Document:

Exhibit 4.1

 

Execution Version

 

REGISTRATION RIGHTS AGREEMENT

 

This REGISTRATION RIGHTS AGREEMENT, dated as of April 12, 2013 (this “Agreement”), is entered into by and between Southcross Energy Partners, L.P., a Delaware limited partnership (“Southcross”), and Southcross Energy LLC, a Delaware limited liability company (the “Purchaser”).

 

WHEREAS, this Agreement is made in connection with the Closing of the issuance and sale of the Purchased Units (as defined in the Purchase Agreement) pursuant to the Series A Convertible Preferred Unit Purchase Agreement, dated the date hereof, by and between Southcross and the Purchaser (the “Purchase Agreement”);

 

WHEREAS, Southcross has agreed to provide the registration and other rights set forth in this Agreement for the benefit of the Purchaser pursuant to the Purchase Agreement; and

 

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

 

ARTICLE I.
 DEFINITIONS

 

Section 1.01                             Definitions.  Capitalized terms used in this Agreement and not defined herein shall have the meanings ascribed to such terms in the Purchase Agreement.  As used in this Agreement, the following terms have the meanings indicated:

 

“Agreement” shall have the meaning specified in the introductory paragraph of this Agreement.

 

“Delay Liquidated Damages” shall have the meaning specified in Section 2.01(c) of this Agreement.

 

“Effective Date” means, with respect to a particular Shelf Registration Statement, the date of effectiveness of such Shelf Registration Statement.

 

“Effectiveness Period” shall have the meaning specified in Section 2.01(a) of this Agreement.

 

“Filing Date” shall have the meaning specified in Section 2.01(a) of this Agreement.

 

“Holder” means a record holder of Registrable Securities.

 

“Included Registrable Securities” shall have the meaning specified in Section 2.02(a) of this Agreement.

 

“Launch Date” shall have the meaning specified in Section 2.02(b) of this Agreement.

 

“Liquidated Damages” shall have the meaning specified in Section 2.01(c) of this Agreement.

 

“Liquidated Damages Cap” shall have the meaning specified in Section 2.01(d) of this Agreement.

 

 

“Losses” shall have the meaning specified in Section 2.08(a) of this Agreement.

 

“Managing Underwriter” means, with respect to any Underwritten Offering, the book running lead manager of such Underwritten Offering.

 

“Opt-Out Notice” shall have the meaning specified in Section 2.02(a) of this Agreement.

 

“Other Holder” shall have the meaning specified in Section 2.02(c) of this Agreement.

 

“Overnight Underwritten Offering” shall have the meaning specified in Section 2.02(b) of this Agreement.

 

“Piggyback Offering” shall have the meaning specified in Section 2.02(a) of this Agreement.

 

“Pricing Date” shall have the meaning specified in Section 2.02(b) of this Agreement.

 

“Primary Offering” shall have the meaning specified in Section 2.04(n) of this Agreement.

 

“Purchase Agreement” shall have the meaning specified in the recitals of this Agreement.

 

“Purchaser” shall have the meaning specified in the introductory paragraph of this Agreement.

 

“Registrable Securities” means, except as set forth in Section 1.02, the Conversion Units underlying the Series A Preferred Units acquired pursuant to the Purchase Agreement (including Conversion Units underlying any Series A Preferred Units issued to the Purchaser as payment in-kind pursuant to the terms of the Series A Preferred Units).

 

“Registration Expenses” shall have the meaning specified in Section 2.07(a) of this Agreement.

 

“Selling Expenses” shall have the meaning specified in Section 2.07(a) of this Agreement.

 

“Selling Holder” means a Holder who is selling Registrable Securities under a registration statement pursuant to the terms of this Agreement.

 

“Selling Holder Documentation” shall have the meaning specified in Section 2.02(b) of this Agreement.

 

“Shelf Registration Statement” means a registration statement under the Securities Act to permit the public resale of the Registrable Securities from time to time as permitted by Rule 415 of the Securities Act (or any similar provision then in force under the Securities Act).

 

“Southcross” shall have the meaning specified in the introductory paragraph of this Agreement.

 

“Underwritten Offering” means an offering (including an offering pursuant to a Shelf Registration Statement) in which Common Units are sold to an underwriter on a best efforts or firm commitment basis for reoffering to the public or an offering that is an Overnight Underwritten Offering with one or more investment banks.

 

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“Underwritten Offering Filing” shall have the meaning specified in Section 2.02(a) of this Agreement.

 

“Underwritten Offering Request” shall have the meaning specified in Section 2.03(a) of this Agreement.

 

“Unit Purchase Price” means $22.86.

 

Section 1.02                             Registrable Securities.  Any Registrable Security will cease to be a Registrable Security at the earliest of the following:  (a) when a registration statement covering such Registrable Security becomes or has been declared effective by the Commission and such Registrable Security has been sold or disposed of pursuant to such registration statement; (b) when such Registrable Security has been disposed of pursuant to Rule 144 (or any similar provision then in force) under the Securities Act; (c) when such Registrable Security is held by Southcross or one of its subsidiaries; and (d) when such Registrable Security has been sold in a private transaction in which the transferor’s rights under this Agreement are not assigned to the transferee of such securities pursuant to the terms of this Agreement.

 

ARTICLE II.
 REGISTRATION RIGHTS

 

Section 2.01                             Shelf Registration.

