, or the initiation
of any proceedings for that purpose; or (iii) the receipt by the Partnership of
any notification with respect to the suspension of the qualification of any
Registrable Securities for sale under the applicable securities or blue sky laws
of any jurisdiction. Following the provision of such notice, the Partnership
agrees to, as promptly as practicable, amend or supplement the prospectus or
prospectus supplement or take other appropriate action so that the prospectus or
prospectus supplement does not include an untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary to make
the statements therein not misleading in the light of the circumstances then
existing and to take such other action as is reasonably necessary to remove a
stop order, suspension, threat thereof or proceedings related thereto. By 9:30
a.m. New York City time on the Business Day following the date any
post-effective amendment has become effective, the Partnership shall file with
the Commission in accordance with Rule 424 under the Securities Act the final
prospectus to be used in connection with sales pursuant to such Registration
Statement;

(f) upon request and subject to appropriate confidentiality obligations, furnish
to each Selling Holder copies of any and all transmittal letters or other
correspondence with the Commission, the staff of the Commission or any other
governmental agency or self-regulatory body or other body having jurisdiction
(including any domestic or foreign securities exchange) relating to such
offering of Registrable Securities;

(g) otherwise use its commercially reasonable efforts to comply with all
applicable rules and regulations of the Commission;

(h) use its commercially reasonable efforts to cause all Registrable Securities
registered pursuant to this Agreement to be listed on each securities exchange
or nationally recognized quotation system on which similar securities issued by
the Partnership are then listed;

(i) use its commercially reasonable efforts to cause Registrable Securities to
be registered with or approved by such other governmental agencies or
authorities as may be necessary by virtue of the business and operations of the
Partnership to enable the Selling Holders to consummate the disposition of such
Registrable Securities;

(j) provide a transfer agent and registrar for all Registrable Securities
covered by any Registration Statement not later than the Effective Date of such
Registration Statement;

(k) enter into customary agreements and take such other actions as are
reasonably requested by the Selling Holders or the underwriters, if any, in
order to expedite or facilitate the disposition of Registrable Securities
(including making appropriate officers of the General Partner available to
participate in customary marketing activities);

(l) if reasonably requested by a Selling Holder, (i) incorporate in a prospectus
supplement or post-effective amendment such information as such Selling Holder
reasonably requests to be included therein relating to the sale and distribution
of Registrable Securities, including information with respect to the number of
Registrable Securities being offered or sold, the purchase price being paid
therefor and any other terms of the offering of the Registrable

 

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Securities to be sold in such offering; and (ii) make all required filings of
such prospectus supplement or post-effective amendment after being notified of
the matters to be incorporated in such prospectus supplement or post-effective
amendment;

(m) if reasonably required by the Partnership’s transfer agent, the Partnership
shall promptly deliver any authorizations, certificates and directions required
by the transfer agent which authorize and direct the transfer agent to transfer
such Registrable Securities without legend upon sale by the Holder of such
Registrable Securities under the Registration Statement;

(n) use its commercially reasonable efforts to prevent the issuance of any stop
order or other suspension of effectiveness of a Registration Statement, or the
suspension of the qualification of any of the Registrable Securities for sale in
any jurisdiction and, if such an order or suspension is issued, to obtain the
withdrawal of such order or suspension as soon as reasonably practicable and to
notify Legal Counsel and each Holder who holds Registrable Securities being sold
of the issuance of such order and the resolution thereof or its receipt of
actual notice of the initiation or threat of any proceeding for such purpose;

(o) make generally available to its security holders as soon as practical, but
not later than ninety (90) days after the close of the period covered thereby,
an earnings statement (in form complying with, and in the manner provided by,
the provisions of Rule 158 under the securities Act) covering a twelve-month
period beginning not later than the first day of the Partnership’s fiscal
quarter next following the applicable Effective Date of a Registration
Statement; and

(p) if any Holder could reasonably be deemed to be an “underwriter,” as defined
in Section 2(a)(11) of the Securities Act, in connection with the Registration
Statement and any amendment or supplement thereof (a “Holder Underwriter
Registration Statement”), then the Partnership will reasonably cooperate with
such Holder in allowing such Holder to conduct customary “underwriter’s due
diligence” with respect to the Partnership and satisfy its obligations in
respect thereof. In addition, at any Holder’s request, the Partnership will
furnish to such Holder, on the date of the effectiveness of the Holder
Underwriter Registration Statement and thereafter from time to time on such
dates as such Holder may reasonably request (provided that such request shall
not be more frequently than on an annual basis unless such Holder is offering
Registrable Securities pursuant to a Holder Underwriter Registration Statement),
(i) a “comfort” letter, dated such date, from the Partnership’s independent
certified public accountants in form and substance as has been customarily given
by independent certified public accountants to underwriters in underwritten
public offerings of securities by the Partnership, addressed to such Holder,
(ii) an opinion, dated as of such date, of counsel representing the Partnership
for purposes of the Holder Underwriter Registration Statement, in form, scope
and substance as has been customarily given in underwritten public offerings of
securities by the Partnership, including standard “10b-5” negative assurance for
such offerings, addressed to such Holder and (iii) a standard officer’s
certificate from the chief executive officer or chief financial officer, or
other officers serving such functions, of the General Partner addressed to the
Holder, as has been customarily given by such officers in underwritten public
offerings of securities by the Partnership. The Partnership will also use its
reasonable efforts to provide Legal Counsel to such Holder with an opportunity
to review and comment upon any such Holder Underwriter Registration Statement,
and any amendments and supplements thereto, prior to its filing with the
Commission.

