Exhibit 10.1

 

AMENDMENT NO. 1

 

TO

 

AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP

OF

MIDCOAST OPERATING, L.P.

 

July 29, 2015

 

This Amendment No. 1 (this “Amendment No. 1”) to the Amended and Restated
Agreement of Limited Partnership dated November 13, 2013 (as amended, the
“Partnership Agreement”) of Midcoast Operating, L.P. (the “Partnership”) is
hereby adopted by Midcoast OLP GP, L.L.C., a Delaware limited liability company
(the “General Partner”), Midcoast Energy Partners, L.P., a Delaware limited
partnership (“MEP”), and Enbridge Energy Partners, L.P., a Delaware limited
partnership (“EEP” and, together with MEP, the “Limited Partners”). Capitalized
terms used but not defined herein are used as defined in the Partnership
Agreement.

 

RECITALS

 

WHEREAS, EEP proposed this Amendment No. 1 to MEP and the General Partner
because, among other reasons, EEP believes that this Amendment No. 1 will
provide a benefit to EEP as a significant holder of Class A common units of MEP;
and

 

WHEREAS, the General Partner and the Limited Partners wish to amend the
Partnership Agreement.

 

NOW, THEREFORE, in consideration of the mutual covenants and obligations set
forth in this Amendment No. 1, and for other good and valuable consideration,
the receipt of which is hereby acknowledged, the General Partner and the Limited
Partners hereby agree as follows:

 

Section 1. Amendments.

 

(a) Section 6.01 in the Partnership Agreement is hereby amended and restated to
read in its entirety:

 

“Within 45 days following the end of each Quarter commencing with the Quarter
ending December 31, 2013, the Partnership shall distribute to the Partners pro
rata in accordance with their respective Percentage Interests an amount equal to
100% of Distributable Cash; provided, that, commencing with and including the
distributions with respect to the Quarter ending June 30, 2015 and continuing
through and including the distributions made with respect to the Quarter ending
December 31, 2017, within 45 days following the end of each such Quarter, the
Partnership shall distribute to the Partners an amount equal to 100% of
Distributable Cash in accordance with Schedule B to this Agreement.
Notwithstanding any other provision of this Agreement, the Partnership shall not
make a distribution to the Partners on account of their interests in the
Partnership if such distribution would violate the TBOC or other applicable
law.”

 

(b) The Partnership Agreement is hereby amended by adding the new Schedule B
attached to this Amendment No. 1.

 

Section 3. Ratification of Partnership Agreement. Except as expressly modified
and amended herein, all of the terms and conditions of the Partnership Agreement
shall remain in full force and effect.

 

Section 4. Governing Law. This Amendment No. 1 will be governed by and construed
in accordance with the laws of the State of Texas, without giving effect to the
principles of conflicts of law thereof. Any right to trial by jury with respect
to any claim or proceeding related to or arising out of this Amendment No. 1, or
any transaction or conduct in connection herewith, is hereby waived by each of
the Partners.

  

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

 

 

 

 

IN WITNESS WHEREOF, the parties have executed this Amendment No. 1 as of July
29, 2015.

 

  GENERAL PARTNER:         MIDCOAST OLP GP, L.L.C.         By: Midcoast
Holdings, L.L.C., as general partner of
Midcoast Energy Partners, L.P., as sole member of
Midcoast OLP GP, L.L.C.               By: /s/ Chris Kaitson                 
Name: Chris Kaitson   Title: Vice President—Law and Assistant Secretary        
            LIMITED PARTNERS:         MIDCOAST ENERGY PARTNERS, L.P.         By:
Midcoast Holdings, L.L.C., its general partner               By: /s/ Chris
Kaitson   Name: Chris Kaitson   Title: Vice President—Law and Assistant
Secretary               ENBRIDGE ENERGY PARTNERS, L.P.         By: Enbridge
Energy Management, L.L.C., as delegate of Enbridge Energy Company, Inc., as
general partner               By: /s/ Chris Kaitson   Name: Chris Kaitson  
Title: Vice President—Law and Assistant Secretary

