exv10w2



 






Exhibit 10.2










CROSSTEX ENERGY, L.P.




$125,000,000




SENIOR SECURED NOTES




AMENDED AND RESTATED

MASTER SHELF AGREEMENT




Dated as of March 31, 2005












 









 








TABLE OF CONTENTS

(Not Part of Agreement)




	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Page	 
	1.	 	AUTHORIZATION OF ISSUE OF NOTES; AMENDMENT AND RESTATEMENT; ASSUMPTION	 	 	2	 
	 
	 	 	 	1A. Authorization of Issue of Series A Notes	 	 	2	 
	 
	 	 	 	1B. Authorization of Series B Notes	 	 	2	 
	 
	 	 	 	1C. Authorization of Series C Notes	 	 	2	 
	 
	 	 	 	1D. Authorization of Issue of Shelf Notes	 	 	2	 
	 
	 	 	 	1E. Assumption and Amendment and Restatement of Existing Notes	 	 	3	 
	 
	 	 	 	1F. Amendment and Restatement of Existing Notes and Existing ShelfAgreement and Issuance of Notes	 	 	3	 
	2.	 	PURCHASE AND SALE OF SHELF NOTES	 	 	4	 
	 
	 	 	 	2A. Facility	 	 	4	 
	 
	 	 	 	2B. Issuance Period	 	 	4	 
	 
	 	 	 	2C. Periodic Spread Information	 	 	4	 
	 
	 	 	 	2D. Request for Purchase	 	 	5	 
	 
	 	 	 	2E. Rate Quotes	 	 	5	 
	 
	 	 	 	2F. Acceptance	 	 	5	 
	 
	 	 	 	2G. Market Disruption	 	 	6	 
	 
	 	 	 	2H. Closing	 	 	6	 
	 
	 	 	 	2I. Fees	 	 	7	 
	3.	 	CONDITIONS OF AMENDMENT AND RESTATEMENT AND CLOSING	 	 	8	 
	 
	 	 	 	3A. Certain Documents	 	 	8	 
	 
	 	 	 	3B. Opinion of Purchaser’s Special Counsel	 	 	11	 
	 
	 	 	 	3C. Representations and Warranties; No Default	 	 	11	 
	 
	 	 	 	3D. Purchase Permitted by Applicable Laws	 	 	11	 
	 
	 	 	 	3E. Legal Matters	 	 	11	 
	 
	 	 	 	3F. Payment of Fees	 	 	11	 
	 
	 	 	 	3G. Proceedings	 	 	12	 
	 
	 	 	 	3H. Private Placement Numbers	 	 	12	 
	 
	 	 	 	3I. Title	 	 	12	 
	 
	 	 	 	3J. Collateral Agent’s Liens	 	 	12	 






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TABLE OF CONTENTS

(Not Part of Agreement)





	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Page	 
	 
	 	 	 	3K. Encumbrance of Real Property Interests	 	 	12	 
	 
	 	 	 	3L. Corporate Structure	 	 	12	 
	4.	 	PREPAYMENTS	 	 	12	 
	 
	 	 	 	4A. Required Prepayments	 	 	12	 
	 
	 	 	 	4B. Optional Prepayment With Yield-Maintenance Amount	 	 	12	 
	 
	 	 	 	4C. Notice of Optional Prepayment	 	 	12	 
	 
	 	 	 	4D. Application of Prepayments	 	 	13	 
	 
	 	 	 	4E. Retirement of Notes	 	 	13	 
	 
	 	 	 	4F. Offer to Prepay Notes in the Event of Asset Dispositions and Debt Issuance	 	 	13	 
	5.	 	AFFIRMATIVE COVENANTS	 	 	15	 
	 
	 	 	 	5A. Reporting Requirements	 	 	15	 
	 
	 	 	 	5B. Information Required by Rule 144A	 	 	17	 
	 
	 	 	 	5C. Visitation Rights	 	 	17	 
	 
	 	 	 	5D. Covenant to Secure Notes Equally	 	 	17	 
	 
	 	 	 	5E. Preservation of Legal Existence, Etc.	 	 	17	 
	 
	 	 	 	5F. Maintenance of Properties, Etc.	 	 	17	 
	 
	 	 	 	5G. Compliance with Laws, Etc.	 	 	17	 
	 
	 	 	 	5H. Payment of Taxes, Etc.	 	 	18	 
	 
	 	 	 	5I. Maintenance of Insurance	 	 	18	 
	 
	 	 	 	5J. Keeping of Books	 	 	18	 
	 
	 	 	 	5K. Transactions with Affiliates	 	 	18	 
	 
	 	 	 	5L. Compliance with Environmental Laws	 	 	18	 
	 
	 	 	 	5M. Environmental Remediation and Indemnification	 	 	18	 
	 
	 	 	 	5N. Maintenance of Credit Facility	 	 	19	 
	 
	 	 	 	5O. Additional Covenants and Additional Defaults	 	 	19	 
	 
	 	 	 	5P. Post-Closing Requirements	 	 	20	 
	6.	 	NEGATIVE COVENANTS	 	 	20	 
	 
	 	 	 	6A(1). [Intentionally omitted.]	 	 	20	 
	 
	 	 	 	6A(2). Interest Charge Coverage Ratio	 	 	20	 
	 
	 	 	 	6A(3). Leverage Ratio	 	 	20	 






-ii-









 







TABLE OF CONTENTS

(Not Part of Agreement)





	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Page	 
	 
	 	 	 	6B. Distributions, Etc.	 	 	20	 
	 
	 	 	 	6C(1). Liens, Etc.	 	 	21	 
	 
	 	 	 	6C(2). Debt	 	 	22	 
	 
	 	 	 	6C(3). Investments in Other Persons	 	 	24	 
	 
	 	 	 	6C(4). Mergers, Acquisitions, Etc.	 	 	25	 
	 
	 	 	 	6C(5). Sales, Etc. of Property	 	 	26	 
	 
	 	 	 	6D. Change in Nature of Business	 	 	26	 
	 
	 	 	 	6E. ERISA Plans	 	 	27	 
	 
	 	 	 	6F. Accounting Changes	 	 	27	 
	 
	 	 	 	6G. Creation of Material Subsidiaries	 	 	27	 
	 
	 	 	 	6H. Commodity Contracts	 	 	27	 
	 
	 	 	 	6I. Amendment of Company Partnership Agreement	 	 	27	 
	 
	 	 	 	6J. Bank Agreement	 	 	28	 
	 
	 	 	 	6K. Other Debt	 	 	28	 
	7.	 	EVENTS OF DEFAULT	 	 	28	 
	 
	 	 	 	7A. Acceleration	 	 	28	 
	 
	 	 	 	7B. Rescission of Acceleration	 	 	31	 
	 
	 	 	 	7C. Notice of Acceleration or Rescission	 	 	31	 
	 
	 	 	 	7D. Other Remedies	 	 	32	 
	8.	 	REPRESENTATIONS, COVENANTS AND WARRANTIES	 	 	32	 
	 
	 	 	 	8A. Organization	 	 	32	 
	 
	 	 	 	8B. Financial Statements	 	 	32	 
	 
	 	 	 	8C. Actions Pending	 	 	33	 
	 
	 	 	 	8D. Outstanding Debt	 	 	33	 
	 
	 	 	 	8E. Title to Properties	 	 	33	 
	 
	 	 	 	8F. Taxes	 	 	34	 
	 
	 	 	 	8G. Conflicting Agreements and Other Matters	 	 	34	 
	 
	 	 	 	8H. Offering of Notes	 	 	34	 
	 
	 	 	 	8I. Use of Proceeds	 	 	35	 
	 
	 	 	 	8J. ERISA	 	 	35	 






-iii-









 






TABLE OF CONTENTS

(Not Part of Agreement)





	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Page	 
	 
	 	 	 	8K. Governmental Consent	 	 	35	 
	 
	 	 	 	8L. Compliance with Laws	 	 	36	 
	 
	 	 	 	8M. Environmental Compliance	 	 	36	 
	 
	 	 	 	8N. Utility Company Status	 	 	36	 
	 
	 	 	 	8O. Investment Company Status	 	 	36	 
	 
	 	 	 	8P. Disclosure	 	 	36	 
	 
	 	 	 	8Q. Rule 144A	 	 	36	 
	 
	 	 	 	8R. Delivery of Bank Agreement	 	 	36	 
	 
	 	 	 	8S. Hostile Tender Offers	 	 	36	 
	 
	 	 	 	8T. Subsidiaries	 	 	37	 
	 
	 	 	 	8U. Ownership	 	 	37	 
	 
	 	 	 	8V. Natural Gas Act	 	 	37	 
	 
	 	 	 	8W. Solvency	 	 	37	 
	9.	 	REPRESENTATIONS OF THE PURCHASERS	 	 	37	 
	 
	 	 	 	9A. Nature of Purchase	 	 	37	 
	 
	 	 	 	9B. Source of Funds	 	 	37	 
	10.	 	DEFINITIONS; ACCOUNTING MATTERS	 	 	39	 
	 
	 	 	 	10A. Yield-Maintenance Terms	 	 	39	 
	 
	 	 	 	10B. Other Terms	 	 	41	 
	 
	 	 	 	10C. Computation of Time Periods	 	 	58	 
	 
	 	 	 	10D. Accounting Terms; Changes in GAAP	 	 	59	 
	 
	 	 	 	10E. Miscellaneous	 	 	59	 
	11.	 	MISCELLANEOUS	 	 	59	 
	 
	 	 	 	11A. Note Payments	 	 	59	 
	 
	 	 	 	11B. Expenses	 	 	60	 
	 
	 	 	 	11C. Consent to Amendments	 	 	60	 
	 
	 	 	 	11D. Form, Registration, Transfer and Exchange of Notes; Lost Notes	 	 	61	 
	 
	 	 	 	11E. Persons Deemed Owners; Participations	 	 	62	 
	 
	 	 	 	11F. Survival of Representations and Warranties; Entire Agreement	 	 	62	 
	 
	 	 	 	11G. Successors and Assigns	 	 	62	 






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TABLE OF CONTENTS

(Not Part of Agreement)





	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Page	 
	 
	 	 	 	11H. Independence of Covenants	 	 	62	 
	 
	 	 	 	11I. Notices	 	 	62	 
	 
	 	 	 	11J. Payments Due on Non-Business Days	 	 	63	 
	 
	 	 	 	11K. Severability	 	 	63	 
	 
	 	 	 	11L. Descriptive Headings	 	 	63	 
	 
	 	 	 	11M. Satisfaction Requirement	 	 	63	 
	 
	 	 	 	11N. Governing Law	 	 	63	 
	 
	 	 	 	11O. Severalty of Obligations	 	 	64	 
	 
	 	 	 	11P. Counterparts	 	 	64	 
	 
	 	 	 	11Q. Binding Agreement	 	 	64	 
	 
	 	 	 	11R. Waiver of Jury Trial; Consent to Jurisdiction	 	 	64	 
	 
	 	 	 	11S. Maximum Interest Payable	 	 	65	 
	 
	 	 	 	11T. Release of Collateral	 	 	65	 






-v-









 






PURCHASER SCHEDULE




	 	 	 	 	 
	SCHEDULE 6C(2)

	 	–
	 	EXISTING DEBT
	SCHEDULE 6C(3)

	 	–
	 	EXISTING INVESTMENTS
	SCHEDULE 8G

	 	–
	 	LIST OF AGREEMENTS RESTRICTING DEBT
	SCHEDULE 8T

	 	–
	 	SUBSIDIARIES
	SCHEDULE 10B(3)

	 	–
	 	EXISTING GUARANTORS
	 	 	 	 	 
	EXHIBIT A-1

	 	–
	 	FORM OF SERIES A NOTE
	EXHIBIT A-2

	 	–
	 	FORM OF SERIES B NOTE
	EXHIBIT A-3

	 	–
	 	FORM OF SERIES C NOTE
	EXHIBIT A-4

	 	–
	 	FORM OF SHELF NOTE
	EXHIBIT B

	 	–
	 	FORM OF REQUEST FOR PURCHASE
	EXHIBIT C

	 	–
	 	FORM OF CONFIRMATION OF ACCEPTANCE
	EXHIBIT D-1

	 	–
	 	FORM OF OPINION OF COMPANY’S SPECIAL COUNSEL
	EXHIBIT D-2

	 	–
	 	FORM OF OPINION OF COMPANY’S LOUISIANA COUNSEL
	EXHIBIT E

	 	–
	 	FORM OF FUNDS DELIVERY INSTRUCTION LETTER
	EXHIBIT F

	 	–
	 	FORM OF SUBSIDIARY GUARANTY
	EXHIBIT G

	 	–
	 	FORM OF COMPANY SECURITY AGREEMENT
	EXHIBIT H

	 	–
	 	FORM OF GUARANTOR SECURITY AGREEMENT
	EXHIBIT I

	 	–
	 	FORM OF INTERCREDITOR AND COLLATERAL AGENCY AGREEMENT






-vi-









 






CROSSTEX ENERGY SERVICES, L.P.

2501 Cedar Springs, Suite 600

Dallas, TX 75201




March 31, 2005




	 	 	 
	To:

	 	Prudential Investment Management, Inc. 

(herein called “Prudential”)
	 
	 	 
	

	 	Each of the Persons named in the
	

	 	Purchaser Schedule attached hereto
	

	 	as holders of Existing Series A Notes, Existing Series B Notes
	

	 	or Existing Series C Notes (the “Existing Holders”)
	 
	 	 
	

	 	Each Prudential Affiliate (as hereinafter defined)
	

	 	  which becomes bound by certain provisions of this
	

	 	  Agreement as hereinafter provided (together with
	

	 	  Prudential and the Existing Holders, the “Purchasers”)
	

	 	c/o Prudential Capital Group
	

	 	Gateway Center Four
	

	 	100 Mulberry Street
	

	 	Newark, NJ 07102-4069






Ladies and Gentlemen:




     The undersigned, Crosstex Energy, L.P., a Delaware limited partnership (the “Company”), and
Crosstex Energy Services, L.P., a Delaware limited partnership whose general partner and majority
owner are wholly-owned Subsidiaries of the Company (the “Prior Issuer”), hereby agree with you as
follows:



INTRODUCTION




     The Prior Issuer, Prudential and the Existing Holders are parties to the Master Shelf
Agreement, dated June 3, 2003 (as heretofore amended, the “Existing Shelf Agreement”), under which
the Prior Issuer issued, and there are now outstanding, the Prior Issuer’s 6.95% Senior Secured
Notes, Series A, due June 1, 2010 (the “Existing Series A Notes”) in the aggregate principal amount
of $30,000,000, the Prior Issuer’s 6.88% Senior Secured Notes, Series B, due July 1, 2010, in the
aggregate principal amount of $10,000,000 (the “Existing Series B Notes”), and the Prior Issuer’s
6.96% Senior Secured Notes, Series C, due June 18, 2014, in the aggregate principal amount of
$75,000,000 (the “Existing Series C Notes” and, together with the Existing Series A Notes and the
Existing Series B Notes, the “Existing Notes”). The Prior Issuer is a wholly owned subsidiary of
the Company and both are part of a common enterprise. The Company is (a) primarily and
unconditionally liable for the existing



 









 





obligations of the Prior Issuer under the Existing Shelf Agreement pursuant to that certain
Limited Partner Guaranty Agreement executed by it of even date with the Existing Shelf Agreement
and (b) a beneficiary of the proceeds of the Existing Notes issued by the Prior Issuer under the
Existing Shelf Agreement by virtue of (i) distributions made to it by the Prior Issuer and (ii)
investments made in the Prior Issuer for the benefit of the Company. The Prior Issuer and the
Company have advised Prudential and the Existing Holders that the Company wishes to assume the
obligations of the Prior Issuer under the Existing Shelf Agreement and the Existing Notes and amend
and restate the Existing Note Agreement as hereinafter provided. Subject to the terms and
conditions hereto, Prudential and the Existing Holders are willing to agree to this request of the
Company and the Prior Issuer.




     Accordingly, the parties hereto agree as follows:



          1. AUTHORIZATION OF ISSUE OF NOTES; AMENDMENT AND RESTATEMENT; ASSUMPTION.



          1A. Authorization of Issue of Series A Notes. The Company will authorize the issue of its
6.95% Senior Secured Notes, Series A, due June 1, 2010 (the “Series A Notes”), in the aggregate
principal amount of $30,000,000, to be dated the most recent date to which interest has been paid
on the Existing Series A Notes, to mature June 1, 2010, to bear interest on the unpaid balance
thereof from the date thereof until the principal thereof shall have become due and payable at the
rate of 6.95% per annum and on the occurrence and during the continuation of an Event of Default at
the rate specified therein, to be substantially in the form of Exhibit A-1 hereto and to be issued
upon exchange for the Existing Series A Notes. The term “Series A Notes” as used herein shall
include each Series A Note delivered pursuant to any provision of this Agreement and each Series A
Note delivered in substitution or exchange for such Series A Note pursuant to any such provision.



          1B. Authorization of Series B Notes. The Company will authorize the issue of its 6.88% Senior
Secured Notes, Series B, due July 1, 2010 (the “Series B Notes”), in the aggregate principal amount
of $10,000,000, to be dated the most recent date to which interest has been paid on the Existing
Series B Notes, to mature July 1, 2010, to bear interest on the unpaid balance thereof from the
date thereof until the principal thereof shall have become due and payable at the rate of 6.88% per
annum and on the occurrence and during the continuation of an Event of Default at the rate
specified therein, to be substantially in the form of Exhibit A-2 hereto and to be issued upon
exchange for the Existing Series B Notes. The term “Series B Notes” as used herein shall include
each Series B Note delivered pursuant to any provision of this Agreement and each Series B Note
delivered in substitution or exchange for any such Series B Note pursuant to any such provision.



          1C. Authorization of Series C Notes. The Company will authorize the issue of its 6.96% Senior
Secured Notes, Series C, due June 18, 2014 (the “Series C Notes”), in the aggregate principal
amount of $75,000,000, to be dated the most recent date to which interest has been paid on the
Existing Series C Notes, to mature June 18, 2014, to bear interest on the unpaid balance thereof
from the date thereof until the principal thereof shall become due and payable at the rate of 6.96%
per annum and on the occurrence and during the continuation of an Event of Default at the rate
specified therein, to be substantially in the form of Exhibit A-3 hereto and to



2









 





be issued upon exchange for the Existing Series C Notes. The term
“Series C Notes” as used herein shall include each Series C Note delivered pursuant to any
provision of this Agreement and each Series C Note delivered in substitution or exchange for any
such Series C Note pursuant to any such provision.




          1D. Authorization of Issue of Shelf Notes. The Company will authorize the issue of its senior
secured promissory notes (the “Shelf Notes”) in the aggregate principal amount of $10,000,000; to
be dated the date of issue thereof; to mature, in the case of each Shelf Note so issued, no more
than 10 years after the date of original issuance thereof; to have an average life, in the case of
each Shelf Note so issued, of no more than 8 years after the date of original issuance thereof; to
bear interest on the unpaid balance thereof from the date thereof at the rate per annum, and to
have such other particular terms, as shall be set forth in the Confirmation of Acceptance with
respect to such Note delivered pursuant to paragraph 2F; and to be substantially in the form of
Exhibit A-4 attached hereto. The term “Shelf Notes” as used herein shall include each
Shelf Note delivered pursuant to any provision of this Agreement and each Shelf Note delivered in
substitution or exchange for any such Shelf Note pursuant to any such provision. The term “Notes”
as used in this Agreement shall mean any Series A Note, any Series B Note, any Series C Note or any
Shelf Note. Notes which have (i) the same final maturity, (ii) the same principal prepayment
dates, (iii) the same principal prepayment amounts (as a percentage of the original principal
amount of each Note), (iv) the same interest rate, (v) the same interest payment periods, and (vi)
the same original date of issuance are herein called a “Series” of Notes. Capitalized terms used
herein have the meanings specified in paragraph 10.



          1E. Assumption and Amendment and Restatement of Existing Notes. The Company hereby
irrevocably, absolutely, unconditionally and expressly assumes (i) due and punctual payment of all
of the principal of, interest on, Yield-Maintenance Amount (if any) with respect to, and all other
payments due under or relating to the Existing Notes or the Existing Note Agreement. The Company
covenants that its debts, liabilities and obligations assumed pursuant to this paragraph 1E shall
be those of a primary obligor and not a guarantor, surety or secondary obligor.



          1F. Amendment and Restatement of Existing Notes and Existing Shelf Agreement and Issuance of
Notes. Subject to the terms and conditions herein set forth, the Company, the Prior Issuer,
Prudential and the Existing Holders agree that, effective on the Restatement Date, (i) the Existing
Series A Notes will be amended and restated in their entirety to be a like principal amount of
Series A Notes having the terms described in paragraph 1A hereof and to be in the form of Exhibit
A-1 hereto, the Existing Series B Notes will be amended and restated in their entirety to be a like
principal amount of Series B Notes having the terms described in paragraph 1B hereof and to be in
the form of Exhibit A-2 hereto, and the Existing Series C Notes will be amended and restated in
their entirety to be a like principal amount of Series C Notes having the terms described in
paragraph 1C hereof and to be in the form of Exhibit A-3 hereto, and (ii) the Existing Shelf
Agreement shall be amended and restated in its entirety to read as set forth in this Agreement. On
the Restatement Date, the Company will deliver to each Existing Holder, at the offices of Schiff
Hardin, LLP, 6600 Sears Tower, Chicago, Illinois 60606, one or more Notes, evidencing the aggregate
principal amount of the Existing Notes held by such Existing Holder being so amended and restated,
registered in the name of such Existing Holder and in the denominations specified in the Purchaser
Schedule



3









 





attached hereto. The Notes issued under this paragraph 1F are given in exchange and
substitution for, and not as payment of the indebtedness evidenced by, the Existing Notes being
amended and restated pursuant to this paragraph 1F, (ii) merely re-evidence the indebtedness
evidenced by the Existing Notes, and (iii) are not intended to constitute a novation or discharge
of the indebtedness evidenced by the Existing Notes. Any Note issued in exchange for any Existing
Notes shall carry the rights to unpaid interest which was carried on the Existing Note for which
such Note was issued in exchange, so that neither gain nor loss of interest shall result from any
such exchange.




          2. PURCHASE AND SALE OF SHELF NOTES.



          2A. Facility. Prudential is willing to consider, in its sole discretion and within limits
which may be authorized for purchase by Prudential Affiliates from time to time, the purchase of
Shelf Notes pursuant to this Agreement. The willingness of Prudential to consider such purchase of
Shelf Notes is herein called the “Facility”. At any time, the aggregate principal amount of Shelf
Notes stated in paragraph 1D, minus the aggregate principal amount of Shelf Notes purchased
and sold pursuant to this Agreement prior to such time, minus the aggregate principal
amount of Accepted Notes (as hereinafter defined) which have not yet been purchased and sold
hereunder prior to such time is herein called the “Available Facility Amount” at such time.
NOTWITHSTANDING THE WILLINGNESS OF PRUDENTIAL TO CONSIDER PURCHASES OF SHELF NOTES BY PRUDENTIAL
AFFILIATES, THIS AGREEMENT IS ENTERED INTO ON THE EXPRESS UNDERSTANDING THAT NEITHER PRUDENTIAL NOR
ANY PRUDENTIAL AFFILIATE SHALL BE OBLIGATED TO MAKE OR ACCEPT OFFERS TO PURCHASE SHELF NOTES, OR TO
QUOTE RATES, SPREADS OR OTHER TERMS WITH RESPECT TO SPECIFIC PURCHASES OF SHELF NOTES, AND THE
FACILITY SHALL IN NO WAY BE CONSTRUED AS A COMMITMENT BY PRUDENTIAL OR ANY PRUDENTIAL AFFILIATE.



          2B. Issuance Period. Shelf Notes may be issued and sold pursuant to this Agreement until the
earlier of (i) June 18, 2007 and (ii) the thirtieth day after Prudential shall have given to the
Company, or the Company shall have given to Prudential, written notice stating that it elects to
terminate the issuance and sale of Shelf Notes pursuant to this Agreement (or if such thirtieth day
is not a Business Day, the Business Day next preceding such thirtieth day). The period during
which Shelf Notes may be issued and sold pursuant to this Agreement is herein called the “Issuance
Period”.



          2C. Periodic Spread Information. Provided no Default or Event of Default exists, not later
than 9:30 A.M. (New York City local time) on a Business Day during the Issuance Period if there is
an Available Facility Amount on such Business Day, the Company may request by telecopier or
telephone, and Prudential will, to the extent reasonably practicable, provide to the Company on
such Business Day (or, if such request is received after 9:30 A.M. (New York City local time) on
such Business Day, on the following Business Day), information (by telecopier or telephone) with
respect to various spreads at which Prudential Affiliates might be interested in purchasing Shelf
Notes of different average lives; provided, however, that the Company may not make
such requests more frequently than once in every five Business Days or such other period as shall
be mutually agreed to by the Company and Prudential. The amount



4









 





and content of information so provided shall be in the sole discretion of Prudential but it is
the intent of Prudential to provide information which will be of use to the Company in determining
whether to initiate procedures for use of the Facility. Information so provided shall not
constitute an offer to purchase Shelf Notes, and neither Prudential nor any Prudential Affiliate
shall be obligated to purchase Shelf Notes at the spreads specified. Information so provided shall
be representative of potential interest only for the period commencing on the day such information
is provided and ending on the earlier of the fifth Business Day after such day and the first day
after such day on which further spread information is provided. Prudential may suspend or
terminate providing information pursuant to this paragraph 2C for any reason, including its
determination that the credit quality of the Company has declined since the date of this Agreement.