 

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Notwithstanding anything to the contrary in this Section 2.02, the Partnership
will not name a Holder as an underwriter (as defined in Section 2(a)(11) of the
Securities Act) in any public disclosure or filing with the Commission or any
Eligible Market (provided, however, that the foregoing shall not prohibit the
Partnership from including the disclosure found in the “Plan of Distribution”
section attached hereto as Exhibit A in a Registration statement), without such
Holder’s express prior written consent. If the staff of the Commission requires
the Partnership to name any Holder as an underwriter (as defined in Section
2(a)(11) of the Securities Act), and such Holder does not give its express prior
written consent thereto, then such Holder’s Registrable Securities shall not be
included on the applicable Registration Statement and the Partnership shall have
no further obligations hereunder with respect to Registrable Securities held by
such Holder, unless such Holder has not had an opportunity to conduct customary
underwriter’s due diligence as set forth in subsection (p) of this Section 2.02
with respect to the Partnership at the time such Holder’s consent is sought.

Each Selling Holder, upon receipt of notice from the Partnership of the
happening of any event of the kind described in subsection (g) of this Section
2.02, shall promptly discontinue offers and sales of the Registrable Securities
by means of a prospectus or prospectus supplement until such Selling Holder’s
receipt of the copies of the supplemented or amended prospectus contemplated by
subsection (g) of this Section 2.02 or until it is advised in writing by the
Partnership that the use of the prospectus may be resumed and has received
copies of any additional or supplemental filings incorporated by reference in
the prospectus, and, if so directed by the Partnership, such Selling Holder will
deliver to the Partnership (at the Partnership’s expense) all copies in their
possession or control, other than permanent file copies then in such Selling
Holder’s possession, of the prospectus covering such Registrable Securities
current at the time of receipt of such notice.

Section 2.03 Cooperation by Holders. The Partnership shall have no obligation to
include Registrable Securities of a Holder in a Registration Statement who has
failed to timely furnish such information that the Partnership determines, after
consultation with its counsel, is reasonably required in order for any
registration statement or prospectus supplement, as applicable, to comply with
the Securities Act. To the extent the Partnership requires any information from
any Holder for inclusion in a Registration statement, it shall deliver a written
notice to such Holder requesting such Holder to deliver such information within
five (5) Business Days of the receipt by such Holder of such written notice.

Section 2.04 Expenses.

(a) Certain Definitions. “Registration Expenses” shall not include Selling
Expenses but otherwise means all expenses incident to the Partnership’s
performance under or compliance with this Agreement to effect the registration
of Registrable Securities on a Registration Statement pursuant to Section 2.01,
and the disposition of such Registrable Securities, including, without
limitation, all registration, filing, securities exchange listing and NASDAQ
fees (or fees of any other principal trading market on which the Common Units
then trade), all registration, filing, qualification and other fees and expenses
of complying with

 

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securities or blue sky laws, fees of the Financial Industry Regulatory
Authority, fees of transfer agents and registrars, all word processing,
duplicating and printing expenses, and the fees and disbursements of counsel and
independent public accountants for the Partnership, including the expenses of
any special audits or “cold comfort” letters required by or incident to such
performance and compliance. “Selling Expenses” means all underwriting fees,
discounts and selling commissions and transfer taxes allocable to the sale of
the Registrable Securities.

(b) Expenses. The Partnership will pay all reasonable Registration Expenses, as
determined in good faith, in connection with a shelf Registration, whether or
not any sale is made pursuant to such shelf Registration. Each Selling Holder
shall pay its pro rata share of all Selling Expenses in connection with any sale
of its Registrable Securities hereunder. In addition, except as otherwise
provided in Section 2.05, the Partnership shall not be responsible for
professional fees (including legal fees) incurred by Holders in connection with
the exercise of such Holders’ rights hereunder.

Section 2.05 Indemnification.