 

[Signature Page to Amendment No. 1 to Midcoast Operating Partnership Agreement]

 

 

Schedule B

 

Distributable Cash shall be distributed by the Partnership for such Quarter to
the Partners as follows: 0.001% (the “GP Quarterly Distribution Percentage”) to
the General Partner and, so long as MEP and EEP are the sole Limited Partners,
to EEP based on the EEP Quarterly Distribution Percentage and to MEP based on
the MEP Quarterly Distribution Percentage; provided, that if the Limited
Partners cease to be comprised solely of MEP and EEP, then Distributable Cash
shall be distributed by the Partnership to the Limited Partners pro rata in
accordance with their respective Percentage Interests. Capitalized terms used
but not defined in this Schedule B shall have the meanings assigned to such
terms in the Partnership Agreement.

 

Certain definitions for this Schedule B:

 

“EEP Quarterly Distribution Percentage” means EEP’s Percentage Interest, unless
the MEP Coverage Ratio for the applicable Quarter is less than 1.0 (prior to
giving effect to the following), in which case the EEP Quarterly Distribution
Percentage shall be the percentage equal to 100% minus the GP Quarterly
Distribution Percentage minus the MEP Quarterly Distribution Percentage;
provided, that in no instance will the EEP Quarterly Distribution Percentage be
less than 0%.

 

“MEP Coverage Ratio” means an amount equal to MEP Distributable Cash for the
applicable Quarter divided by the Total Distribution for the applicable Quarter.

 

“MEP Distributable Cash” means, with respect to any Quarter, an amount equal to
the total of the following (amounts in this definition shall be derived from the
line items in the MEP financial statements for such Quarter unless otherwise
specified below):

 

Net income attributable to general partner and limited partner interests in MEP
Add: Normalizing adjustments that are made in connection with the MEP Adjusted
Earnings that are net of non-controlling interest Adjusted net income (loss)  
Add: Depreciation and amortization Adjusted net income attributable to EEP
retained interest Interest expense Income tax expense Less: Adjusted EBITDA
attributable to EEP Adjusted EBITDA attributable to MEP   Less: Maintenance
capital expenditures attributable to MEP Income tax expense attributable to MEP
Interest expense attributable to MEP Add: Distribution in excess of equity
earnings attributable to MEP G&A abatement pursuant to Intercorporate Services
Agreement attributable to MEP MEP Distributable Cash

 

B-1

 

 

“MEP Quarterly Distribution Percentage” means MEP’s pro rata Percentage
Interest, unless the MEP Coverage Ratio for the applicable Quarter is less than
1.0 (prior to giving effect to the following), in which case the MEP Quarterly
Distribution Percentage shall be the percentage equal to the sum of MEP’s
Percentage Interest plus the MEP Quarterly Increase Percentage; provided, that
in no instance will the MEP Quarterly Distribution Percentage be more than
99.999%.

 

“MEP Quarterly Increase Percentage” means a percentage equal to (i) the Total
Distribution for such quarter minus MEP Distributable Cash for such quarter
divided by (ii) Distributable Cash.

 

“MEP LP Agreement” means the First Amended and Restated Agreement of Limited
Partnership of MEP dated November 13, 2013, as amended, modified or replaced
from time to time.

 

“Total Distribution” means for the Quarter, the aggregate amount declared by the
Board of Directors of MEP’s general partner to be distributed to the unitholders
of MEP; provided that, if the distribution amount per MEP Class A common unit
for the Quarter would exceed a $0.005 increase over the distribution amount per
MEP Class A common unit for the immediately preceding Quarter, then the Total
Distribution amount shall be reduced by an amount equal to the excess of the
Total Distribution amount minus the aggregate amount that would have been
distributed if the declared distribution was a $0.005 increase over the
distribution amount per MEP Class A common unit for the immediately preceding
Quarter.

 

B-2