 

(a)                                 Shelf Registration.  As soon as practicable following Southcross’ receipt of written notice from the Holders of a majority of the Registrable Securities then outstanding requesting the filing of a Shelf Registration Statement, Southcross shall use its reasonable best efforts to prepare and file a Shelf Registration Statement under the Securities Act covering Registrable Securities then outstanding; provided, however, that the right of such Holders to request such filing shall expire on the seventh anniversary of the date hereof; provided, further, that Southcross shall have no requirement to file a Shelf Registration Statement at any time when Southcross is not eligible to use a registration statement on Form S-3 to register resales of the Registrable Securities. If Southcross does not meet the Commission’s definition of “well known seasoned issuer,” Southcross shall use its reasonable best efforts to cause the Shelf Registration Statement to become effective no later than 180 days after the date of the filing of such Shelf Registration Statement (the “Filing Date”).  A Shelf Registration Statement filed pursuant to this Section 2.01(a) shall be on such appropriate registration form of the Commission as shall be selected by Southcross; provided, however, that if a prospectus supplement will be used in connection with the marketing of an Underwritten Offering from a Shelf Registration Statement and the Managing Underwriter at any time shall notify Southcross in writing that, in the reasonable judgment of such Managing Underwriter, inclusion of detailed information to be used in such prospectus supplement is of material importance to the success of the Underwritten Offering of such Registrable Securities, Southcross shall use its reasonable best efforts to include such information in the prospectus supplement.  Southcross will use its reasonable best efforts to cause a Shelf Registration Statement filed pursuant to this Section 2.01(a) to be continuously effective under the Securities Act until the earliest date on which any of the following occurs: (i) all Registrable Securities covered by such Shelf Registration Statement have been distributed in the manner set forth and as contemplated in such Shelf Registration Statement, (ii) there are no

 

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longer any Registrable Securities outstanding and (iii) two years from the Effective Date of such Shelf Registration Statement (the “Effectiveness Period”).  A Shelf Registration Statement when it becomes or is declared effective (including the documents incorporated therein by reference) will comply as to form in all material respects with all applicable requirements of the Securities Act and the Exchange Act and will not contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading (and, in the case of any prospectus contained in such Shelf Registration Statement, in the light of the circumstances under which a statement is made).  As soon as practicable following the Effective Date of a Shelf Registration Statement, but in any event within three (3) Business Days of such date, Southcross will notify the Selling Holders of the effectiveness of such Shelf Registration Statement.

 

(b)                                 Maximum Shelf Registration Requests; Delay Rights.

 

(i)                                     Notwithstanding anything to the contrary contained in this Agreement, Southcross shall not be obligated to file or effect more than two (2) Shelf Registration Statements (including any post-effective amendments to a Shelf Registration Statement filed for the primary purpose of including Selling Holders or adding Conversion Units to such Registration Statement) pursuant to Section 2.01 of this Agreement.

 

(ii)                                  Notwithstanding anything to the contrary contained in this Agreement, Southcross may, upon written notice to any Selling Holder whose Registrable Securities are included in a Shelf Registration Statement, suspend such Selling Holder’s use of any prospectus that is a part of such Shelf Registration Statement (in which event the Selling Holder shall discontinue sales of the Registrable Securities pursuant to the Shelf Registration Statement) if (A) Southcross is pursuing an acquisition, merger, reorganization, disposition or other similar transaction and Southcross determines in good faith that Southcross’ ability to pursue or consummate such a transaction would be materially and adversely affected by any required disclosure of such transaction in the Shelf Registration Statement or (B) Southcross has experienced some other material non-public event the disclosure of which at such time, in the good faith judgment of Southcross, would materially and adversely affect Southcross; provided, however, that in no event shall the Selling Holders be suspended from selling Registrable Securities pursuant to the Shelf Registration Statement for a period that exceeds an aggregate of sixty (60) days in any one hundred-eighty (180) day period or ninety (90) days (exclusive of days covered by any lock-up agreement executed by a Selling Holder in connection with any Underwritten Offering by Southcross or a Selling Holder) in any 365 day period.  Upon disclosure of such information or the termination of the conditions described above, Southcross shall provide prompt notice to the Selling Holders whose Registrable Securities are included in the Shelf Registration Statement, and shall promptly terminate any suspension of sales it has put into effect and shall take such other actions necessary or appropriate to permit registered sales of Registrable Securities as contemplated in this Agreement.

 

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(c)                                  Failure To Become Effective; Additional Rights to Liquidated Damages.

 

(i)                                     If a Shelf Registration Statement required by Section 2.01(a) does not become or is not declared effective within 180 days after its Filing Date, then each Selling Holder shall be entitled to a payment (with respect to each Registrable Security held by the Selling Holder), as liquidated damages and not as a penalty, of 0.25% per annum of the Unit Purchase Price for the first 60-day period immediately following the 180th day after the Filing Date, with such payment amount increasing by an additional 0.25% per annum of the Unit Purchase Price for each subsequent 60-day period, up to a maximum of 1.00% per annum of the Unit Purchase Price (the “Liquidated Damages”), until such time as such Shelf Registration Statement becomes effective or is declared effective or the Registrable Securities covered by such Shelf Registration Statement are no longer outstanding.

 

(ii)                                  If (A) the Holders shall be prohibited from selling their Registrable Securities under the Registration Statement as a result of a suspension pursuant to Section 2.01(b)(i) of this Agreement in excess of the periods permitted therein or (B) the Registration Statement is filed and effective but, during the Effectiveness Period, shall thereafter cease to be effective or fail to be usable for its intended purpose without being succeeded within ninety (90) Business Days by a post-effective amendment to the Registration Statement, a supplement to the prospectus or a report filed with the Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act, then, until the suspension is lifted or such amendment, supplement or report is filed and effective, but not including any day on which a suspension is lifted, if applicable, then each Holder shall be entitled to a payment (with respect to each Registrable Security), as liquidated damages and not as a penalty, of 0.125% per annum of the Unit Purchase Price for the first 90 days following (x) the date on which the suspension period exceeded the permitted period under Section 2.01(b)(i) of this Agreement or (y) the 91st Business Day after the Registration Statement ceased to be effective or failed to be useable for its intended purposes, increasing by an additional 0.125% per annum of the Unit Purchase Price for each subsequent 90-day period, up to a maximum of 0.50% per annum of the Unit Purchase Price (the “Delay Liquidated Damages”).  For purposes of this Section 2.01(c)(ii), a suspension shall be deemed lifted on the date that notice that the suspension has been lifted or that a post-effective amendment is effective is delivered to the Holders pursuant to Section 3.01 of this Agreement.

