First Amendment


    
      

    

     

    Exhibit
      10.1

     

    

      FIRST
        AMENDMENT TO 

      FOURTH
        AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT

      


      


      


      THIS
        FIRST AMENDMENT TO FOURTH AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT
        (the
“Amendment”) is made effective as of February 27, 2006, by and among SOUTHERN
        UNION COMPANY, a Delaware corporation (the “Borrower”), the financial
        institutions listed on the signature pages of the Credit Agreement (as
        hereinafter defined) (individually the “Bank” and collectively the “Banks”) and
        JPMORGAN CHASE BANK, N.A., a national banking association (“JPMorgan”), in its
        capacity as agent (the “Agent”) for the Banks.

      


      RECITALS:

      


      WHEREAS,
        the Borrower, the Banks and the Agent have executed a certain Fourth Amended
        and
        Restated Revolving Credit Agreement dated effective September 29, 2005 (the
        “Credit Agreement”); and 

      


      WHEREAS,
        the Majority Banks, the Agent and the Borrower desire to amend the Credit
        Agreement in certain respects.

      


      NOW,
        THEREFORE, in consideration of Ten Dollars ($10.00) and other good and valuable
        consideration the receipt and sufficiency of which are hereby acknowledged,
        the
        parties hereto agree as follows:

      AGREEMENTS:

      


      1. Amendment
        of Definitions. 

      


      (a) The
        definition of “Additional Offering” contained in Section
        1
        of the
        Credit Agreement is hereby amended and restated in its entirety to read as
        follows:

      


      “Additional
        Offering”
shall
        mean, collectively, either or both of the following securities offerings,
        but
        only to the extent necessary to cause the net cash proceeds thereof to be
        sufficient to fully pay all amounts then outstanding under the Bridge Loan:
        (a)
        any offering or issuance of capital stock, Equity-Preferred Securities or
        any
        other equity interests in the Borrower (to the extent permitted under Section
        10.5) issued after the Sid Richardson Acquisition Closing Date; and (b) an
        offering made pursuant to Rule 144A of the Securities Act of debt securities
        of
        Southern Union Gathering. 

       

      (b) 
        The
        definitions of “Cross Country Acquisition,” “Cross Country Acquisition
        Agreement” and “Cross Country Acquisition Closing Date” contained in
Section
        1
        of the
        Credit Agreement are hereby deleted in their entirety and shall be of no
        further
        force or effect. 

      


      2. New
        Definitions.
        The
        following additional definitions are hereby added to Section
        1
        of the
        Credit Agreement:

      


      “Bridge
        Loan”
shall
        mean a short-term credit facility to be obtained by the Borrower and ESSI,
        as
        co-borrowers, in an aggregate principal amount not to exceed $1,600,000,000
        for
        purposes of financing the EAT Entities Loan, so long as such short-term credit
        facility to the Borrower and ESSI is obtained upon terms and conditions
        substantially similar to the terms and conditions set forth in the term sheet
        attached hereto as Exhibit
        D,
        together with (a) structural changes to such credit facility contemplated
        under
        the flow chart attached as Exhibit
        E
        and (b)
        such other changes to such term sheet and flow chart as the Agent reasonably
        determines are not material to the Banks.

      


      “EAT
        Entities”
shall
        mean SUG EAT, Inc. and SUG EAT, LLC.

      


      “EAT
        Entities Loan”
shall
        mean a short-term loan by ESSI to the EAT Entities in an aggregate principal
        amount not to exceed $1,600,000,000 for purposes of financing the payment
        by the
        EAT Entities of the purchase price to be paid under the Sid Richardson
        Acquisition Agreement.

      


      “Leapartners”
shall
        mean Leapartners, L.P., a Texas limited partnership.

      


      “Qualified
        Intermediary”
shall
        mean that certain entity created and owned by Chicago Deferred Exchange
        Corporation that the Borrower hereafter enters into a “qualified exchange
        accommodation agreement” with for purposes of facilitating the Sid Richardson
        Acquisition.

      


      “REM”
shall
        mean Richardson Energy Marketing, Ltd., a Texas limited
        partnership.

      


      “SRES”
shall
        mean Sid Richardson Energy Services, Ltd., a Texas limited
        partnership.

      


      “Sid
        Richardson Acquisition”
shall
        mean, collectively, (a) the acquisition by SUG EAT, Inc. of 100% of all issued
        and outstanding limited partner interests in SRES and REM in accordance with
        the
        Sid Richardson Acquisition Agreement, and (b) the acquisition by SUG EAT,
        LLC of
        100% of all issued and outstanding general partner interests in SRES, REM
        and
        Leapartners in accordance with the Sid Richardson Acquisition Agreement,
        so long
        as such acquisitions are in substantial compliance with the following specified
        terms:

      


      (a) immediately
        after the consummation of such acquisitions, (i) SUG EAT, Inc. owns and holds
        100% of all issued and outstanding limited partner interests in SRES and
        REM,
        (ii) SUG EAT, LLC owns and holds 100% of all issued and outstanding general
        partner interests in SRES, REM and Leapartners, (iii) as security for the
        EAT
        Entities Loan, the EAT Entities have granted to ESSI a second priority security
        interest in 100% of all issued and outstanding limited partner interests
        in SRES
        and REM and 100% of all issued and outstanding general partner interests
        in
        SRES, REM and Leapartners, subject only to the first priority security interest
        granted by the EAT Entities in such partnership interests as security for
        the
        Bridge Loan, and (iv) Southern Union Panhandle is and shall remain as the
        sole
        manager of SUG EAT, LLC, and (v) the EAT Entities have granted to the Borrower
        a
        "call option" whereby the Borrower can effectively require (1) distributions
        by
        the Qualified Intermediary to the EAT Entities of the net cash proceeds received
        by the Qualified Intermediary from any sale by the Borrower of any of its
        operating divisions permitted under Section 10.8(ix), together with
        corresponding partial prepayments by the EAT Entities of the EAT Entities
        Loan
        in an amount equal to such net cash proceeds distribution, and (2) full
        prepayment of the EAT Entities Loan at any time later than 180 days after
        the
        Sid Richardson Acquisition Closing Date;

      


      (b) the
        aggregate consideration paid by the EAT Entities for all partnership interests
        in SRES and REM and the general partner interest in Leapartners shall be
        approximately $1,600,000,000 (which amount is subject to customary purchase
        price adjustment as set forth in the Sid Richardson Acquisition Agreement);
        and

       

      (c) all
        material requisite approvals and consents from any Governmental Authority
        with
        respect to such acquisition shall have been received by the EAT Entities,
        the
        Borrower and its Subsidiaries, as applicable, in a form acceptable to the
        Agent.

      


      “Sid
        Richardson Acquisition Agreement”
shall
        mean that certain Purchase and Sale Agreement dated as of December 15, 2005,
        by
        and among SRCG, Ltd., a Texas limited partnership, and SRCG Genpar, L.P.,
        a
        Delaware limited partnership, as Sellers, and Southern Union Gathering and
        Southern Union Panhandle, as Buyers, as assigned or to be assigned by Southern
        Union Gathering and Southern Union Panhandle to the EAT Entities, and as
        the
        same may hereafter be amended (the form of any such amendment to be approved
        by
        the Agent, such approval not to be unreasonably withheld, conditioned or
        delayed).