          2D. Request for Purchase. The Company may from time to time during the Issuance Period make
requests for purchases of Shelf Notes (each such request being a “Request for Purchase”). Each
Request for Purchase shall be made to Prudential by telecopier or overnight delivery service, and
shall, unless otherwise expressly accepted by Prudential, (i) specify the aggregate principal
amount of Shelf Notes covered thereby, which shall not be less than $10,000,000 and not be greater
than the Available Facility Amount at the time such Request for Purchase is made, (ii) specify the
principal amounts, final maturities, principal prepayment dates and amounts and interest payment
periods (quarterly or semi-annual in arrears) of the Shelf Notes covered thereby, (iii) specify the
use of proceeds of such Shelf Notes, (iv) specify the proposed day for the closing of the purchase
and sale of such Shelf Notes, which shall be a Business Day during the Issuance Period not less
than 10 days and not more than 25 days after the making of such Request for Purchase, (v) specify
the number of the account and the name and address of the depository institution to which the
purchase prices of such Shelf Notes are to be transferred on the Closing Day for such purchase and
sale, (vi) certify that the representations and warranties contained in paragraph 8 are true on and
as of the date of such Request for Purchase and that there exists on the date of such Request for
Purchase no Event of Default or Default, (vii) specify the Designated Spread for such Shelf Notes
and (viii) be substantially in the form of Exhibit B attached hereto. Each Request for
Purchase shall be in writing and shall be deemed made when received by Prudential.



          2E. Rate Quotes. Not later than five Business Days after the Company shall have given
Prudential a Request for Purchase pursuant to paragraph 2D, Prudential may, but shall be under no
obligation to, provide to the Company by telephone or telecopier, in each case between 9:30 A.M.
and 1:30 P.M. New York City local time (or such later time as Prudential may elect) interest rate
quotes for the several principal amounts, maturities, principal prepayment schedules, and interest
payment periods of Shelf Notes specified in such Request for Purchase. Each quote shall represent
the interest rate per annum payable on the outstanding principal balance of such Shelf Notes, at
which a Prudential Affiliate would be willing to purchase such Shelf Notes at 100% of the principal
amount thereof.



          2F. Acceptance. Within 30 minutes after Prudential shall have provided any interest rate
quotes pursuant to paragraph 2E or such other period as Prudential may specify to the Company (such
period being the “Acceptance Window”), the Company may, subject to paragraph 2G, elect to accept
such interest rate quotes as to not less than $10,000,000 aggregate principal amount of the Shelf
Notes specified in the related Request for Purchase. Such election



5









 





shall be made by an Authorized Officer of the Company notifying Prudential by
telephone or telecopier within the Acceptance Window that the Company elects to accept such
interest rate quotes, specifying the Notes (each such Shelf Note being an “Accepted Note”) as to
which such acceptance (an “Acceptance”) relates. The day the Company notifies an Acceptance with
respect to any Accepted Notes is herein called the “Acceptance Day” for such Accepted Notes. Any
interest rate quotes as to which Prudential does not receive an Acceptance within the Acceptance
Window shall expire, and no purchase or sale of Shelf Notes hereunder shall be made based on such
expired interest rate quotes. Subject to paragraph 2G and the other terms and conditions hereof,
the Company agrees to sell to a Prudential Affiliate, and Prudential agrees to cause the purchase
by a Prudential Affiliate of, the Accepted Notes at 100% of the principal amount of such Shelf
Notes. As soon as practicable following the Acceptance Day, the Company, Prudential and each
Prudential Affiliate which is to purchase any such Accepted Notes will execute a confirmation of
such Acceptance substantially in the form of Exhibit C attached hereto (a “Confirmation of
Acceptance”). If the Company should fail to execute and return to Prudential within two Business
Days following receipt thereof a Confirmation of Acceptance with respect to any Accepted Notes,
Prudential may at its election at any time prior to its receipt thereof cancel the closing with
respect to such Accepted Notes by so notifying the Company in writing.




          2G. Market Disruption. Notwithstanding the provisions of paragraph 2F, if Prudential shall
have provided interest rate quotes pursuant to paragraph 2E and thereafter prior to the time an
Acceptance with respect to such quotes shall have been notified to Prudential in accordance with
paragraph 2F the domestic market for U.S. Treasury securities or derivatives shall have closed or
there shall have occurred a general suspension, material limitation, or significant disruption of
trading in securities generally on the New York Stock Exchange or in the domestic market for U.S.
Treasury securities or derivatives, then such interest rate quotes shall expire, and no purchase or
sale of Shelf Notes hereunder shall be made based on such expired interest rate quotes. If the
Company thereafter notifies Prudential of the Acceptance of any such interest rate quotes, such
Acceptance shall be ineffective for all purposes of this Agreement, and Prudential shall promptly
notify the Company that the provisions of this paragraph 2G are applicable with respect to such
Acceptance.



          2H. Closing.



          2H(1). Shelf Note Closings. Not later than 11:30 A.M. (New York City local time) on the
Closing Day for any Accepted Notes, the Company will deliver to each Purchaser listed in the
Confirmation of Acceptance relating thereto at the offices of Schiff Hardin LLP, 6600 Sears Tower,
Chicago, Illinois 60606 the Accepted Notes to be purchased by such Purchaser in the form of one or
more Shelf Notes in authorized denominations as such Purchaser may request for each Series of
Accepted Notes to be purchased on the Closing Day, dated the Closing Day and registered in such
Purchaser’s name (or in the name of its nominee), against payment of the purchase price thereof by
transfer of immediately available funds for credit to the Company’s account specified in the
Request for Purchase of such Shelf Notes.



          2H(2). Rescheduled Closings If the Company fails to tender to any Purchaser the Accepted
Notes to be purchased by such Purchaser on the scheduled Closing Day for such Accepted Notes as
provided above in this paragraph 2H, or any of the conditions specified in



6









 






paragraph 3 shall not have been fulfilled by the time required on such scheduled Closing Day,
the Company shall, prior to 1:00 P.M., New York City local time, on such scheduled Closing Day
notify Prudential (which notification shall be deemed received by each Purchaser) in writing
whether (x) such closing is to be rescheduled (such rescheduled date to be a Business Day during
the Issuance Period not less than one Business Day and not more than 30 Business Days after such
scheduled Closing Day (the “Rescheduled Closing Day”) and certify to Prudential (which
certification shall be for the benefit of each Purchaser) that the Company reasonably believes that
it will be able to comply with the conditions set forth in paragraph 3 on such Rescheduled Closing
Day and that the Company will pay the Delayed Delivery Fee in accordance with paragraph 2I(2) or
(y) such closing is to be canceled as provided in paragraph 2I(3). In the event that the Company
shall fail to give such notice referred to in the preceding sentence, Prudential (on behalf of each
Purchaser) may at its election, at any time after 1:00 P.M., New York City local time, on such
scheduled Closing Day, notify the Company in writing that such closing is to be canceled as
provided in paragraph 2I(3). Notwithstanding anything to the contrary appearing in this Agreement,
the Company may elect to reschedule a closing with respect to any given Accepted Notes on not more
than one occasion, unless Prudential shall have otherwise consented in writing.




          2I. Fees.



          2I(1). Issuance Fee The Company will pay to each Purchaser in immediately available funds a
fee (the “Issuance Fee”) on each Closing Day in an amount equal to 0.25% of the aggregate principal
amount of Shelf Notes sold to such Purchaser on such Closing Day.



          2I(2). Delayed Delivery Fee If the closing of the purchase and sale of any Accepted Note is
delayed for any reason (other than if the Company has satisfied all of the conditions in paragraph
3 with respect to the purchase of such Accepted Notes and the Purchasers fail to purchase such
Accepted Notes) beyond the original Closing Day for such Accepted Note, the Company will pay to the
Purchaser of such Accepted Note on the Cancellation Date or actual closing date of such purchase
and sale a fee (the “Delayed Delivery Fee”) calculated as follows:



(BEY - MMY) X DTS/360 X PA




where “BEY” means Bond Equivalent Yield, i.e., the bond equivalent yield per annum of such Accepted
Note, “MMY” means Money Market Yield, i.e., the yield per annum on a commercial paper investment of
the highest quality selected by Prudential on the date Prudential receives notice of the delay in
the closing for such Accepted Note having a maturity date or dates the same as, or closest to, the
Rescheduled Closing Day or Rescheduled Closing Days (a new alternative investment being selected by
Prudential each time such closing is delayed); “DTS” means Days to Settlement, i.e., the number of
actual days elapsed from and including the original Closing Day with respect to such Accepted Note
to but excluding the date of such payment; and “PA” means Principal Amount, i.e., the principal
amount of the Accepted Note for which such calculation is being made. In no case shall the Delayed
Delivery Fee be less than zero. Nothing contained herein shall obligate any Purchaser to purchase
any Accepted Note on any day other than the Closing Day for such Accepted Note, as the same may be
rescheduled from time to time in compliance with paragraph 2H.




7









 








          2I(3). Cancellation Fee If the Company at any time notifies Prudential in writing that the
Company is canceling the closing of the purchase and sale of any Accepted Note, or if Prudential
notifies the Company in writing under the circumstances set forth in the penultimate sentence of
paragraph 2H(2) that the closing of the purchase and sale of such Accepted Note is to be canceled,
or if the closing of the purchase and sale of such Accepted Note is not consummated on or prior to
the last day of the Issuance Period (the date of any such notification, or the last day of the
Issuance Period, as the case may be, being the “Cancellation Date”), the Company will pay the
Purchasers in immediately available funds an amount (the “Cancellation Fee”) calculated as follows:



PI X PA




where “PI” means Price Increase, i.e., the quotient (expressed in decimals) obtained by dividing
(a) the excess of the ask price (as determined by Prudential) of the Hedge Treasury Note(s) on the
Cancellation Date over the bid price (as determined by Prudential) of the Hedge Treasury Notes(s)
on the Acceptance Day for such Accepted Note by (b) such bid price; and “PA” has the meaning
specified in paragraph 2I(2). The foregoing bid and ask prices shall be as reported by TradeWeb
LLC (or, if such data for any reason ceases to be available through TradeWeb LLC, any publicly
available source of similar market data). Each price shall be rounded to the second decimal place.
In no case shall the Cancellation Fee be less than zero.




          3. CONDITIONS OF AMENDMENT AND RESTATEMENT AND CLOSING. The effectiveness of the amendment
and restatement of the Existing Notes and the Existing Shelf Agreement pursuant to paragraph 1F
hereof is subject to the satisfaction, on the Restatement Date, of, and the obligation of any
Purchaser to purchase and pay for any Shelf Notes is subject to the satisfaction, on or before the
Closing Day for such Shelf Notes, of the following conditions:



          3A. Certain Documents. Such Purchaser shall have received the following, each dated the date
of the Restatement Date or applicable Closing Day, as the case may be, unless otherwise specified:




     (i) The Notes to be issued to such Purchaser pursuant to paragraph 1F hereof or the
Shelf Note(s) to be purchased by such Purchaser, as the case may be.




     (ii) A certificate of the Secretary or an Assistant Secretary of the Ultimate General
Partner certifying (A) the existence of the Company and the General Partner, (B) the Company
Partnership Agreement, (C) the General Partner’s organizational documents, (D) the Ultimate
General Partner’s organizational documents, (E) the resolutions of the Ultimate General
Partner approving this Agreement, the Notes, and the other Loan Documents and the related
transactions, and (F) all documents evidencing other necessary corporate, partnership or
limited liability company action and governmental approvals, if any, with respect to this
Agreement, the Notes, and the other Loan Documents executed and delivered on or before the
Restatement Date or such Closing Day, as the case may be (provided, that for any
Closing Day occurring after the Restatement Date, the Ultimate General Partner may certify
that there has been no change to any applicable authorization or approval since the date on
which it was most recently



8









 






     delivered to such Purchaser under this clause (ii) as an alternative to the further
delivery thereof).




     (iii) A certificate of the Secretary or an Assistant Secretary of the Ultimate General
Partner certifying the names and true signatures of the officers of the Ultimate General
Partner authorized to sign this Agreement, the Notes, the other Loan Documents and the other
documents to be delivered hereunder on behalf of the Company (provided, that for any
Closing Day occurring after the Restatement Date, the Secretary or an Assistant Secretary
and one other officer of the Ultimate General Partner may certify that there has been no
change to the officers of the Ultimate General Partner authorized to sign on behalf of the
Company Accepted Notes and other documents to be delivered therewith since the date on which
a certificate setting forth the names and true signatures of such officers, as described
above, was most recently delivered to such Purchaser under this clause (iii), as an
alternative to the further delivery thereof).




     (iv) Certificates of the Secretary or an Assistant Secretary of each of the Guarantors
certifying (A) the organizational documents of such Guarantor, (B) the resolutions of the
governing body of such Guarantor approving this Agreement, the Guaranty, and the other Loan
Documents to which such Guarantor is a party and the related transactions, and (C) all other
documents evidencing other necessary corporate, partnership or limited liability company
action and governmental approvals, if any, with respect to this Agreement, the Guaranty, and
the other Loan Documents to which such Guarantor is a party executed and delivered on or
before the Restatement Date or such Closing Day, as the case may be (provided, that
for any Closing Day occurring after the Restatement Date, such Guarantor may certify that
there has been no change to any applicable authorization or approval since the date on which
it was most recently delivered to such Purchaser under this clause (ii) as an alternative to
the further delivery thereof).




     (v) Certificates of the Secretary or an Assistant Secretary of each Guarantor
certifying the names and true signatures of the officers of such Guarantor authorized to
sign the Guaranty, the other Loan Documents to which such Guarantor is a party and the other
documents to be delivered hereunder on behalf of such Guarantor (provided, that for
any Closing Day occurring after the Restatement Date, the Secretary or an Assistant
Secretary and one other officer of such Guarantor may certify that there has been no change
to the officers of such Guarantor authorized to sign any other documents to be delivered on
such Closing Day since the date on which a certificate setting forth the names and true
signatures of such officers, as described above, was most recently delivered to such
Purchaser under this clause (v), as an alternative to the further delivery thereof).




     (vi) A favorable opinion of Baker Botts L.L.P., special counsel to the Company and the
Guarantors (or such other counsel designated by the Company and acceptable to the
Purchaser(s)) satisfactory to such Purchaser and substantially in the form of Exhibit
D-1 attached hereto, and a favorable opinion of Taylor, Porter, Brooks & Phillips,
special Louisiana counsel to the Company and the Guarantors (or such other counsel
designated by the Company and acceptable to the Purchaser(s)) satisfactory to



9









 






such Purchaser and substantially in the form of Exhibit D-2 hereto, and, in
either case, as to such other matters as such Purchaser may reasonably request. The Company
hereby directs such counsel to deliver such opinion, agrees that the issuance and sale of
any Notes will constitute a reconfirmation of such direction, and understands and agrees
that each Purchaser receiving such opinions will be and is hereby authorized to rely on such
opinions.




     (vii) Certificates of good standing, existence and authority for the Company, the
General Partner, the Ultimate General Partner and each of the Guarantors from each of the
states in which the Company, the General Partner, the Ultimate General Partner and each of
the Guarantors is either organized or is qualified to do business as a foreign entity.




     (viii) Solely with respect to the Restatement Date, results of searches of the UCC
Records of the Secretary of State of Delaware and the Secretary of State and applicable
counties of the States of Texas, Alabama, Delaware, Louisiana, Mississippi, New Mexico and
Oklahoma and, in the case of the searches of the UCC Records, reflecting no Liens against
any of the Collateral as to which perfection of a Lien is accomplished by the filing of a
financing statement other than Liens in favor of the Collateral Agent for the benefit of the
Holders and the Banks and Liens permitted by paragraph 6C(1).




     (ix) The Guaranties duly executed by all parties thereto.




     (x) The Intercreditor Agreement duly executed by the Collateral Agent, the Banks, the
Purchasers other than Prudential, the Company and the Guarantors.




     (xi) The Security Agreements duly executed by all parties thereto.




     (xii) Amendments to each of the existing Mortgages in form and substance satisfactory
to the Purchasers.




     (xiii) Appropriate UCC-1 or UCC-3 Financing Statements, naming the Collateral Agent as
the secured party and covering the Collateral, for filing with the appropriate authorities.




     (xiv) Solely with respect to the Restatement Date, certificate(s) of insurance naming
the Collateral Agent as loss payee or additional insured evidencing insurance which meets
the requirements of this Agreement and the Security Documents and which is in amount, form
and substance and from an issuer satisfactory to the Required Holders.




     (xv) Solely with respect to the Restatement Date, a certified copy of the Bank
Agreement in form and substance satisfactory to the Purchasers.




     (xvi) Additional documents or certificates with respect to legal matters or corporate
or other proceedings related to the transactions contemplated hereby as may be reasonably
requested by such Purchaser.



10









 






     (xvii) With respect to any Closing Day, written instructions of the Company in the form
of Exhibit E attached hereto.




     (xviii) Solely with respect to the Restatement Date, a certificate dated as of the
Restatement Date from the Chief Financial Officer of the Company as to the Solvency of the
Company and its Subsidiaries on a consolidated basis.




     (xix) The most recently completed annual (or other audited) financial statements of the
Company and its Subsidiaries, interim financial statements of the Company and its
Subsidiaries dated the end of the most recent fiscal quarter for which financial statements
are available and financial projections of the Company and its Subsidiaries covering a
period at least equal to the greater of (a) the period covered by any similar projections
delivered under the Bank Agreement, or (b) 3 years and incorporating the Notes provided for
herein.



          3B. Opinion of Purchaser’s Special Counsel. Such Purchaser shall have received from Schiff
Hardin LLP, who is acting as special counsel for it in connection with this transaction, a
favorable opinion satisfactory to such Purchaser as to such matters incident to the matters herein
contemplated as it may reasonably request.



          3C. Representations and Warranties; No Default. The representations and warranties contained
in paragraph 8 hereof and in the other Loan Documents shall be true on and as of the Restatement
Date or such Closing Day, as the case may be, except to the extent of changes caused by the
transactions herein contemplated; there shall exist on the Restatement Date or such Closing Day, as
the case may be, no Event of Default or Default; and the Company shall have delivered to such
Purchaser an Officer’s Certificate, dated the Restatement Date or such Closing Day, as the case may
be, to both such effects.



          3D. Purchase Permitted by Applicable Laws. The exchange for or purchase of and payment for,
as the case may be, the Notes to be issued to or purchased by such Purchaser on the terms and
conditions herein provided (including the use of the proceeds of such Notes by the Company) shall
not violate any applicable law or governmental regulation (including, without limitation, Section 5
of the Securities Act or Regulation T, U or X of the Board of Governors of the Federal Reserve
System) and shall not subject such Purchaser to any tax, penalty, liability or other onerous
condition under or pursuant to any applicable law or governmental regulation, and such Purchaser
shall have received such certificates or other evidence as it may request to establish compliance
with this condition.



          3E. Legal Matters. Counsel for such Purchaser, including any special counsel for the
Purchasers retained in connection with the purchase and sale of such Accepted Notes, shall be
satisfied as to all legal matters relating to such purchase and sale, and such Purchaser shall have
received from such counsel favorable opinions as to such legal matters as it may request.



          3F. Payment of Fees. The Company shall have paid to the Purchasers and Prudential any fees
due them pursuant to or in connection with this Agreement, including any Issuance Fee due pursuant
to paragraph 2I(1) and any Delayed Delivery Fee due
pursuant to



11









 





paragraph 2I(2). In addition, all other fees which are due and payable on or
before the Restatement Date or any Closing Day, as the case may be, shall have been paid, and
without limiting the provisions of paragraph 11B, special counsel to the Purchasers shall have
received its fees, charges and disbursements to the extent reflected in a statement of such special
counsel rendered to the Company at least one Business Day prior to such Closing Day, as the case
may be.




          3G. Proceedings. All corporate and other proceedings taken or to be taken in connection with
the transactions contemplated hereby and all documents incident thereto shall be satisfactory in
substance and form to such Purchaser, and it shall have received all such counterpart originals or
certified or other copies of such documents as it may reasonably request.



          3H. Private Placement Numbers. Private Placement numbers issued by Standard & Poor’s CUSIP
Service Bureau (in cooperation with the Securities Valuation Office of the National Association of
Insurance Commissioners) shall have been obtained for the Notes.



          3I. Title. Prudential shall be satisfied in its reasonable discretion as to the status of the
Company’s or a Guarantor’s, as applicable, title to the Company’s and its Subsidiaries’ Properties.



          3J. Collateral Agent’s Liens. Prudential shall have received satisfactory evidence that the
Liens granted to the Collateral Agent under the Security Documents are Acceptable Security
Interests and that all actions or filings necessary to protect, preserve and validly perfect such
Liens have been made, taken or obtained, as the case may be, and are in full force and effect.



          3K. Encumbrance of Real Property Interests. Prudential shall be satisfied that the Security
Documents encumber substantially all of such real property interests held by the Company and its
Subsidiaries as the Collateral Agent may require.



          3L. Corporate Structure. The corporate and capital structure of the Company shall be
reasonably satisfactory to such Purchaser.



          4. PREPAYMENTS. The Notes shall be subject to prepayment with respect to any required
prepayments set forth in such Notes as provided in paragraphs 4A and 4F and with respect to the
optional prepayments permitted by paragraph 4B. Any prepayment made by the Company pursuant to any
other provision of this paragraph 4 shall not reduce or otherwise affect its obligation to make any
required prepayment as specified in paragraph 4A.



          4A. Required Prepayments. The Notes of each Series shall be subject to required prepayments,
if any, set forth in the Notes of such Series.



          4B. Optional Prepayment With Yield-Maintenance Amount. The Notes shall be subject to
prepayment, in whole at any time or from time to time in part (in integral multiples of $1,000,000
and in a minimum amount of $100,000), at the option of the Company, at 100% of the principal amount so prepaid plus interest thereon to the prepayment
date and the Yield-Maintenance Amount, if any, with respect to each such Note. Any partial
prepayment of



12









 





Notes pursuant to this paragraph 4B shall be applied in satisfaction of required
payments of principal of the Notes in inverse order of their scheduled due dates.




          4C. Notice of Optional Prepayment. The Company shall give the Holder of each Note to be
prepaid pursuant to paragraph 4B irrevocable written notice of such prepayment not less than 10
Business Days prior to the prepayment date, specifying such prepayment date, specifying the
aggregate principal amount of the Notes to be prepaid on such date, identifying each Note held by
such Holder, and the principal amount of each such Note, to be prepaid on such date and stating
that such prepayment is to be made pursuant to paragraph 4B. Notice of prepayment having been
given as aforesaid, the principal amount of the Notes specified in such notice, together with
interest thereon to the prepayment date and together with the Yield-Maintenance Amount, if any,
herein provided, shall become due and payable on such prepayment date. The Company shall, on or
before the day on which it gives written notice of any prepayment pursuant to paragraph 4A, give
telephonic notice of the principal amount of the Notes to be prepaid and the prepayment date to
each Holder which shall have designated a recipient for such notices in the Purchaser
Schedule attached hereto or by notice in writing to the Company.



          4D. Application of Prepayments. Upon any partial prepayment of the Notes of any Series
pursuant to paragraph 4A, the amount so prepaid shall be allocated to all outstanding Notes of such
Series (including, for the purpose of this paragraph 4D only, all Notes prepaid or otherwise
retired or purchased or otherwise acquired by the Company or any of its Subsidiaries or Affiliates
other than by prepayment pursuant to paragraph 4A, 4B or 4F) in proportion to the respective
outstanding principal amounts thereof. Upon any partial prepayment of the Notes pursuant to
paragraph 4B, the amount to be prepaid shall be applied pro rata to all outstanding Notes of all
Series according to the respective unpaid principal amounts thereof.



          4E. Retirement of Notes. The Company shall not, and shall not permit any of its Subsidiaries
or Affiliates to, prepay or otherwise retire in whole or in part prior to their stated installment
or final maturities (other than by prepayment pursuant to paragraphs 4A, 4B or 4F upon acceleration
of such final maturity pursuant to paragraph 7A), or purchase or otherwise acquire, directly or
indirectly, Notes held by any Holder.



          4F. Offer to Prepay Notes in the Event of Asset Dispositions and Debt Issuance.