 

(d)                                 General.  The Liquidated Damages and the Delay Liquidated Damages shall be paid to each Selling Holder in cash within ten (10) Business Days of the end of each such 60-day or 90-day period, as applicable.  Any payments made pursuant to this Section 2.01(d) shall constitute the Selling Holders’ exclusive remedy for such events.  The Liquidated Damages and the Delay Liquidated Damages imposed hereunder shall be paid to the Selling Holders in immediately available funds.  In no event will the aggregate amount of Liquidated Damages and the Delay Liquidated Damages paid to the Selling Holders exceed 5% of the aggregate of the Purchase Price (the “Liquidated Damages Cap”).  In addition to being subject to the Liquidated Damages Cap, the payment of the Liquidated Damages and the Delay Liquidated Damages to a Selling Holder shall cease at such time as the Registrable Securities of such Selling Holder become eligible for resale under Rule 144 of the Securities Act.

 

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Section 2.02                             Piggyback Rights.

 

(a)                                 Underwritten Offering Piggyback Rights.  Except as provided in Section 2.02(b), if at any time during any Effectiveness Period Southcross proposes to file (i) a prospectus supplement to an effective shelf registration statement, other than a Shelf Registration Statement contemplated by Section 2.01, or (ii) a registration statement, other than a shelf registration statement, in either case, for the sale of Common Units in an Underwritten Offering for its own account, then, as soon as practicable but not less than three (3) Business Days prior to the filing of (A) any preliminary prospectus supplement relating to such Underwritten Offering pursuant to Rule 424(b) of the Securities Act, (B) the prospectus supplement relating to such Underwritten Offering pursuant to Rule 424(b) of the Securities Act (if no preliminary prospectus supplement is used) or (C) such registration statement (other than a shelf registration statement), as the case may be (an “Underwritten Offering Filing”), Southcross shall give notice of such proposed Underwritten Offering to the Holders and such notice shall offer the Holders the opportunity to include in such Underwritten Offering such number of Registrable Securities (the “Included Registrable Securities”) as each such Holder may request in writing (a “Piggyback Offering”); provided, however, that Southcross shall not be required to include any Registrable Securities if (aa) the Holders do not offer at least $5 million of the then outstanding Registrable Securities or (bb) Southcross has been advised by the Managing Underwriter that the inclusion of Registrable Securities for sale for the benefit of the Holders will have an adverse effect on the price, timing or distribution of the Common Units, in which case the amount of Registrable Securities to be offered for the accounts of participating Holders shall be determined based on the provisions of Section 2.02(c) of this Agreement.  Each Holder shall keep any information relating to any such Underwritten Offering confidential and shall not disseminate or in any way disclose such information.  Except as provided in Section 2.02(b), each Holder shall then have two (2) Business Days from the date of such notice to request inclusion of its Registrable Securities in the Piggyback Offering.  If no request for inclusion from a Holder is received within the specified time, such Holder shall have no further right to participate in such Piggyback Offering.  If, at any time after giving written notice of its intention to undertake an Underwritten Offering and prior to the closing of such Underwritten Offering, Southcross shall determine for any reason not to undertake or to delay such Underwritten Offering, Southcross shall give written notice of such determination to the Selling Holders and, (x) in the case of a determination not to undertake such Underwritten Offering, shall be relieved of its obligation to sell any Included Registrable Securities in connection with such terminated Underwritten Offering, and (y) in the case of a determination to delay such Underwritten Offering, shall be permitted to delay offering any Included Registrable Securities for the same period as the delay of the Underwritten Offering.  Any Selling Holder shall have the right to withdraw such Selling Holder’s request for inclusion of such Selling Holder’s Registrable Securities in such Underwritten Offering by giving written notice to Southcross of such withdrawal at least one (1) Business Day prior to the time of pricing of such Underwritten Offering.  Each Holder’s rights under this Section 2.02(a) shall terminate when such Holder holds less than a majority of the then outstanding Registrable Securities.  Notwithstanding the foregoing, any Holder may deliver written notice (an “Opt-Out Notice”) to Southcross requesting that such Holder not receive notice from Southcross of any proposed Underwritten Offering; provided, however, that such Holder may later revoke any such Opt-Out Notice in writing.

 

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(b)                                 Overnight Underwritten Offering Piggyback Rights.  If at any time during any Effectiveness Period Southcross proposes to make an Underwritten Offering Filing and such Underwritten Offering is expected to be effected by launching an Underwritten Offering after the close of trading on one trading day (the “Launch Date”) and pricing the Underwritten Offering before the open of trading on the next succeeding trading day (the “Pricing Date” and, such execution format, an “Overnight Underwritten Offering”), then no later than three (3) Business Days after Southcross engages a Managing Underwriter for the proposed Overnight Underwritten Offering, (x) Southcross shall notify the Holders of the pendency of the Overnight Underwritten Offering and (y) if the Holders propose to include Registrable Securities in the Overnight Underwritten Offering, then the Managing Underwriter of the Overnight Underwritten Offering shall, no later than the fifth (5th) Business Day prior to the expected Launch Date, provide to the Selling Holders all of the documentation customarily required for the inclusion of Registrable Securities in the Overnight Underwritten Offering, including, without limitation, a custody agreement and power-of-attorney, Selling Holders’ customary representations and warranties, and a form of legal opinion required to be delivered by counsel to the Selling Holders (in form and substance reasonably acceptable to counsel for the Selling Holders) at the closing of an Overnight Underwritten Offering and any over-allotment option closing (collectively, the “Selling Holder Documentation”). To include Registrable Securities in an Overnight Underwritten Offering, each Selling Holder shall, subject to receipt of notice of the Overnight Underwritten Offering and Selling Holder Documentation within the time periods set forth above, (A) complete its review and return the Selling Holder Documentation, with such revisions as have been agreed to by Southcross (such agreement not to be unreasonably withheld) and the Selling Holder, at least three (3) Business Days prior to the expected Launch Date, (B) place the Registrable Securities eligible for inclusion in an Overnight Underwritten Offering into the custody of Southcross’ transfer agent at least three (3) Business Days prior to the expected Launch Date, (C) agree to participate following reasonable notice in any due diligence calls arranged by the Managing Underwriter of an Overnight Underwritten Offering on the expected Launch Date, the Pricing Date or in advance of the closing of an Overnight Underwritten Offering and any over-allotment option closing, and (D) unconditionally waive any right to withdraw any Registrable Securities placed into the custody of Southcross’ transfer agent for inclusion in an Overnight Underwritten Offering within two (2) Business Days of the expected Launch Date, whether on the basis of the offering price, underwriter discount, or for any other reason; provided, however, that Southcross shall not be required to include such Registrable Securities if (aa) the Holders do not offer a majority of the then outstanding Registrable Securities or (bb) Southcross has been advised by the Managing Underwriter that the inclusion of Registrable Securities for sale for the benefit of the Holders will have an adverse effect on the price, timing or distribution of the Common Units, in which case the amount of Registrable Securities to be offered for the accounts of participating Holders shall be determined based on the provisions of Section 2.02(c) of this Agreement.  If, at any time after giving written notice of its intention to undertake an Overnight Underwritten Offering and prior to the closing of such Overnight Underwritten Offering, Southcross shall determine for any reason not to undertake or to delay such Overnight Underwritten Offering, Southcross shall give written notice of such determination to the Selling Holders and, (i) in the case of a determination not to undertake such Overnight Underwritten Offering, shall be relieved of its obligation to sell any Registrable Securities held by the Selling Holders in connection with such terminated Overnight Underwritten Offering, and (ii) in the case of a determination to delay such Overnight