       

      “Sid
        Richardson Acquisition Closing Date”
means
        the date on which the Sid Richardson Acquisition is consummated.

       

      “Southern
        Union Gathering”
shall
        mean Southern Union Gathering Company LLC, a Delaware limited liability
        company.

      


      “SUG
        EAT, Inc.”
        shall
        mean SUG EAT, Inc., a Delaware corporation.

      


        “SUG
        EAT, LLC”
shall
        mean SUG EAT, LLC, a Delaware limited liability company.

      


      3. Additional
        Required Payments and Prepayments.
        New
Sections
        4.1(c)
        and
4.1(d)
        are
        hereby added to the Credit Agreement to read as follows:

      


      (c) All
        net
        cash proceeds payable as a result of any sale by the Borrower of any of its
        operating divisions permitted under Section 10.8(ix) shall be distributed
        and
        applied as follows: (i) if SRES, REM and Leapartners have not yet become
        wholly-owned Subsidiaries of the Borrower, then substantially contemporaneously
        with the consummation of the applicable operating division sale, (1) the
        Borrower shall assign to the Qualified Intermediary all of the Borrower's
        rights
        to receive all net cash proceeds payable as a result of such sale of such
        operating division of the Borrower, (2) the Borrower shall exercise its call
        option rights to cause the Qualified Intermediary to distribute to the EAT
        Entities all such net cash proceeds received by the Qualified Intermediary
        from
        such sale of such operating division, (3) upon receipt of such proceeds from
        the
        Qualified Intermediary, the EAT Entities will make a corresponding partial
        or
        full prepayment, as applicable, to ESSI of the EAT Entities Loan in an amount
        equal to such net cash proceeds distribution as required by the terms of
        the EAT
        Entities Loan, (4) the Borrower shall cause ESSI to make a corresponding
        partial
        or full prepayment, as applicable, of the Bridge Loan in an amount equal
        to such
        proceeds received by ESSI from such prepayment of the EAT Entities Loan,
        and (5)
        any remaining amounts of such net sales proceeds paid to or otherwise received
        by the Qualified Intermediary, ESSI or the Borrower and not distributed or
        applied in accordance with the foregoing requirements shall be applied towards
        payment of Obligations under this Agreement to the extent then outstanding;
        and
        (ii) if SRES, REM and Leapartners have become wholly-owned Subsidiaries of
        the
        Borrower, then all net cash proceeds payable as a result of such sale of
        such
        operating division of the Borrower shall be applied (1) first, to payment
        of the
        Bridge Loan until the same is fully paid, and (2) second, to payment of
        Obligations under this Agreement to the extent then outstanding.

       

      (d) All
        net
        cash proceeds received by the Borrower or Southern Union Gathering from the
        Additional Offering and from additional Funded Debt of Southern Union Gathering
        incurred in accordance with the terms of Section
        9.12,
        shall
        be applied (i) first, to payment of the Bridge Loan until the same is fully
        paid, and (ii) second, to payment of Obligations under this Agreement to
        the
        extent then outstanding; provided,
        however,
        that to
        the extent applicable, the following shall not be required to applied in
        accordance with the foregoing requirements: (A) any net proceeds of issuances
        pursuant to employee stock plans after the Closing Date by the Borrower;
        and (B)
        any net proceeds resulting from the settlement of forward stock purchase
        contracts or remarketing of the senior notes associated with the Equity Units
        (defined below), so long as such net proceeds are promptly applied to repay
        Obligations under this Agreement to the extent then outstanding. For purposes
        of
        the foregoing, “Equity Units” mean the 2,500,000 equity units issued by the
        Borrower on June 11, 2003, with each such equity unit consisting of a forward
        stock purchase contract for the purchase of shares of the Borrower’s common
        stock and a 2.75% senior note of the Borrower due August 16, 2008, which
        2008
        senior notes were issued pursuant to Supplemental Indenture No. 1, dated
        as of
        June 11, 2003 between the Borrower and JPMorgan Chase Bank, as trustee.


      


      4. Lines
        of Business Modification.
        Section
        7.15
        of the
        Credit Agreement is hereby amended and restated in its entirety to hereafter
        be
        and read as follows:

      


      7.15 Lines
        of Business. The
        nature of the Borrower's lines of business are predominately the following:
        (a)
        the operation of energy distribution and transportation services, including
        without limitation, natural gas sales, storage and transportation and
        distribution, propane sales and distribution and promotion, marketing and
        sale
        of compressed natural gas and the terminalling and storage of liquefied natural
        gas; (b) the development and marketing of fuel cell and distributive energy
        options; (c) electric marketing/generation; (d) the operation of fuel oil
        distribution and transportation networks; (e) gathering and processing of
        natural gas; and (f) sales and rentals of appliances utilizing one or more
        of
        the fuel or energy options specified in this Section 7.15.

      


      5. Pledge
        of Sid Richardson Equity Representation and Warranty.
        A new
Section
        7.19
        is
        hereby added to the Credit Agreement to read as follows:

      


      7.19 No
        Agreements Prohibiting Pledge of Sid Richardson Equity.
        Except
        for the
        applicable negative covenants of this Agreement and the Bridge Loan, neither
        the
        Borrower nor Southern Union Gathering nor Southern Union Panhandle is a party
        to
        any contract or other agreement with any Person that directly or indirectly
        prohibits the Borrower or any of its Subsidiaries (including without limitation,
        Southern Union Gathering and Southern Union Panhandle) from granting any
        Lien
        against the partnership interests in SRES, REM or Leapartners at any time
        owned
        and held by the Borrower or any of its Subsidiaries as security for any Debt
        of
        the Borrower or any of its Subsidiaries.

      


      6. New
        Affirmative Covenants.
        New
Sections
        9.12
        and
9.13
        are
        hereby added to the Credit Agreement to read as follows:

      


      9.12 Additional
        Offering; Additional Funded Debt. To
        the
        extent necessary to fully pay the Bridge Loan on or before 364 days after
        the
        Sid Richardson Acquisition Closing Date, the Borrower agrees to cause (a)
        the
        Additional Offering and/or the incurrence of additional Funded Debt of Southern
        Union Gathering to be consummated in full and (b) the proceeds received by
        the
        Borrower and/or Southern Union Gathering from the Additional Offering and/or
        such additional Funded Debt of Southern Union Gathering to be utilized to
        fully
        pay the Bridge Loan.

      


      9.13 Conveyance
        of Sid Richardson Equity Interests to Subsidiaries. Contemporaneously
        with the consummation of the final sale by the Borrower of its operating
        divisions permitted under Section 10.8(ix), the Borrower shall cause SRES,
        REM
        and Leapartners to become wholly-owned Subsidiaries of the Borrower by requiring
        (i) SUG EAT, Inc. to assign and convey to Southern Union Gathering 100% of
        all
        issued and outstanding limited partner interests in SRES and REM, and (ii)
        SUG
        EAT, LLC to assign and convey to Southern Union Panhandle 100% of all issued
        and
        outstanding general partner interests in SRES, REM and Leapartners.  