          (i) Notice of Offer to Prepay Notes. The Company will, at least 15 days prior to (a)
the receipt by the Company or any of its Subsidiaries of Net Cash Proceeds from any Asset
Disposition in excess of $20,000,000 or any Recovery Event in excess of $20,000,000 (except (1) to
the extent a Reinvestment Notice shall be delivered in respect of such Asset Disposition or
Recovery Event and (2) cash receipts in the ordinary course of business of the applicable
recipient), (b) each Reinvestment Prepayment Date, and (c) the receipt by the Company or any of its
Subsidiaries of any Net Cash Proceeds from the issuance or incurrence of any Debt for borrowed
money (excluding any Debt incurred in accordance with paragraph 6C(2)), give written notice thereof
to each Holder. Such notice shall contain and constitute an offer to prepay the Notes as described in paragraph 4F(iii) and shall be accompanied by the
certificate described in paragraph 4F(vi). For purposes of calculating whether the Net Cash



13









 





Proceeds received from an Asset Disposition exceed $20,000,000 or from a Recovery Event exceed
$20,000,000, such proceeds shall be determined as of the date of the applicable Asset Disposition
or Recovery Event, whether or not received on such date, but no such amount shall be required to be
applied to prepayment of the Notes pursuant to this paragraph 4F until received by the applicable
Person. The provisions of this paragraph 4F do not constitute a consent to the consummation of any
Asset Disposition not permitted by paragraph 6C(5) or a consent to the issuance or incurrence of
any Debt by the Company or any of its Subsidiaries not otherwise permitted hereunder.




          (ii) Notice of Acceptance of Offer under Paragraph 4F(i). If the Company shall at any
time receive an acceptance to an offer to prepay Notes under paragraph 4F(i) from some, but not
all, of the Holders, then the Company will, within two Business Days after the receipt of such
acceptance, give written notice of such acceptance to each other Holder which has notified the
Company that it requests to receive notices under this paragraph 4F(ii).



          (iii) Offer to Prepay Notes. The offer to prepay Notes contemplated by paragraph
4F(i) shall be an offer to prepay, in accordance with and subject to this paragraph 4F, on the date
the Company or any Subsidiary shall receive any Net Cash Proceeds (in the case of an offer to
prepay given as a result of clauses (a) or (c) of paragraph 4F(i)) or on the Reinvestment
Prepayment Date (in the case of an offer to prepay given as a result of clause (b) of paragraph
4F(i)) (the “Proposed Prepayment Date”), a principal amount of the Notes held by each Holder (in
this case only, “Holder” in respect of any Note registered in the name of a nominee for a disclosed
beneficial owner shall mean such beneficial owner) that is equal to the product of (x) the amount
of the Net Cash Proceeds described in clauses (a) or (c) of paragraph 4F(i) (in the case of an
offer to prepay given as a result of such clauses) or the Reinvestment Prepayment Amount with
respect to the Reinvestment Event relating to the Reinvestment Prepayment Date (in the case of an
offer to prepay even as a result of clause (b) of paragraph 4F(i)) and (y) a fraction, the
numerator of which is the outstanding principal amount of Notes held by such Holder on such
Proposed Prepayment Date and the denominator of which is the sum of the outstanding principal
amount of all Bank Obligations on such Proposed Prepayment Date plus the sum of the outstanding
principal amount of all Notes on such Proposed Prepayment Date.



          (iv) Rejection; Acceptance. A Holder may accept the offer to prepay made pursuant to
paragraph 4F(i) by causing a notice of such acceptance to be delivered to the Company prior to the
Proposed Prepayment Date. A failure by a Holder to so respond to an offer to prepay made pursuant
to this paragraph 4F prior to the Proposed Prepayment Date shall be deemed to constitute a
rejection of such offer by such Holder.



          (v) Prepayment. Prepayment of the Notes to be prepaid pursuant to this paragraph 4F
shall be at 100% of the principal amount so prepaid, together with interest on such Notes accrued
to the date of prepayment and, (i) with respect to a prepayment as a result of an Asset Disposition
or a Recovery Event, to the extent that the aggregate principal amount of the Notes prepaid
pursuant to this paragraph 4F as a result of all Asset Dispositions or Recovery Events would exceed
$20,000,000, the Yield-Maintenance Amount, if any, with respect to the principal amount of the Notes being prepaid, to the extent the principal amount of the Notes
being prepaid, together with the aggregate principal amount of Notes previously prepaid



14









 





pursuant to this paragraph 4F as a result of Asset Dispositions or Recovery Events, would exceed $20,000,000
and (ii) with respect to a prepayment as a result of the issuance or incurrence of any Debt for
borrowed money, the Yield maintenance Amount, if any, with respect to each such Note. The
prepayment shall be made on the Proposed Prepayment Date. The principal amount of any Note prepaid
pursuant to this paragraph 4F shall be applied and reduce the required prepayments of such Note
referred to in paragraph 4A hereof in the inverse order of their scheduled due dates.




          (vi) Officer’s Certificate. Each offer to prepay the Notes pursuant to this paragraph
4F shall be accompanied by a certificate, executed by a Responsible Officer of the Company and
dated the date of such offer, specifying (i) the Proposed Prepayment Date, (ii) the date that such
offer is made pursuant to this paragraph 4F, (iii) the principal amount of each Note offered to be
prepaid, (iv) the interest and the Yield-Maintenance Amount, if any, that would be due on each Note
offered to be prepaid, (v) that the conditions of this paragraph 4F have been fulfilled, and (vi)
in reasonable detail, a description of the event giving rise to such offer to prepay and the
details of the calculation of the amount of the Notes offered to be prepaid.



          5. AFFIRMATIVE COVENANTS. During the Issuance Period and so long thereafter as any Note or
any amount under any Loan Document shall remain unpaid, the Company agrees to comply with the
following covenants.



          5A. Reporting Requirements. The Company will furnish to each Holder:




     (i) Quarterly Financials. As soon as available and in any event within 45 days
after the end of each of the first three fiscal quarters of each fiscal year of the Company,
an unaudited Consolidated balance sheet of the Company and its Subsidiaries as of the end of
such quarter and unaudited Consolidated statements of operations, changes in partners’
capital and cash flows of the Company and its Subsidiaries for the period commencing at the
end of the preceding fiscal year and ending with the end of such quarter, setting forth in
each case in comparative form the corresponding figures for the corresponding period of the
preceding fiscal year, all in reasonable detail and duly certified (subject to normal
year-end audit adjustments and the absence of footnotes) by the chief financial officer,
chief accounting officer or vice president finance of the Ultimate General Partner as having
been prepared in accordance with GAAP, together with (i) a certificate of said officer
stating that no Default or Event of Default has occurred and is continuing or, if a Default
or Event of Default has occurred and is continuing, a statement as to the nature thereof and
the action that the Company proposes to take with respect thereto and (ii) a schedule in
reasonable detail showing the computations used by such officer in determining, as of the
end of such fiscal quarter, compliance with the covenants contained in paragraphs 6A(2) and
6A(3);




     (ii) Audited Annual Financials. As soon as available and in any event within
90 days after the end of each fiscal year of the Company, audited Consolidated balance
sheets of the Company and its Subsidiaries as of the end of such fiscal year and audited
Consolidated statements of operations, changes in partners’ capital and cash flows of
the Company and its Subsidiaries for such fiscal year, in each case certified without
qualification by KPMG LLP or other independent public accountants of recognized



15









 






national
standing acceptable to the Required Holders, together with (a) a certificate of the chief
financial officer, chief accounting officer or vice president finance of the Ultimate
General Partner stating that no Default or Event of Default has occurred and is continuing
or, if a Default or Event of Default has occurred and is continuing, a statement as to the
nature thereof and the action the Company proposes to take with respect thereto, (b) a
schedule in reasonable detail showing computations used by such chief financial officer,
chief accounting officer or vice president finance of the Ultimate General Partner in
determining, as of the end of such fiscal year, compliance with the covenants contained in
paragraphs 6A(2) and 6A(3), and (b) copies of any material accountant’s letters received by
management in connection with such accounting firm’s findings during its audit of the
financial records of the Company during, or in respect of, such fiscal year;




     (iii) Defaults. Forthwith, but in any event within five Business Days,
following the occurrence of any Default or Event of Default, a certificate of a Responsible
Officer setting forth the details thereof and the action that the Company is taking or
proposes to take with respect thereto;




     (iv) Litigation. Promptly after any Responsible Officer becoming aware of the
assertion or occurrence thereof, notice of any litigation, judicial reference proceeding,
arbitration proceeding or regulatory proceeding affecting the Company or any Subsidiary or
the property of the Company or any Subsidiary, other than any such litigation or proceeding
that, if adversely determined, could not reasonably be expected to have a Material Adverse
Effect;




     (v) Environmental Proceedings. Promptly after the assertion or occurrence
thereof or any Responsible Officer becoming aware of the reasonable likelihood thereof,
notice of any Environmental Proceeding against the Company or any Subsidiary, or of any
noncompliance by the Company or any Subsidiary with any Environmental Law or Environmental
Permit, that could reasonably be expected to have a Material Adverse Effect;




     (vi) SEC Filings. Promptly after the same are available, copies of each annual
report, proxy or financial statement or other report or communication sent to the
stockholders of the Company, and copies of all annual, regular, periodic and special reports
and registration statements which the Company may file or be required to file with the SEC
under Section 13 or 15(d) of the Securities Exchange Act of 1934, and not otherwise required
to be delivered to the Holders pursuant hereto;




     (vii) Other Debt. Promptly after the furnishing thereof, copies of any
statement or report furnished to any holder of debt securities of the Company or any
Subsidiary thereof pursuant to the terms of any indenture, loan or credit or similar
agreement and not otherwise required to be furnished to the Holders pursuant to any other
clause of this paragraph 5A; and




     (viii) SEC Investigation. Promptly, and in any event within five Business Days
after receipt thereof by the Company or any Subsidiary thereof, copies of each notice or
other correspondence received from the SEC (or comparable agency in any



16









 






applicable non-U.S.
jurisdiction) concerning any investigation or possible investigation or other inquiry by
such agency regarding financial or other operational results of the Company or any
Subsidiary thereof;




     (ix) ERISA Event. Promptly after the assertion or occurrence thereof or any
Responsible Officer becoming aware of the reasonable likelihood thereof, notice of the
occurrence of any ERISA Event;




     (x) Changes in Reporting Practices. Promptly after the assertion or occurrence
thereof or any Responsible Officer becoming aware of the reasonable likelihood thereof,
notice of any material change in accounting policies or financial reporting practices by the
Company or any Subsidiary; and




     (xi) Other Information. Promptly upon request, such additional information
regarding the financial position or business (including with respect to environmental
matters) of the Company or any Subsidiary as any Holder may reasonably request from time to
time.



          If the certificate containing any computations referred to in clauses (i) or (ii) includes Pro
Forma EBITDA with respect to the construction of any Property, such certificate shall also certify
as to (1) with respect to the first inclusion of Pro Forma EBITDA with respect to the construction
of any Property, the Scheduled Completion Date of such construction and (2) thereafter, the
Company’s current good faith estimate of the date upon which such construction will be completed.



          5B. Information Required by Rule 144A. The Company will, upon the request of any Holder,
provide such Holder, and any qualified institutional buyer designated by such Holder, such
financial and other information as such Holder may reasonably determine to be necessary in order to
permit compliance with the information requirements of Rule 144A under the Securities Act in
connection with the resale of Notes, except at such times as the Company is subject to and in
compliance with the reporting requirements of section 13 or 15(d) of the Exchange Act. For the
purpose of this paragraph 5B, the term “qualified institutional buyer” shall have the meaning
specified in Rule 144A under the Securities Act.



          5C. Visitation Rights. At any reasonable time and from time to time, upon reasonable notice
by the Holder concerned, the Company will permit, and cause each Subsidiary to permit, any Holder,
and any agents or representatives thereof, to examine and make copies of and abstracts from the
records and books of account of, and visit the properties of, the Company and its Subsidiaries and
to discuss the affairs, finances and accounts of the Company and its Subsidiaries with any of their
respective officers or directors (or equivalent persons) or, provided the Company has been
given reasonable opportunity to be present, with their independent certified public accountants;
provided, however, that, unless a Default or Event of Default has occurred and is
continuing, the Holders’ visitation rights shall be limited to not more than two occasions in any
calendar year.



          5D. Covenant to Secure Notes Equally. The Company will, if it or any Subsidiary shall create
or assume any Lien upon any of its property or assets, whether now



17









 





owned or hereafter acquired,
other than Liens permitted by the provisions of paragraph 6C(1) (unless prior written consent to
the creation or assumption thereof shall have been obtained pursuant to paragraph 11C), make or
cause to be made effective provision whereby the Notes will be secured by such Lien equally and
ratably with any and all other Debt thereby secured so long as any such other Debt shall be so
secured.




          5E. Preservation of Legal Existence, Etc. The Company will preserve and maintain, and cause
each Subsidiary to preserve and maintain, its legal existence, rights (charter and statutory) and
franchises, except as otherwise permitted by paragraph 6C(4); provided, however, that neither the
Company nor any Subsidiary shall be required to preserve any such right or franchise if the general
partner, board of directors or equivalent body of the Company or such Subsidiary determines that
the preservation thereof is no longer desirable in the conduct of the business of the Company or
such Subsidiary, as applicable, and if the loss thereof is not disadvantageous in any material
respect to the Holders.



          5F. Maintenance of Properties, Etc. Except as otherwise permitted by paragraph 6C(5), the
Company will maintain and preserve, and cause each Subsidiary to maintain and preserve, all of its
material properties that are necessary for the conduct of its business in good working order and
condition, ordinary wear and tear excepted.



          5G. Compliance with Laws, Etc. The Company will comply, and cause each Subsidiary to comply,
with all Governmental Rules the noncompliance with which could reasonably be expected to have a
Material Adverse Effect.



          5H. Payment of Taxes, Etc. The Company will pay and discharge, and cause each Subsidiary to
pay and discharge, before the same become delinquent, (a) all federal, state and other material
taxes, assessments and governmental charges or levies imposed upon or against it or its property
and (b) all material lawful claims that, if unpaid, might by law become a Lien upon its property;
provided, however, that neither the Company nor any Subsidiary shall be required to pay or
discharge any such tax, assessment, charge, levy or claim that is being contested in good faith
and, in the case of any such tax, assessment, charge or levy, by proper proceedings and as to
which, in all such cases, it is maintaining appropriate reserves in accordance with GAAP.



          5I. Maintenance of Insurance. The Company will maintain, and cause each Subsidiary to
maintain, insurance with responsible and reputable insurance companies or associations in such
amounts and covering such risks (a) as is usually carried by companies engaged in similar
businesses and owning similar properties in the same general areas in which the Company or such
Subsidiary, as applicable, operates and (b) as is reasonably acceptable to the Required Holders.



          5J. Keeping of Books. The Company will keep, and cause each Subsidiary to keep, proper books
of record and account in which full and correct entries shall be made of all financial transactions
and the Properties and business of the Company and each Subsidiary, in accordance with GAAP
consistently applied.



18









 






          5K. Transactions with Affiliates. The Company will conduct, and cause each Subsidiary to
conduct, all transactions otherwise permitted under the Loan Documents with any of its Affiliates
(other than the Company or a Guarantor) on terms that are fair and reasonable and no less favorable
to the Company or such Subsidiary than it would obtain in a comparable arms’ length transaction
with a Person not an Affiliate.




          5L. Compliance with Environmental Laws. The Company will (i) comply, and cause each
Subsidiary to comply, with all applicable Environmental Laws and Environmental Permits, except in
such instances in which (a) such requirement of law or order, writ, injunction or decree is being
contested in good faith by the appropriate proceedings diligently conducted, if such contest could
reasonably be expected to cause such non-compliance to not have a Material Adverse Effect or (b)
the failure to comply therewith could not reasonably be expected to have a Material Adverse Effect,
(ii) obtain and renew, and cause each Subsidiary to obtain and renew, when needed all material
Environmental Permits necessary for its operations and properties that, if not obtained and
renewed, could reasonably be expected to have a Material Adverse Effect, (iii) conduct, and cause
each Subsidiary to conduct, any necessary investigation, study, sampling and testing at properties
currently owned and operated by the Company or any Subsidiary in accordance with the requirements
of all applicable Environmental Laws and (iv) undertake, and cause each Subsidiary to undertake,
any cleanup, removal, remedial and other action necessary to remove and clean up all Hazardous
Materials from any of its currently owned or operated properties, in accordance with the material
requirements of all applicable Environmental Laws, the noncompliance with which could reasonably be
expected to have a Material Adverse Effect.




          5M. Environmental Remediation and Indemnification. If at any time any Hazardous Material is
discovered on, under or about any Mortgaged Property or any other property owned or operated by the
Company or any Subsidiary (“Other Property”) and failure to remediate the same would cause the
Company or any Subsidiary to be in violation of any Environmental Law that could reasonably be
expected to have a Material Adverse Effect, the Company will inform the Holders of the same and of
the Company’s proposed remediation program, and the Company or such Subsidiary will, at no cost and
expense to the Collateral Agent or the Holders, and only to the extent of any legal requirement
under applicable Environmental Laws for the Company or such Subsidiary to do so, remediate or
remove such Hazardous Materials from such Mortgaged Property or Other Property or the groundwater
underlying such Mortgaged Property or Other Property in accordance with (i) such remediation
program as a prudent operator would undertake, (ii) the approval of the appropriate Governmental
Persons, if any such approval is required under the applicable Environmental Laws, and (iii) all
applicable Environmental Laws the noncompliance with which could reasonably be expected to have a
Material Adverse Effect. The Company and any Subsidiary shall have the right to contest any notice
or directive by any appropriate Governmental Person to remediate or remove Hazardous Materials from
any Mortgaged Property or Other Property so long as the Company or such Subsidiary diligently
prosecutes such contest to completion and complies with any final order or determination. The
Company shall be solely responsible for, and will indemnify and hold harmless the Collateral Agent
and the Holders and their respective directors, officers, employees, agents, successors and assigns
from and against, any and all losses, damages, demands, claims, causes of action, judgments,
actions, assessments, penalties, costs, expenses and liabilities to the extent that they directly
or indirectly arise out of or are




19









 








attributable to the release of any Hazardous Materials at any Mortgaged Property or Other
Property, including the following: (a) all foreseeable and unforeseeable consequential damages; (b)
the costs of any repair, cleanup or detoxification of any Mortgaged Property or Other Property
required by any applicable Environmental Laws, and the preparation and implementation of any
closure, remedial or other plans required by any applicable Environmental Laws; and (c) all
reasonable costs and expenses incurred by the Collateral Agent or any Holder in connection with
clauses (a) and (b) above, including reasonable attorneys’ fees; provided, however,
that the Company shall not be liable for any of the foregoing if a final, nonappealable judgment by
a court of competent jurisdiction finds that such release of Hazardous Materials resulted from the
gross negligence or willful misconduct of the Collateral Agent or a Holder. The indemnities
provided in this paragraph 5M shall survive the repayment or any other satisfaction of the
Obligations of the Company under the Loan Documents.




          5N. Maintenance of Credit Facility. The Company will at all times maintain a committed
revolving credit facility in an amount of not less than $20,000,000 with a remaining term of at
least 6 months.




          5O. Additional Covenants and Additional Defaults. If the Company or any Subsidiary enters
into, assumes or otherwise becomes bound or obligated under any agreement (including amendments of
the Bank Agreement) evidencing, securing, guaranteeing or otherwise relating to the Bank
Obligations that contains one or more Additional Covenants or Additional Defaults, the terms of
this Agreement shall, without any further action on the part of the Company or any of the holders
of the Notes, be deemed to be amended automatically to include each Additional Covenant and each
Additional Default contained in such agreement. The Company further covenants to promptly execute
and deliver at its expense (including the reasonable fees and expenses of counsel for the holders
of the Notes) an amendment to this Agreement in form and substance satisfactory to the Required
Holder(s) evidencing the amendment of this Agreement to include such Additional Covenants and
Additional Defaults, provided that the execution and delivery of such amendment shall not
be a precondition to the effectiveness of such amendment as provided for in this paragraph 5O, but
shall merely be for the convenience of the parties hereto.




          5P. Post-Closing Requirements. Within 120 days following the Restatement Date (or such later
date as is acceptable to the Required Holders), the Company shall deliver to the Holders, in form
and substance satisfactory to Required Holders, a copy of the signed order of the Louisiana Public
Service Commission authorizing each of the Louisiana Guarantors to execute Guaranties and Security
Documents with respect to the Obligations under this Agreement (the “Louisiana Public Service
Commission Order”). Notwithstanding anything herein to the contrary, within the 120 day period
following the Restatement Date (or such later date as is acceptable to the Required Holders), the
failure to have obtained the Louisiana Public Service Commission Order shall not be considered to
be a violation of the representations, warranties and covenants in this Agreement or any of the
other Loan Documents so long as the Company is diligently pursuing the same.




          6. NEGATIVE COVENANTS. During the Issuance Period and so long thereafter as any Note or any
amount under any Loan Document shall remain unpaid, the Company agrees to comply with the following
covenants.




20









 








          6A(1). [Intentionally omitted.]




          6A(2). Interest Charge Coverage Ratio. The Company shall not, as of the end of any fiscal
quarter, permit the Interest Charge Coverage Ratio for the Company and its Subsidiaries on a
Consolidated basis to be less than 3.00 to 1.00.




          6A(3). Leverage Ratio. The Company shall not, as of the end of any fiscal quarter, permit the
Leverage Ratio for the Company and its Subsidiaries on a Consolidated basis to be greater than 4.00
to 1.00; provided however, that during an Acquisition Adjustment Period, the Leverage Ratio shall
not be greater than 4.75 to 1.00.




          6B. Distributions, Etc. The Company will not pay any management fee or similar fee of any
sort to any Affiliate thereof or to any other Person, declare or pay any dividends or
distributions, purchase, redeem, retire, defease or otherwise acquire for value any of its equity
interests or any warrants, rights or options to acquire such equity interests, now or hereafter
outstanding, return any capital to its equity holders as such, or make any distribution of
Property, equity interests, warrants, rights, options, obligations or securities to its
equity-holders as such, or permit any Subsidiary to purchase, redeem, retire, defease or otherwise
acquire for value any equity interests in the Company or any warrants, rights or options to acquire
such equity interests or to pay any such fee, except for the following:





     (i) the Company and any Subsidiary may pay any management fee or similar fee of any
sort to any Affiliate of the Company or its Subsidiaries pursuant to the Company Partnership
Agreement, the CESL Partnership Agreement or the Omnibus Agreement;




     (ii) provided that no Default or Event of Default has occurred and is continuing or
would be caused thereby, the Company may declare and pay Quarterly Distributions;
provided, further, that no more than $10,000,000 of advances under the Bank
Agreement for the purpose of funding such cash distributions to the Partners shall be
outstanding at any time;




     (iii) the Company may pay Quarterly Distributions within 60 days after the date of
declaration thereof if, at the date of declaration, such payment would comply with clause
(ii) of this paragraph 6B;




     (iv) the Company and its Subsidiaries may declare and pay dividends and other
distributions payable solely in equity interests; and




     (v) any Subsidiary may pay dividends, or make other distributions, to the Company or
any wholly owned Subsidiary.



          6C(1). Liens, Etc. The Company will not create, incur, assume or suffer to exist, or permit
any Subsidiary to create, incur, assume or suffer to exist, any Lien, or enter into or permit to
exist any agreement with any other Person not to create any Lien, on or with respect to any of its
properties of any character (including accounts receivable) whether now owned or hereafter acquired
(a “negative pledge”), or sign or file, or permit any Subsidiary to sign or file, under the Uniform
Commercial Code of any jurisdiction, a financing statement that names the




21









 








Company or any Subsidiary as debtor (except in connection with true leases), or
sign, or permit any Subsidiary to sign, any security agreement authorizing any secured party
thereunder to file such a financing statement (except in connection with true leases), excluding,
however, from the operation of the foregoing restrictions the following:





     (i) Liens created by the Security Documents (provided, that the obligations of
the Company to the Banks and Affiliates of the Banks in respect of Interest Rate Contracts
and Hydrocarbon Hedge Agreements may be secured by such Liens only so long as, with respect
to each Bank or Affiliate thereof, the Bank remains a Bank under the Bank Agreement);




     (ii) Permitted Liens;




     (iii) Liens securing obligations of such Person as lessee under Capital Leases
permitted by paragraph 6C(2)(vii);




     (iv) purchase-money Liens on property acquired or held by the Company or any Subsidiary
in the ordinary course of business, to secure the purchase price of such property or to
secure Debt incurred solely for the purpose of financing the acquisition of such property to
be subject to such Liens, or Liens existing on any such property at the time of acquisition
thereof (or at the time the Company acquires the Subsidiary owning such property), or
renewals or refinancings of any of the foregoing Liens for the same or a lesser amount;
provided, however, that (a) no such Lien may extend to or cover any property
other than the property being acquired and improvements and accessions thereto and proceeds
thereof, (b) no such renewal or refinancing may extend to or cover any property not
previously subject to the Lien being renewed or refinanced, (c) the Debt secured thereby
does not exceed the cost or fair market value, whichever is lower, of the property being
acquired on the date of acquisition and (d) the aggregate principal amount of Debt at any
time outstanding secured by such Liens may not exceed the amount permitted by paragraph
6C(2)(viii);




     (v) the negative pledge contained in the Bank Agreement and the negative pledge
contained in any agreement, instrument or document executed at any time in connection with
Debt permitted by clause (xi) of paragraph 6C(2); provided that any such negative
pledge in connection with Debt permitted by clause (xi) of paragraph 6C(2) shall not place
any restriction on the creation or existence of any Lien now or hereafter securing the
Obligations or, as a result of the creation or existence of any Lien securing the
Obligations, cause or require the creation of any Lien securing such Debt;




     (vi) options, put and call arrangements, rights of first refusal, setoff rights and
customary limitations and restrictions constituting negative pledges, in each case,
contained in, and limited to, specific leases, licenses, conveyances, partnership agreements
and co-owners’ agreements, and similar conveyances and agreements, to the extent that any
such Lien referred to in this clause does not materially impair the use of the Property
covered by such Lien for the purposes for which such Property is held or materially impair
the value of such Property subject thereto; and



22









 






     (vii) Liens incurred in the ordinary course of business of the Company or any
Subsidiary with respect to obligations (other than Debt for borrowed money) that do not
exceed $5,000,000 in the aggregate at any one time outstanding;




     (viii) licenses or leases or subleases as licensor, lessor or sublessor of any of its
Property, including intellectual property, in the ordinary course of business;




     (ix) Liens represented by the escrow of cash or Permitted Investments securing the
obligations of the Company or any Subsidiary under any agreement to acquire, or pursuant to
which it acquired, any Property, which Liens secure the obligations of the Company or such
Subsidiary to the seller of such Property, provided that such acquisition is permitted
pursuant to the terms of this Agreement;




     (x) any Lien permitted by any Mortgage;




     (xi) negative pledges relating to assets pursuant to merger agreements, stock or asset
purchase agreements and similar agreements in respect of the disposition of such assets,
provided that such merger agreement, stock or asset purchase agreement or similar agreement
in respect of the disposition of such asset is permitted pursuant to the terms of this
Agreement; and




     (xii) the negative pledge contained in the Promissory Note of Crosstex Louisiana
Energy, L.P., dated April 2, 2004, payable to the order of the Company.