 

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Underwritten Offering, shall be permitted to delay offering any Registrable Securities held by the Selling Holders for the same period as the delay of the Overnight Underwritten Offering.  Any Selling Holder shall have the right to withdraw such Selling Holder’s request for inclusion of such Selling Holder’s Registrable Securities in such Overnight Underwritten Offering by giving written notice to Southcross of such withdrawal at least two (2) Business Days prior to the Launch Date.  Each Holder’s rights under this Section 2.02(b) shall terminate when such Holder holds less than $5 million of Registrable Securities (based on the Unit Purchase Price).  Notwithstanding the foregoing, any Holder may deliver an Opt-Out Notice to Southcross requesting that such Holder not receive notice from Southcross of any proposed Overnight Underwritten Offering; provided, however, that such Holder may later revoke any such Opt-Out Notice in writing.

 

(c)                                  Priority of Piggyback Rights.  In connection with an Underwritten Offering contemplated by Section 2.02(a) or Section 2.02(b), if the Managing Underwriter or Underwriters of such Underwritten Offering advises Southcross that the total amount of Common Units that the Selling Holders and any other Persons intend to include in such Underwritten Offering exceeds the number that can be sold in such Underwritten Offering without being likely to have an adverse effect on the price, timing or distribution of the Common Units offered or the market for the Common Units, then the Common Units to be included in such Underwritten Offering shall include the number of Common Units that such Managing Underwriter or Underwriters advises Southcross can be sold without having such adverse effect, with such number to be allocated (i) first to Southcross, (ii) second pro rata among the Selling Holders and any other Persons who have been or are granted registration rights on or after the date of this Agreement who have requested participation in the Underwritten Offering (the “Other Holders”) based, for each such Selling Holder or Other Holder, on the percentage derived by dividing (A) the number of Common Units proposed to be sold by such Selling Holder(s) and such Other Holders in such Underwritten Offering; by (B) the aggregate number of Common Units proposed to be sold by all Selling Holders and all Other Holders in the Underwritten Offering.

 

Section 2.03                             Underwritten Offering.

 

(a)                                 Request for Underwritten Offering.  In the event that a Selling Holder (together with any Affiliates that are Selling Holders) elects to dispose of Registrable Securities under a Shelf Registration Statement pursuant to an Underwritten Offering and reasonably anticipates gross proceeds of greater than $20 million from such Underwritten Offering of Registrable Securities, Southcross shall, at the request of such Selling Holder (each, an “Underwritten Offering Request”), enter into an underwriting agreement in customary form with the Managing Underwriter or Underwriters, which shall include, among other provisions, indemnities to the effect and to the extent provided in Section 2.08, and shall take all such other reasonable actions as are requested by the Managing Underwriter to expedite or facilitate the disposition of the Registrable Securities; provided, however, that Southcross shall not be required to effect more than two (2) Underwritten Offerings pursuant to Section 2.03 of this Agreement, and the Holders shall be limited to one Underwritten Offering Request in any 240 day period.

 

(b)                                 General Procedures.  In connection with any Underwritten Offering, Southcross shall be entitled to select the Managing Underwriter or Underwriters.  In connection with an

 

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Underwritten Offering contemplated by this Agreement in which a Selling Holder participates, each Selling Holder and Southcross shall be obligated to enter into an underwriting agreement with the Managing Underwriter or Underwriters that contains such representations, covenants, indemnities and other rights and obligations as are customary in underwriting agreements for firm commitment offerings of equity securities.  No Selling Holder may participate in an Underwritten Offering unless such Selling Holder agrees to sell its Registrable Securities on the basis provided in such underwriting agreement and completes and executes all questionnaires, powers-of-attorney, indemnities and other documents reasonably required under the terms of such underwriting agreement.  Each Selling Holder may, at its option, require that any or all of the representations and warranties by, and the other agreements on the part of, Southcross to and for the benefit of such underwriters also be made to and for such Selling Holder’s benefit and that any or all of the conditions precedent to the obligations of such underwriters under such underwriting agreement also be conditions precedent to its obligations.  No Selling Holder shall be required to make any representations or warranties to or agreements with Southcross or the underwriters other than representations, warranties or agreements regarding such Selling Holder and its ownership of the securities being registered on its behalf and its intended method of distribution and any other representation required by Law.  If any Selling Holder disapproves of the terms of an Underwritten Offering, such Selling Holder may elect to withdraw therefrom by notice to Southcross and the Managing Underwriter; provided, however, that such withdrawal must be made at least one (1) Business Day prior to the pricing of such Underwritten Offering to be effective.  No such withdrawal or abandonment shall affect Southcross’ obligation to pay Registration Expenses.  Upon the receipt by Southcross of a written request from the Holders of at least $30 million of Common Units that are participating in an Underwritten Offering, Southcross’ management shall be required to participate in a roadshow or similar marketing effort in connection with that Underwritten Offering; provided, that management:  (i) is given at least 60 days’ notice prior to the commitment of any roadshow or similar marketing effort; (ii) agrees to the proposed commencement date of any roadshow or similar marketing effort; and (iii) is not required to participate in any roadshow or similar marketing effort for more than two days.