By the Partnership. In the event of a registration of any Registrable Securities
under the Securities Act pursuant to this Agreement, the Partnership will
indemnify and hold harmless each Selling Holder thereunder, its directors,
officers, managers, partners, employees, members, representatives and agents and
each Person, if any, who controls such Selling Holder within the meaning of the
Securities Act and the Exchange Act, and their respective directors, officers,
managers, partners, employees, members, representatives or agents (collectively,
the “Selling Holder Indemnified Persons”), against any losses, claims, damages,
expenses or liabilities (including reasonable attorneys’ fees and expenses)
(collectively, “Losses”), joint or several, to which such Selling Holder
Indemnified Person may become subject under the Securities Act, the Exchange Act
or otherwise, insofar as such Losses (or actions or proceedings, whether
commenced or threatened, in respect thereof) arise out of or are based upon (i)
any untrue statement or alleged untrue statement of any material fact (in the
case of any prospectus, in light of the circumstances under which such statement
is made) contained in (which, for the avoidance of doubt, includes documents
incorporated by reference in) the applicable Registration Statement or other
registration statement contemplated by this Agreement, any preliminary
prospectus, prospectus supplement or final prospectus contained therein, or any
amendment or supplement thereof, or any free writing prospectus relating
thereto, or any filing made in connection with the qualification of the offering
under the securities or other “blue sky” laws of any jurisdiction in which
Registrable Securities are offered, or arise out of or are based upon the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein (in the case of a
prospectus, in light of the circumstances under which they were made) not
misleading or (ii) any violation or alleged violation by the Partnership of this
Agreement, the Securities Act or the Exchange Act, and will reimburse each such
Selling Holder Indemnified Person for any legal or other expenses reasonably
incurred by them, as incurred, in connection with investigating, defending or
resolving any such Loss or actions or proceedings; provided, however, that the
Partnership will not be liable in any such case if and to the extent that any
such Loss arises out of or is based solely upon an untrue statement or alleged
untrue statement or omission or alleged omission so made in conformity with
information furnished by such Selling Holder Indemnified Person in writing
specifically for use in the applicable Registration Statement or other
registration statement, or prospectus supplement, as applicable.

 

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Such indemnity shall remain in full force and effect regardless of any
investigation made by or on behalf of such Selling Holder Indemnified Person,
and shall survive the transfer of such securities by such Selling Holder.

(a) By Each Selling Holder. Each Selling Holder agrees severally and not jointly
to indemnify and hold harmless the Partnership, the Partnership Entities, the
General Partner’s directors, officers, employees and agents and each Person,
who, directly or indirectly, controls the Partnership within the meaning of the
Securities Act or of the Exchange Act to the same extent as the foregoing
indemnity from the Partnership to the Selling Holders, but only with respect to
Losses incurred solely and to the extent of information regarding such Selling
Holder furnished in writing by or on behalf of such Selling Holder expressly for
inclusion in a Registration Statement or any other registration statement
contemplated by this Agreement, any preliminary prospectus, prospectus
supplement or final prospectus contained therein, or any amendment or supplement
thereto or any free writing prospectus relating thereto; provided, however, that
the liability of each Selling Holder shall not be greater in amount than the
dollar amount of the proceeds (net of any Selling Expenses) received by such
Selling Holder from the sale of the Registrable Securities giving rise to such
indemnification.

(b) Notice. Promptly after receipt by an indemnified party hereunder of notice
of the commencement of any action, such indemnified party shall, if a claim in
respect thereof is to be made against the indemnifying party hereunder, notify
the indemnifying party in writing thereof, but the omission to so notify the
indemnifying party shall not relieve it from any liability that it may have to
any indemnified party other than under this Section 2.05(c) except to the extent
that the indemnifying party is materially prejudiced by such failure. In any
action brought against any indemnified party, it shall notify the indemnifying
party of the commencement thereof. The indemnifying party shall be entitled to
participate in and, to the extent it shall wish, to assume and undertake the
defense thereof with counsel reasonably satisfactory to such indemnified party
and, after notice from the indemnifying party to such indemnified party of its
election so to assume and undertake the defense thereof, the indemnifying party
shall not be liable to such indemnified party under this Section 2.05 for any
legal expenses subsequently incurred by such indemnified party in connection
with the defense thereof other than reasonable costs of investigation and of
liaison with counsel so selected; provided, however, that, (i) if the
indemnifying party has failed to assume the defense or employ counsel reasonably
satisfactory to the indemnified party or (ii) if the defendants in any such
action include both the indemnified party and the indemnifying party and counsel
to the indemnified party shall have concluded that there may be reasonable
defenses available to the indemnified party that are different from or
additional to those available to the indemnifying party, or if the interests of
the indemnified party reasonably may be deemed to conflict with the interests of
the indemnifying party, then the indemnified party shall have the right to
select a separate counsel and to assume such legal defense and otherwise to
participate in the defense of such action, with the reasonable expenses and fees
of such separate counsel and other reasonable expenses related to such
participation to be reimbursed by the indemnifying party as incurred.
Notwithstanding any other provision of this Agreement, no indemnifying party
shall settle any action brought against any indemnified party with respect to
which such indemnified party may be entitled to indemnification hereunder
without the prior written consent of the indemnified party, unless the
settlement thereof imposes no liability or obligation on, includes a complete
and unconditional release from liability of, and does not contain any admission
of wrongdoing by, the indemnified party.