      


      7. Amendment
        of Capital Requirements Negative Covenant.
        Section
        10.1(b)
        of the
        Credit Agreement is hereby amended and restated in its entirety to hereafter
        be
        and read as follows:

      (b) permit
        the ratio of its Consolidated Total Indebtedness to its Consolidated Total
        Capitalization to be greater than (i) 0.65 to 1.00 at the end of any fiscal
        quarter ending prior to the Sid Richardson Acquisition Closing Date; (ii)
        0.70
        to 1.00 at the end of any fiscal quarter ending on or after the Sid Richardson
        Acquisition Closing Date, but before the earlier to occur of (x) payment
        in full
        of the Bridge Loan and (y) 364 days after the Sid Richardson Acquisition
        Closing
        Date; and (iii) 0.65 to 1.00 at the end of any fiscal quarter ending on or
        after
        the earlier to occur of (x) payment in full of the Bridge Loan and (y) 364
        days
        after the Sid Richardson Acquisition Closing Date.

      


      8. Amendment
        of Liens Negative Covenant.
        Section
        10.2(d)
        of the
        Credit Agreement is hereby amended and restated in its entirety to hereafter
        be
        and read as follows:

      


      (d) (i)
        Liens
        on property existing at the time of acquisition thereof by the Borrower or
        any
        Subsidiary, including without limitation, (A) any property acquired by the
        Borrower in consummating and finalizing any of the Prior Acquisitions, (B)
        any
        Liens existing on any property of Panhandle Eastern or any of its Subsidiaries
        to secure existing Debt of Panhandle Eastern or any of its Subsidiaries as
        of
        the Closing Date and (C) any Liens against any property of Panhandle Eastern
        or
        any of its Subsidiaries to secure Panhandle Eastern Refinancing Debt
        (provided
        such
        Liens are limited to property of Panhandle Eastern or any of its Subsidiaries
        securing the Debt so extended, refinanced, renewed, replaced, defeased or
        refunded), (ii) Liens against (A) the partnership and other equity interests
        in
        Panhandle Eastern, and (B) the partnership and other equity interests in
        SRES,
        REM and Leapartners, in each case to secure the Bridge Loan, or (iii) purchase
        money Liens placed on an item of real or personal property purchased by the
        Borrower or any Subsidiary to secure a portion of the purchase price of such
        property; provided
        that no
        such Lien may encumber or cover any other property of the Borrower or any
        Subsidiary.

      


      9. Amendment
        of Debt Negative Covenant.
        Sections
        10.3(a)
        and
10.3(g)
        of the
        Credit Agreement are hereby amended and restated in their entirety to hereafter
        be and read as follows:

      (a) Debt
        evidenced by the Notes or the Facility Letter of Credit Obligations, or
        outstanding under the Bridge Loan, or issued pursuant to the Additional Offering
        and any Equity-Preferred Securities (to the extent the same constitutes Debt)
        not in default, as well as (i) Debt of Panhandle Eastern and/or any of its
        Subsidiaries outstanding as of the Closing Date, (ii) any Panhandle Eastern
        Refinancing Debt, (iii) any working capital credit facility or facilities
        provided directly to Panhandle Eastern and/or any of Panhandle Eastern’s
        Subsidiaries by any party other than the Borrower, so long as the principal
        amount of all such outstanding working capital facilities, together with
        the
        outstanding principal amount of any working capital loans or advances by
        the
        Borrower to Panhandle Eastern and/or any of Panhandle Eastern’s Subsidiaries,
        does not exceed (A) $50,000,000 in the aggregate at any time that the ratio
        of
        Consolidated Total Indebtedness to Consolidated Total Capitalization for
        Panhandle Eastern and Panhandle Eastern’s Subsidiaries (excluding the Borrower
        and all other Subsidiaries of the Borrower for purposes of such calculation)
        is
        greater than 0.65 to 1.00 and (B) $75,000,000 in the aggregate at any time
        that
        the ratio of Consolidated Total Indebtedness to Consolidated Total
        Capitalization for Panhandle Eastern and Panhandle Eastern’s Subsidiaries
        (excluding the Borrower and all other Subsidiaries of the Borrower for purposes
        of such calculation) is less than or equal to 0.65 to 1.00, (iv) Funded Debt
        of
        Southern Union Gathering to the extent that the net proceeds thereof are
        applied
        to the Bridge Loan, and (v) any loans or advances by the Borrower to Panhandle
        Eastern and/or any of the Borrower’s other Subsidiaries permitted under Section
        10.4(b).

      


      (g) additional
        Debt of the Borrower and Structured Securities of the Borrower and the Southern
        Union Trusts, provided
        that
        after giving effect to the issuance thereof, there shall exist no Default
        or
        Event of Default; and: (i) the ratio of Consolidated Total Indebtedness to
        Consolidated Total Capitalization shall be no greater than (A) 0.65 to 1.00
        at
        all times prior to the Sid Richardson Acquisition Closing Date; (B) 0.70
        to 1.00
        at all times on or after the Sid Richardson Acquisition Closing Date, but
        before
        the earlier to occur of (x) payment in full of the Bridge Loan and (y) 364
        days
        after the Sid Richardson Acquisition Closing Date; and (C) 0.65 to 1.00 at
        all
        times after the earlier to occur of (x) payment in full of the Bridge Loan
        and
        (y) 364 days after the Sid Richardson Acquisition Closing Date; (ii) the
        ratio
        of EBDIT for the four fiscal quarters most recently ended to pro forma Cash
        Interest Expense for the following four fiscal quarters shall be no less
        than
        2.00 to 1.0 at all times; provided,
        however,
        that if
        the additional Debt for which the determinations required to be made by this
        subparagraph (g) will be used to finance in whole or in part the consideration
        to be paid by the Borrower for the acquisition of any entity otherwise permitted
        under the terms of this Agreement, the determination of EBDIT for purposes
        of
        this ratio shall include not only the EBDIT of the Borrower and its Subsidiaries
        for the four fiscal quarters most recently ended, but shall also include
        the
        EBDIT of such entity to be acquired for such four fiscal quarters most recently
        ended; and (iii) (A) such Debt and Structured Securities shall have a final
        maturity or mandatory redemption date, as the case may be, no earlier than
        the
        Maturity Date and shall mature or be subject to mandatory redemption or
        mandatory defeasance no earlier than the Maturity Date (as so extended) and
        shall be subject to no mandatory redemption or “put” to the Borrower or any
        Southern Union Trust exercisable, or sinking fund or other similar mandatory
        principal payment provisions that require payments to be made toward principal,
        prior to such Maturity Date (as so extended); or (B) (x) such additional
        Debt
        shall have a final maturity date prior to the Maturity Date, (y) such additional
        Debt shall not exceed Two Hundred Fifty Million Dollars ($250,000,000.00)
        in the
        aggregate plus Twenty Million Dollars ($20,000,000.00) of reimbursement
        obligations incurred in connection with Non-Facility Letters of Credit issued
        by
        a Bank or Banks or by any other financial institution, and (z) such additional
        Debt shall be borrowed from a Bank or Banks as a loan or loans arising
        independent of this Agreement or shall be borrowed from a financial institution
        that is not a Bank under this Agreement.