 

Section 2.04                             Sale Procedures.  In connection with its obligations under this Article II, Southcross will, as expeditiously as possible:

 

(a)                                 prepare and file with the Commission such amendments and supplements to a Shelf Registration Statement and the prospectus used in connection therewith as may be necessary to keep such Shelf Registration Statement effective for its Effectiveness Period and as may be necessary to comply with the provisions of the Securities Act with respect to the disposition of all securities covered by such Shelf Registration Statement;

 

(b)                                 furnish to each Selling Holder (i) as far in advance as reasonably practicable before filing a Shelf Registration Statement or any other registration statement contemplated by this Agreement or any supplement or amendment thereto, upon request, copies of reasonably complete drafts of all such documents proposed to be filed (including exhibits and each document incorporated by reference therein to the extent then required by the rules and regulations of the Commission), and provide each such Selling Holder the opportunity to object to any information pertaining to such Selling Holder and its plan of distribution that is contained therein and make the corrections reasonably requested by such Selling Holder with respect to such information prior to filing such Shelf Registration Statement or such other registration

 

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statement and the prospectus included therein or any supplement or amendment thereto, and (ii) an electronic copy of such Shelf Registration Statement or such other registration statement and the prospectus included therein and any supplements and amendments thereto as such Selling Holder may reasonably request in order to facilitate the public sale or other disposition of the Registrable Securities covered by such Shelf Registration Statement or other registration statement;

 

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

 

(d)                                 promptly notify each Selling Holder and each underwriter of Registrable Securities, at any time when a prospectus relating thereto is required to be delivered under the Securities Act, of (i) the filing of a Shelf Registration Statement or any other registration statement contemplated by this Agreement or any prospectus or prospectus supplement to be used in connection therewith, or any amendment or supplement thereto, and, with respect to such Shelf Registration Statement or any other registration statement or any post-effective amendment thereto, when the same has become effective; and (ii) the receipt of any written comments from the Commission with respect to any filing referred to in clause (i) and any written request by the Commission for amendments or supplements to such Shelf Registration Statement or any other registration statement or any prospectus or prospectus supplement thereto;

 

(e)                                  immediately notify each Selling Holder and each underwriter of Registrable Securities, at any time when a prospectus relating thereto is required to be delivered under the Securities Act, of (i) the happening of any event as a result of which the prospectus or prospectus supplement contained in a Shelf Registration Statement or any other registration statement contemplated by this Agreement, as then in effect, or any supplemental amendment thereto, includes an untrue statement of a material fact or omits to state any material fact required to be stated therein or necessary to make the statements therein not misleading in the light of the circumstances then existing; (ii) the issuance or threat of issuance by the Commission of any stop order suspending the effectiveness of such Shelf Registration Statement or any other registration statement contemplated by this Agreement, or the initiation of any proceedings for that purpose; or (iii) the receipt by Southcross of any notification with respect to the suspension of the qualification of any Registrable Securities for sale under the applicable securities or blue sky laws of any jurisdiction.  Following the provision of such notice, Southcross agrees to as promptly as practicable amend or supplement the prospectus or prospectus supplement or take other appropriate action so that the prospectus or prospectus supplement does not include an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading in the light of the circumstances then existing and to take such other action as is necessary to remove a stop order, suspension, threat thereof or proceedings related thereto;

 

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

 

(g)                                  in the case of an Underwritten Offering, furnish upon request, (i) an opinion letter of counsel for Southcross dated the date of the closing under the underwriting agreement, including a standard “10b-5” letter and (ii) a “cold comfort” letter dated the pricing date of such Underwritten Offering and a letter of like kind dated the date of the closing under the underwriting agreement, in each case, signed by the independent public accountants who have certified Southcross’ financial statements included or incorporated by reference into the applicable registration statement, and each of the opinion and the “cold comfort” letter shall be in customary form and covering substantially the same matters with respect to such registration statement (and the prospectus included therein and any supplement thereto) and as are customarily covered in opinion letters of issuer’s counsel and in accountants’ letters delivered to the underwriters in underwritten offerings of equity securities;

 

(h)                                 otherwise use its commercially reasonable efforts to comply with all applicable rules and regulations of the Commission, and make available to its security holders, as soon as reasonably practicable, an earnings statement, which earnings statement shall satisfy the provisions of Section 11(a) of the Securities Act and Rule 158 promulgated thereunder;

 

(i)                                     make available to the appropriate representatives of the Managing Underwriter and Selling Holders access to such information and Southcross personnel as is reasonable and customary to enable such parties to establish a due diligence defense under the Securities Act; provided, however, that Southcross need not disclose any non-public information to any such representative unless and until such representative has entered into a confidentiality agreement with Southcross reasonably satisfactory to Southcross;

 

(j)                                    cause all such Registrable Securities registered pursuant to this Agreement to be listed on each securities exchange or nationally recognized quotation system, if any, on which similar securities issued by Southcross are then listed;

 

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

 

(l)                                     provide a transfer agent and registrar for all Registrable Securities covered by such registration statement not later than the effective date of such registration statement;

 

(m)                             take such other actions as are reasonably requested by the Selling Holders or the underwriters, if any, to expedite or facilitate the disposition of such Registrable Securities; and

 

(n)                                 (i) cooperate with a Selling Holder if such Selling Holder could reasonably be deemed to be an “underwriter,” as defined in Section 2(a)(11) of the Securities Act, in connection with the registration statement in respect of any registration of the Registrable

 

11

 

Securities of such Selling Holder pursuant to this Agreement, and any amendment or supplement thereof (any such registration statement or amendment or supplement a “Primary Offering”), in allowing such Selling Holder to conduct customary “underwriter’s due diligence” with respect to Southcross and satisfy its obligations in respect thereof, (ii) furnish to such Selling Holder upon such Selling Holder’s request, on the date of the effectiveness of any Primary Offering and thereafter from time to time on such dates as such Selling Holder may reasonably request, the letters covered by Section 2.04(g) of this Agreement, in each case addressed to such Selling Holder, and (iii) permit legal counsel to such Selling Holder to review and comment upon any such Primary Offering at least five (5) Business Days prior to its filing with the Commission and all amendments and supplements to any such Primary Offering within a reasonable number of days prior to their filing with the Commission and not file any Primary Offering or amendment or supplement thereto in a form to which such Selling Holder’s legal counsel reasonably objects in writing.