          6C(2). Debt. The Company will not create, incur, assume or suffer to exist, or permit any
Subsidiary to create, incur, assume or suffer to exist, any Debt other than the following:





     (i) Debt under the Loan Documents;




     (ii) Debt under the Bank Agreement Documents;




     (iii) Debt existing on the date of this Agreement and described in Schedule
6C(2), including renewals and refinancings of such Debt, so long as the principal amount
thereof is not increased (other than to pay any associated premiums, fees and expenses);




     (iv) Debt under one or more Interest Rate Contracts or Hydrocarbon Hedge Agreements;




     (v) Debt in respect of endorsement of negotiable instruments in the ordinary course of
business;




     (vi) Debt between the Company and any Subsidiary or between Subsidiaries,
provided that (a) such Debt is noted on the books and records of the Company and its
Subsidiaries and (b) in the case of any Debt owed by the Company or any Subsidiary that is a
Guarantor to any Subsidiary that is not a Guarantor, such Debt is subordinated to the
Obligations of the Company or such Subsidiary under the Loan Documents on terms and



23









 





conditions, and pursuant to documentation, in form and a substance satisfactory to the
Required Holders in their sole reasonable discretion;




     (vii) Debt in respect of Capital Leases not exceeding $15,000,000 in aggregate amount
equivalent to principal at any time outstanding;




     (viii) Debt secured by Liens permitted by paragraph 6C(1)(iv), not exceeding
$20,000,000 in aggregate principal amount at any time outstanding;




     (ix) Debt consented to in writing by the Required Holders;




     (x) unsecured Debt in addition to that described above, not exceeding $15,000,000 in
aggregate principal amount at any time outstanding; and




     (xi) unsecured Funded Debt of the Company, a Finance Entity and/or any Guarantor,
and/or any unsecured guaranty by the Company or any Guarantor of Funded Debt of the Company
or any Affiliate of the Company; provided that (a) the Company is in compliance with
paragraph 6A(3) immediately after giving effect to the incurrence of any such Funded Debt or
guaranty determined based upon the outstanding amount of Funded Debt of the Company and its
Subsidiaries on a Consolidated basis, immediately after giving effect to such incurrence,
EBITDA for the four fiscal quarters most recently ended on or before the date of such
incurrence and the maximum Leverage Ratio allowed as of the end of the fiscal quarter most
recently ended on or prior to the date of such incurrence (and in the case of any guaranty
of Funded Debt of the Company or any Affiliate of the Company, the aggregate amount of such
Funded Debt so guaranteed shall be “Funded Debt” of the Company for purposes of calculating
the Leverage Ratio), (b) such Debt does not impose any financial or other “maintenance”
covenants on the Company or any of the Subsidiaries that are more onerous than the covenants
set forth in this Agreement, (c) such Debt shall not require any scheduled payment on
account of principal (whether by redemption, purchase, retirement, defeasance, set-off or
otherwise) prior to the latest maturity date of any Note and (d) such Debt shall contain
terms and conditions that are customary for such transactions.



Notwithstanding the foregoing, if at any time any provision of Section 6.02 of the Bank Agreement
(other than clause (j) thereof) is modified, then the Company and the holders of the Notes agree to
execute an amendment to this Agreement, in form reasonably satisfactory to the Required Holder(s),
under which this paragraph 6C(2) is modified in the same manner in which Section 6.02 of the Bank
Agreement has been modified; provided, however that no holder of a Note shall be
required to execute any such amendment to this Agreement unless the holders of the Notes have
received compensation equivalent (on a proportionate basis based upon the aggregate outstanding
principal amount of the Notes and the aggregate outstanding principal amount of the Debt
outstanding under the Bank Agreement) to any fees or other compensation paid to any Bank or its
agent with respect to such modification to the Section 6.02 of the Bank Agreement.




          6C(3). Investments in Other Persons. The Company will not make, or permit any Subsidiary to
make, any loan or advance to any Person, or purchase or otherwise acquire, or




24









 








permit any Subsidiary to purchase or otherwise acquire, any equity interests,
warrants, rights, options, obligations or other securities of, make any capital contribution to, or
otherwise invest in, any Person (all of the foregoing collectively called “Investments”);
provided, however, that nothing in this section shall prevent the Company or any
Subsidiary from doing any of the following:





     (i) acquiring Permitted Investments;




     (ii) generating and holding accounts receivable in the ordinary course of business;




     (iii) so long as no Default has occurred and is continuing or would be caused thereby,
making Investments in Persons that will not be Subsidiaries of the Company, for
consideration not exceeding $10,000,000 in the aggregate during the term of this Agreement;




     (iv) making Investments permitted by paragraph 6C(4)(i);




     (v) acquiring Investments in connection with (a) the bankruptcy or reorganization of
suppliers and customers or (b) the settlement of delinquent obligations of, and other
disputes with, customers and suppliers arising in the ordinary course of business;




     (vi) so long as no Default or Event of Default has occurred and is continuing or would
be caused thereby, making loans and advances to officers or employees of the Company or any
Subsidiary, provided that the aggregate principal amount of such loans and advances,
other than loans for the purpose of financing the purchase of common units, subordinated
units or other equity securities in the Company, shall not exceed $500,000 in aggregate
principal amount at any time outstanding;




     (vii) holding Investments existing on the date of this Agreement and described in
Schedule 6C(3);




     (viii) holding Investments in the Company and its Subsidiaries existing on the
Restatement Date;




     (ix) making Investments after the Restatement Date in Subsidiaries that are not
Guarantors in an aggregate amount not to exceed $15,000,000; and




     (x) making Investments in the Company and the Guarantors.



          6C(4). Mergers, Acquisitions, Etc. The Company will not merge or consolidate with or into, or
sell, lease, transfer or otherwise dispose of (whether in one transaction or in a series of
transactions) all or substantially all of its Property (whether now owned or hereafter acquired)
to, or enter into any Acquisition, or permit any Subsidiary to do any of the foregoing, except for
the following:




25









 









     (i) so long as no Default or Event of Default has occurred and is continuing or would
be caused thereby, the Company or any Subsidiary may make any Acquisition; provided,
however, that any such Acquisition shall be permitted only if, (a) before the
effectiveness of such Acquisition and to the extent required by the Required Holders, the
Company delivers to the Holders (I) guaranties, mortgages, deeds of trust, security
agreements, releases, UCC financing statements and UCC terminations, duly executed by the
parties thereto, in form and substance satisfactory to the Required Holders and accompanied
by UCC searches, title investigations and legal opinions (except with respect to priority)
demonstrating that, upon the effectiveness of such Acquisition and the recording and filing
of any necessary documentation, the Collateral Agent will have an Acceptable Security
Interest on the Property to be acquired, (II) such legal opinions in relation to the
documents described in the foregoing subclause (I) as the Required Holders may reasonably
request, and (III) evidence of company authority to enter into, and environmental
assessments with respect to, such Acquisition, (b) the Company or such Guarantor is the
acquiring or surviving entity, (c) no Default or Event of Default exists and the Acquisition
would not reasonably be expected to cause a Default or Event of Default, (d) after giving
effect to such Acquisition on a pro forma basis, the Company would have been in compliance
with all of the covenants contained in this Agreement, including, without limitation,
paragraph 6A as of the end of the most recent fiscal quarter, (e) the acquisition target is
in the same or similar line of business as the Company and its Subsidiaries, (f) the terms
of paragraph 6G are satisfied, and (g) the aggregate amount of cash, Permitted Investments
and the remaining unused portion of the aggregate commitments under the Bank Agreement is
sufficient to fund such Acquisition;




     (ii) so long as no Default has occurred and is continuing or would be caused thereby,
any Subsidiary may sell or otherwise transfer all of its Property to, or merge into or
consolidate with any other Subsidiary or the Company; provided, however,
that any such disposition merger or consolidation shall be permitted only if, before the
effectiveness of such disposition merger or consolidation and to the extent reasonably
required by the Required Holders, the Company delivers to the Holders documents (or
photocopies thereof) of the type described in the proviso to clause (i) above;




     (iii) so long as no Default or Event of Default has occurred and is continuing or would
be caused thereby, any Subsidiary of the Company may sell or otherwise transfer all of its
Property to, or merge into or consolidate with, any other Person so long as such transaction
is not prohibited by paragraph 6C(5);




     (iv) any Subsidiary of the Company may dissolve so long as all of its Property is
distributed to the Company or a Subsidiary; provided that if such dissolving Subsidiary is a
Guarantor, all of its Property shall be distributed to the Company or another Guarantor; and




     (v) the Company and its Subsidiaries may acquire Property in the ordinary course of
business.



26









 





          6C(5). Sales, Etc. of Property. The Company will not sell, lease, transfer or otherwise
dispose of, or permit any Subsidiary to sell, lease, transfer or otherwise dispose of, any of its
Property, except for the following:





     (i) sales of inventory in the ordinary course of business;




     (ii) sales, leases, transfers and other dispositions in the ordinary course of business
of worn-out or other Property that is no longer useful in the conduct of the business of the
Company or any Subsidiary;




     (iii) liquidations or other dispositions of cash and Permitted Investments;




     (iv) so long as no Default has occurred and is continuing or would be caused thereby,
sales and other transfers of Property from the Company to any Subsidiary or by any
Subsidiary to the Company or to any other Subsidiary, provided, however,
that any such sale or other transfer of real property or equity interests shall be permitted
only if, before the effectiveness of such sale or other transfer and to the extent required
by the Required Holders, the Company delivers to the Holders documents of the type described
in the proviso to paragraph 6C(4)(i);




     (v) sales of Property resulting from the condemnation thereof;




     (vi) sales or discounts of overdue accounts receivable in the ordinary course of
business, in connection with the compromise or collection thereof; and




     (vii) so long as no Default has occurred and is continuing or would be caused thereby,
sales, leases, transfers and other dispositions of Property for consideration not exceeding
$30,000,000 in the aggregate in any fiscal year of the Company, provided that the
Net Cash Proceeds thereof are used to prepay Notes to the extent required under paragraph
4F.



          6D. Change in Nature of Business. The Company will not make, or permit any Subsidiary to
make, any material change in the nature of their collective businesses as carried on as of the date
hereof.




          6E. ERISA Plans. The Company will not establish, maintain or contribute to, or permit any
ERISA Affiliate to establish, maintain or contribute to, any Plan, and the Company will not become
obligated to, or permit any Subsidiary to become obligated to, contribute to any Multiemployer
Plan.




          6F. Accounting Changes. The Company will not make or permit, or permit any Subsidiary to make
or permit, any change in (i) any of its accounting policies affecting the presentation of financial
statements or reporting practices, except as required or permitted by GAAP, or (ii) its fiscal
year.




          6G. Creation of Material Subsidiaries. The Company will not create, or permit any Subsidiary
to create, any Material Subsidiary unless within 15 days after the formation of such Subsidiary and
to the extent reasonably required by the Required Holders,




27









 








such Subsidiary delivers to the Holders (a) guaranties, mortgages, deeds of trust, security
agreements, releases, UCC financing statements and UCC terminations, duly executed by the parties
thereto, in form and substance reasonably satisfactory to the Required Holders and accompanied by
UCC searches, title investigations and legal opinions (except with respect to priority)
demonstrating that, upon the recording and filing of any necessary documentation, the Collateral
Agent will have an Acceptable Security Interest on the Property of such Subsidiary, (b) such legal
opinions in relation to the documents described in the foregoing subclause (a) as the Required
Holders may reasonably request, and (c) evidence of company authority on the part of the Company or
the Subsidiary creating the new Subsidiary, and on the part of the new Material Subsidiary created,
to enter into and perform its obligations under such documents.




          6H. Commodity Contracts. The Company will not, and will not permit any Subsidiary to, enter
into, assume or otherwise acquire an interest in (i) any contract or other obligation to purchase
or sell any natural gas or other commodities or goods, or any hedged or unhedged commodity futures
contract, option or other derivative contract, that in any case would result in the Company or such
Subsidiary having an “open” or “uncovered” position in natural gas or other commodities or goods,
or in any derivative of any thereof, exceeding $500,000 in the aggregate at the end of any day or
(ii) any other futures or derivatives contract or obligation for speculative purposes.




          6I. Amendment of Company Partnership Agreement. The Company will not amend, modify or
supplement (i) the definition of “Available Cash” in the Company Partnership Agreement or increase
the amount of any management fee or similar fee of any sort payable to any Affiliate of the Company
or its Subsidiaries (other than the Company and its Subsidiaries) without the prior written consent
of the Required Holders, or (ii) any other provision of the Company Partnership Agreement if such
amendment, modification or supplement would be materially adverse to the interests of the Holders
without the prior written consent of the Required Holders. The Company shall not amend, modify or
supplement (a) the definition of “Available Cash” in the CESL Partnership Agreement or increase the
amount of any management fee or similar fee of any sort payable to any Affiliate of the Company or
its Subsidiaries (other than the Company and its Subsidiaries) without the prior written consent of
the Required Holders or (b) any other provision of the CESL Partnership Agreement if such
amendment, modification or supplement would be materially adverse to the interests of the Holders
without the prior written consent of the Required Holders. The Company shall not increase the
amount of any management fee or similar fee of any sort payable to any Affiliate of the Company or
its Subsidiaries (other than the Company and its Subsidiaries) under the Omnibus Agreement without
the prior written consent of the Required Holders.




          6J. Bank Agreement. The Company will not amend, supplement or otherwise modify any term of
the Bank Agreement without the prior written consent of the Required Holders, which consent will
not be unreasonably withheld, which amendment, supplement or modification would have the effect of
(i) (a) prior to the date on which the Company has delivered to the Holders, in form and substance
satisfactory to Required Holders, the Louisiana Public Service Commission Order pursuant to
paragraph 5P, increasing the aggregate commitments under the Bank Agreement above $250,000,000 and
(b) on or after the time that the Company has delivered to the Holders, in form and substance
satisfactory to Required Holders, the Louisiana Public Service Commission Order pursuant to
paragraph 5P,




28









 








increasing the aggregate commitments under the Bank Agreement above $350,000,000 (ii)
increasing the rate of interest except with respect to imposing the default rate as provided for in
the Bank Agreement on the date hereof or any fees charged on the Bank Obligations or (iii) being
materially adverse to the interests of the Holders.




          6K. Other Debt. The Company will not make any optional or scheduled payments or prepayments
on account of principal (whether by redemption, purchase, retirement, defeasance, set-off or
otherwise) in respect of any unsecured Debt incurred pursuant to paragraph 6C(2)(xi) prior to the
latest maturity date of any Note, other than principal payments not exceeding $7,500,000 in the
aggregate prior to such latest maturity date. The Company shall not amend, supplement or otherwise
modify the terms of any Debt incurred under paragraph 6C(2)(xi), if such amendment, supplement or
other modification would not be permitted by the terms of paragraph 6C(2)(xi) without the prior
written consent of the Required Holder(s), which consent will not be unreasonably withheld.




          6L. Terrorism Sanctions Regulations. The Company will not and will not permit any Subsidiary
to (a) become a Person described or designated in the Specially Designated Nationals and Blocked
Persons List of the Office of Foreign Assets Control or in Section 1 of the Anti-Terrorism Order or
(b) engage in any dealings or transactions with any such Person.




          7. EVENTS OF DEFAULT.




          7A. Acceleration. If any of the following events shall occur and be continuing for any reason
whatsoever (and whether such occurrence shall be voluntary or involuntary or come about or be
effected by operation of law or otherwise):





     (i) the Company defaults in the payment of any principal of, or Yield-Maintenance
Amount payable with respect to, any Note when the same shall become due, either by the terms
thereof or otherwise as herein provided; or




     (ii) the Company defaults in the payment of any interest on any Note for more than
three Business Days after the date due; or




     (iii) the Company or any Material Subsidiary defaults (whether as primary obligor or as
guarantor or other surety) in any payment of principal of or interest on any other
obligation for money borrowed (or any Capitalized Lease Obligation, any obligation under a
conditional sale or other title retention agreement, any obligation issued or assumed as
full or partial payment for property whether or not secured by a purchase money mortgage or
any obligation under notes payable or drafts accepted representing extensions of credit)
beyond any period of grace provided with respect thereto, or the Company or any Material
Subsidiary fails to perform or observe any other agreement, term or condition contained in
any agreement under which any such obligation is created (or if any other event thereunder
or under any such agreement shall occur and be continuing) and the effect of such failure or
other event is to cause, or to permit the holder or holders of such obligation (or a trustee
on behalf of such holder or holders) to cause, such obligation to become due (or to be
repurchased by the Company



29









 





or any Material Subsidiary) prior to any stated maturity, provided that the
aggregate amount of all obligations as to which such a payment default shall occur and be
continuing or such a failure or other event causing or permitting acceleration (or resale to
the Company or any Material Subsidiary) shall occur and be continuing exceeds $10,000,000;
or




     (iv) any representation or warranty made by the Company, the General Partner, any
Guarantor or any Subsidiary in any Loan Document or by the Company, the General Partner, any
Guarantor, or any Subsidiary or any of their officers in any writing furnished in connection
with or pursuant to any Loan Document shall be false in any material respect on the date as
of which made; or




     (v) the Company fails to perform or observe any term, covenant or agreement contained
in paragraph 6 (other than paragraph 6L) or paragraph 5A(iii), 5E, 5I, 5N or 5P; or




     (vi) the Company, any Guarantor or any Subsidiary fails to perform or observe any other
term, covenant, agreement or condition contained in any Loan Document on its part to be
performed or observed and such failure shall not be remedied within 30 days after written
notice thereof has been given to the Company, such Guarantor or such Subsidiary, as
applicable, by the Required Holder(s); or




     (vii) the Company or any Material Subsidiary makes an assignment for the benefit of
creditors or is generally not paying its debts as such debts become due; or




     (viii) any decree or order for relief in respect of the Company or any Material
Subsidiary is entered under any bankruptcy, reorganization, compromise, arrangement,
insolvency, readjustment of debt, dissolution or liquidation or similar law, whether now or
hereafter in effect (the “Bankruptcy Law”), of any jurisdiction; or




     (ix) the Company or any Material Subsidiary petitions or applies to any tribunal for,
or consents to, the appointment of, or taking possession by, a trustee, receiver, custodian,
liquidator or similar official of the Company or any Material Subsidiary, or of any
substantial part of the assets of the Company or any Material Subsidiary, or commences a
voluntary case under the Bankruptcy Law of the United States or any proceedings (other than
proceedings for the voluntary liquidation and dissolution of a Subsidiary) relating to the
Company or any Material Subsidiary under the Bankruptcy Law of any other jurisdiction; or




     (x) any such petition or application is filed, or any such proceedings are commenced,
against the Company or any Material Subsidiary and the Company or such Subsidiary by any act
indicates its approval thereof, consent thereto or acquiescence therein, or an order,
judgment or decree is entered appointing any such trustee, receiver, custodian, liquidator
or similar official, or approving the petition in any such proceedings, and such order,
judgment or decree remains unstayed and in effect for more than 60 days; or



30









 






     (xi) any order, judgment or decree is entered in any proceedings against the Company
decreeing the dissolution of the Company and such order, judgment or decree remains unstayed
and in effect for more than 60 days; or




     (xii) any order, judgment or decree is entered in any proceedings against the Company,
any Guarantor or any Subsidiary decreeing a split-up of the Company, any Guarantor or any
Subsidiary which requires the divestiture of assets representing a substantial part, or the
divestiture of the stock of a Subsidiary whose assets represent a substantial part, of the
consolidated assets of the Company and its Subsidiaries (determined in accordance with GAAP)
or which requires the divestiture of assets, or stock of a Subsidiary, which shall have
contributed a substantial part of the consolidated net income of the Company and its
Subsidiaries (determined in accordance with GAAP) for any of the three fiscal years then
most recently ended, and such order, judgment or decree remains unstayed and in effect for
more than 60 days; or




     (xiii) (a) any judgment or order for the payment of money in excess of $10,000,000 is
rendered against the Company or any Material Subsidiary by a court of competent
jurisdiction, and either (A) enforcement proceedings are commenced by any creditor upon such
judgment or order or (B) there is any period of 30 consecutive days during which a stay of
enforcement of such judgment or order, by reason of a pending appeal or otherwise, is not in
effect, unless such judgment or order has been vacated, satisfied, dismissed, or bonded
pending appeal or, in the case of a judgment or order the entire amount of which is covered
by insurance (subject to applicable deductibles), is the subject of a binding agreement with
the plaintiff and the insurer covering payment therefor; or




          (b) any non-monetary judgment or order is rendered against the Company or any Material
Subsidiary that could reasonably be expected to have a Material Adverse Effect, and there is
any period of 30 consecutive days during which a stay of enforcement of such judgment or
order, by reason of a pending appeal or otherwise, is not in effect; or




     (xiv) any material provision of any Loan Document for any reason ceases to be valid and
binding on, or enforceable against, the Company or any Material Subsidiary, as applicable
(except (a) pursuant to the terms of such Loan Document, (b) as permitted by this Agreement
(including, without limitation, paragraphs 6C(5) and 11T hereof) or (c) to the extent such
provision is released in writing by the Required Holders), or the Company or any Material
Subsidiary, as applicable, so states in writing; or




     (xv) any Security Document for any reason (except pursuant to the terms hereof
(including, without limitation, paragraphs 6C(5) and 11T hereof) or thereof) ceases to
create an Acceptable Security Interest on any material portion of the Collateral purported
to be covered by such Security Document, and the same, if curable, is not cured within 15
days after the Collateral Agent or the Required Holders notify the Company or the affected
Subsidiary, as applicable, of the same; or




     (xvi) a Change of Control shall occur;



31









 





then (a) if such event is an Event of Default specified in clause (i) or (ii) of this paragraph 7A,
any Holder may at its option, by notice in writing to the Company, declare all of the Notes held by
such Holder to be, and all of the Notes held by such Holder shall thereupon be and become,
immediately due and payable at par together with interest accrued thereon, without presentment,
demand, protest or notice of any kind (including, without limitation, notice of intent to
accelerate), all of which are hereby waived by the Company, (b) if such event is an Event of
Default specified in clause (viii), (ix) or (x) of this paragraph 7A with respect to the Company,
all of the Notes at the time outstanding shall automatically become immediately due and payable at
par together with interest accrued thereon and together with the Yield-Maintenance Amount, if any,
with respect to each Note, without presentment, demand, protest or notice of any kind (including,
without limitation, notice of intent to accelerate and notice of acceleration of maturity), all of
which are hereby waived by the Company, and (c) if such event is any Event of Default other than as
specified in preceding clause (b), the Required Holder(s) of the Notes may at its or their option
by notice in writing to the Company, declare all of the Notes to be, and all of the Notes shall
thereupon be and become, immediately due and payable together with interest accrued thereon and
together with the Yield-Maintenance Amount, if any, with respect to each Note, without presentment,
demand, protest or notice of any kind (including, without limitation, notice of intent to
accelerate), all of which are hereby waived by the Company.




          The Company acknowledges, and the parties hereto agree, that each Holder has the right to
maintain its investment in the Notes free from repayment by the Company (except as herein
specifically provided for) and that the provision for payment of the Yield-Maintenance Amount by
the Company in the event that the Notes are prepaid or are accelerated as a result of an Event of
Default, is intended to provide compensation for the deprivation of such right under such
circumstances.