 

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(c) Contribution. If the indemnification provided for in this Section 2.05 is
held by a court or government agency of competent jurisdiction to be unavailable
to any indemnified party or is insufficient to hold them harmless in respect of
any Losses, then each such indemnifying party, in lieu of indemnifying such
indemnified party, shall contribute to the amount paid or payable by such
indemnified party as a result of such Losses in such proportion as is
appropriate to reflect the relative fault of the indemnifying party, on the one
hand, and of the indemnified party, on the other hand, in connection with the
statements or omissions that resulted in such Losses, as well as any other
relevant equitable considerations; provided, however, that in no event shall any
Selling Holder be required to contribute an aggregate amount in excess of the
dollar amount of net proceeds (net of Selling Expenses) received by such Selling
Holder from the sale of Registrable Securities giving rise to such
indemnification. The relative fault of the indemnifying party, on the one hand,
and the indemnified party, on the other, shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of a material
fact or the omission or alleged omission to state a material fact has been made
by, or relates to, information supplied by such party in writing, and the
parties’ relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission. The parties hereto agree that it
would not be just and equitable if contributions pursuant to this paragraph were
to be determined by pro rata allocation or by any other method of allocation
that does not take account of the equitable considerations referred to
herein. The amount paid by an indemnified party as a result of the Losses
referred to in the first sentence of this paragraph shall be deemed to include
any legal and other expenses reasonably incurred by such indemnified party in
connection with investigating, defending or resolving any Loss that is the
subject of this paragraph. No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any Person who is not guilty of such fraudulent
misrepresentation.

(d) Other Indemnification. The provisions of this Section 2.05 shall be in
addition to any other rights to indemnification or contribution that an
indemnified party may have pursuant to law, equity, contract or otherwise.

Section 2.06 Rule 144 Reporting. With a view to making available the benefits of
certain rules and regulations of the Commission that may permit the sale of the
Registrable Securities to the public without registration, the Partnership
agrees to use its commercially reasonable efforts to:

(a) make and keep public information regarding the Partnership available, as
those terms are understood and defined in Rule 144 under the Securities Act (or
any similar provision then in effect), at all times from and after the date
hereof;

(b) file with the Commission in a timely manner all reports and other documents
required of the Partnership under the Securities Act and the Exchange Act at all
times from and after the date hereof; and

(c) so long as a Holder owns any Registrable Securities, furnish (i) to the
extent accurate, forthwith upon request, a written statement of the Partnership
that it has complied with the reporting requirements of Rule 144 under the
Securities Act (or any similar provision then in effect), the Securities Act and
the Exchange Act, and (ii) unless otherwise available via the

 

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Commission’s EDGAR filing system, to such Holder forthwith upon request a copy
of the most recent annual or quarterly report of the Partnership, and such other
reports and documents so filed as such Holder may reasonably request in availing
itself of any rule or regulation of the Commission allowing such Holder to sell
any such securities without registration.

Section 2.07 Transfer or Assignment of Registration Rights. The rights to cause
the Partnership to register Registrable Securities under this Article II may be
transferred or assigned by each Holder to one or more transferees or assignees
of Registrable Securities or securities convertible into Registrable Securities;
provided, however, that (a) unless any such transferee or assignee is an
Affiliate of, and after such transfer or assignment continues to be an Affiliate
of, such Holder, the amount of Registrable Securities or securities convertible
into Registrable Securities, as applicable, transferred or assigned to such
transferee or assignee shall represent at least $5 million of Registrable
Securities (determined by multiplying the number of Registrable Securities (on
an as-converted basis without regard to any limitations on conversions and/or
redemptions of the Series A Preferred units) owned by the average of the closing
price on the NASDAQ (or any other principal trading market on which the Common
Units then trade) for the Common Units for the ten (10) Trading Days preceding
the date of such transfer or assignment), (b) the Partnership is given written
notice prior to any said transfer or assignment, stating the name and address of
each such transferee or assignee and identifying the securities with respect to
which such registration rights are being transferred or assigned and (c) each
such transferee or assignee assumes in writing responsibility for its portion of
the obligations of such transferring Holder under this Agreement.

ARTICLE III

MISCELLANEOUS

Section 3.01 Communications. All notices and demands provided for hereunder
shall be in writing and shall be given by registered or certified mail, return
receipt requested, telecopy, air courier guaranteeing overnight delivery,
personal delivery or email to the following addresses:

(a) If to the Purchasers, to the addresses set forth on Schedule A, with a copy
to (which shall not constitute notice):

Schulte Roth & Zabel LLP

919 Third Avenue

New York, New York 10022

Attention: Eleazer Klein, Esq.

Facsimile: (212) 593-5955

Email: eleazer.klein@srz.com

 

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(b) If to the Partnership:

CSI Compressco GP Inc.