 

Each Selling Holder, upon receipt of notice from Southcross of the happening of any event of the kind described in subsection (e) of this Section 2.04, shall forthwith discontinue disposition of the Registrable Securities until such Selling Holder’s receipt of the copies of the supplemented or amended prospectus contemplated by subsection (e) of this Section 2.04 or until it is advised in writing by Southcross that the use of the prospectus may be resumed, and has received copies of any additional or supplemental filings incorporated by reference in the prospectus, and, if so directed by Southcross, such Selling Holder will deliver, or will request the Managing Underwriter or underwriters, if any, to deliver to Southcross all copies in their possession or control, other than permanent file copies then in such Selling Holder’s possession, of the prospectus and any prospectus supplement covering such Registrable Securities current at the time of receipt of such notice.

 

If reasonably requested by a Selling Holder, Southcross shall:  (i) as soon as practicable incorporate in a prospectus supplement or post-effective amendment such information as such Selling Holder reasonably requests to be included therein relating to the sale and distribution of Registrable Securities, including information with respect to the number of Registrable Securities being offered or sold, the purchase price being paid therefor and any other terms of the offering of the Registrable Securities to be sold in such offering; (ii) as soon as practicable make all required filings of such prospectus supplement or post-effective amendment after being notified of the matters to be incorporated in such prospectus supplement or post-effective amendment; and (iii) as soon as practicable, supplement or make amendments to any Shelf Registration Statement or any other registration statement contemplated by this Agreement.

 

Section 2.05                             Cooperation by Holders.  Southcross shall have no obligation to include Registrable Securities of a Holder in a Shelf Registration Statement or in an Underwritten Offering under Article II of this Agreement if such Selling Holder has failed to timely furnish such information that, in the opinion of counsel to Southcross, is reasonably required for such registration statement or prospectus supplement, as applicable, to comply with the Securities Act.

 

Section 2.06                             Restrictions on Public Sale by Holders of Registrable Securities.  During the Effectiveness Period, each Holder of Registrable Securities who is included in a Shelf Registration Statement agrees not to effect any public sale or distribution of the Registrable Securities during the thirty (30) calendar day period beginning on the date that a prospectus

 

12

 

supplement or other prospectus (including any free writing prospectus) is filed with the Commission with respect to an Underwritten Offering of equity securities of Southcross; provided, that the duration of the foregoing restrictions shall be no longer than the duration of the shortest restriction generally imposed by the underwriters on the officers, directors or any other unitholder of Southcross on whom a restriction is imposed in connection with such public offering; provided, further, that this Section 2.06 shall apply only to a Selling Holder (together with any Affiliates that are Selling Holders) that holds a majority of the then outstanding Registrable Securities.

 

Section 2.07                             Expenses.

 

(a)                                 Certain Definitions.  “Registration Expenses” means all expenses incident to Southcross’ performance under or compliance with this Agreement to effect the registration of Registrable Securities in a Shelf Registration Statement pursuant to Section 2.01, a Piggyback Offering or Overnight Underwritten Offering pursuant to Section 2.02, or an Underwritten Offering pursuant to Section 2.03, and the disposition of such securities, including, without limitation, all customary registration, filing, securities exchange listing and NYSE fees, all customary registration, filing, qualification and other fees and expenses of complying with securities or “blue sky” laws, fees of the Financial Industry Regulatory Authority, Inc., fees of transfer agents and registrars, all word processing, duplicating and printing expenses, the fees and disbursements of counsel to Southcross and independent public accountants for Southcross, including the expenses of any special audits or “cold comfort” letters required by or incident to such performance and compliance.  “Selling Expenses” means all underwriting fees, discounts and selling commissions (and similar fees or arrangements associated with) and transfer taxes allocable to the sale of the Registrable Securities.

 

(b)                                 Expenses.  Southcross will pay all reasonable Registration Expenses as determined in good faith, including, in the case of an Underwritten Offering or a Piggyback Offering, whether or not any sale is made pursuant to the related registration statement.  Except as otherwise provided in Section 2.08, Southcross shall not be responsible for legal fees incurred by Holders in connection with the exercise of such Holders’ rights and obligations under this Agreement hereunder, or for any Selling Expenses.  Each Selling Holder shall pay all Selling Expenses in connection with any sale of its Registrable Securities.

 

Section 2.08                             Indemnification.

 

(a)                                 By Southcross.  In the event of a registration of any Registrable Securities under the Securities Act pursuant to this Agreement, Southcross will indemnify and hold harmless each Selling Holder thereunder, its directors, officers, employees, agents and managers, and each underwriter, pursuant to the applicable underwriting agreement with such underwriter, of Registrable Securities thereunder and each Person, if any, who controls such Selling Holder or underwriter within the meaning of the Securities Act and the Exchange Act, and its directors, officers, employees, agents and managers, against any losses, claims, damages, expenses or liabilities (including reasonable attorneys’ fees and expenses) (collectively, “Losses”), joint or several, to which such Selling Holder or underwriter or controlling Person may become subject under the Securities Act, the Exchange Act or otherwise, insofar as such Losses (or actions or proceedings, whether commenced or threatened, in respect thereof) arise out of or are based upon

 

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any untrue statement or alleged untrue statement of any material fact (in the case of any prospectus, in the light of the circumstances under which such statement is made) contained in a Shelf Registration Statement or any other registration statement contemplated by this Agreement, any preliminary prospectus or final prospectus contained therein, or any free writing prospectus related thereto, or any amendment or supplement thereof, or arise out of or are based upon the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein (in the case of a prospectus, in the light of the circumstances under which they were made) not misleading, and will reimburse each such Selling Holder, its directors and officers, each such underwriter and each such controlling Person for any legal or other expenses reasonably incurred by them in connection with investigating or defending any such Loss or actions or proceedings; provided, however, that Southcross will not be liable in any such case if and to the extent that any such Loss arises out of or is based upon an untrue statement or alleged untrue statement or omission or alleged omission so made in conformity with information furnished by such Selling Holder, such underwriter or such controlling Person in writing specifically for use in the Shelf Registration Statement or such other registration statement, free writing prospectus or prospectus supplement, as applicable.  Such indemnity shall remain in full force and effect regardless of any investigation made by or on behalf of such Selling Holder or any such director, officer, employee, agent, manager or controlling Person, and shall survive the transfer of such securities by such Selling Holder.