          7B. Rescission of Acceleration. At any time after any or all of the Notes shall have been
declared immediately due and payable pursuant to paragraph 7A, the Required Holder(s) may, by
notice in writing to the Company, rescind and annul such declaration and its consequences if (i)
the Company shall have paid all overdue interest on the Notes, the principal of and
Yield-Maintenance Amount, if any, payable with respect to any Notes which have become due otherwise
than by reason of such declaration, and interest on such overdue interest and overdue principal and
Yield Maintenance Amount at the rate specified in the Notes, (ii) the Company shall not have paid
any amounts which have become due solely by reason of such declaration, (iii) all Events of Default
and Defaults, other than non-payment of amounts which have become due solely by reason of such
declaration, shall have been cured or waived pursuant to paragraph 11C, and (iv) no judgment or
decree shall have been entered for the payment of any amounts due pursuant to the Notes or this
Agreement. No such rescission or annulment shall extend to or affect any subsequent Event of
Default or Default or impair any right arising therefrom.




          7C. Notice of Acceleration or Rescission. Whenever any Note shall be declared immediately due
and payable pursuant to paragraph 7A or any such declaration shall be rescinded and annulled
pursuant to paragraph 7B, the Company shall forthwith give written notice thereof to each Holder at
the time outstanding.




32









 








          7D. Other Remedies. If any Event of Default or Default shall occur and be continuing, the
Holder of any Note may proceed to protect and enforce its rights under this Agreement, such Note
and the other Loan Documents by exercising such remedies as are available to such Holder in respect
thereof under applicable law, either by suit in equity or by action at law, or both, whether for
specific performance of any covenant or other agreement contained in this Agreement or in aid of
the exercise of any power granted in this Agreement. No remedy conferred in this Agreement upon
any Holder is intended to be exclusive of any other remedy, and each and every such remedy shall be
cumulative and shall be in addition to every other remedy conferred herein or now or hereafter
existing at law or in equity or by statute or otherwise. All amounts recovered by any Holder as the
result of the exercise of such remedies or from distributions or other payments under the
Intercreditor Agreement (after application of amounts thereunder pursuant to the terms of Section
4.3 thereof) shall be applied in accordance with the following priorities (with all partial
payments of amounts owing within each category being allocated ratably in accordance with the
amounts so owing to each Holder): first, to the payment of all fees, indemnities, costs and
expenses then owing to the Holders under the Loan Documents; second, after payment in full
of the amounts set forth in clause first above, to the payment of the Yield-Maintenance
Amount, if any, then owing; third, after payment in full of the amounts set forth in clause
second above, to the payment of all accrued and unpaid interest then owing to the Holders
under the Loan Documents; and fourth, after payment in full of the amounts set forth in
clause third above, to the payment of principal then outstanding under the Notes




          8. REPRESENTATIONS, COVENANTS AND WARRANTIES. The Company represents, covenants and warrants
as follows (all references to “Subsidiary” and “Subsidiaries” in this paragraph 8 shall be deemed
omitted if the Company has no Subsidiaries at the time the representations herein are made or
repeated):




          8A. Organization. The Company (a) is a limited partnership duly formed, validly existing and
in good standing under the laws of Delaware, (b) is duly qualified or licensed as a foreign limited
partnership and is in good standing in each jurisdiction in which it owns or leases property or in
which the conduct of its business requires it to so qualify or be licensed, except to the extent
that the failure to so qualify or be licensed could not reasonably be expected to have a Material
Adverse Effect, and (c) has all requisite limited partnership power and authority to own or lease
and operate its properties and to carry on its business as now conducted and as proposed to be
conducted. Each Subsidiary is duly organized and validly existing in good standing under the laws
of the jurisdiction in which it is organized, and each Subsidiary has the corporate, partnership,
limited liability company or similar power to own its respective property and to carry on its
respective business as now being conducted. The execution, delivery and performance by the Company
of this Agreement, the Notes and the other Loan Documents to which it is a party are within the
Company’s powers and have been duly authorized by all necessary action. The execution, delivery
and performance by each Guarantor of each Loan Document to which it is a party are within such
Guarantor’s powers and have been duly authorized by all necessary corporate, partnership or limited
liability company action.




          8B. Financial Statements. The Company has furnished Prudential, each Existing Holder and each
Purchaser of any Accepted Notes with the following financial statements, identified by a principal
financial officer of the Ultimate General Partner: (i)




33









 








Consolidated balance sheets of the Company and its Subsidiaries as at December 31, 2003
and as at December 31 in each of the three fiscal years of the Company most recently completed
after December 31, 2003, if any, prior to the date as of which this representation is made or
repeated to such Purchaser (other than fiscal years completed within 120 days prior to such date
for which audited financial statements have not been released) and Consolidated statements of
operations and cash flows and a Consolidated statement of changes in partners’ capital of the
Company and its Subsidiaries for each such year, all such Consolidated statements having been
reported on by KPMG LLP; and (ii) a Consolidated balance sheet of the Company and its Subsidiaries
as at the end of the quarterly period (if any) most recently completed prior to such date and after
the end of such fiscal year (other than quarterly periods completed within 45 days prior to such
date for which financial statements have not been released) and the comparable quarterly period in
the preceding fiscal year and Consolidated statements of operations, cash flows and changes in
partners’ capital for the periods from the beginning of the fiscal years in which such quarterly
periods are included to the end of such quarterly periods, prepared by the Company. Such financial
statements (including any related schedules and/or notes) are true and correct in all material
respects (subject, as to interim statements, to changes resulting from audits and year-end
adjustments), have been prepared in accordance with GAAP consistently followed throughout the
periods involved and show all liabilities, direct and contingent, of the Company and its
Subsidiaries required to be shown in accordance with such principles. The balance sheets fairly
present the condition of the Company and its Subsidiaries as at the dates thereof, and the
statements of operations, cash flows and changes in partners’ capital fairly present the results of
the operations of the Company and its Subsidiaries and their cash flows for the periods indicated.
There has been no material adverse change in the business, property or assets, condition (financial
or otherwise) operations or prospects of the Company and its Subsidiaries taken as a whole since
the end of the most recent fiscal year for which such audited financial statements have been
furnished.




          8C. Actions Pending. There is no action, suit, investigation or proceeding pending or, to the
knowledge of the Company, threatened against the Company or any of its Subsidiaries, or any
properties or rights of the Company or any of its Subsidiaries, by or before any court, arbitrator
or administrative or governmental body which might result in any material adverse change in the
business, property or assets, condition (financial or otherwise), operations or prospects of the
Company and its Subsidiaries taken as a whole. There is no action, suit, investigation or
proceeding pending or, to the knowledge of the Company, threatened against the Company or any of
its Subsidiaries which purports to affect the validity or enforceability of this Agreement, any
Note or any other Loan Document.




          8D. Outstanding Debt. Neither the Company nor any of its Subsidiaries has outstanding any
Debt except as permitted by paragraphs 6A(3) and 6C(2). There exists no default under the
provisions of any instrument evidencing such Debt or of any agreement relating thereto.




          8E. Title to Properties. Each of the Company and its Subsidiaries has good and indefeasible
title to its respective material real properties (other than easements or properties which it
leases) and good title to all of its respective material personal properties and assets, including
the material properties and assets reflected in the most recent audited balance sheet referred to
in paragraph 8B (other than properties and assets disposed of in the ordinary course of




34









 








business), subject to no Lien of any kind except Liens permitted by paragraph 6C(1).
Each of the Company and its Subsidiaries has good and defensible title to all material easements
and rights of way purported to be owned by it. All leases necessary in any material respect for
the conduct of the respective businesses of the Company and its Subsidiaries are valid and
subsisting and are in full force and effect. The Company and each Subsidiary enjoys peaceful and
undisturbed possession of all easements and rights of way necessary in any material respect for the
operation of its Properties. None of the Assigned Agreements, and none of the other documents
creating or affecting any such leasehold, easement or right of way, contains any provisions that
could reasonably be expected to have a Material Adverse Effect or to materially impair the
operation of the business of the Company and its Subsidiaries, taken as a whole.




          8F. Taxes. The Company and each of its Subsidiaries has filed, or there has been filed on its
behalf, or an extension has been obtained for the filing of, all federal, state and other material
tax returns required to be filed before the making of this representation and warranty, and each
has paid all taxes shown thereon to be due, including interest, additions to taxes and penalties,
or has provided adequate reserves in accordance with GAAP for the payment thereof.




          8G. Conflicting Agreements and Other Matters. Neither the Company nor any of its Subsidiaries
is a party to any contract or agreement or subject to any charter or other restriction which
materially and adversely affects its business, property or assets, condition (financial or
otherwise) or operations. Neither the execution nor delivery of this Agreement, the Notes or any
other Loan Document, nor the offering, issuance and sale of the Notes, nor fulfillment of nor
compliance with the terms and provisions hereof and of the other Loan Documents will conflict with,
or result in a breach of the terms, conditions or provisions of, or constitute a default under, or
result in any violation of, or result in the creation of any Lien upon any of the properties or
assets of the Company or any of its Subsidiaries other than the Liens created in favor of the
Collateral Agent for the ratable benefit of the Holders and the Banks pursuant to, the Company
Partnership Agreement or the charter or by-laws or other organizational documents of any of its
Subsidiaries, any award of any arbitrator or any agreement (including any agreement with partners
or members), instrument, order, judgment, decree, statute, law, rule or regulation to which the
Company or any of its Subsidiaries is subject. Neither the Company nor any of its Subsidiaries is
a party to, or otherwise subject to any provision contained in, any instrument evidencing Debt of
the Company or such Subsidiary, any agreement relating thereto or any other contract or agreement
(including its limited partnership agreement or limited liability company agreement) which limits
the amount of, or otherwise imposes restrictions on the incurring of, Debt of the Company of the
type to be evidenced by the Notes, or Debt of the Subsidiaries that are Guarantors of the type to
be evidenced by the Guaranties, except as set forth in the agreements listed in Schedule 8G
attached hereto.




          8H. Offering of Notes. Neither the Company nor any agent acting on its behalf has, directly
or indirectly, offered the Notes or any similar security of the Company for sale to, or solicited
any offers to buy the Notes or any similar security of the Company from, or otherwise approached or
negotiated with respect thereto with, any Person other than institutional investors, and neither
the Company nor any agent acting on its behalf has taken or will take any action which would
subject the issuance or sale of the Notes to the provisions of
Section 5 of the






35









 








Securities Act or to the provisions of any securities or Blue Sky law of any
applicable jurisdiction.




          8I. Use of Proceeds. None of the proceeds of the sale of any Notes will be used, directly or
indirectly, for the purpose, whether immediate, incidental or ultimate, of purchasing or carrying
any “margin stock” as defined in Regulation U (12 CFR Part 221) of the Board of Governors of the
Federal Reserve System (“margin stock”) or for the purpose of maintaining, reducing or retiring any
Debt which was originally incurred to purchase or carry any stock that is then currently a margin
stock or for any other purpose which might constitute the purchase of such Notes a “purpose credit”
within the meaning of such Regulation U, unless the Company shall have delivered to the Purchaser
which is purchasing such Notes, on the Closing Day for such Notes, an opinion of counsel
satisfactory to such Purchaser stating that the purchase of such Notes does not constitute a
violation of such Regulation U. Neither the Company nor any agent acting on its behalf has taken
or will take any action which might cause this Agreement or the Notes to violate Regulation T,
Regulation U or any other regulation of the Board of Governors of the Federal Reserve System or to
violate the Exchange Act, in each case as in effect now or as the same may hereafter be in effect.




          8J. ERISA. No accumulated funding deficiency (as defined in section 302 of ERISA and section
412 of the Code), whether or not waived, exists with respect to any Plan (other than a
Multiemployer Plan). No liability to the PBGC has been or is expected by the Company or any ERISA
Affiliate to be incurred with respect to any Plan (other than a Multiemployer Plan) by the Company,
any Subsidiary or any ERISA Affiliate which is or would be materially adverse to the business,
property or assets, condition (financial or otherwise) or operations of the Company and its
Subsidiaries taken as a whole. Neither the Company, any Subsidiary nor any ERISA Affiliate has
incurred or presently expects to incur any withdrawal liability under Title IV of ERISA with
respect to any Multiemployer Plan which is or would be materially adverse to the business, property
or assets, condition (financial or otherwise) or operations of the Company and its Subsidiaries
taken as a whole. The execution and delivery of this Agreement and the issuance and sale of the
Notes will be exempt from or will not involve any transaction which is subject to the prohibitions
of section 406 of ERISA and will not involve any transaction in connection with which a penalty
could be imposed under section 502(i) of ERISA or a tax could be imposed pursuant to section 4975
of the Code. The representation by the Company in the next preceding sentence is made in reliance
upon and subject to the accuracy of the representation of each Purchaser in paragraph 9B as to the
source of funds to be used by it to purchase any Notes.




          8K. Governmental Consent. Neither the nature of the Company or of any Subsidiary, nor any of
their respective businesses or properties, nor any relationship between the Company or any
Subsidiary and any other Person, nor any circumstance in connection with the offering, issuance,
sale or delivery of the Notes is such as to require any authorization, consent, approval, exemption
or any action by or notice to or filing with any court or administrative or governmental or
regulatory body (other than routine filings after the Closing Day for any Notes with the Securities
and Exchange Commission and/or state Blue Sky authorities) in connection with the execution and
delivery of this Agreement and the other Loan Documents, the offering, issuance, sale or delivery
of the Notes or fulfillment of or compliance with the terms and provisions hereof or of the other
Loan Documents.




36









 








          8L. Compliance with Laws. The Company and its Subsidiaries and all of their respective
properties and facilities have complied at all times and in all respects with all federal, state,
local and regional statutes, laws, ordinances and judicial or administrative orders, judgments,
rulings and regulations, including those relating to protection of the environment except, in any
such case, where failure to comply would not result in a Material Adverse Effect.




          8M. Environmental Compliance. Except as described in the Company’s filings pursuant to the
Securities Exchange Act of 1934, the Company and its Subsidiaries (i) are in compliance with any
and all applicable Environmental Laws, (ii) have received all permits required of them under
applicable Environmental Laws to conduct their respective businesses, (iii) are in compliance with
all terms and conditions of any such permit and (iv) do not have any liability in connection with
the release into the environment of any Hazardous Materials, except where such noncompliance with
Environmental Laws, failure to receive required permits, failure to comply with the terms and
conditions of such permits or liability in connection with such releases would not, individually or
in the aggregate, have a Material Adverse Effect.




          8N. Utility Company Status. Neither the Company nor any Subsidiary is a (i) “holding
company,” a “subsidiary company” of a “holding company” or an “affiliate” of a “holding company” or
of a “subsidiary company” of a “holding company,” as such terms are defined in the Public Utility
Holding Company Act of 1935, as amended or (ii) public utility within the meaning of the Federal
Power Act, as amended.




          8O. Investment Company Status. Neither the Company nor any Subsidiary is an “investment
company” or a company “controlled” by an “investment company” within the meaning of the Investment
Company Act of 1940, as amended, or an “investment adviser” within the meaning of the Investment
Advisers Act of 1940, as amended.




          8P. Disclosure. Neither this Agreement nor any other document, certificate or statement
furnished to any Purchaser by or on behalf of the Company in connection herewith contains any
untrue statement of a material fact or omits to state a material fact necessary in order to make
the statements contained herein and therein, taken as a whole, not misleading. There is no fact
peculiar to the Company or any of its Subsidiaries which materially adversely affects or in the
future may reasonably be expected (so far as the Company can now foresee) to materially adversely
affect the business, property or assets, condition (financial or otherwise) or operations of the
Company or any of its Subsidiaries and which has not been set forth in this Agreement.




          8Q. Rule 144A. The Notes are not of the same class as securities of the Company, if any,
listed on a national securities exchange, registered under Section 6 of the Exchange Act or quoted
in a U.S. automated inter-dealer quotation system.




          8R. Delivery of Bank Agreement. The Company has delivered to each Purchaser a true, correct
and complete copy of the Bank Agreement, including all amendments and waivers of any provision
thereof.




          8S. Hostile Tender Offers. None of the proceeds of the sale of any Notes will be used to
finance a Hostile Tender Offer.




37









 








          8T. Subsidiaries. As of the date hereof, the Company has no Subsidiaries other than those
described in Schedule 8T.




          8U. Ownership.




          (a) The General Partner is the sole general partner of the Company, with, as of the date
hereof, a 2% general partner interest in the Company. No part of the partnership interests in the
Company is subject to any Lien granted by the General Partner or Crosstex Holdings, L.P., other
than preferential rights of the Partners under the Company Partnership Agreement.




          (b) As of the date hereof, the equity interests in the Subsidiaries are legally and
beneficially owned by the Persons, and by such Persons in the percentages, specified in
Schedule 8T. No part of such equity interests is subject to any Lien, other than in favor
of the Collateral Agent.




          8V. Natural Gas Act. Neither the Company nor any Subsidiary is subject to the jurisdiction of
the Federal Energy Regulatory Commission under the Natural Gas Act of 1938, as amended.




          8W. Solvency. The Company is, together with its Subsidiaries on a consolidated basis,
Solvent.




          8X. Foreign Assets Control Regulations, Etc.




          (a) Neither the sale of the Notes by the Company hereunder nor its use of the proceeds thereof
will violate the Trading with the Enemy Act, as amended, or any of the foreign assets control
regulations of the United States Treasury Department (31 CFR, Subtitle B, Chapter V, as amended) or
any enabling legislation or executive order relating thereto.




          (b) Neither the Company nor any Subsidiary (i) is a Person described or designated in the
Specially Designated Nationals and Blocked Persons List of the Office of Foreign Assets Control or
in Section 1 of the Anti-Terrorism Order or (ii) engages in any dealings or transactions with any
such Person. The Company and its Subsidiaries are in compliance, in all material respects, with
the USA Patriot Act.




          (c) No part of the proceeds from the sale of the Notes hereunder will be used, directly or
indirectly, for any payments to any governmental official or employee, political party, official of
a political party, candidate for political office, or anyone else acting in an official capacity,
in order to obtain, retain or direct business or obtain any improper advantage, in violation of the
United States Foreign Corrupt Practices Act of 1977, as amended, assuming in all cases that such
Act applies to the Company.




          9. REPRESENTATIONS OF THE PURCHASERS.




     Each Purchaser represents as follows:



38









 





          9A. Nature of Purchase. Such Purchaser is not acquiring the Notes purchased by it hereunder
with a view to or for sale in connection with any distribution thereof within the meaning of the
Securities Act, provided that the disposition of such Purchaser’s property shall at all
times be and remain within its control. Such Purchaser is an “accredited investor” within the
meaning of Regulation D under the Securities Act. Such Purchaser understands that the Notes have
not been registered under the Securities Act and may be resold only if registered pursuant to the
provisions of the Securities Act or if an exemption from registration is available, except under
circumstances where neither such registration nor such exemption is required by law, and that the
Company is not required to register the Notes.




          9B. Source of Funds. At least one of the following statements is an accurate representation
as to each source of funds (the “Source”) to be used by such Purchaser to pay the purchase price of
the Notes to be purchased by such Purchaser hereunder:





     (i) the Source is an “insurance company general account” (as the term is defined in the
United States Department of Labor’s Prohibited Transaction Exemption (“PTE”) 95-60) in
respect of which the reserves and liabilities (as defined by the annual statement for life
insurance companies approved by the National Association of Insurance Commissioners (the
“NAIC Annual Statement”)) for the general account contract(s) held by or on behalf of any
employee benefit plan together with the amount of the reserves and liabilities for the
general account contract(s) held by or on behalf of any other employee benefit plans
maintained by the same employer (or affiliate thereof as defined in PTE 95-60) or by the
same employee organization in the general account do not exceed 10% of the total reserves
and liabilities of the general account (exclusive of separate account liabilities) plus
surplus as set forth in the NAIC Annual Statement filed with such Purchaser’s state of
domicile; or




     (ii) the Source is a separate account that is maintained solely in connection with such
Purchaser’s fixed contractual obligations under which the amounts payable, or credited, to
any employee benefit plan (or its related trust) that has any interest in such separate
account (or to any participant or beneficiary of such plan (including any annuitant)) are
not affected in any manner by the investment performance of the separate account; or




     (iii) the Source is either (a) an insurance company pooled separate account, within the
meaning of PTE 90-1 or (b) a bank collective investment fund, within the meaning of the PTE
91-38 and, except as disclosed by such Purchaser to the Company in writing pursuant to this
clause (iii), no employee benefit plan or group of plans maintained by the same employer or
employee organization beneficially owns more than 10% of all assets allocated to such pooled
separate account or collective investment fund; or




     (iv) the Source constitutes assets of an “investment fund” (within the meaning of Part
V of PTE 84-14 (the “QPAM Exemption”)) managed by a “qualified professional asset manager”
or “QPAM” (within the meaning of Part V of the QPAM Exemption), no employee benefit plan’s
assets that are included in such investment fund, when combined with the assets of all other
employee benefit plans established or



39









 





maintained by the same employer or by an affiliate (within the meaning of Section V(c)(1) of the QPAM Exemption) of such employer or by the
same employee organization and managed by such QPAM, exceed 20% of the total client assets
managed by such QPAM, the conditions of Part I(c) and (g) of the QPAM Exemption are
satisfied, neither the QPAM nor a person controlling or controlled by the QPAM (applying the
definition of “control” in Section V(e) of the QPAM Exemption) owns a 5% or more interest in
the Company and (a) the identity of such QPAM and (b) the names of all employee benefit
plans whose assets are included in such investment fund have been disclosed to the Company
in writing pursuant to this clause (iv); or




     (v) the Source constitutes assets of a “plan(s)” (within the meaning of Section IV of
PTE 96-23 (the “INHAM Exemption”)) managed by an “in-house asset manager” or “INHAM” (within
the meaning of Part IV of the INHAM exemption), the conditions of Part I(a), (g) and (h) of
the INHAM Exemption are satisfied, neither the INHAM nor a person controlling or controlled
by the INHAM (applying the definition of “control” in Section IV(h) of the INHAM Exemption)
owns a 5% or more interest in the Company and (a) the identity of such INHAM and (b) the
name(s) of the employee benefit plan(s) whose assets constitute the Source have been
disclosed to the Company in writing pursuant to this clause (v); or




     (vi) the Source is a governmental plan; or




     (vii) the Source is one or more employee benefit plans, or a separate account or trust
fund comprised of one or more employee benefit plans, each of which has been identified to
the Company in writing pursuant to this clause (vii); or




     (viii) the Source does not include assets of any employee benefit plan, other than a
plan exempt from the coverage of ERISA.



As used in this paragraph 9B, the terms “employee benefit plan,” “governmental plan,” and “separate
account” shall have the respective meanings assigned to such terms in Section 3 of ERISA.




          10. DEFINITIONS; ACCOUNTING MATTERS. For the purpose of this Agreement, the terms defined in
paragraphs 10A and 10B (or within the text of any other paragraph) shall have the respective
meanings specified therein and all accounting matters shall be subject to determination as provided
in paragraph 10D.




          10A. Yield-Maintenance Terms.




          “Called Principal” means, with respect to any Note, the principal of such Note that is to be
prepaid pursuant to paragraph 4B or 4F or is declared to be immediately due and payable pursuant to
paragraph 7A, as the context requires.




          “Designated Spread” shall mean 1.00% in the case of each Series A Note and 0% in the case of
each Note of any other Series unless the Confirmation of Acceptance with respect to the Notes of
such Series specifies a different Designated Spread in which case it shall mean, with respect to
each Note of such Series, the Designated Spread so specified.





40









 








          “Discounted Value” means, with respect to the Called Principal of any Note, the amount
obtained by discounting all Remaining Scheduled Payments with respect to such Called Principal from
their respective scheduled due dates to the Settlement Date with respect to such Called Principal,
in accordance with accepted financial practice and at a discount factor (as converted to reflect
the periodic basis on which interest on such Note is payable, if payable other than on a
semi-annual basis) equal to the Reinvestment Yield with respect to such Called Principal.




          “Reinvestment Yield” means, with respect to the Called Principal of any Note, the Designated
Spread over the yield to maturity implied by (i) the yields reported as of 10:00 a.m. (New York
City local time) on the Business Day next preceding the Settlement Date with respect to such Called
Principal for actively traded U.S. Treasury securities having a maturity equal to the Remaining
Average Life of such Called Principal as of such Settlement Date on the Treasury Yield Monitor page
of Standard & Poor’s MMS – Treasury Market Insight (or, if Standard & Poor’s shall cease to report
such yields in MMS – Treasury Market Insight or shall cease to be Prudential Capital Group’s
customary source of information for calculating yield-maintenance amounts on privately placed
notes, then such source as is then Prudential Capital Group’s customary source of such
information), or if such yields shall not be reported as of such time or the yields reported as of
such time shall not be ascertainable, (ii) the Treasury Constant Maturity Series yields reported,
for the latest day for which such yields shall have been so reported as of the Business Day next
preceding the Settlement Date with respect to such Called Principal, in Federal Reserve Statistical
Release H.15(519) (or any comparable successor publication) for actively traded U.S. Treasury
securities having a constant maturity equal to the Remaining Average Life of such Called Principal
as of such Settlement Date. Such implied yield shall be determined, if necessary, by (a)
converting U.S. Treasury bill quotations to bond equivalent yields in accordance with accepted
financial practice and (b) interpolating linearly between yields reported for various maturities.
The Reinvestment Yield shall be rounded to that number of decimal places as appears in the coupon
of the applicable Note.