      


      10. Amendment
        of Investment Negative Covenant.
        Sections
        10.4(a)
        and
10.4(b)
        of the
        Credit Agreement are hereby amended and restated in their entirety to hereafter
        be and read as follows:

      (a) stock
        or
        other equity interests of (i) the Subsidiaries named in Section 7.1; (ii)
        other
        entities that are acquired by the Borrower or any Subsidiary but that are
        promptly merged with and into the Borrower; (iii) Southern Union Panhandle,
        Panhandle Eastern and any Subsidiaries of Panhandle Eastern acquired as a
        result
        of the Panhandle Eastern Acquisition, (iv) Southern Union Gathering, SRES,
        REM
        and any Subsidiaries of SRES or REM acquired as a result of the Sid Richardson
        Acquisition; (v) CCE Holdings; and (vi) the same Qualifying Entities as the
        Qualifying Entities under subparagraph (ii) of the definition of "Qualifying
        Assets,” provided
        that at
        any one time the aggregate purchase price paid for such stock in such Qualifying
        Entities, including the aggregate amount of Debt assumed or deemed incurred
        by
        the Borrower in connection with the purchase of such stock, is not more than
        twenty percent (20%) of the Consolidated Net Worth of the Borrower and its
        Subsidiaries as of the applicable determination date.

      


      (b) loans
        or
        advances to a Subsidiary, as well as advances of proceeds of (i) the Bridge
        Loan
        by ESSI to the EAT Entities for purposes of facilitating the consummation
        of the
        Sid Richardson Acquisition, and (ii) the Additional Offering and permitted
        Funded Debt of Southern Union Gathering by Southern Union Gathering to the
        Borrower for purposes of facilitating the payment of the Bridge Loan;
provided,
        however,
        that
        the principal amount of such loans and advances for working capital purposes
        at
        any time outstanding to Panhandle Eastern and/or any of Panhandle Eastern’s
        Subsidiaries, together with the principal amount of any outstanding working
        capital credit facility or facilities provided directly to Panhandle Eastern
        and/or any of Panhandle Eastern’s Subsidiaries by any party other than the
        Borrower, does not exceed $25,000,000 in the aggregate at any time.

      


      11. Amendment
        of Sale of Assets Negative Covenant.
        Section
        10.8
        of the
        Credit Agreement is hereby amended and restated in its entirety to hereafter
        be
        and read as follows:

      


      10.8 Sale
        or Other Disposition of Assets. The
        Borrower will not, and will not permit any Subsidiary to, except as permitted
        under this Section 10.8, sell, assign, lease, or otherwise dispose of (whether
        in one transaction or in a series of transactions) all or any part of its
        Property (whether now owned or hereafter acquired); provided,
        however,
        that
        (i) the Borrower or any Subsidiary may in the ordinary course of business
        dispose of (a) Property consisting of Inventory; and (b) Property con-sist-ing
        of goods or equipment that are, in the opinion of the Borrower or any
        Subsidiary, obsolete or unproductive, but if in the good faith judgment of
        the
        Borrower or any Subsidiary such disposition with-out replacement thereof
        would
        have a Material Adverse Effect, such goods and equipment shall be replaced,
        or
        their utility and function substituted, by new or existing goods or equipment;
        (ii) the Borrower may transfer or dispose of any of its Significant
        Property (in any transaction or series of transactions) to any Subsidiary
        or
        Subsidiaries only if such Property so transferred or disposed of after the
        Closing Date has an aggregate value (determined after depreciation and in
        accordance with GAAP) of not more than ten percent (10%) of the aggregate
        value
        of all of the Borrower’s and its Subsidiaries’ real property and tangible
        personal property other than Inventory considered on a consolidated basis
        and
        determined after depreciation and in accordance with GAAP, as of June 30,
        2005;
        (iii) the Borrower may dispose of its real property in one or more
        sale/leaseback transactions, provided that any Debt incurred in connection
        with
        such transaction does not create a Default as defined herein; (iv) a Southern
        Union Trust may distribute the Borrower’s subordinated debt securities
        constituting a portion of the Structured Securities, on the terms and under
        the
        conditions set out in the registration state-ment therefor filed with the
        Securities and Exchange Commission on March 25, 1995 or any similar registration
        statement filed with the Securities and Exchange Commission in connection
        with
        any other Structured Securities issued in connection with the Prior
        Acquisitions; (v) the Borrower or any Subsidiary may dispose of real
        property or tangible personal property other than Inven-tory (in consideration
        of such amount as in the good faith judgment of the Borrower or such Subsidiary
        represents a fair consideration therefor), provided that the aggregate value
        of
        such property disposed of (determined after depreciation and in accordance
        with
        GAAP) after the Closing Date does not exceed ten percent (10%) of the aggregate
        value of all of the Borrower’s and its Subsidiaries’ real property and tangible
        personal property other than Inventory considered on a consolidated basis
        and
        deter-mined after depreciation and in accordance with GAAP, as of June 30,
        2005;
        (vi) the Borrower may dispose of Qualifying Assets of the type described in
        clause (ii) of the definition of Qualifying Assets, provided that the Borrower
        applies the net proceeds from such disposition against the Loans in an amount
        equal to the amount of Loan proceeds previously advanced to finance the
        acquisition of such clause (ii) Qualifying Assets; (vii) the Borrower may
        dispose of other Investments of the type acquired under the terms of Section
        10.4(h), provided that the Borrower applies the net proceeds from such
        disposition against the Loans in an amount equal to the amount of Loan proceeds
        previously advanced to finance the acquisition of such other Investments;
        (viii)
        the Borrower may sell all stock or all or substantially all of the assets
        in Sea
        Robin Pipeline Company; and (ix) the Borrower may sell any of its operating
        divisions, so long as the Bridge Loan has not been fully paid and the net
        proceeds from such disposition(s) are assigned, distributed and applied in
        accordance with the terms of Section 4.1(c). 

       

      12. No
        Agreements Prohibiting Pledge of Sid Richardson Equity.
        A new
Section
        10.19
        is
        hereby added to the Credit Agreement to read as follows:

      


      10.19 No
        Agreements Prohibiting Pledge of Sid Richardson Equity. Neither
        the Borrower nor Southern Union Panhandle nor Southern Union Gathering will
        enter into any contract or other agreement with any Person that directly
        or
        indirectly prohibits the Borrower, Southern Union Panhandle or Southern Union
        Gathering from granting any Lien against the partnership interests in SRES,
        REM
        or Leapartners at any time owned and held by the Borrower or any of its
        Subsidiaries as security for any Debt of the Borrower or any of its
        Subsidiaries, other than the applicable negative covenants of this Agreement
        and
        the Bridge Loan.