 

(b)                                 By Each Selling Holder.  Each Selling Holder agrees to indemnify and hold harmless Southcross, its directors, officers, employees and agents and each Person, if any, who controls Southcross within the meaning of the Securities Act or of the Exchange Act to the same extent as the foregoing indemnity from Southcross to the Selling Holders, but only with respect to information regarding such Selling Holder furnished in writing by or on behalf of such Selling Holder expressly for inclusion in a Shelf Registration Statement or any other registration statement contemplated by this Agreement, any preliminary prospectus or final prospectus contained therein, or any free writing prospectus related thereto, or any amendment or supplement thereof; provided, however, that the liability of each Selling Holder shall not be greater in amount than the dollar amount of the proceeds (net of Selling Expenses) received by such Selling Holder from the sale of the Registrable Securities giving rise to such indemnification.  Such indemnity shall remain in full force and effect regardless of any investigation made by or on behalf of Southcross or any such director, officer, employee, agent, manager or controlling Person, and shall survive the transfer of such securities by such Selling Holder.

 

(c)                                  Notice.  Promptly after any indemnified party has received notice of any indemnifiable claim hereunder, or the commencement of any action, suit or proceeding by a third person, which the indemnified party believes in good faith is an indemnifiable claim under this Agreement, the indemnified party shall give the indemnifying party written notice of such claim but failure to so notify the indemnifying party will not relieve the indemnifying party from any liability it may have to such indemnified party hereunder except to the extent that the indemnifying party is materially prejudiced by such failure.  Such notice shall state the nature and the basis of such claim to the extent then known.  The indemnifying party shall be entitled to participate in and, to the extent it shall wish, to assume and undertake the defense thereof with counsel reasonably satisfactory to such indemnified party and, after notice from the indemnifying party to such indemnified party of its election so to assume and undertake the

 

14

 

defense thereof, the indemnifying party shall not be liable to such indemnified party under this Section 2.08 for any legal expenses subsequently incurred by such indemnified party in connection with the defense thereof other than reasonable costs of investigation and of liaison with counsel so selected; provided, however, that, (i) if the indemnifying party has failed to assume the defense and employ counsel or (ii) if the defendants in any such action include both the indemnified party and the indemnifying party and counsel to the indemnified party shall have concluded that there may be reasonable defenses available to the indemnified party that are different from or additional to those available to the indemnifying party, or if the interests of the indemnified party reasonably may be deemed to conflict with the interests of the indemnifying party, then the indemnified party shall have the right to select a separate counsel and to assume such legal defense and otherwise to participate in the defense of such action, with the reasonable out-of-pocket expenses and fees of such separate counsel and other reasonable out-of-pocket expenses related to such participation to be reimbursed by the indemnifying party as incurred.  Notwithstanding any other provision of this Agreement, the indemnifying party shall not settle any indemnified claim without the consent of the indemnified party, unless the settlement thereof imposes no liability or obligation on, and includes a complete release from liability of, and does not contain any admission of wrongdoing by, the indemnified party.

 

(d)                                 Contribution.  If the indemnification provided for in this Section 2.08 is held by a court or government agency of competent jurisdiction to be unavailable to any indemnified party or is insufficient to hold them harmless in respect of any Losses, then each such indemnifying party, in lieu of indemnifying such indemnified party, shall contribute to the amount paid or payable by such indemnified party as a result of such Loss in such proportion as is appropriate to reflect the relative fault of the indemnifying party on the one hand and of such indemnified party on the other in connection with the statements or omissions which resulted in such Losses, as well as any other relevant equitable considerations; provided, however, that in no event shall such Selling Holder be required to contribute an aggregate amount in excess of the dollar amount of gross proceeds received by such Selling Holder from the sale of Registrable Securities giving rise to such indemnification.  The relative fault of the indemnifying party on the one hand and the indemnified party on the other shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact has been made by, or relates to, information supplied by such party, and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission.  The parties hereto agree that it would not be just and equitable if contributions pursuant to this paragraph were to be determined by pro rata allocation or by any other method of allocation which does not take account of the equitable considerations referred to herein.  The amount paid by an indemnified party as a result of the Losses referred to in the first sentence of this paragraph shall be deemed to include any legal and other expenses reasonably incurred by such indemnified party in connection with investigating or defending any Loss that is the subject of this paragraph.  No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any Person who is not guilty of such fraudulent misrepresentation.

 

(e)                                  Other Indemnification.  The provisions of this Section 2.08 shall be in addition to any other rights to indemnification or contribution that an indemnified party may have pursuant to Law, equity, contract or otherwise.

 

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Section 2.09                             Rule 144 Reporting.  With a view to making available the benefits of certain rules and regulations of the Commission that may permit the sale of the Registrable Securities to the public without registration, Southcross agrees to use its commercially reasonable efforts to:.

 

(a)                                 make and keep public information regarding Southcross available, as those terms are understood and defined in Rule 144 of the Securities Act, at all times from and after the date hereof;

 

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

 

(c)                                  so long as a Holder owns any Registrable Securities, furnish, unless otherwise available at no charge by access electronically to the Commission’s EDGAR filing system, to such Holder forthwith upon request (i) a copy of the most recent annual or quarterly report of Southcross, and (ii) such other reports and documents so filed with the Commission as such Holder may reasonably request in availing itself of any rule or regulation of the Commission allowing such Holder to sell any such securities without registration.