          “Remaining Average Life” means, with respect to the Called Principal of any Note, the number
of years (calculated to the nearest one-twelfth year) obtained by dividing (i) such Called
Principal into (ii) the sum of the products obtained by multiplying (a) each Remaining Scheduled
Payment of such Called Principal (but not of interest thereon) by (b) the number of years
(calculated to the nearest one-twelfth year) which will elapse between the Settlement Date with
respect to such Called Principal and the scheduled due date of such Remaining Scheduled Payment.




          “Remaining Scheduled Payments” means, with respect to the Called Principal of any Note, all
payments of such Called Principal and interest thereon that would be due on or after the Settlement
Date with respect to such Called Principal if no payment of such Called Principal were made prior
to its scheduled due date.




          “Settlement Date” means, with respect to the Called Principal of any Note, the date on which
such Called Principal is to be prepaid pursuant to paragraph 4B or 4F or is declared to be
immediately due and payable pursuant to paragraph 7A, as the context requires.




41









 








          “Yield-Maintenance Amount” means, with respect to any Note, (a) other than with respect to the
Series C Notes, an amount equal to the excess, if any, of the Discounted Value of the Called
Principal of such Note over the sum of (i) such Called Principal plus (ii) interest accrued thereon
as of (including interest due on) the Settlement Date with respect to such Called Principal and (b)
with respect to the Series C Notes (1) if the Settlement Date with respect to which the
Yield-Maintenance Amount is being determined is on or before June 18, 2007, an amount equal to the
excess, if any, of the Discounted Value of the Called Principal of such Series C Note over the sum
of (i) such Called Principal plus (ii) interest accrued thereon as of (including interest due on)
the Settlement Date with respect to such Called Principal, and (2) if the Settlement Date with
respect to which the Yield-Maintenance Amount is being determined is after June 18, 2007, the
percentage of the Called Principal of such Series C Note set forth below opposite the Settlement
Date:




	 	 	 	 	 
	Settlement Date	 	Percentage	 
	After June 18, 2007 and on or before
June 18, 2008
	 	 	3.50	%
	After June 18, 2008 and on or before
June 18, 2009
	 	 	3.00	%
	After June 18, 2009 and on or before
June 18, 2010
	 	 	2.50	%
	After June 18, 2010 and on or before
June 18, 2011
	 	 	2.00	%
	After June 18, 2011 and on or before
June 18, 2012
	 	 	1.50	%
	After June 18, 2012 and on or before
June 18, 2013
	 	 	1.00	%
	After June 18, 2013
	 	 	0.00	%






The Yield-Maintenance Amount shall in no event be less than zero.




          10B.Other Terms.




          “Acceptable Security Interest” in any Property means a Lien which (a) exists in favor of the
Collateral Agent for its benefit and the ratable benefit of the Holders, the Administrative Agent,
the Banks and the Bank Affiliates that are parties to any Hydrocarbon
Hedge Agreement or Interest Rate Contract with the Company or any of its Subsidiaries, (b) is
superior to all other Liens, except Permitted Liens, (c) secures the Obligations and, if
outstanding, the Bank Obligations and obligations of the Company to the Banks and Affiliates of
the Banks in respect of Interest Rate Contracts and Hydrocarbon Hedge Agreements (so long







42









 








as, with
respect to the Bank or Affiliate thereof, the Bank remains a Bank under the Bank Agreement) and (d)
is perfected and enforceable.




          “Acceptance” shall have the meaning specified in paragraph 2F.




          “Acceptance Day” shall have the meaning specified in paragraph 2F.




          “Acceptance Window” shall have the meaning specified in paragraph 2F.




          “Accepted Note” shall have the meaning specified in paragraph 2F.




          “Accounts” means the unpaid portion of the obligations to the Company and its Subsidiaries of
customers of the Company and its Subsidiaries to pay for goods sold and shipped or services
rendered (net of commissions to agents).




          “Acquisition” means the direct or indirect purchase or acquisition, whether in one or more
related transactions, by the Company or any of its Subsidiaries of any Person or group of Persons
(or any equity interest in any Person or group of Persons) or any related group of assets,
liabilities or securities of any Person or group of Persons, other than acquisitions of Property in
the ordinary course of business.




          “Acquisition Adjustment Period” means the period of three consecutive fiscal quarters
commencing on the first day of the fiscal quarter during which the Company or any of its
Subsidiaries consummates any Acquisition in which the purchase price therefor exceeds $50,000,000
(whether such purchase price is paid in cash, by the assumption of Debt of the Person or assets so
acquired, or otherwise) and ending on the last day of the third fiscal quarter following such date.




          “Additional Covenant” shall mean any affirmative or negative covenant or similar restriction
applicable to the Company or any Subsidiary (regardless of whether such provision is labeled or
otherwise characterized as a covenant) the subject matter of which either (i) is similar to that of
any covenant in paragraph 5 or 6 of this Agreement, or related definitions in paragraph 10 of this
Agreement, but contains one or more percentages, amounts or formulas that is more restrictive than
those set forth herein or more beneficial to the holder or holders of the Debt created or evidenced
by the document in which such covenant or similar restriction is contained (and such covenant or
similar restriction shall be deemed an Additional Covenant only to the extent that is more
restrictive or more beneficial) or (ii) is different from the subject matter of any covenants in
paragraph 5 or 6 of this Agreement, or related definitions in paragraph 10 of this Agreement.




          “Additional Default” shall mean any provision contained in any document or instrument creating
or evidencing Debt of the Company or any Subsidiary which permits the holder or holders of Debt to
accelerate (with the passage of time or giving of notice or both) the maturity thereof or otherwise
requires the Company or any Subsidiary to purchase such Debt
prior to the stated maturity thereof and which either (i) is similar to any Default or Event
of Default contained in paragraph 7 of this Agreement, or related definitions in paragraph 10 of
this Agreement, but contains one or more percentages, amounts or formulas that is more restrictive
or has a shorter grace period than those set forth herein or is more beneficial to the holders of such





43









 








other Debt (and such provision shall be deemed an Additional Default only to the extent that
it is more restrictive, has a shorter grace period or is more beneficial) or (ii) is different from
the subject matter of any Default or Event of Default contained in paragraph 7 of this Agreement,
or related definitions in paragraph 10 of this Agreement.




          “Administrative Agent” means Bank of America, in its capacity as administrative agent pursuant
to the Bank Agreement and any successor administrative agent appointed pursuant to the provisions
thereof.




          “Affiliate” means, as 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, such
Person or any Subsidiary of such Person. The term “control” (including the terms “controlled by”
or “under common control with”) means the possession, directly or indirectly, 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.




          “Agreement” has the meaning specified in paragraph 11C.




          “Agreement in Principle” means that certain letter dated March 11, 2003 from Prudential to the
Company.




          “Anti-Terrorism Order” means Executive Order No. 13,224 of September 24, 2001, Blocking
Property and Prohibiting Transactions with Persons Who Commit, Threaten to Commit or Support
Terrorism, 66 U.S. Fed. Reg. 49, 079 (2001), as amended.




          “Approved Consultant’s Report” means a report by Barnes & Click, Inc., Purvin & Gertz, Oil &
Gas Advisors, Inc. or another consultant selected by the Company and reasonably acceptable to the
Required Holders confirming that the assumptions used by the Company in the adjustments to EBITDA
in connection with any Acquisition, acquisition of Property or percentage of completion of
construction of Property are reasonable.




          “Asset Disposition” means any sale, transfer, license, lease or other disposition (including
any sale and leaseback transaction) of any property or any series of related dispositions of
property by any Person, including any sale, assignment, transfer or other disposal, with or without
recourse, of any notes or accounts receivable or any rights and claims associated therewith;
provided, that the term “Asset Disposition” shall not include any transaction permitted by
paragraph 6C(5)(i), (ii), (iii), (iv), (v) or (vi).




          “Assigned Agreements” means (a) the “Assigned Agreements” as defined in the Company Security
Agreement and (b) the “Assigned Agreements” as defined in the Guarantor Security Agreement.




          “Authorized Officer” shall mean (i) in the case of the Company, the chief executive officer,
chief financial officer or any vice president of the Ultimate General Partner
designated as an “Authorized Officer” of the Company for the purpose of this Agreement in an
Officer’s Certificate executed by the Ultimate General Partner’s chief executive officer or chief
financial officer and delivered to Prudential, and (ii) in the case of Prudential, any officer of
Prudential designated as its “Authorized Officer” in the Purchaser Schedule or any officer
of






44









 








Prudential designated as its “Authorized Officer” for the purpose of this Agreement in a
certificate executed by one of its Authorized Officers. Any action taken under this Agreement on
behalf of the Company by any individual who on or after the date of this Agreement shall have been
an Authorized Officer of the Company and whom Prudential in good faith believes to be an Authorized
Officer of the Company at the time of such action shall be binding on the Company even though such
individual shall have ceased to be an Authorized Officer of the Company, and any action taken under
this Agreement on behalf of Prudential by any individual who on or after the date of this Agreement
shall have been an Authorized Officer of Prudential and whom the Company in good faith believes to
be an Authorized Officer of Prudential at the time of such action shall be binding on Prudential
even though such individual shall have ceased to be an Authorized Officer of Prudential.




          “Available Cash” for any fiscal quarter has the meaning set forth in the Company Partnership
Agreement.




          “Available Facility Amount” shall have the meaning specified in paragraph 2A.




          “Bank Agreement” means the Third Amended and Restated Credit Agreement dated as of March 31,
2005 among the Company, the Banks, Bank of America, N.A., as Administrative Agent, Union Bank of
California, N.A., as Syndication Agent, and Royal Bank of Canada and BNP Paribas, as
Co-Documentation Agents, and as further amended, modified or supplemented from time to time as
permitted by this Agreement.




          “Bank Agreement Documents” means the “Credit Documents” as defined in the Bank Agreement on
the date hereof.




          “Bank Obligations” means the “Obligations,” as such term is defined in the Bank Agreement on
the date hereof.




          “Bankruptcy Law” shall have the meaning specified in clause (viii) of paragraph 7A.




          “Banks” means the lenders listed on the signature pages of the Bank Agreement and each
Eligible Assignee (as defined in the Bank Agreement) that shall become a party to the Bank
Agreement pursuant to the terms thereof.




          “Business Day” means any day other than (i) a Saturday or a Sunday, (ii) a day on which
commercial banks in New York City are required or authorized to be closed and (iii) for purposes of
paragraph 2C hereof only, a day on which Prudential is not open for business.




          “Cancellation Date” shall have the meaning specified in paragraph 2I(3).




          “Cancellation Fee” shall have the meaning specified in paragraph 2I(3).




          “Capital Leases” means, as applied to any Person, any lease of any Property by such Person as
lessee which would, in accordance with GAAP, be required to be classified and accounted for as a
capital lease on the balance sheet of such Person.




45









 








          “CERCLA” means the Comprehensive Environmental Response, Compensation, and Liability Act of
1980, as amended, state and local analogs, and all rules and regulations and requirements
thereunder in each case as now or hereafter in effect.




          “CERCLIS” means the Comprehensive Environmental Response, Compensation and Liability
Information System maintained by the U.S. Environmental Protection Agency.




          “CESL Partnership Agreement” means the Second Amended and Restated Agreement of Limited
Partnership of Crosstex Energy Services, L.P., dated as of April 1, 2004 between Crosstex Operating
GP, LLC, Crosstex Energy, L.P. and the other parties thereto, as the same may be amended, modified
or supplemented from time-to-time as permitted by this Agreement.




          “Change of Control” means an event or series of events by which:




          (a) any “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, but excluding any employee benefit plan of such person or its
subsidiaries, and any person or entity acting in its capacity as trustee, agent or other fiduciary
or administrator of any such plan) other than the Qualifying Owners becomes the “beneficial owner”
(as defined in Rules 13d-3 and 13d-5 under the Securities Exchange Act of 1934) of 50% or more of
the equity securities of the Ultimate General Partner entitled to vote for members of the board of
directors or equivalent governing body of the Ultimate General Partner on a fully-diluted basis; or




          (b) during any period of 12 consecutive months, a majority of the members of the board of
directors or other equivalent governing body of the Ultimate General Partner cease to be composed
of individuals (i) who were members of that board or equivalent governing body on the first day of
such period, (ii) whose election or nomination to that board or equivalent governing body was
approved by individuals referred to in clause (i) above constituting at the time of such election
or nomination at least a majority of that board or equivalent governing body or (iii) whose
election or nomination to that board or other equivalent governing body was approved by individuals
referred to in clauses (i) and (ii) above constituting at the time of such election or nomination
at least a majority of that board or equivalent governing body (excluding, in the case of both
clause (ii) and clause (iii), any individual whose initial nomination for, or assumption of office
as, a member of that board or equivalent governing body occurs as a result of an actual or
threatened solicitation of proxies or consents for the election or removal of one or more directors
by any person or group other than a solicitation for the election of one or more directors by or on
behalf of the board of directors).




          “Closing Day” means, with respect to any Accepted Note, the Business Day specified for the
closing of the purchase and sale of such Accepted Note in the Request for Purchase of such Accepted
Note, provided that (i) if the Company and the Purchasers which are obligated to purchase such Note
agree in writing on an earlier Business Day for such closing, the
“Closing Day” for such Accepted Note shall be such earlier Business Day, and (ii) if the
closing of the purchase and sale of such Accepted Note is rescheduled pursuant to paragraph 2H, the
Closing Day for such Accepted Note, for all purposes of this Agreement except references to




46









 








“original Closing Day” in paragraph 2I(2), shall mean the Rescheduled Closing Day with respect to
such Accepted Note.




          “Code” means the Internal Revenue Code of 1986, as amended, and any successor statute.




          “Collateral” means all Collateral as defined in each of the Security Agreements and in each of
the Mortgages.




          “Collateral Agent” means Bank of America, N.A., in its capacity as collateral agent pursuant
to the Intercreditor Agreement and any successor collateral agent appointed pursuant to the
provisions thereof.




          “Collateral Release Date” shall mean the date upon which each of the following shall have
occurred: (i) the Company shall have obtained a rating of its senior unsecured debt (or if no such
senior unsecured debt is outstanding that is rated by Standard and Poors, Moody’s Investors
Services, Inc. or Fitch Ratings, the Company has a corporate debt rating) of BBB – or better from
Standard and Poor’s, a division of the McGraw-Hill Company, Baa3 or better from Moody’s Investors
Services, Inc., or BBB – or better from Fitch Ratings, (ii) all of the other Creditors (as defined
in the Intercreditor Agreement) shall have directed the Collateral Agent in writing, in form and
substance reasonably satisfactory to the Required Holder(s), to release all Liens in the Collateral
securing any Obligations (as defined in the Intercreditor Agreement) and to terminate all Security
Agreements, Mortgages and any other instrument or agreement pursuant to which a Lien has been
created or arose to secure any or all of the Obligations (as defined in the Intercreditor
Agreement), (iii) all parties to the Intercreditor Agreement shall have executed an amendment to or
a restatement of the Intercreditor Agreement, in form and substance reasonably satisfactory to the
Required Holder(s), amending the Intercreditor Agreement to reflect the releases and terminations
referred to in clause (ii), above, and the termination of the appointment and authority of the
Collateral Agent (except with respect to distribution of “Specified Payments” (as defined in the
Intercreditor Agreement), (iv) all parties to the Bank Agreement shall have executed an amendment
to the Bank Agreement, in form and substance reasonably satisfactory to the Required Holder(s),
deleting any requirement that the Company or any Subsidiary grant or maintain any Lien to secure
any Obligations owed thereunder, changing the definition of “Credit Documents” contained thereto to
delete the reference to “the Security Documents”, and making other changes to reflect the
terminations and releases referred to in clause (ii), above, and the other amendments referred to
in this clause (iv), and (v) no Default or Event of Default shall have occurred and be continuing.




          “Company” shall have the meaning specified in the first paragraph hereof.




          “Company Partnership Agreement” means the Second Amended and Restated Agreement of Limited
Partnership of Crosstex Energy, L.P. dated as of March 29, 2004 among the General Partner and
Crosstex Energy, Inc., as the Organizational Limited Partner, as the
same may be amended, modified or supplemented from time-to-time as permitted by this
Agreement.





47









 








          “Company Security Agreement” means the Security Agreement between the Company and the
Collateral Agent in form and substance reasonably satisfactory to the Collateral Agent and the
Required Holders, substantially in the form of Exhibit G attached hereto, and as it may be
further amended, modified or supplemented from time-to-time.




          “Confirmation of Acceptance” shall have the meaning specified in paragraph 2F.




          “Consolidated” refers to the consolidation of the accounts of the Company and its Subsidiaries
in accordance with GAAP, including, when used in reference to the Company, principles of
consolidation consistent with those applied in the preparation of the financial statements referred
to in paragraphs 5A and 8B.




          “Debt” for any Person, means, without duplication,




(a) indebtedness of such Person for borrowed money;



(b) obligations of such Person evidenced by bonds, debentures, notes or
other similar instruments;



(c) obligations of such Person to pay the deferred purchase price of
Property or services (other than trade payables which are not more than 90
days past due, except for any such trade payables which are being contested
in good faith and by appropriate proceedings);



(d) all indebtedness created or arising under any conditional-sale or other
title-retention agreement with respect to property acquired by such Person
(even though the rights and remedies of the seller or lender under such
agreement in the event of default are limited to repossession or sale of
such property);



(e) obligations of such Person as lessee under Capital Leases;



(f) the net amount payable by such Person under any Hydrocarbon Hedge
Agreement or Interest Rate Contract if such Hydrocarbon Hedge Agreement or
Interest Rate Contract terminated at the date of determination due to a
default by such Person;



(g) reimbursement obligations of such Person in respect of letters of
credit, acceptance facilities, drafts or similar instruments issued or
accepted by banks and other financial institutions for the account of such
Person;



(h) obligations of such Person under direct or indirect guaranties in
respect of, and obligations (contingent or otherwise) of such Person to
purchase or otherwise acquire, or otherwise to assure a creditor against
loss in respect of, another’s indebtedness or obligations of the kinds
referred to in clauses (a) through (g) above; and




48









 








(i) another’s indebtedness or obligations of the kinds referred to in
clauses (a) through (h) secured by any Lien on or in respect of any Property
of such Person; provided that the amount of such Debt, if such Person has
not assumed the same or become liable therefore, shall in no event be deemed
to be greater than the fair market value from time to time of the Property
subject to such Lien.



          “Default Rate” means, for any Note at any time upon the occurrence of an Event of Default and
until such Event of Default has been cured or waived in writing, a rate of interest per annum from
time to time equal to the lesser of (i) the maximum rate permitted by applicable law and (ii) the
greater of (a) 2% over the coupon rate for such Note over the rate of interest in effect
immediately prior to such Event of Default and (b) 2.0% over the rate of interest publicly
announced by The Bank of New York from time to time in New York City as its Prime Rate.




          “Delayed Delivery Fee” shall have the meaning specified in paragraph 2I(2).




          “EBITDA” means, for the Company and its Subsidiaries on a Consolidated basis for any period,
(a) Net Income for such period plus (b) to the extent deducted in determining Net Income,
Interest Expense, taxes, depreciation, amortization and other noncash items for such period.
EBITDA shall be calculated, on a pro forma basis, after giving effect to, without duplication, (a)
any Acquisition or (b) any Property under construction (based on the percentage of completion of
construction of any such Property), in each case, occurring during the period commencing on the
first day of such period to and including the date of such transaction or percentage of completion
of Property under construction to be included in EBITDA, as the case may be (the “Reference
Period”) and whether or not such acquired Property or percentage of completion of such construction
of Property were operated during such Reference Period, as if such Acquisition or percentage of
completion of such construction of Property occurred on the first day of the Reference Period. In
making the calculation contemplated by the preceding sentence, EBITDA generated or to be generated
by such acquired Person, by such acquired Property or by such Property under construction (based on
the percentage of completion of construction of such Property) shall be determined in good faith by
the Company based on reasonable assumptions and may take into account pro forma expenses that would
have been incurred by the Company and its Subsidiaries in the operation of such acquired Person,
acquired Property or Property under construction, (based on the percentage of completion of
construction of such Property, during such period computed on the basis of personnel expenses for
employees retained or to be retained by the Company and its Subsidiaries in the operation of such
acquired Person, acquired Property or Property under construction (based on the percentage of
completion of construction of such Property) and non-personnel costs and expenses incurred by the
Company and its Subsidiaries in the operation of the Company’s and its Subsidiaries’ business at
similarly situated facilities of the Company or any of its Subsidiaries; provided however, that
such pro forma calculations shall be reasonably acceptable to the Required Holders if the Company
does not provide the Holders with an Approved Consultant’s Report supporting such pro forma
calculations (any such pro forma calculations described in this sentence being
hereinafter referred to as “Pro Forma EBITDA”). Notwithstanding the foregoing, such pro forma
adjustments to EBITDA with respect to any Property under construction shall be reduced if such
construction is not completed by, or if the estimated date by which such construction is to be
completed is beyond, a date that is more than 90 days beyond the Scheduled Completion Date





49









 








for such
construction, such reduction to be reflected in the next set of financial statements to be
delivered to the Holders on or after the date such construction is not so completed or it is
determined that such construction will not be so completed and to be in an amount equal to the
product of (i) the applicable percentage reduction rate relating to the number of days of delay as
set forth below and (ii) the amount of the Pro Forma EBITDA attributable to such property:




	 	 	 	 	 
	Delay or estimated delay,	 	applicable percentage
	whichever is greater	 	reduction rate
	>90 days < 180 days
	 	 	25	%
	>180 days < 270 days
	 	 	50	%
	> 270 days
	 	 	100	%






          “Environmental Law” means any Governmental Rule relating to pollution or protection of the
environment or any natural resource, to any Hazardous Material or to health or safety, including
any Governmental Rule relating to the use, handling, transportation, treatment, storage, disposal,
release or discharge of any Hazardous Material.




          “Environmental Permit” means any Governmental Action required under any Environmental Law.




          “Environmental Proceeding” means any action, suit, written demand, demand letter, claim,
notice of noncompliance or violation, notice of liability or potential liability, investigation,
proceeding, consent order or consent agreement relating in any way to any Environmental Law, any
Environmental Permit or any Hazardous Material or arising from alleged injury or threat to health,
safety or the environment, including (a) by any Governmental Person for enforcement, cleanup,
removal, response, remedial or other action or damages and (b) by any Person for damages,
contribution, indemnification, cost recovery, compensation or injunctive relief.




          “ERISA” means the Employee Retirement Income Security Act of 1974, as amended from time to
time, and the regulations promulgated and rulings issued thereunder.




          “ERISA Affiliate” means any Person that for purposes of Title IV of ERISA is a member of the
Company’s controlled group, or is under common control with the Company, within the meaning of
Section 414 of the Code and the regulations promulgated and rulings issued thereunder.




          “ERISA Event” means (a) a Reportable Event with respect to a Plan; (b) a withdrawal by the
Company or any ERISA Affiliate from a Plan subject to Section 4063 of ERISA during a plan year in
which it was a substantial employer (as defined in Section 4001(a)(2) of ERISA) or a cessation of
operations that is treated as such a withdrawal under Section 4062(e) of ERISA; (c) a complete or
partial withdrawal by the Company or any ERISA Affiliate from a Multiemployer Plan or notification
that a Multi Employer Plan is in
reorganization; (d) the filing of a notice of intent to terminate, the treatment of a Plan
amendment as a termination under Sections 4041 or 4041A of ERISA, or the commencement of
proceedings by the PBGC to terminate a Plan or Multiemployer Plan; (e) an event or condition which
constitutes grounds under Section 4042 of ERISA for the termination of, or the appointment of a





50









 








trustee to administer, any Plan or Multiemployer Plan; or (f) the imposition of any liability under
Title IV of ERISA, other than for PBGC premiums due but not delinquent under Section 4007 of ERISA,
upon the Company or any ERISA Affiliate.




          “Event of Default” means any of the events specified in paragraph 7A, provided that there has
been satisfied any requirement in connection with such event for the giving of notice, or the lapse
of time, or the happening of any further condition, event or act, and “Default” shall mean any of
such events, whether or not any such requirement has been satisfied.




          “Exchange Act” means the Securities Exchange Act of 1934, as amended.




          “Existing Note” shall have the meaning specified in the Introduction.




          “Existing Series A Notes” shall have the meaning specified in the Introduction.




          “Existing Series B Notes” shall have the meaning specified in the Introduction.




          “Existing Series C Notes” shall have the meaning specified in the Introduction.




          “Existing Shelf Agreement” shall have the meaning specified in the Introduction.




          “Facility” shall have the meaning specified in paragraph 2A.