      


      13. Cross-Default
        to Bridge Loan.
        Section
        11.3
        of the
        Credit Agreement is hereby amended and restated in its entirety to hereafter
        be
        and read as follows:

      


      11.3 Other
        Debt Default.
        The
        Borrower or any Subsidiary fails to pay principal or interest on any other
        Debt
        aggregating more than $3,000,000.00 when due and any related grace period
        has
        expired, or the holder of any of such other Debt declares such Debt due prior
        to
        its stated maturity because of the Borrower's or any Subsidiary's default
        thereunder and the expiration of any related grace period, or the occurrence
        of
        a default or event of default under the Bridge Loan that is not cured or
        effectively waived prior to the expiration of any related grace
        period.

      


      14. Amendment
        of Addresses for Notices.
        Section
        13.4
        of the
        Credit Agreement is hereby amended and restated in its entirety to hereafter
        be
        and read as follows:

      


      13.4 Notices.
        All
        notices and other communications provided for herein shall be in writing
        (including telex, facsimile, or cable communication) and shall be mailed,
        telecopied, telexed, cabled or delivered addressed as follows:

       

      (a) If
        to the
        Borrower, to it at: Southern
        Union Company

      417
        Lackawanna Avenue

      Scranton,
        Pennsylvania 18503

      Attention:
        Mr. Richard N. Marshall

      Fax:
        (570) 614-5158

      


      with
        copies to:  Southern
        Union Company

      5444
        Westheimer Road

      Houston,
        Texas 77056

      Attention:
        Monica Gaudiosi, Esq.

      Fax:
        (713) 989-1166

      


      (b) If
        to the
        Agent, to it at: JPMorgan
        Chase Bank, N.A.

      700
        Lavaca, 2nd Floor

      Austin,
        Texas 78701

      Attention:
        Manager/Commercial Lending 

      Fax:
        (512) 479-2814

      with
        a
        copy to:  JPMorgan
        Chase Bank, N.A.

      Loan
        and
        Agency Services

      1111
        Fannin, Floor 10

      Houston,
        Texas 77002

      Attention:
        Rosemarie Salvacion 

      Fax:
        (713) 427-6307

      


      and
        if to
        any Bank, at the address specified below its name on the signature pages
        hereof,
        or as to the Borrower or the Agent, to such other address as shall be designated
        by such party in a written notice to the other party and, as to each other
        party, at such other address as shall be designated by such party in a written
        notice to the Borrower and the Agent. All such notices and communications
        shall,
        when mailed, telecopied, telexed, transmitted, or cabled, become effective
        when
        deposited in the mail, confirmed by telex answer back, transmitted to the
        telecopier, or delivered to the cable company, except that notices and
        communications to the Agent under Sections 2.1(c) or 2.2 shall not be effective
        until actually received by the Agent.

      


      15. New
        Exhibits. 
        A new
Exhibit
        D
        in the
        form of Exhibit
        D
        attached
        to this Amendment and a new Exhibit
        E
        in the
        form of Exhibit
        E
        attached
        to this Amendment are hereby added to the Credit Agreement.

      


      16. Other
        Sections.
        Except
        as expressly amended by this Amendment, the provisions of the Credit Agreement
        and the Notes shall remain in full force and effect, and the Borrower
        acknowledges and reaffirms its liability to the Banks thereunder. In the
        event
        of any inconsistency between this Amendment and the terms of the Credit
        Agreement or the Notes, this Amendment shall govern.

      


      17. Representations
        and Warranties.
        The
        Borrower represents and warrants to the Banks as of the Borrower’s execution of
        this Amendment and as of the effective date hereof that:

      


      a.  -Representations
        and Warranties.
        The
        representations and warranties contained in Section
        7
        of the
        Credit Agreement, as amended hereby, are true and correct, and no Default
        or
        Event of Default has occurred and is continuing.

      


      b.  -Corporate
        Power and Authorization.
        The
        Borrower is duly authorized and empowered to execute, deliver and perform
        its
        obligations under this Amendment and to make the borrowings provided for
        in the
        Credit Agreement, and all requisite corporate action on the Borrower’s part for
        the due execution, delivery and performance of this Amendment has been duly
        and
        effectively taken.

      


      c.  -Binding
        Obligations.
        This
        Amendment constitutes the legal, valid and binding obligation of the Borrower,
        enforceable against the Borrower in accordance with its terms, except as
        limited
        by Debtor Laws.

      


      d.  -No
        Conflict or Resultant Lien.
        The
        execution, delivery and performance of this Amendment and the consummation
        of
        the transactions contemplated herein do not and will not violate any provision
        of, or result in a default under, the certificate of incorporation or bylaws
        of
        the Borrower, or any contract, agreement or instrument or any governmental
        requirement to which the Borrower is subject, or result in the creation or
        imposition of any Lien upon any property of the Borrower (other than as
        contemplated or permitted by the Credit Agreement).

      


      e.  -No
        Consent.
        The
        Borrower’s execution, delivery and performance of this Amendment does not
        require the consent or approval of any Person.

      


      18. Miscellaneous.

      


      a.
        In
        accordance with the terms of Section 13.2 of the Credit Agreement, this
        Amendment shall become effective when executed and delivered by the Borrower,
        the Agent and the Majority Banks, so long as (i) no material
        adverse change shall have occurred as of such effective date with respect
        to the
        business, assets, properties or condition (financial or otherwise) of the
        Borrower reflected in the quarterly financial statements of the Borrower
        dated
        September 30, 2005 (copies of such financial statements having been supplied
        to
        the Agent and each Bank),
        and
        (ii) all fees owed by the Borrower in connection with this Amendment pursuant
        to
        the Credit Agreement or any other written agreement between the Borrower
        and the
        Agent shall have been paid by the Borrower.

       

      b. No
        Bank,
        by its execution of this Amendment, waives any rights it may have against
        any
        person not a party hereto.

      


      c. This
        Amendment may be executed in multiple counterparts, each of which shall
        constitute an original instrument, but all of which shall constitute one
        and the
        same Amendment.

      


      d. All
        capitalized terms used herein and not otherwise defined shall have the meanings
        ascribed to such terms in the Credit Agreement.

      


      e. The
        invalidity of any one or more covenants, phrases, clauses, sentences or
        paragraphs of this Amendment shall not affect the remaining portion of this
        Amendment, or any part thereof, and in case of any such invalidity, this
        Amendment shall be construed as if such invalid covenants, phrases, clauses,
        sentences or paragraphs had not been inserted. The section headings in this
        Amendment are for convenience only and shall not limit or in any way affect
        the
        meaning of the terms and provisions of this Amendment.

      


      f. THIS
        AMENDMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS
        OF THE
        STATE OF TEXAS AND THE UNITED STATES OF AMERICA.

      


      THIS
        WRITTEN AMENDMENT, TOGETHER WITH THE CREDIT AGREEMENT, THE NOTES AND THE
        LOAN
        DOCUMENTS, REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT
        BE
        CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENT
        OF THE PARTIES.

      


      THERE
        ARE
        NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.