CSI Compressco LP

3809 S. FM 1788

Midland, Texas 79706

Attention: Timothy A. Knox, President

Email: tim.knox@csicompressco.com

with a copy to (which shall not constitute notice):

TETRA Technologies, Inc.

24955 Interstate 45 North

The Woodlands, Texas 77380

Attention: Bass C. Wallace, Jr.

Email: bwallace@tetratec.com

and

Vinson & Elkins L.L.P.

1001 Fannin Street

Suite 2500

Houston TX 77002-6760

Attention: David P. Oelman

Email: doelman@velaw.com

or to such other address as the Partnership or the Purchasers may designate to
each other in writing from time to time or, if to a transferee or assignee of
the Purchasers or any transferee or assignee thereof, to such transferee or
assignee at the address provided pursuant to Section 2.07. All notices and
communications shall be deemed to have been duly given: at the time delivered by
hand, if personally delivered; upon actual receipt if sent by certified or
registered mail, return receipt requested, or regular mail, if mailed; upon
actual receipt of the facsimile or email copy, if sent via facsimile or email;
and upon actual receipt when delivered to an air courier guaranteeing overnight
delivery.

Section 3.02 Binding Effect. This Agreement shall be binding upon the
Partnership, each of the Purchasers and their respective successors and
permitted assigns, including subsequent Holders of Registrable Securities to the
extent permitted herein. 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.

Section 3.03 Assignment of Rights. Except as provided in Section 2.07, 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.

Section 3.04 Recapitalization, Exchanges, Etc. Affecting Units. The provisions
of this Agreement shall apply to the full extent set forth herein with respect
to any and all units of

 

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the Partnership or any successor or assign of the Partnership (whether by
merger, consolidation, sale of assets or otherwise) that may be issued in
respect of, in exchange for or in substitution of, the Registrable Securities,
and shall be appropriately adjusted for combinations, unit splits,
recapitalizations, pro rata distributions of units and the like occurring after
the date of this Agreement.

Section 3.05 Aggregation of Registrable Securities. All Registrable Securities
held or acquired by Persons who are Affiliates of one another shall be
aggregated together for the purpose of determining the availability of any
rights under this Agreement.

Section 3.06 Specific Performance. Damages in the event of breach of this
Agreement by a party hereto may be difficult, if not impossible, to ascertain,
and it is therefore agreed that each such Person, in addition to and without
limiting any other remedy or right it may have, will have the right to seek an
injunction or other equitable relief in any court of competent jurisdiction,
enjoining any such breach, and enforcing specifically the terms and provisions
hereof, and each of the parties hereto hereby waives any and all defenses it may
have on the ground of lack of jurisdiction or competence of the court to grant
such an injunction or other equitable relief. The existence of this right will
not preclude any such Person from pursuing any other rights and remedies at law
or in equity that such Person may have.

Section 3.07 Counterparts. This Agreement may be executed in any number of
counterparts and by different parties hereto in separate 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.

Section 3.08 Governing Law, Submission to Jurisdiction. 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 or
performance 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), will be construed in accordance with and
governed by the laws of the State of New York without regard to principles of
conflicts of laws. 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 New York, and the parties hereto hereby irrevocably submit
to the non-exclusive jurisdiction of any federal or state court located within
the State of New York 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.

Section 3.09 Waiver of Jury Trial. THE PARTIES TO THIS AGREEMENT EACH HEREBY
WAIVE, AND AGREE TO CAUSE THEIR AFFILIATES TO WAIVE, TO THE FULLEST EXTENT
PERMITTED BY LAW, ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION OR
CAUSE OF ACTION (A) ARISING UNDER THIS AGREEMENT OR (B) IN ANY WAY CONNECTED
WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO IN RESPECT
OF THIS

 

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AGREEMENT OR ANY OF THE TRANSACTIONS RELATED HERETO, IN EACH CASE WHETHER NOW
EXISTING OR HEREAFTER ARISING, AND WHETHER IN CONTRACT, TORT, EQUITY OR
OTHERWISE. THE PARTIES TO THIS AGREEMENT EACH HEREBY AGREES AND CONSENTS THAT
ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT
TRIAL WITHOUT A JURY AND THAT THE PARTIES TO THIS AGREEMENT MAY FILE AN ORIGINAL
COUNTERPART OF A COPY OF THIS AGREEMENT WITH ANY COURT AS WRITTEN EVIDENCE OF
THE CONSENT OF THE PARTIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.

Section 3.10 Entire Agreement. This Agreement, the Purchase Agreement and the
other agreements and documents referred to herein are intended by the parties as
a final expression of their agreement and 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
restrictions, promises, warranties or undertakings, other than those set forth
or referred to herein or in the Purchase Agreement with respect to the rights
granted by the Partnership or any of its Affiliates or the Purchasers or any of
their respective Affiliates set forth herein or therein. This Agreement, the
Purchase Agreement and the other agreements and documents referred to herein or
therein supersede all prior agreements and understandings between the parties
with respect to such subject matter.