          “Finance Entity” means any Subsidiary of the Company that is not also a Subsidiary of Crosstex
Energy Services, L.P. and that is formed for the purpose of issuing Debt specifically permitted by
clause (xi) of paragraph 6C(2).




          “Funded Debt” of any Person means Debt of such Person as described in clauses (a), (b), (d)
and (e) of the definition of “Debt” in this paragraph 10B.




          “GAAP” means United States generally accepted accounting principles as in effect from time to
time, applied on a basis consistent with the requirements of paragraph 10D.




          “General Partner” means Crosstex Energy GP, L.P., a Delaware limited partnership.




          “Governmental Action” means any authorization, approval, consent, waiver, exception, license,
filing, registration, permit, notarization or other requirement of any Governmental Person.




          “Governmental Person” means, whether domestic or foreign, any national, federal, state or
local government, any political subdivision thereof, or any governmental, quasi-
governmental, judicial, public or statutory instrumentality, authority, body or entity,
including any central bank and any comparable authority.




51









 








          “Governmental Rule” means any treaty, law, rule, regulation, ordinance, order, code,
interpretation, judgment, writ, injunction, decree, determination, award, directive, guideline,
request, policy or similar form of decision of any Governmental Person, referee or arbitrator.




          “Guarantor” means as of the date hereof, Prior Issuer and each of the Persons listed on
Schedule 10B(3), and thereafter, each of the present and future direct and indirect
Material Subsidiaries of the Company (other than any Material Subsidiary of the Company that is not
organized in a jurisdiction in the United States of America if the Guaranty by such Material
Subsidiary could reasonably be expected to have material adverse tax consequences on the Company or
any Subsidiary), and “Guarantors” means all such Guarantors collectively.




          “Guarantor Security Agreement” means the Second Amended and Restated Subsidiary Security
Agreement between each of the Guarantors and the Collateral Agent, in substantially the form of
Exhibit H attached hereto, as amended, modified or supplemented from time-to-time.




          “Guaranty” means each of the Guaranties executed by each Guarantor, in substantially the form
of Exhibit F attached hereto, as each may be amended from time-to-time, and “Guaranties”
shall mean all such Guaranties collectively.




          “Hazardous Material” means any substance or material described as a toxic or hazardous
substance, waste or material or as a pollutant, contaminant or infectious waste, or words of
similar import, in any Environmental Law, including asbestos, petroleum (including crude oil and
any fraction thereof, natural gas, natural-gas liquid, liquefied natural gas and synthetic gas
usable for fuel, and any mixture of any of the foregoing), polychlorinated biphenyls, urea
formaldehyde, radon gas, radioactive matter, and chemicals that may cause cancer or reproductive
toxicity.




          “Hedge Treasury Note(s)” means, with respect to any Accepted Note, the United States Treasury
Note or Notes whose duration (as determined by Prudential) most closely matches the duration of
such Accepted Note.




          “Holder” means a holder of Notes and “Holders” means the holders of the Notes from time to
time.




          “Hostile Tender Offer” means, with respect to the use of proceeds of any Note, any offer to
purchase, or any purchase of, shares of capital stock of any corporation or equity interests in any
other entity, or securities convertible into or representing the beneficial ownership of, or rights
to acquire, any such shares or equity interests, if such shares, equity interests, securities or
rights are of a class which is publicly traded on any securities exchange or in any
over-the-counter market, other than purchases of such shares, equity interests, securities or
rights representing less than 5% of the equity interests or beneficial ownership of such
corporation or other entity for portfolio investment purposes, and such offer or purchase has not
been duly approved by the board of directors of such corporation or the equivalent governing
body of such other entity prior to the date on which the Company makes the Request for
Purchase of such Note.





52









 








          “Hydrocarbon Hedge Agreement” means a swap, collar, floor, cap, option or other derivative
contract which is intended to reduce or eliminate the risk of fluctuations in the price of
Hydrocarbons.




          “Hydrocarbons” means oil, gas, coal seam gas, casinghead gas, drip gasoline, natural gasoline,
condensate, distillate, and all other liquid and gaseous hydrocarbons produced or to be produced in
conjunction therewith from a well bore and all products, by-products, and other substances derived
therefrom or the processing thereof, and all other minerals and substances produced in conjunction
with such substances, including, but not limited to, sulfur, geothermal steam, water, carbon
dioxide, helium, and any and all minerals, ores, or substances of value and the products and
proceeds therefrom.




          “including” means, unless the context clearly requires otherwise, “including without
limitation”.




          “INHAM Exemption” shall have the meaning set forth in paragraph 9B.




          “Intercreditor Agreement” means the Amended and Restated Intercreditor and Collateral Agency
Agreement in substantially the form of Exhibit I attached hereto, as it may be amended,
modified or supplemented from time-to-time in accordance with its terms.




          “Interest Charge Coverage Ratio” means, for the Company and its Subsidiaries on a Consolidated
basis, as of the end of any fiscal quarter, the ratio of (a) EBITDA for the four-fiscal quarter
period then ended to (b) Interest Expense for the four-fiscal quarter period then ended.




          “Interest Expense” means, for the Company and its Subsidiaries determined on a Consolidated
basis, for any period, the total interest, letter of credit fees, and other fees incurred in
connection with any Debt for such period, whether paid or accrued, including, without limitation,
all commissions, discounts and other fees and charges owed with respect to letters of credit and
bankers’ acceptance financing, all as determined in conformity with GAAP and on a pro forma basis
at any time that EBITDA is being determined on such a basis.




          “Interest Rate Contract” means an interest rate protection agreement, interest rate future,
interest rate option, interest rate swap, interest rate cap, collar or other interest rate hedge
arrangement, to or under which the Company or any Subsidiary is or becomes a party.




          “Issuance Fee” shall have the meaning specified in paragraph 2I(1).




          “Issuance Period” shall have the meaning specified in paragraph 2B.




          “Letter of Credit” means, individually, any letter of credit issued by the issuing Bank which
is subject to the Bank Agreement and “Letters of Credit” means all such letters of credit
collectively.




          “Leverage Ratio” means, for the Company and its Subsidiaries on a Consolidated basis, as of
the end of any fiscal quarter, the ratio of (a) Funded Debt for the Company and its




53









 








Subsidiaries on
a Consolidated basis as of the end of such fiscal quarter to (b) EBITDA for the four fiscal
quarters then ended.




          “Lien” means, with respect to any Property, (a) any lien, charge, option, claim, deed of
trust, mortgage, security interest, pledge or other encumbrance, or any other type of preferential
arrangement of any kind, in respect of such Property, including any easement, right of way or other
encumbrance on title to real property, or (b) the interest of a vendor or lessor under any
conditional-sale agreement, capital lease or other title-retention agreement relating to such
Property.




          “Limited Partners” means Crosstex Holdings, L.P., a Delaware limited partnership, and each of
the other limited partners of the Company.




          “Loan Documents” means, collectively, the Agreement in Principle, this Agreement, the Notes,
the Security Documents, the Guaranties, the Intercreditor Agreement, each Confirmation of
Acceptance and each other agreement, instrument or document executed at any time in connection with
the foregoing documents, as each such Loan Document may be amended, modified or supplemented from
time-to-time.




          “Louisiana Guarantors” means each of Crosstex LIG, LLC and Crosstex Tuscaloosa, LLC.




          “Material Adverse Effect” shall mean a material adverse effect on (a) the business, assets,
properties, liabilities (actual and contingent), operations or condition (financial or otherwise)
of the Company and its Subsidiaries, taken as a whole, (b) the ability of the Company or any
Guarantor to perform its obligations under this Agreement or any of the Loan Documents or (c) the
rights and remedies of the Holders or the Collateral under this Agreement or any of the Loan
Documents.




          “Material Subsidiaries” means shall mean a Subsidiary of the Company having: (a) assets of
$10,000,000 or more or (b) EBITDA (calculated on a separate basis) of $2,500,000 or more.




          “Maximum Rate” means the maximum nonusurious interest rate under applicable law.




          “Moody’s” means Moody’s Investors Service, Inc. and any successor thereto.




          “Mortgaged Property” means the aggregate of all of the “Mortgaged Property” and “Trust
Property” as defined in all of the Mortgages.




          “Mortgages” means, collectively, each mortgage, deed of trust or other similar agreement
executed by the Company or any Subsidiary in favor of the Collateral Agent for its benefit and the
ratable benefit of the Banks and the Holders, in form and substance reasonably satisfactory to the
Collateral Agent and the Required Holder(s), as the same may be amended, modified or supplemented
from time-to-time.




54









 





          “Multiemployer Plan” means a “multiemployer plan,” as defined in Section 4001(a)(3) of ERISA
and subject to Title IV thereof, to which the Company or any ERISA Affiliate is making or accruing
an obligation to make contributions, or has within any of the preceding five plan years made or
accrued an obligation to make contributions, such plan being maintained pursuant to one or more
collective-bargaining agreements.




          “Multiple Employer Plan” means a “single employer plan,” as defined in Section 4001(a)(15) of
ERISA and subject to Title IV thereof, that (a) is maintained by the Company or an ERISA Affiliate
and at least one Person other than the Company and its ERISA Affiliates or (b) was so maintained
previously, but is not currently maintained by the Company or its ERISA Affiliates, and in respect
of which the Company or an ERISA Affiliate would still have liability under Section 4063, 4064 or
4069 of ERISA in the event such plan has been or were to be terminated.




          “NAIC Annual Statement” shall have the meaning set forth in paragraph 9B.




          “Net Cash Proceeds” means (a) in connection with any Asset Disposition or Recovery Event, the
proceeds thereof in the form of cash and cash equivalents (including any such proceeds received by
way of deferred payment of principal pursuant to a note or installment receivable or purchase price
adjustment receivable or otherwise, but only as and when received) of such Asset Disposition or
Recovery Event, net of attorneys’ fees, accountants’ fees, investment banking fees and insurance
consultant fees, amounts required to be applied to the repayment of Debt secured by a Lien
permitted hereunder on any asset which is the subject of such Asset Disposition or Recovery Event
(other than any Lien pursuant to a Security Document) and other customary fees and expenses
actually incurred in connection therewith and net of taxes paid or reasonably estimated to be
payable as a result thereof within two years of the date of the relevant Asset Disposition or
Recovery Event as a result of any gain recognized in connection therewith (after taking into
account any applicable tax credits or deductions and any tax sharing arrangements) and (b) in
connection with any issuance or sale of debt securities or instruments or the incurrence of loans,
the cash proceeds or cash equivalents received from such issuance or incurrence, net of attorneys’
fees, investment banking fees, brokerage, finder’s or similar fees, accountants’ fees, underwriting
discounts and commissions and other customary fees and expenses actually incurred in connection
therewith




          “Net Income” means, for any period for which such amount is being determined, the Consolidated
net income of the Company and its Subsidiaries, as determined in accordance with GAAP consistently
applied, excluding, however, any net gain or loss from extraordinary items, including but not
limited to any net gain or loss during such period arising from the sale, exchange, or other
disposition of capital assets other than in the ordinary course of business.




          “New Subsidiary Guarantors” shall have the meaning specified in paragraph 5P(i)(b).




          “Notes” shall have the meaning specified in paragraph 1D.




          “Obligations” means the principal, interest, fees, Yield-Maintenance Amount, charges,
expenses, attorneys’ fees and disbursements, indemnities and any other amounts




55









 





payable by the Company and the Guarantors to the Collateral Agent and the Holders under the
Loan Documents.




          “Officer’s Certificate” means a certificate signed in the name of the Company by an Authorized
Officer of the Company.




          “Omnibus Agreement” means the Omnibus Agreement among the Company, the General Partner, the
Ultimate General Partner, Crosstex Energy, Inc. and Crosstex Energy Services, L.P.




          “Partners” means the General Partner and the Limited Partners.




          “PBGC” means the Pension Benefit Guaranty Corporation.




          “Permitted Investments” means investments having a maturity of not greater than 3 months from
the date of acquisition thereof in (a) obligations issued or unconditionally guaranteed by the
United States of America or issued by any agency thereof and backed by the full faith and credit of
the United States of America, (b) demand deposits and certificates of deposit (located in the
United States of America) of any Bank or any other commercial bank organized under the laws of the
United States of America or any state thereof and having combined capital and surplus of at least
$500,000,000, (c) commercial paper with a rating of at least “Prime-l” by Moody’s or “A-l” by S&P
or (d) other investments agreed to from time to time between the Company and the Required Holders.




          “Permitted Liens” means such of the following as to which no enforcement, collection,
execution, levy or foreclosure proceeding has been commenced that has not been stayed or bonded
pending appeal: (a) Liens for taxes, assessments and governmental charges or levies, to the extent
the same are not yet due or are being contested in good faith by proper proceedings and appropriate
reserves are being maintained for the same; (b) Liens imposed by law, such as materialmen’s,
mechanics’, carriers’, workmen’s, repairmen’s and bankers’ Liens and other similar Liens arising in
the ordinary course of business securing obligations that are not overdue for a period of more than
60 days or that are being contested in good faith and by proper proceedings and as to which
appropriate reserves are being maintained; (c) pledges or deposits to secure obligations under
workers’ compensation laws or similar legislation or to secure public or statutory obligations; (d)
easements, rights of way, landlord’s liens and other encumbrances on title to real property that do
not materially and adversely affect the value of such property or the use of such property by the
Company or any Subsidiary for its current purposes; (e) deposits to secure the performance of bids,
trade contracts (other than for borrowed money), leases, statutory obligations, surety and appeal
bonds, performance bonds and other obligations of like nature incurred in the ordinary course of
business; and (f) Liens arising by reason of any judgment or order of any Governmental Person,
referee or arbitrator if appropriate legal proceedings for the review of such judgment or order are
being diligently prosecuted and execution or enforcement thereof is stayed pending appeal.




          “Person” means an individual, partnership, corporation (including a business trust), limited
liability partnership, limited liability company, joint stock company, trust,




56









 





unincorporated association, joint venture or other entity, or a government or any political
subdivision or agency thereof or any trustee, receiver, custodian or similar official.




          “PICA” means The Prudential Insurance Company of America.




          “Pipeline Entities” means Crosstex Pipeline, LLC, a Texas limited liability company, and
Crosstex Pipeline Partners, Ltd., a Texas limited partnership.




          “Plan” means a Single Employer Plan or a Multiple Employer Plan.




          “Prior Issuer” shall have the meaning specified in the first paragraph hereof.




          “Property” of any Person means any property or assets (whether real, personal, or mixed,
tangible or intangible) of such Person.




          “Proposed Prepayment Date” shall have the meaning specified in paragraph 4F(iii).




          “Prudential” means Prudential Investment Management, Inc.




          “Prudential Affiliate” means (i) any corporation or other entity controlling, controlled by,
or under common control with, Prudential either directly or through subsidiaries and (ii) any
managed account or investment fund which is managed by Prudential or a Prudential Affiliate
described in clause (i) of this definition. For purposes of this definition, the terms “control”,
“controlling” and “controlled” shall mean the ownership, directly or through subsidiaries, of a
majority of a corporation’s or other entity’s Voting Stock or equivalent voting securities or
interests.




          “Purchasers” means PICA and Pruco Life Insurance Company with respect to the Series A Notes,
PICA with respect to the Series B Notes, The Prudential Insurance Company of America, Pruco Life
Insurance Company, Pruco Life Insurance Company of New Jersey, Gibraltar Life Insurance Company,
Ltd., RGA Reinsurance Company, Connecticut General Life Insurance Company and Zurich American
Insurance Company with respect to the Series C Notes, and, with respect to any Accepted Notes,
Prudential and/or the Prudential Affiliate(s) which are purchasing such Accepted Notes.




          “QPAM Exemption” shall have the meaning set forth in paragraph 9B.




          “Qualifying Owners” means (a) the significant owners of the ultimate parent company of the
General Partner, Crosstex Energy, Inc., on the date hereof, consisting of Yorktown Energy Partners
IV, L.P., Yorktown Energy Partners V, L.P., Lubar Nominees and Barry E. Davis or any Affiliate of
the foregoing, (b) Crosstex Energy, Inc. and its Affiliates and (c) any transferee of any of the
foregoing to the extent such transferee is approved by a majority of the ownership interests of the
then-existing Qualifying Owners (other than the transferor) or any Affiliate of the foregoing.




57









 





          “Quarterly Distributions” means cash distributions by the Company to the Partners during any
fiscal quarter in amounts that do not exceed the Available Cash for the immediately preceding
fiscal quarter.




          “Recovery Event” means any settlement of or payment in respect of any property or casualty
insurance claim (excluding any claim in respect of business interruption) or any condemnation
proceeding relating to any asset of the Company or any of its Subsidiaries.




          “Reinvestment Deferred Amount” with respect to any Reinvestment Event, the aggregate Net Cash
Proceeds received by the Company or any of its Subsidiaries in connection therewith that are not
required to be applied to prepay the Notes pursuant to paragraph 4F or the Bank Obligations as a
result of the delivery of a Reinvestment Notice.




          “Reinvestment Event” means any Asset Disposition or Recovery Event in respect of which a
Reinvestment Notice has been delivered.




          “Reinvestment Notice” means a written notice executed by a Responsible Officer stating that no
Event of Default has occurred and is continuing and that the Company (directly or indirectly
through a Subsidiary) intends and expects to use all or a specified portion of the Net Cash
Proceeds of a Asset Disposition or Recovery Event to acquire assets useful in its business and/or
to repair Property, as applicable.




          “Reinvestment Prepayment Amount” means with respect to any Reinvestment Event, the
Reinvestment Deferred Amount relating thereto less any amount expended prior to the relevant
Reinvestment Prepayment Date, and in any event expended prior to the date on which the Company
would otherwise be required to apply such Reinvestment Deferred Amount to repay any other Debt of
the Company or any of its Subsidiaries, to acquire assets useful in the business of any such Person
and/or to repair Property, as applicable.




          “Reinvestment Prepayment Date” means with respect to any Reinvestment Event, the earlier of
(a) the date occurring 270 days after such Reinvestment Event or, provided that the Company
(directly or indirectly through a Subsidiary) has entered into a binding contract to acquire assets
useful in its business and/or to repair Property, as applicable, such later date as is reasonably
determined by the Company and notified to the Holders to be the earliest date on which the Company
(directly or indirectly through a Subsidiary), shall have, using diligent efforts, (i) completed
acquiring assets useful in its business and/or (ii) repaired Property, as applicable and (b) the
date on which the Company (directly or indirectly through a Subsidiary) shall have determined not
to, or shall have otherwise ceased to, acquire assets useful in its business and/or to repair
Property, as applicable, with all or any portion of the relevant Reinvestment Deferred Amount.




          “Reportable Event” means any of the events set forth in Section 4043(c) of ERISA, other than
events for which the 30 day notice period has been waived.




          “Request for Purchase” shall have the meaning specified in paragraph 2D.




          “Required Holder(s)” means the Holder or Holders of at least 50.1% of the aggregate principal
amount of the Notes outstanding at such time.




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          “Rescheduled Closing Day” shall have the meaning specified in paragraph 2H(3).




          “Responsible Officer” means the Chief Executive Officer, President, Chief Financial Officer,
any Executive Vice President, any Senior Vice President, the Vice President of Finance, Treasurer
or Assistant Treasurer of the Ultimate General Partner.




          “Restatement Date” means March 31, 2005.




          “S&P” means Standard & Poor’s Ratings Services, a division of The McGraw-Hill Companies, Inc.,
and any successor thereto.




          “Scheduled Completion Date” means with respect to the construction of any Property, the date
indicated as the Company’s good faith estimate of the scheduled date of the completion of such
construction in the first certificate sent by the Company pursuant to paragraph 5A(i) or 5A(ii)
which includes the first calculation of Pro Forma EBITDA for such Property.




          “SEC” means the Securities and Exchange Commission (or any governmental body or agency
succeeding to the function of the Securities and Exchange Commission.)




          “Securities Act” means the Securities Act of 1933, as amended.




          “Security Agreements” means, collectively, the Company Security Agreement and the Guarantor
Security Agreement.




          “Security Documents” means, collectively, (a) the Security Agreements, (b) the Mortgages, (c)
each other agreement, instrument or document executed at any time in connection with the Security
Agreements or the Mortgages, and (d) each other agreement, instrument or document executed at any
time in connection with securing the Obligations.




          “Series” shall have the meaning specified in paragraph 1D.




          “Series A Notes” shall have the meaning specified in paragraph 1A.




          “Series B Notes” shall have the meaning specified in paragraph 1B.




          “Series C Notes” shall have the meaning specified in paragraph 1C.




          “Shelf Notes” shall have the meaning specified in paragraph 1D.




          “Single Employer Plan” means a single employer plan, as defined in Section 4001(a)(15) of
ERISA and subject to Title IV thereof, that (a) is maintained by the Company or an ERISA Affiliate
and no Person other than the Company and its ERISA Affiliates or (b) was so maintained previously,
but is not currently maintained by the Company or its ERISA Affiliates, and in respect of which the
Company or an ERISA Affiliate would still have liability under Section 4069 of ERISA in the event
such plan has been or were to be terminated.




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          “Solvent” means with respect to any Person, as of any date of determination, (a) the amount of
the “present fair saleable value” of the assets of such Person will, as of such date, exceed the
amount of all “liabilities of such Person, contingent or otherwise”, as of such date, as such
quoted terms are determined in accordance with applicable federal and state laws governing
determinations of the insolvency of debtors, (b) the present fair saleable value of the assets of
such Person will, as of such date, be greater than the amount that will be required to pay the
probable liability of such Person on its debts as such debts become absolute and matured, (c) such
Person will not have, as of such date, an unreasonably small amount of capital with which to
conduct its business, and (d) such Person will be able to pay its debts as they mature. For
purposes of this definition, (i) “debt” means liability on a “claim”, and (ii) “claim” means any
(x) right to payment, whether or not such a right is reduced to judgment, liquidated, unliquidated,
fixed, contingent, matured, unmatured, disputed, undisputed, legal, equitable, secured or unsecured
or (y) right to an equitable remedy for breach of performance if such breach gives rise to a right
to payment, whether or not such right to an equitable remedy is reduced to judgment, fixed,
contingent, matured or unmatured, disputed, undisputed, secured or unsecured.




          “Subsidiary” of a Person means any corporation or other entity of which more than 50% of the
outstanding capital stock or other equity ownership interests having ordinary voting power to elect
a majority of the board of directors of such corporation (irrespective of whether at such time
capital stock of any other class or classes or other equity ownership interests of such corporation
shall or might have voting power upon the occurrence of any contingency) is at the time directly or
indirectly owned by such Person, by such Person and one or more Subsidiaries of such Person or by
one or more Subsidiaries of such Person. Unless otherwise specified, “Subsidiary” means a
Subsidiary of the Company.




          “Transferee” means any direct or indirect transferee of all or any part of any Note purchased
by any Purchaser under this Agreement.




          “Ultimate General Partner” means Crosstex Energy GP, LLC, a Delaware limited liability
company, and its successors and permitted assigns as general partner of the General Partner or as
the business entity with the ultimate authority to manage the business and operations of the
Company.




          “USA Patriot Act” means United States Public Law 107-56, Uniting and Strengthening America by
Providing Appropriate Tools Required to Intercept and Obstruct Terrorism (USA PATRIOT ACT) Act of
2001, as amended from time to time, and the rules and regulations promulgated thereunder from time
to time in effect.




          “Voting Stock” means, with respect to any corporation, any shares of stock of such corporation
whose holders are entitled under ordinary circumstances to vote for the election of directors of
such corporation (irrespective of whether at the time stock of any other class or classes shall
have or might have voting power by reason of the happening of any contingency).




          10C. Computation of Time Periods. In the Loan Documents in the computation of periods of time
from a specified date to a later specified date, the word “from” means “from and including” and the
words “to” and “until” each mean “to but excluding”.




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          10D. Accounting Terms; Changes in GAAP.





     (i) All accounting terms not specifically defined in this Agreement shall be construed
in accordance with GAAP applied on a consistent basis with those applied in the preparation
of the Financial Statements.




     (ii) Unless otherwise indicated, all financial statements of the Company and its
Subsidiaries, all calculations for compliance with covenants in this Agreement and all
calculations of any amounts to be calculated under the definitions in this Agreement shall
be based upon the Consolidated accounts of the Company and its Subsidiaries in accordance
with GAAP and consistent with the principles applied in preparing the most recent audited
financial statements delivered pursuant to clause (ii) or paragraph 5A or, if no such
statements have been so delivered, the most recent audited financial statements referred to
in clause (i) of paragraph 8B. If at any time any change in GAAP would affect the
computation of any financial ratio or requirement set forth in any Loan Document, and either
the Company or the Required Holders shall so request, the Required Holders and the Company
shall negotiate in good faith to amend such ratio or requirement to preserve the original
intent thereof in light of such change in GAAP, provided that, until so amended, (i)
such ratio or requirement shall continue to be computed in accordance with GAAP prior to
such change therein and (ii) the Company shall provide to the Holders financial statements
and other documents required under this Agreement or as reasonably requested hereunder
setting forth a reconciliation between calculations of such ratio or requirement made before
and after giving effect to such change in GAAP.