      


       

      


      [Remainder
        of page left intentionally blank]

      



      
        
          
            


             

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

      


      SOUTHERN
        UNION COMPANY

      


      By: /S/
        RICHARD N. MARSHALL

      Name:
        _Richard
        N. Marshall__________________

      Title:
        Vice
        President and Treasurer__________

      


      


      JPMORGAN
        CHASE BANK, N.A., for itself and as Agent for the Banks

      


      By: /S/
        KEN M. SAMPLE

      Name: Ken
        M.
        Sample

      Title: Senior
        Vice President


      
        
          


          


          


          


           

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      WACHOVIA
        BANK, N.A.

       

      By:    By: 

      Name: 

      Title: 

      


      


      


      BANK
        OF
        AMERICA, N.A.

       

      By:    By: 

      Name: 

      Title: 

      


      


      


       

      KBC
        BANK
        N.V. 

       

      By:    By: 

      Name: 

      Title: 

      


      


      


      WELLS
        FARGO BANK, NA

       

      By:    By:    By: 

      Name: 

      Title: 

       

       

      


      


      CALYON
        NEW YORK BRANCH

      


      By:    By:    By: 

      Name: 

      Title: 

      


      


      


      MERRILL
        LYNCH BANK USA 

      


      By:    By:    By: 

      Name: 

      Title: 

      


      


      


      SOVEREIGN
        BANK

      


      By:    By:    By: 

      Name: 

      Title: 

      


      


      


      LASALLE
        BANK NATIONAL ASSOCIATION 

      


      By:    By:    By: 

      Name: 

      Title: 

      


      


      


      THE
        BANK
        OF TOKYO-MITSUBISHI UFJ, LTD.

      


      By:    By:    By: 

      Name: 

      Title: 

      


      


      


      


      


      


      UMB
        BANK,
        N.A.

      


      By:    By:    By: 

      Name: 

      Title: 

      


      


      


      BAYERISCHE
        LANDESBANK,

      CAYMAN
        ISLANDS BRANCH

      


      By:    By:    By: 

      Name: 

      Title: 

      


      


      


      CREDIT
        SUISSE, CAYMAN ISLANDS

      BRANCH

      


      By:    By:    By: 

      Name: 

      Title: 

      


      


      


      PNC
        BANK,
        NATIONAL ASSOCIATION

      


      By:    By:    By: 

      Name: 

      Title: 

      


      


      


      SUMITOMO
        MITSUI BANKING 

      CORPORATION

      


      By:    By:    By: 

      Name: 

      Title: 

      


      



      
        
          


          


          


          


           

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      MIZUHO
        CORPORATE BANK (USA)

      


      By:    By:    By: 

      Name: 

      Title: 

      


      


      


      BANK
        OF
        CHINA, NEW YORK BRANCH

      


      By:    By:    By: 

      Name: 

      Title: 

      


      


      


      ROYAL
        BANK OF CANADA

      


      By:    By:    By: 

      Name: 

      Title: 

      


      


      


      BANK
        OF
        COMMUNICATIONS,

      NEW
        YORK
        BRANCH

      


      By:    By:    By: 

      Name: 

      Title: 

      


      


      


      CHINATRUST
        COMMERCIAL BANK,

      NEW
        YORK
        BRANCH

      


      By:    By:    By: 

      Name: 

      Title: 

      


      


      


      


      


      



      
        
          
            


             

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      EXHIBIT
        D

       

      


       

      SUMMARY
        OF TERMS OF UP TO $1.65 BILLION BRIDGE FACILITY

       

      Set
        forth below is a summary of certain of the terms of the up to $1.65 Billion
        Bridge Facility and the documentation related thereto. 

      .

      I. Parties.

       

      
        	
                Borrower

                 

              	
                Southern
                  Union Company, a Delaware corporation (the “Company”).

                 

              
	
                Guarantors

                 

              	
                None.

                 

              
	
                Joint
                  Lead Arrangers and Joint Book-Runners 

              	
                Lehman
                  Brothers Inc. (“Lehman
                  Brothers”)
                  and Merrill Lynch, Pierce, Fenner & Smith Incorporated (“MLPF&S”)
                  (in such capacities, the “Arrangers”).

                 

              
	
                Syndication
                  Agents

                 

              	
                To
                  be determined.

                 

              
	
                Documentation
                  Agents

                 

              	
                To
                  be determined.

                 

              
	
                Administrative
                  Agent

                 

              	
                Lehman
                  Commercial Paper Inc. (“LCPI”)
                  (in such capacity, the “Administrative
                  Agent”).

                 

              
	
                Lenders

                 

              	
                Lehman
                  Brothers Commercial Bank (or one of its affiliates), Merrill Lynch
                  (or one
                  of its affiliates), and a syndicate of banks, financial institutions
                  and
                  other entities arranged by the Arranger in consultation with the
                  Company
                  (collectively, the “Lenders”).

                 

              


      

      


      II. Type
        and Amounts 

       

      
        	
                Bridge
                  Facility 

              	
                A
                  senior bridge loan facility in an aggregate principal amount of
                  up to
                  $1.65 billion (the “Bridge
                  Facility”)
                  (the loans made thereunder, the “Bridge
                  Loans”).

              
	
                Availability: 

              	
                The
                  Bridge Loans will be made in a single drawing on the date of the
                  consummation of the Acquisition (defined below) (the “Closing
                  Date”).
                  Any Bridge Loans that are repaid or prepaid may not be
                  reborrowed.

              
	
                Purpose: 

              	
                The
                  proceeds of the Bridge Loans will be used by the Company to finance
                  in
                  part the Acquisition and to pay related fees and
                  expenses.

              
	
                Maturity: 

              	
                The
                  Bridge Loans will mature and be due and payable on the date that
                  is 364
                  days following the Closing Date (the “Maturity
                  Date”).
                  

              


      

      


       

      III. Certain
        Payment Provisions

       

      
        	
                Fees
                  and Interest Rates

                 

              	
                As
                  set forth on Annex A-I attached to this Exhibit A.

                 

              
	
                Optional
                  Prepayments

                 

              	
                Bridge
                  Loans may be prepaid in minimum amounts to be agreed upon. Optional
                  prepayments of the Bridge Loans will be applied to the outstanding
                  principal amount of such Bridge Loans. 