Section 3.11 Amendment. This Agreement may be amended only by means of a written
amendment signed by the Partnership and the Required Holders. 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 any Purchaser 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.

Section 3.12 No Presumption. This Agreement has been reviewed and negotiated by
sophisticated parties with access to legal counsel and shall not be construed
against the drafter.

Section 3.13 Obligations Limited to Parties to Agreement. Each of the parties
hereto covenants, agrees and acknowledges that, other than as set forth herein,
no Person other than the Purchasers, the Selling Holders, their respective
permitted assignees and the Partnership shall have any obligation hereunder and
that, notwithstanding that one or more of such Persons may be a corporation,
partnership or limited liability company, no recourse under this Agreement or
under any documents or instruments delivered in connection herewith shall be had
against any former, current or future director, officer, employee, agent,
general or limited partner, manager, member, stockholder or Affiliate of any of
such Persons or their respective permitted assignees, or any former, current or
future director, officer, employee, agent, general or limited partner, manager,
member, stockholder or Affiliate of any of the foregoing, whether by the
enforcement of any assessment or by any legal or equitable proceeding, or by
virtue of any applicable law, it being expressly agreed and acknowledged that no
personal liability whatsoever shall attach to, be imposed on or otherwise be
incurred by any former, current or future director, officer, employee, agent,
general or limited partner, manager, member, stockholder or Affiliate of any of
such Persons or any of their respective assignees, or any former, current or
future director, officer,

 

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employee, agent, general or limited partner, manager, member, stockholder or
Affiliate of any of the foregoing, as such, for any obligations of such Persons
or their respective permitted assignees under this Agreement or any documents or
instruments delivered in connection herewith or for any claim based on, in
respect of or by reason of such obligation or its creation, except, in each
case, for any assignee of any Purchaser or a Selling Holder hereunder.

Section 3.14 Interpretation. Article, Section and Schedule references in this
Agreement are references to the corresponding Article, Section or Schedule to
this Agreement, unless otherwise specified. All Schedules 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 specified. The word
“including” shall mean “including but not limited to” and shall not be construed
to limit any general statement that it follows to the specific or similar items
or matters immediately following it. Whenever the Partnership has an obligation
under this Agreement, the expense of complying with that obligation shall be an
expense of the Partnership unless otherwise specified. Any reference in this
Agreement to “$” shall mean U.S. dollars. Whenever any determination, consent or
approval is to be made or given by a Purchaser, such action shall be in such
Purchaser’s sole discretion, unless otherwise specified in this Agreement. If
any provision in this Agreement is held to be illegal, invalid, not binding or
unenforceable, (a) 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 of this Agreement, and the
remaining provisions shall remain in full force and effect, and (b) the parties
hereto shall negotiate in good faith to modify this Agreement so as to effect
the original intent of the parties as closely as possible in an acceptable
manner in order that the transactions contemplated hereby are consummated as
originally contemplated to the greatest extent 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. The words such as “herein,” “hereinafter,”
“hereof” and “hereunder” refer to this Agreement as a whole and not merely to a
subdivision in which such words appear unless the context otherwise requires.
The provision of a Table of Contents, the division of this Agreement into
Articles, Sections and other subdivisions and the insertion of headings are for
convenience of reference only and shall not affect or be utilized in construing
or interpreting this Agreement.

Section 3.15 Severability. If any provision of this Agreement is prohibited by
law or otherwise determined to be invalid or unenforceable by a court of
competent jurisdiction, the provision that would otherwise be prohibited,
invalid or unenforceable shall be deemed amended to apply to the broadest extent
that it would be valid and enforceable, and the invalidity or unenforceability
of such provision shall not affect the validity of the remaining provisions of
this Agreement so long as this Agreement as so modified continues to express,
without material change, the original intentions of the parties as to the
subject matter hereof and the prohibited nature, invalidity or unenforceability
of the provision(s) in question does not substantially impair the respective
expectations or reciprocal obligations of the parties or the practical
realization of

 

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the benefits that would otherwise be conferred upon the parties. The parties
will endeavor in good faith negotiations to replace the prohibited, invalid or
unenforceable provision(s) with a valid provision(s), the effect of which comes
as close as possible to that of the prohibited, invalid or unenforceable
provision(s).