          10E. Miscellaneous. Paragraph, Schedule and Exhibit references are to paragraphs of and
Schedules and Exhibits to this Agreement, unless otherwise specified.




          11. MISCELLANEOUS.




          11A. Note Payments. The Company agrees that, so long as any Purchaser shall hold any Note, it
will make payments of principal of, interest on, and any Yield-Maintenance Amount payable with
respect to, such Note, which comply with the terms of this Agreement, by wire transfer of
immediately available funds for credit (not later than 12:00 noon, New York City local time, on the
date due) to the account or accounts of such Purchaser, if any, as are specified in the
Purchaser Schedule, attached hereto or to the applicable Confirmation of Acceptance, or, in
the case of any Purchaser not named in the Purchaser Schedule or any Purchaser wishing to
change the account specified for it in the Purchaser Schedule, such account or accounts in
the United States as such Purchaser may from time to time designate in writing, notwithstanding any
contrary provision herein or in any Note with respect to the place of payment. Each Purchaser
agrees that, before disposing of any Note, it will make a notation thereon (or on a schedule
attached thereto) of all principal payments previously made thereon and of the date to which
interest thereon has been paid. The Company agrees to afford the benefits of this paragraph 11A to
any Transferee which shall have made the same agreement as the Purchasers have made in this
paragraph 11A. No Holder shall be required to present or surrender any Note or make any notation
thereon, except that upon written request of the Company made concurrently with or reasonably
promptly after payment or prepayment in full of
any Note, the applicable Holder shall





61









 








surrender such Note for cancellation, reasonably
promptly after any such request, to the Company at its principal executive office.




          11B. Expenses. The Company agrees, whether or not the transactions contemplated hereby shall
be consummated, to pay, and save Prudential, each Purchaser and any Transferee harmless against
liability for the payment of, all out-of-pocket expenses arising in connection with such
transactions, including:





     (i) (A) all stamp and documentary taxes and similar charges, (B) costs of obtaining a
private placement number for the Notes and (C) fees and expenses of brokers, agents,
dealers, investment banks or other intermediaries or placement agents, in each case as a
result of the execution and delivery of this Agreement or the issuance of the Notes;




     (ii) document production and duplication charges and the fees and expenses of any
special counsel engaged by Prudential or such Purchaser or such Transferee in connection
with (A) this Agreement and the transactions contemplated hereby and (B) any subsequent
proposed waiver, amendment or modification of, or proposed consent under, this Agreement,
whether or not such the proposed action shall be effected or granted;




     (iii) the costs and expenses, including attorneys’ and financial advisory fees,
incurred by Prudential or such Purchaser or such Transferee or the Collateral Agent (a) in
enforcing (or determining whether or how to enforce) any rights under the Loan Documents or
(b) in responding to any subpoena or other legal process or informal investigative demand
issued in connection with the Loan Documents or the transactions contemplated thereby or
issued by reason of Prudential or such Purchaser’s or such Transferee’s having acquired any
Note, including without limitation costs and expenses incurred in any workout, restructuring
or renegotiation proceeding or bankruptcy case;




     (iv) any judgment, liability, claim, order, decree, cost, fee, expense, action or
obligation resulting from the consummation of the transactions contemplated by the Loan
Documents, including the use of the proceeds of the Notes by the Company; and




     (v) the fees and expenses of the Collateral Agent.



          The obligations of the Company under this paragraph 11B shall survive the transfer of any Note
or portion thereof or interest therein by any Purchaser or Transferee and the payment of any Note.




          11C. Consent to Amendments. This Agreement may be amended, and the Company may take any
action herein prohibited, or omit to perform any act herein required to be performed by it, if the
Company shall obtain the written consent to such amendment, action or omission to act, of the
Required Holder(s) except that, (i) with the written consent of the Holders of all
Notes of a particular Series, and if an Event of Default shall have occurred and be continuing, of
the Holders of all Notes of all Series, at the time outstanding (and not without such written
consents), the Notes of such Series may be amended or the provisions thereof waived to change the
maturity thereof, to change or affect the principal thereof, or to
change or







62









 








affect the time of payment of, or increase the rate of, interest on or any
Yield-Maintenance Amount payable with respect to the Notes of such Series, (ii) without the
written consent of all of the Holders at the time outstanding, no amendment to or waiver of the
provisions of this Agreement shall change or affect the provisions of paragraph 7A or this
paragraph 11C insofar as such provisions relate to proportions of the principal amount of the
Notes, or the rights of any individual Holder, required with respect to any declaration of Notes to
be due and payable or with respect to any consent, amendment, waiver or declaration, (iii)
with the written consent of Prudential (and not without the written consent of Prudential)
the provisions of paragraph 2 may be amended or waived (except insofar as any such amendment or
waiver would affect any rights or obligations with respect to the purchase and sale of Notes which
shall have become Accepted Notes prior to such amendment or waiver), and (iv) with the
written consent of all of the Purchasers which shall have become obligated to purchase Accepted
Notes of any Series (and not without the written consent of all such Purchasers), any of the
provisions of paragraphs 2 and 3 may be amended or waived insofar as such amendment or waiver would
affect only rights or obligations with respect to the purchase and sale of the Accepted Notes of
such Series or the terms and provisions of such Accepted Notes. Each Holder of any Note at the
time or thereafter outstanding shall be bound by any consent authorized by this paragraph 11C,
whether or not such Note shall have been marked to indicate such consent, but any Notes issued
thereafter may bear a notation referring to any such consent. No course of dealing between the
Company and any Holder nor any delay in exercising any rights hereunder or under any Note shall
operate as a waiver of any rights of any Holder of such Note. As used herein and in the Notes, the
term “this Agreement” and references thereto shall mean this Agreement as it may from time to time
be amended or supplemented.




          11D. Form, Registration, Transfer and Exchange of Notes; Lost Notes. The Notes are issuable
as registered notes without coupons in denominations of at least $100,000, except as may be
necessary to reflect any principal amount not evenly divisible by $100,000. The Company shall keep
at its principal office a register in which the Company shall provide for the registration of Notes
and of transfers of Notes. Upon surrender for registration of transfer of any Note at the
principal office of the Company, the Company shall, at its expense, execute and deliver one or more
new Notes of like tenor and of a like aggregate principal amount, registered in the name of such
transferee or transferees. At the option of the Holder of any Note, such Note may be exchanged for
other Notes of like tenor and of any authorized denominations, of a like aggregate principal
amount, upon surrender of the Note to be exchanged at the principal office of the Company.
Whenever any Notes are so surrendered for exchange, the Company shall, at its expense, execute and
deliver the Notes which the Holder making the exchange is entitled to receive. Each installment of
principal payable on each installment date upon each new Note issued upon any such transfer or
exchange shall be in the same proportion to the unpaid principal amount of such new Note as the
installment of principal payable on such date on the Note surrendered for registration of transfer
or exchange bore to the unpaid principal amount of such Note. No reference need be made in any
such new Note to any installment or installments of principal previously due and paid upon the Note
surrendered for registration of transfer or exchange. Every Note surrendered for registration of
transfer or exchange shall be duly endorsed, or be accompanied by a written instrument of transfer
duly executed, by the Holder of such Note or such Holder’s attorney duly authorized in writing.
Any Note or Notes issued in exchange for any Note or upon transfer thereof shall carry the rights
to unpaid interest and interest to accrue which were carried by the Note so exchanged or
transferred, so that neither




63









 








gain nor loss of interest shall result from any such transfer or exchange. Upon receipt of
written notice from the Holder of any Note of the loss, theft, destruction or mutilation of such
Note and, in the case of any such loss, theft or destruction, upon receipt of such Holder’s
unsecured indemnity agreement, or in the case of any such mutilation upon surrender and
cancellation of such Note, the Company will make and deliver a new Note, of like tenor, in lieu of
the lost, stolen, destroyed or mutilated Note.




          11E. Persons Deemed Owners; Participations. Prior to due presentment for registration of
transfer, the Company may treat the Person in whose name any Note is registered as the owner and
holder of such Note for the purpose of receiving payment of principal of and interest on, and any
Yield-Maintenance Amount payable with respect to, such Note and for all other purposes whatsoever,
whether or not such Note shall be overdue, and the Company shall not be affected by notice to the
contrary. Subject to the preceding sentence, the Holder of any Note may from time to time grant
participations in all or any part of such Note to any Person on such terms and conditions as may be
determined by such Holder in its sole and absolute discretion.




          11F. Survival of Representations and Warranties; Entire Agreement. All representations and
warranties contained herein or made in writing by or on behalf of the Company in connection
herewith shall survive the execution and delivery of this Agreement and the Notes, the transfer by
any Purchaser of any Note or portion thereof or interest therein and the payment of any Note, and
may be relied upon by any Transferee, regardless of any investigation made at any time by or on
behalf of any Purchaser or any Transferee. Subject to the preceding sentence, this Agreement and
the other Loan Documents embody the entire agreement and understanding between the parties hereto
with respect to the subject matter hereof and supersede all prior agreements and understandings
relating to such subject matter.




          11G. Successors and Assigns. All covenants and other agreements in this Agreement contained
by or on behalf of any of the parties hereto shall bind and inure to the benefit of the respective
successors and assigns of the parties hereto (including, without limitation, any Transferee)
whether so expressed or not.




          11H. Independence of Covenants. All covenants hereunder shall be given independent effect so
that if a particular action or condition is prohibited by any one of such covenants, the fact that
it would be permitted by an exception to, or otherwise be in compliance within the limitations of,
another covenant shall not avoid the occurrence of a Default or Event of Default if such action is
taken or such condition exists.




          11I. Notices. All written communications provided for hereunder (other than communications
provided for under paragraph 2) shall be sent by first class mail or nationwide overnight delivery
service (with charges prepaid) and (i) if to any Purchaser, addressed as specified for such
communications in the Purchaser Schedule attached hereto (in the case of the Series A
Notes, the Series B Notes or the Series C Notes) or the Purchaser Schedule attached to the
applicable Confirmation of Acceptance (in the case of any Notes issued after the date hereof) or at
such other address as any such Purchaser shall have specified to the Company in writing, (ii) if to
any other Holder of any Note, addressed to it at such address as it shall have specified in writing
to the Company, or, if any such Holder shall not have so specified
an address, then







64









 








addressed to such Holder in care of the last Holder of such Note which shall
have so specified an address to the Company and (iii) if to the Company, addressed to it at 2501
Cedar Springs, Suite 600, Dallas, Texas 75201, Attention: William W. Davis, provided,
however, that any such communication to the Company may also, at the option of the Person
sending such communication, be delivered by any other means either to the Company at its address
specified above or to any Authorized Officer of the Company. Any communication pursuant to
paragraph 2 shall be made by the method specified for such communication in paragraph 2, and shall
be effective to create any rights or obligations under this Agreement only if, in the case of a
telephone communication, an Authorized Officer of the party conveying the information and of the
party receiving the information are parties to the telephone call, and in the case of a telecopier
communication, the communication is signed by an Authorized Officer of the party conveying the
information, addressed to the attention of an Authorized Officer of the party receiving the
information, and in fact received at the telecopier terminal the number of which is listed for the
party receiving the communication in the Purchaser Schedule or at such other telecopier
terminal as the party receiving the information shall have specified in writing to the party
sending such information.




          11J. Payments Due on Non-Business Days. Anything in this Agreement or the Notes to the
contrary notwithstanding, any payment of principal of or interest on, or Yield-Maintenance Amount
payable with respect to, any Note that is due on a date other than a Business Day shall be made on
the next succeeding Business Day. If the date for any payment is extended to the next succeeding
Business Day by reason of the preceding sentence, the period of such extension shall not be
included in the computation of the interest payable on such Business Day.




          11K. Severability. Any provision of this Agreement which is prohibited or unenforceable in
any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition
or unenforceability without invalidating the remaining provisions hereof, and any such prohibition
or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision
in any other jurisdiction.




          11L. Descriptive Headings. The descriptive headings of the several paragraphs of this
Agreement are inserted for convenience only and do not constitute a part of this Agreement.




          11M. Satisfaction Requirement. If any agreement, certificate or other writing, or any action
taken or to be taken, is by the terms of this Agreement required to be satisfactory to Prudential,
any Purchaser, to any Holder or to the Required Holder(s), then (unless stated otherwise) the
determination of such satisfaction shall be made by Prudential, such Purchaser, such Holder or the
Required Holder(s), as the case may be, in the sole and exclusive judgment (exercised in good
faith) of the Person or Persons making such determination.




          11N. Governing Law. THIS AGREEMENT SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, AND
THE RIGHTS OF THE PARTIES SHALL BE GOVERNED BY, THE LAW OF THE STATE OF NEW YORK.




65









 








          11O. Severalty of Obligations. The sales of Notes to the Purchasers are to be several sales,
and the obligations of Prudential and the Purchasers under this Agreement are several obligations.
No failure by Prudential or any Purchaser to perform its obligations under this Agreement shall
relieve any other Purchaser or the Company of any of its obligations hereunder, and neither
Prudential nor any Purchaser shall be responsible for the obligations of, or any action taken or
omitted by, any other such Person hereunder.




          11P. Counterparts. This Agreement may be executed in any number of counterparts, each of
which shall be an original, but all of which together shall constitute one instrument.




          11Q. Binding Agreement. When this Agreement is executed and delivered by the Company and
Prudential, it shall become a binding agreement between the Company and Prudential. This Agreement
shall also inure to the benefit of each Purchaser which shall have executed and delivered a
Confirmation of Acceptance, and each such Purchaser shall be bound by this Agreement to the extent
provided in such Confirmation of Acceptance.




          11R. Waiver of Jury Trial; Consent to Jurisdiction.





     (i) THE COMPANY, PRUDENTIAL AND EACH HOLDER HEREBY KNOWINGLY, VOLUNTARILY, AND
INTENTIONALLY WAIVE ANY RIGHTS THEY MAY HAVE TO A TRIAL BY JURY IN ANY LITIGATION OF ANY
CLAIM WHICH IS BASED HEREON, OR ARISES OUT OF, UNDER, OR IN CONNECTION WITH THIS AGREEMENT,
THE NOTES OR THE OTHER LOAN DOCUMENTS, OR ANY TRANSACTIONS RELATING HERETO OR THERETO, OR
ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN), OR ACTIONS
OF THE COMPANY, PRUDENTIAL OR THE HOLDERS. THE COMPANY ACKNOWLEDGES THAT THIS PROVISION IS
A MATERIAL INDUCEMENT FOR PRUDENTIAL AND EACH PURCHASER TO BECOME A PARTY TO THIS AGREEMENT
AND TO PURCHASE NOTES HEREUNDER.




     (ii) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT, THE NOTES, THE
OTHER LOAN DOCUMENTS OR ANY TRANSACTIONS RELATING HERETO OR THERETO, OR ANY COURSE OF
CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN), OR ACTIONS OF THE COMPANY,
PRUDENTIAL OR THE HOLDERS MAY BE BROUGHT IN THE COURTS OF THE STATE OF NEW YORK OR THE
UNITED STATES OF AMERICA FOR THE SOUTHERN DISTRICT OF NEW YORK, AND THE COMPANY HEREBY
ACCEPTS FOR ITSELF AND IN RESPECT OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY, THE
NONEXCLUSIVE JURISDICTION OF THE AFORESAID COURTS. THE COMPANY, PRUDENTIAL AND EACH HOLDER
HEREBY IRREVOCABLY WAIVE ANY OBJECTIONS, INCLUDING, WITHOUT LIMITATION, ANY OBJECTION TO THE
LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH THEY MAY NOW OR
HEREAFTER HAVE



66









 





TO THE BRINGING OF ANY SUCH ACTION OR PROCEEDING IN SUCH RESPECTIVE JURISDICTIONS.




     (iii) The Company hereby irrevocably consents to service of process on it at the
address provided for notices in paragraph 11I. Any and all service of process and any other
notice in any such action, suit or proceeding shall be effective against the Company if
given by registered or certified mail, return receipt requested, or by any other means or
mail which requires a signed receipt, postage prepaid, mailed to the Company as provided in
the preceding sentence.



          11S. Maximum Interest Payable. The Company, Prudential, each Purchaser and any other Holders
specifically intend and agree to limit contractually the amount of interest payable under this
Agreement, the Notes, the other Loan Documents and all other instruments and agreements related
hereto and thereto to the maximum amount of interest lawfully permitted to be charged under
applicable law. Therefore, none of the terms of this Agreement, the Notes, the other Loan
Documents or any instrument pertaining to or relating to this Agreement, the Notes or the other
Loan Documents shall ever be construed to create a contract to pay interest at a rate in excess of
the maximum rate permitted to be charged under applicable law, and neither Company, any guarantor
nor any other party liable or to become liable hereunder or under the Notes, any guaranty, any
other Loan Document or any other instruments and agreements related hereto and thereto shall ever
be liable for interest in excess of the amount determined at such maximum rate, and the provisions
of this paragraph 11S shall control over all other provisions of this Agreement, any Notes, the
other Loan Documents, any guaranty or any other instrument pertaining to or relating to the
transactions herein contemplated. If any amount of interest taken or received by Prudential, any
Purchaser or any Holder shall be in excess of said maximum amount of interest which, under
applicable law, could lawfully have been collected by Prudential, such Purchaser or such Holder
incident to such transactions, then such excess shall be deemed to have been the result of a
mathematical error by all parties hereto and shall be refunded promptly by the Person receiving
such amount to the party paying such amount, or, at the option of the recipient, credited ratably
against the unpaid principal amount of the Note or Notes held by Prudential, such Purchaser or such
Holder, respectively. All amounts paid or agreed to be paid in connection with such transactions
which would under applicable law be deemed “interest” shall, to the extent permitted by such
applicable law, be amortized, prorated, allocated and spread throughout the stated term of this
Agreement and the Notes. “Applicable law” as used in this paragraph means that law in effect from
time to time which permits the charging and collection of the highest permissible lawful,
nonusurious rate of interest on the transactions herein contemplated, and “maximum rate” as used in
this paragraph means, with respect to each of the Notes, the maximum lawful, nonusurious rates of
interest (if any) which under applicable law may be charged to the Company from time to time with
respect to such Notes.




          11T. Release of Collateral. Prudential, each Purchaser and the Company agree that, effective
upon the Collateral Release Date:





     (i) Prudential and each Purchaser will deliver a direction to the Collateral Agent to
release all Liens in the Collateral securing the Obligations (as defined in the
Intercreditor Agreement) and to terminate all Security Agreements, Mortgages and any



67









 





other instrument or agreement pursuant to which a Lien has been created or arose to
secure any or all of the Obligations (as defined in the Intercreditor Agreement);




     (ii) paragraphs 3A(xi), 3A(xii), 3A(xiii), 3J, 3K, 6C(1)(i), and 7A(xv) of this
Agreement shall no longer be effective and shall be deleted from the Agreement;




     (iii) clause (i) of paragraph 6C(4) of this Agreement shall be amended in its entirety
to read as follows:




     “(i) so long as no Default or Event of Default
has occurred and is continuing or would be caused
thereby, the Company or any Subsidiary may make any
Acquisition; provided, however, that
any such Acquisition shall be permitted only if, (a)
on or before or concurrently with the effectiveness
of such Acquisition and to the extent required by
the Required Holders, the Company delivers to the
Holders (I) guaranties duly executed by the parties
thereto, in form and substance satisfactory to the
Required Holders, and accompanied by UCC searches
and title investigations, (II) such legal opinions
in relation to the documents described in the
foregoing subclause (I) as the Required Holders may
reasonably request, and (III) evidence of Company
authority to enter into, and environmental
assessments with respect to, such Acquisition, (b)
the Company or such Guarantor is the acquiring or
surviving entity, (c) no Default or Event of Default
exists and the Acquisition could not reasonably be
expected to cause a Default or Event of Default, (d)
after giving effect to such Acquisition on a pro
forma basis, the Company would have been in
compliance with all of the covenants contained in
this Agreement, including, without limitation,
paragraph 6A as of the end of the most recent fiscal
quarter, (e) the acquisition target is in the same
or similar line of business as the Company and its
Subsidiaries, (f) the terms of paragraph 6G are
satisfied, and (g) the aggregate amount of cash
(including the proceeds of any Debt permitted to be
incurred under clause (xi) of paragraph 6C(2) or
otherwise hereunder), Permitted Investments and the
remaining unused portion of the commitment under the
Bank Agreement is sufficient to fund such
Acquisition;”;



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     (iv) clause (a) paragraph 8U of the Agreement shall be amended to delete the words “and
Liens in favor of the Collateral Agent” from the second sentence thereof and clause (b) of
paragraph 8U of the Agreement shall be amended to delete the words “, other than in favor of
the Collateral Agent” therefrom;




     (v) the definition of “Assigned Agreements” shall be amended and restated in its
entirety to read as follows:




     “Assigned Agreements” shall mean all
agreements, guaranties, contracts, leases, licenses,
contract rights and rights to payment, including
purchase contracts, sales contracts, transportation
contracts, gathering service agreements, gas
purchase agreements, pipeline lease agreements, gas
marketing agreements and gas processing agreements,
to which the Company or any Subsidiary is a party.




     (vi) the definition of “Loan Documents” shall be amended to delete the words “, the
Security Documents” therefrom.



69









 





          If you are in agreement with the foregoing, please sign the form of acceptance on the enclosed
counterpart of this letter and return the same to the Company, whereupon this letter shall become a
binding agreement between the Company and you.




	 	 	 	 	 
	 	 	Very truly yours,
	 
	 	 	 	 
	 	 	CROSSTEX ENERGY SERVICES, L.P.
	 
	 	 	 	 
	

	 	By:
	 	Crosstex Operating GP, LLC,
	

	 	 	 	its general partner
	 
	 	 	 	 
	

	 	By:	 	/s/ Gysle R. Shellum 
	

	 	 	 	

	

	 	 	 	Gysle R. Shellum
	

	 	 	 	Vice President Finance
	 
	 	 	 	 
	 	 	CROSSTEX ENERGY, L.P.
	 
	 	 	 	 
	

	 	By:
	 	Crosstex Energy GP, L.P.,
	

	 	 	 	its general partner
	 
	 	 	 	 
	

	 	By:
	 	Crosstex Energy GP, LLC,
	

	 	 	 	its general partner


	 

	 	By:	 	/s/ Gysle R. Shellum 
	

	 	 	 	

	

	 	 	 	Gysle R. Shellum
	

	 	 	 	Vice President Finance
	 
	 	 	 	 





	 	 	 
	The foregoing Agreement is hereby accepted  
	as of the date first above written.
	 
	 	 
	PRUDENTIAL INVESTMENT MANAGEMENT, INC.
	 
	 	 
	By:
	 	/s/ Brian E. Lemons 
	

	 	

	

	 	Vice President






[Amended and Restated Master Shelf Agreement- Signature Pages]




 









 





	 	 	 
	THE PRUDENTIAL INSURANCE COMPANY
	OF AMERICA
	 
	 	 
	By:
	 	/s/ Brian E. Lemons
	

	 	

	

	 	Vice President
	 
	 	 
	PRUCO LIFE INSURANCE COMPANY
	 
	 	 
	By:
	 	/s/ Brian E. Lemons
	

	 	

	

	 	Vice President
	 
	 	 
	PRUCO LIFE INSURANCE COMPANY
	OF NEW JERSEY
	 
	 	 
	By:
	 	/s/ Brian E. Lemons
	

	 	

	

	 	Vice President
	 
	 	 
	GIBRALTAR LIFE INSURANCE CO., LTD.
	 
	 	 
	By:

	 	Prudential Investment Management (Japan), Inc.,
	

	 	as Investment Manager
	 
	 	 
	By:

	 	Prudential Investment Management, Inc.,
	

	 	as Sub-Adviser
	 
	 	 
	By:
	 	/s/ Brian E. Lemons
	

	 	
 
	

	 	Vice President






[Amended and Restated Master Shelf Agreement- Signature Pages]




 









 





	 	 	 
	RGA REINSURANCE COMPANY
	 
	 	 
	By:

	 	Prudential Private Placement Investors, L.P.
	

	 	(as Investment Advisor)
	 
	 	 
	By:

	 	Prudential Private Placement Investors, Inc.
	

	 	(as its General Partner)
	 
	 	 
	By:
	 	/s/ Brian E. Lemons
	

	 	

	

	 	Vice President
	 
	 	 
	CONNECTICUT GENERAL LIFE INSURANCE
	COMPANY
	 
	 	 
	By:

	 	Prudential Investment Management, Inc.,
	

	 	as Investment Manager
	 
	 	 
	By:
	 	/s/ Brian E. Lemons
	

	 	

	

	 	Vice President
	 
	 	 
	ZURICH AMERICAN INSURANCE COMPANY
	 
	 	 
	By:

	 	Prudential Private Placement Investors, L.P.
	

	 	(as Investment Advisor)
	 
	 	 
	By:

	 	Prudential Private Placement Investors, Inc.
	

	 	(as its General Partner)
	 
	 	 
	By:
	 	/s/ Brian E. Lemons
	

	 	

	

	 	Vice President






[Amended and Restated Master Shelf Agreement- Signature Pages]