                 

              
	
                Mandatory
                  Prepayments and 

                 

                Commitment
                  Reductions

                 

              	
                (a) Subject
                  to the clause (b) below in this section, the following amounts
                  will be
                  applied to prepay the Bridge Loans, or, to the extent occurring
                  on or
                  prior to the Closing Date, to a reduction of the commitments in
                  respect of
                  the Bridge Facility on a pro rata
                  basis:

                 

                (i) 100%
                  of the net proceeds of any sale or issuance of equity of the Company
                  or
                  any of its subsidiaries (other than the following: (A) any net
                  proceeds of
                  issuances pursuant to employee stock plans after the Closing Date
                  by the
                  Company; and (B) any net proceeds resulting from the settlement
                  of forward
                  stock purchase contracts or remarketing of the senior notes associated
                  with the Equity Units (defined below) so long as such net proceeds
                  are
                  promptly applied to repay amounts outstanding under the Existing
                  Revolving
                  Credit Agreement). “Equity
                  Units”
                  mean the 2,500,000 equity units issued by the Company on June 11,
                  2003,
                  with each such equity unit consisting of a forward stock purchase
                  contract
                  for the purchase of shares of the Company’s common stock and a 2.75%
                  senior note of the Company due August 16, 2008 (the “2008
                  Senior Notes”),
                  which 2008 Senior Notes were issued pursuant to Supplemental Indenture
                  No.
                  1, dated as of June 11, 2003 between the Company and JPMorgan Chase
                  Bank,
                  as trustee (the “Supplemental
                  Indenture”);

                 

                (ii) 100%
                  of the net proceeds of any issuance or incurrence of indebtedness
                  by the
                  Company or any of its subsidiaries (other than any net proceeds
                  of
                  indebtedness issued or incurred that are used to refinance any
                  indebtedness of the Company or any of its subsidiaries that is
                  in
                  existence as of the Closing Date and has a stated maturity date
                  that is
                  prior to March 15, 2007); and

                 

                (iii) 100%
                  of the net proceeds of any sale or other disposition (including
                  as a
                  result of casualty or condemnation) by the Company or any of its
                  subsidiaries of any assets.

                 

                (b) With
                  respect to net proceeds of the types described in subclauses (i),
                  (ii) and
                  (iii) in clause (a) above, in each case that would otherwise be
                  required
                  to be applied as provided in such clause (a) will be applied as
                  set forth
                  in such clause (a) if and only to the extent that (x) the Company
                  or any
                  of its such subsidiary is not required to use such net proceeds
                  to repay
                  its indebtedness (other than intercompany indebtedness) as in effect
                  of
                  the date of the Commitment Letter and (y) there are no contractual
                  or
                  legal restrictions on the ability of the Company to access such
                  net
                  proceeds; provided,
                  however,
                  to
                  the extent that the Company or any of its subsidiaries are restricted
                  or
                  otherwise prohibited from using such net proceeds to repay the
                  Bridge
                  Loans, the Company shall, and shall cause its subsidiaries, to,
                  use its
                  commercially reasonable efforts to remove any such restrictions
                  or
                  prohibitions.

                 

              
	
                IV.
                  Collateral

                 

              	
                The
                  obligations of the Company in respect of the Bridge Facility will
                  be
                  secured by a perfected first priority security interest in (the
                  “Collateral”)
                  (i) 100% of the limited partnership interests in Panhandle Eastern
                  Pipe
                  Line Company, L.P., (ii) 100% of the partnership interests in each
                  of REM
                  and SRES, (iii) 100% of the general partnership interests in Leapartners,
                  and (iv) any proceeds of the foregoing (it being understood that
                  the
                  subsidiary or subsidiaries of the Company that will hold the partnership
                  interests described in clauses (ii) and (iii) above shall pledge
                  such
                  partnership interests). The Collateral shall be free and clear
                  of all
                  liens other than the liens in favor of the Administrative Agent,
                  as
                  collateral agent for the Banks. 

                 

              
	
                V.
                  Certain
                  Conditions Precedent to Borrowings under the Bridge
                  Facility

                 

              	
                Conditions
                  precedent to the making of each extension of credit under the Bridge
                  Facility will be (a) those conditions precedent on Exhibit B (Funding
                  Conditions) to the Commitment Letter to which this Exhibit A is
                  attached,
                  (b) the accuracy of all representations and warranties in the definitive
                  financing documentation with respect to the Bridge Facility (the
                  “Credit
                  Documentation”)
                  (including, without limitation, the material adverse change and
                  litigation
                  representations), (c) there being no default or event of default
                  in
                  existence at the time of, or after giving effect to the making
                  of, such
                  extension of credit and (d) the receipt of a customary borrowing
                  notice.

                 

              
	
                VI.
                  Certain
                  Documentation Matters:

                 

              	 
	
                Representations
                  and Warranties.

                 

              	
                Substantially
                  similar to the Existing Revolving Credit Agreement (defined below),
                  with
                  such modifications as may be reasonably requested by the Arrangers,
                  and
                  including those as to (i) accuracy of disclosure, (ii) the Acquisition,
                  (iii) the Acquired Business, (iv) the Acquisition Agreement, and
                  (v) the
                  creation and perfection of security interests.

                 

                As
                  used herein, “Existing
                  Revolving Credit Agreement”
                  means the Fourth Amended and Restated Revolving Credit Agreement,
                  dated as
                  of September 29, 2005, by and among the Company, as borrower, and
                  the
                  banks named therein, as the banks, and JPMorgan Chase Bank, N.A.,
                  as the
                  administrative agent, and Bank of America, N.A., as the syndication
                  agent,
                  as amended to permit the Transactions.

                 

              
	
                Affirmative
                  Covenants

                 

              	
                Substantially
                  similar to the Existing Revolving Credit Agreement, with such
                  modifications as may be reasonably requested by the Arrangers and
                  are
                  customary for a facility similar to the Bridge Facility.

                 

              
	
                Financial
                  Covenants

                 

              	
                Substantially
                  similar to the Existing Revolving Credit Agreement, with such
                  modifications as may be reasonably requested by the Arrangers and
                  are
                  customary for a facility similar to the Bridge Facility.

                 

              
	
                Negative
                  Covenants

                 

              	
                Substantially
                  similar to the Existing Revolving Credit Agreement, with such
                  modifications as may be reasonably requested by the Arrangers and
                  are
                  customary for a facility similar to the Bridge Facility, including
                  preservation of the Collateral.

                 

              
	
                Events
                  of Default

                 

              	
                Substantially
                  similar to the Existing Revolving Credit Agreement and such additional
                  events of default as may be reasonably requested by the Arrangers
                  and are
                  customary for a facility similar to the Bridge Facility.

                 

              
	
                Voting

                 

              	
                Substantially
                  similar to the Existing Revolving Credit Agreement, with such
                  modifications as may be reasonably requested by the Arrangers and
                  are
                  customary for a facility similar to the Bridge Facility. 

                 

              
	
                Assignments
                  and Participations

                 

              	
                Substantially
                  similar to the Existing Revolving Credit Agreement, with such
                  modifications as may be reasonably requested by the Arrangers and
                  are
                  customary for a facility similar to the Bridge Facility.

                 

              
	
                Yield
                  Protection

                 

              	
                Substantially
                  similar to the Existing Revolving Credit Agreement, with such
                  modifications as may be reasonably requested by the Arrangers and
                  are
                  customary for a facility similar to the Bridge Facility.

                 

              
	
                Expenses
                  and Indemnification

                 

              	
                Substantially
                  similar to the Existing Revolving Credit Agreement, with such
                  modifications as may be reasonably requested by the Arrangers and
                  are
                  customary for a facility similar to the Bridge Facility.

                 

              
	
                Governing
                  Law and Forum...

                 

              	
                State
                  of New York.

                 

              
	
                Counsel
                  to the Administrative Agent and the Arrangers..............................