[Remainder of Page Left Intentionally Blank]

 

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

 

CSI COMPRESSCO LP By:   CSI COMPRESSCO GP INC, its general partner   By:  

/s/ Timothy A. Knox

  Name:   Timothy A. Knox   Title:   President

 

Signature Page to Registration Rights Agreement

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HBC MLP LLC   By: Hudson Bay Capital Management LP, as its Investment Manager  
By:  

/s/ Sander Gerber

  Name:   Sander Gerber   Title:   Authorized Signatory of its Manager
OPPENHEIMER STEELPATH MLP INCOME FUND   By:  

/s/ Brian Watson

  Name:   Brian Watson   Title:   Vice President CSI COMPRESSCO INVESTMENT LLC  
By: CSI Compressco GP Inc., its sole member   By:  

/s/ Timothy A. Knox

  Name:   Timothy A. Knox   Title:   President

 

Signature Page to Registration Rights Agreement

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Schedule A

Purchaser Name; Notice and Contact Information

 

Purchaser

  

Contact Information

HBC MLP LLC   

c/o Hudson Bay Capital Management LP

777 Third Avenue, 30th Floor

New York, New York 10017

Attention: Yoav Roth

                George Antonopoulos

Facsimile:  646-214-7946

Telephone: 212-571-1244

E-mail: investments@hudsonbaycapital.com

             operations@hudsonbaycapital.com

Oppenheimer Steelpath MLP Income Fund   

Oppenheimer Steelpath MLP Income Fund

2100 McKinney Ave, Suite 1401

Dallas, TX 75201

Attention: Brian Watson

CSI Compressco Investment LLC   

c/o CSI Compressco GP Inc.

24955 Interstate 45 North

The Woodlands, Texas 77380

Attention: Timothy A. Knox

E-mail: tim.knox@csicompressco.com

 

Schedule A-1

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Exhibit A

Selling Holders

The Common Units being offered by the selling holders are those issuable upon
conversion of the Series A Preferred Units. We are registering the Common Units
in order to permit the selling holders to offer the Common Units for resale from
time to time. Except for the ownership of the Series A Preferred Units and
                , the selling holders have not had any material relationship
with us within the past three years.

The table below lists the selling holders and other information regarding the
beneficial ownership of the Common Units. The second column lists the number of
Common Units beneficially owned by each selling holder, based on its ownership
of the Series A Preferred Units, as of             , 2016, assuming conversion
of all Series A Preferred Units held by the selling holders on that date,
without regard to any limitations on conversions and/or redemptions of the
Series A Preferred Units.

The third column lists the Common Units being offered by this prospectus by the
selling holders.

In accordance with the terms of a registration rights agreement with the holders
of the Series A Preferred Units, this prospectus generally covers the resale of
all of 130% of the maximum of the sum of (i) the Common Units issued and
issuable pursuant to the Series A Preferred Units and (ii) the Common Units
issued and issuable pursuant to the PIK Units, each as of the Trading Day
immediately preceding the date the registration statement is initially filed
with the Commission, subject to adjustment as provided in the registration
rights agreement and in each case without regard to any limitations on the
issuance of Common Units pursuant to the terms of the Series A Preferred Units.
Because the conversion price of the Series A Preferred Units may be adjusted,
the number of Common Units that will actually be issued may be more or less than
the number of Common Units being offered by this prospectus. The fourth column
assumes the sale of all of the Common Units offered by the selling holders
pursuant to this prospectus.

Under the terms of the Series A Preferred Units, a selling shareholder may not
convert the Series A Preferred Units, to the extent such conversion would cause
such selling shareholder, together with its affiliates, to beneficially own a
number of Common Units which would exceed 9.99% of our then outstanding Common
Units following such conversion, excluding for purposes of such determination
Common Units issuable upon conversion of the Series A Preferred Units which have
not been converted. The number of Common Units in the second column does not
reflect this limitation. The selling shareholders may sell all, some or none of
their Common Units in this offering. See “Plan of Distribution.”

The selling holders may sell all, some or none of their Common Units in this
offering. See “Plan of Distribution.”

 

Exhibit A

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Name of Selling Holder

   Number of Common Units
Owned Prior to Offering      Maximum Number of
Common Units to be Sold
Pursuant to this Prospectus      Number of Common
Units Owned After
Offering                             

 

Exhibit A

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Plan of Distribution

We are registering the Common Units issuable upon conversion of the Series A
Preferred Units to permit the resale of Common Units by the holders of the
Series A Preferred Units from time to time after the date of this prospectus. We
will not receive any of the proceeds from the sale by the selling holders of the
Common Units. We will bear all fees and expenses incident to our obligation to
register the Common Units.

The selling holders may sell all or a portion of the Common Units beneficially
owned by them and offered hereby from time to time directly or through one or
more underwriters, broker-dealers or agents. If the Common Units are sold
through underwriters or broker-dealers, the selling holders will be responsible
for underwriting discounts or commissions or agent’s commissions. The Common
Units may be sold in one or more transactions at fixed prices, at prevailing
market prices at the time of the sale, at varying prices determined at the time
of sale, or at negotiated prices. These sales may be effected in transactions,
which may involve crosses or block transactions,

 

  •   on any national securities exchange or quotation service on which the
Common Units may be listed or quoted at the time of sale;

 

  •   in the over-the-counter market;

 

  •   in transactions otherwise than on these exchanges or systems or in the
over-the-counter market;