                 

              	
                 

                 

                Cahill
                  Gordon & Reindel llp

                 

              


      

      


      


      As
        used
        in this Exhibit D, the following terms shall have the following
        meanings:

      


      “Acquisition
        means
        the following purchase of partnership interest described below: Southern
        Union
        Gathering Company LLC, a Delaware limited liability company and a wholly-owned
        subsidiary of the Company (“SUGC
        LLC”),
        and
        Southern Union Panhandle LLC, a Delaware limited liability company and a
        wholly-owned subsidiary of the Company (“SUP
        LLC”),
        have
        entered into a purchase and sale agreement, dated as of December 15, 2005
        (the
“Acquisition
        Agreement”),
        with
        SRCG, Ltd., a Texas limited partnership, as seller (“SRCG”),
        and
        SRCG Genpar, L.P., a Delaware limited partnership, as seller (“Genpar”
and,
        together with SRCG, the “Sellers”),
        pursuant to which (a) SUGC LLC will purchase from SRCG (i) 100% of the limited
        partner interests in Sid Richardson Energy Services, Ltd., a Texas limited
        partnership (“SRES”),
        and
        (ii) 100% of the limited partner interests in Richardson Energy Marketing,
        Ltd.,
        a Texas limited partnership (“REM”)
        and
        (b) SUP LLC will purchase from Genpar (i) 100% of the general partner interests
        in SRES, (ii) 100% of the general partner interests in REM and (iii) 100%
        of the
        general partner interests in Leapartners, L.P., a Texas limited partnership
        (“Leapartners”
and
        together with SRES and REM, the “Acquired
        Business”).
        

      “Transactions”
means,
        collectively, the Acquisition, the entering into and borrowings under the
        Bridge
        Facility by the Company, and the payment of any related fees and
        expenses.

      


      



      
        
          
            Exhibit
              D
              - 

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      Annex
        A-I

       

      Interest
        and Certain Fees

       

      Interest
        Rate OptionsThe
        Company may elect that the Bridge Loans comprising each borrowing bear interest
        at a rate per annum equal to: (i) the Base Rate plus the Applicable Margin
        (“Base
        Rate Loans”);
        or
        (ii) the LIBOR Rate plus the Applicable Margin (“LIBOR
        Loans”).

       

      As
        used
        herein:

       

      “Base
        Rate”
        means
        the higher of (i) the prime lending rate as set forth on the British Banking
        Association Telerate Page 5 (the “Prime
        Rate”),
        and
        (ii) the federal funds effective rate from time to time plus 0.5%.

       

      “Applicable
        Margin”
        means,
        in the case of Base Rate Loans and LIBOR Loans, a percentage per annum changing
        with the rating of the Company’s unsecured, non-credit enhanced “Senior Funded
        Debt” (as defined in the Existing Revolving Credit Agreement (as in effect on
        the date hereof) and determined in accordance with the pricing grid attached
        hereto as Annex A-II.

       

      “LIBOR
        Rate”
        means
        the rate (adjusted for statutory reserve requirements for eurocurrency
        liabilities) at which eurodollar deposits for one, two, three or six months
        (as
        selected by the Company) are offered in the interbank eurodollar
        market.

       

      No
        new
        LIBOR interest period may be selected when any event of default is
        continuing.

       

      Interest
        Payment DatesFor
        Base
        Rate Loans, quarterly in arrears.

       

      For
        LIBOR
        Loans, on the last day of each relevant interest period and, in the case
        of any
        interest period longer than three months, on each successive date three months
        after the first day of such interest period.

       

      Default
        RateSame
        as
        in the Existing Revolving Credit Agreement.

       

      Rate
        and Fee BasisAll
        per
        annum
        rates
        will be calculated on the basis of a year of 360 days (or 365 days, in the
        case
        of Base Rate Loans the interest rate payable on which is then based on the
        Prime
        Rate) and the actual number of days elapsed.

       

      


       


      
        
          
            Annex
              A-I
              - 

            AUSTIN:
              050100.02807: 338404v5

          

          
          

        

        
          
          

          
            

          

        

        
          
          

          
            


          

        

      



      Annex
        A-II

       

      Pricing
        Grid -Applicable Margin for LIBOR Loans and Base Rate
        Loans

       

      
        	
                Rating
                  of the Company’s unsecured, non-credit enhanced


                 

                Senior
                  Funded Debt

                 

              	
                Applicable
                  Margin

                 

                for

                 

                LIBOR
                  Loans

                 

              	
                Applicable
                  Margin

                 

                for

                 

                Base
                  Rate Loans

                 

              
	
                Equal
                  to or greater than A3 by Moody’s and equal to or greater than A- by
                  S&P

                 

              	
                 

                 

                 

                 

                0.425%

                 

              	
                 

                 

                 

                 

                0.000%

                 

              
	
                Baa1
                  by Moody’s or BBB+ by S&P

                 

              	
                0.500%

                 

              	
                0.000%

                 

              
	
                Baa2
                  by Moody’s or BBB by S&P

                 

              	
                0.575%

                 

              	
                0.000%

                 

              
	
                Baa3
                  by Moody’s or BBB- by S&P

                 

              	
                0.725%

                 

              	
                0.000%

                 

              
	
                Ba1
                  by Moody’s or BB+ by S&P

                 

              	
                1.100%

                 

              	
                0.100%

                 

              
	
                Less
                  than Ba1 by Moody’s and less than BB+ by S&P

                 

              	
                 

                 

                1.350%

                 

              	
                 

                 

                0.350%

                 

              


      

      


      Notwithstanding
        the foregoing provisions, in the event that ratings of the Company’s unsecured,
        non-credit enhanced Senior Funded Debt (as defined in the Existing Revolving
        Credit Agreement) under Standard & Poor’s Ratings Group (“S&P”)
        and
        under Moody’s Investor Service, Inc. (“Moody’s”)
        fall
        within different rating categories which are not functional equivalents,
        the
        Applicable Margin for LIBOR Loans and Base Rate Loans shall be based on the
        higher of such ratings if there is only one category differential between
        the
        functional equivalents of such ratings, and if there is a two category
        differential between the functional equivalents of such ratings, the component
        of pricing from the grid set forth above shall be based on the rating category
        which is then in the middle of or between the two category ratings which
        are
        then in effect, and if there is greater than a two category differential
        between
        the functional equivalents of such ratings, the component of pricing from
        the
        grid set forth above shall be based on the rating category which is then
        one
        rating category above the lowest of the two category ratings which are then
        in
        effect. Additionally, in the event that Company withdraws from having its
        unsecured, non-credit enhanced Senior Funded Debt being rated by Moody’s or
        S&P, so that one or both of such ratings services fails to rate the
        Borrowers unsecured, non-credit enhanced Senior Funded Debt, the component
        of
        pricing from the grid set forth above for purposes of determining the applicable
        Applicable Margin for LIBOR Loans and Base Rate Loans for all Rate Periods
        (as
        defined in the Existing Revolving Credit Facility) commencing thereafter
        shall
        be (x) in the case of LIBOR Loans, 1.350% and (y) in the case of Base Rate
        Loans, 0.350%, in each case until such time as the Company subsequently causes
        its unsecured, non-credit enhanced Senior Funded Debt to be rated by both
        of
        said ratings services.