 

  •   through the writing of options, whether such options are listed on an
options exchange or otherwise;

 

  •   in ordinary brokerage transactions and transactions in which the
broker-dealer solicits purchasers;

 

  •   in block trades in which the broker-dealer will attempt to sell the Common
Units as agent but may position and resell a portion of the block as principal
to facilitate the transaction;

 

  •   in purchases by a broker-dealer as principal and resale by the
broker-dealer for its account;

 

  •   in exchange distributions in accordance with the rules of the applicable
exchange;

 

  •   privately negotiated transactions;

 

  •   as short sales;

 

  •   as sales pursuant to Rule 144;

 

  •   as broker-dealers may agree with the selling holders to sell a specified
number of such Common Units at a stipulated price per unit;

 

  •   in a combination of any such methods of sale; and

 

  •   in any other method permitted pursuant to applicable law.

If the selling holders effect such transactions by selling Common Units to or
through underwriters, broker-dealers or agents, such underwriters,
broker-dealers or agents may receive commissions in the form of discounts,
concessions or commissions from the selling holders or commissions from
purchasers of the Common Units for whom they may act as agent or to whom they
may sell as principal (which discounts, concessions or commissions as to
particular underwriters, broker-dealers or agents may be in excess of those
customary in the types of

 

Exhibit A

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transactions involved). In connection with sales of the Common Units or
otherwise, the selling holders may enter into hedging transactions with
broker-dealers, which may in turn engage in short sales of the Common Units in
the course of hedging in positions they assume. The selling holders may also
sell Common Units short and deliver Common Units covered by this prospectus to
close out short positions and to return borrowed Common Units in connection with
such short sales. The selling holders may also loan or pledge Common Units to
broker-dealers that in turn may sell such units.

The selling holders may pledge or grant a security interest in some or all of
the Series A Preferred Units or Common Units owned by them and, if they default
in the performance of their secured obligations, the pledgees or secured parties
may offer and sell the Common Units from time to time pursuant to this
prospectus or any amendment to this prospectus under Rule 424(b)(7) or other
applicable provision of the Securities Act of 1933, as amended, amending, if
necessary, the list of selling holders to include the pledgee, transferee or
other successors in interest as selling holders under this prospectus. The
selling holders also may transfer and donate the Common Units in other
circumstances in which case the transferees, donees, pledgees or other
successors in interest will be the selling beneficial owners for purposes of
this prospectus.

The selling holders and any broker-dealer participating in the distribution of
the Common Units may be deemed to be “underwriters” within the meaning of the
Securities Act, and any commission paid, or any discounts or concessions allowed
to, any such broker-dealer may be deemed to be underwriting commissions or
discounts under the Securities Act. At the time a particular offering of the
Common Units is made, a prospectus supplement, if required, will be distributed
which will set forth the aggregate amount of Common Units being offered and the
terms of the offering, including the name or names of any broker-dealers or
agents, any discounts, commissions and other terms constituting compensation
from the selling holders and any discounts, commissions or concessions allowed
or reallowed or paid to broker-dealers.

Under the securities laws of some states, the Common Units may be sold in such
states only through registered or licensed brokers or dealers. In addition, in
some states the Common Units may not be sold unless such units have been
registered or qualified for sale in such state or an exemption from registration
or qualification is available and is complied with.

There can be no assurance that any selling holder will sell any or all of the
Common Units registered pursuant to the registration statement, of which this
prospectus forms a part.

The selling holders and any other person participating in such distribution will
be subject to applicable provisions of the Securities Exchange Act of 1934, as
amended, and the rules and regulations thereunder, including, without
limitation, Regulation M of the Exchange Act, which may limit the timing of
purchases and sales of any of the Common Units by the selling holders and any
other participating person. Regulation M may also restrict the ability of any
person engaged in the distribution of the Common Units to engage in
market-making activities with respect to the Common Units. All of the foregoing
may affect the marketability of the Common Units and the ability of any person
or entity to engage in market-making activities with respect to the Common
Units.

 

Exhibit A

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We will pay all expenses of the registration of the Common Units pursuant to the
registration rights agreement, estimated to be $         in total, including,
without limitation, Securities and Exchange Commission filing fees and expenses
of compliance with state securities or “blue sky” laws; provided, however, that
a selling holder will pay all underwriting discounts and selling commissions, if
any. We will indemnify the selling holders against liabilities, including some
liabilities under the Securities Act, in accordance with the registration rights
agreements, or the selling holders will be entitled to contribution. We may be
indemnified by the selling holders against civil liabilities, including
liabilities under the Securities Act, that may arise from any written
information furnished to us by the selling holder specifically for use in this
prospectus, in accordance with the related registration rights agreement, or we
may be entitled to contribution.

Once sold under the registration statement, of which this prospectus forms a
part, the Common Units will be freely tradable in the hands of persons other
than our affiliates.

 

Exhibit A