 

Section 2.10                             Transfer or Assignment of Registration Rights.  The rights to cause Southcross to register Registrable Securities granted to the Purchaser by Southcross under this Article II may be transferred or assigned by a Holder to a transferee or assignee; provided, that (i) the transferee or assignee is an Affiliate of the Purchaser or (ii) there is transferred to such transferee at least $5 million of the then outstanding Registrable Securities.  The transferor shall give written notice to Southcross at least ten (10) Business Days prior to any said transfer or assignment, setting forth the information required under Section 3.01 of this Agreement for each such transferee and identifying the securities with respect to which such registration rights are being transferred or assigned, and each such transferee shall agree in writing to be subject to all of the terms and conditions of this Agreement.

 

Section 2.11                             Limitation on Subsequent Registration Rights.  From and after the date hereof, Southcross shall not, without the prior written consent of the Holders of a majority of the outstanding Registrable Securities, enter into any agreement with any current or future holder of any securities of Southcross that would allow such current or future holder to require Southcross to include securities in any Underwritten Offering or Overnight Underwritten Offering by Southcross for its own account on a basis that is superior in any way to the Piggyback Offering rights granted to the Holders pursuant to Section 2.02 of this Agreement.

 

ARTICLE III.
 MISCELLANEOUS

 

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

 

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(a)                                 If to the Purchaser:

 

Southcross Energy LLC
 1700 Pacific Ave., Suite 2900 
 Dallas, Texas 75201 
 Attention:  David W. Biegler
 Facsimile:  (214) 393-7504

 

with a copy to:

 

Charlesbank Equity Fund VI, Limited Partnership
 200 Clarendon Street, 54th Floor
 Boston, Massachusetts 02116 
 Attention:   Jon Biotti

Tami E. Nason

Facsimile:  (617) 619-5402

 

(b)                                 If to Southcross:

 

Southcross Energy Partners, L.P.
 1700 Pacific Ave., Suite 2900 
 Dallas, Texas 75201 
 Attention:  David W. Biegler
 Facsimile:  (214) 393-7504

 

with a copy to:

 

Latham & Watkins LLP
 811 Main Street, Suite 3700 
 Houston, Texas 77002 
 Attention:  Ryan Maierson 
 Facsimile:  (713) 546-5401

 

and

 

Akin Gump Strauss Hauer & Feld LLP
 1111 Louisiana Street
 Houston, Texas 77002 
 Attention: John Goodgame
 Facsimile:  (713) 236-0822

 

or, if to a transferee of the Purchaser, to the transferee at the addresses provided pursuant to Section 2.10 above.  All notices and communications shall be deemed to have been duly given:  (i) at the time delivered by hand, if personally delivered; (ii) when notice is sent to the sender that the recipient has read the message, if sent by electronic mail; (iii) upon actual receipt if sent by registered or certified mail, return receipt requested, or regular mail, if mailed; (iv) when

 

17

 

receipt is acknowledged, if sent by facsimile; and (v) upon actual receipt when delivered to an air courier guaranteeing overnight delivery.

 

Section 3.02                             Successors and Assigns.  This Agreement shall inure to the benefit of and be binding upon the successors and assigns of each of the parties, including subsequent Holders of Registrable Securities to the extent permitted herein.

 

Section 3.03                             Aggregation of Registrable Securities.  All Registrable Securities held or acquired by Persons who are Affiliates of one another shall be aggregated together for the purpose of determining the availability of any rights under this Agreement.

 

Section 3.04                             Recapitalization, Exchanges, Etc..  Affecting the Registrable Securities.  The provisions of this Agreement shall apply to the fullest extent set forth herein with respect to any and all units of Southcross or any successor or assignee of Southcross (whether by merger, consolidation, sale of assets or otherwise) that may be issued in respect of, in exchange for or in substitution of, the Registrable Securities, and shall be appropriately adjusted for combinations, splits, recapitalizations and the like occurring after the date of this Agreement.

 

Section 3.05                             Specific Performance.  Damages in the event of breach of this Agreement by a party hereto may be difficult, if not impossible, to ascertain, and it is therefore agreed that each such Person, in addition to and without limiting any other remedy or right it may have, will have the right to an injunction or other equitable relief in any court of competent jurisdiction, enjoining any such breach, and enforcing specifically the terms and provisions hereof, and each of the parties hereto hereby waives any and all defenses it may have on the ground of lack of jurisdiction or competence of the court to grant such an injunction or other equitable relief.  The existence of this right will not preclude any such Person from pursuing any other rights and remedies at law or in equity which such Person may have.

 

Section 3.06                             Counterparts.  This Agreement may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which counterparts, when so executed and delivered, shall be deemed to be an original and all of which counterparts, taken together, shall constitute but one and the same Agreement.

 

Section 3.07                             Headings.  The headings in this Agreement are for convenience of reference only and shall not limit or otherwise affect the meaning hereof.

 

Section 3.08                             Governing Law, Submission to Jurisdiction.  This Agreement, and all claims or causes of action (whether in contract or tort) that may be based upon, arise out of or relate to this Agreement or the negotiation, execution or performance of this Agreement (including any claim or cause of action based upon, arising out of or related to any representation or warranty made in or in connection with this Agreement), will be construed in accordance with and governed by the Laws of the State of Delaware without regard to principles of conflicts of laws.  Any action against any party relating to the foregoing shall be brought in any federal or state court of competent jurisdiction located within the State of Delaware, and the parties hereto hereby irrevocably submit to the non-exclusive jurisdiction of any federal or state court located within the State of Delaware over any such action.  The parties hereby irrevocably waive, to the fullest extent permitted by applicable Law, any objection which they may now or hereafter have

 

18

 

to the laying of venue of any such dispute brought in such court or any defense of inconvenient forum for the maintenance of such dispute.  Each of the parties hereto agrees that a judgment in any such dispute may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by Law.

 

Section 3.09                             Waiver of Jury Trial.  THE PARTIES TO THIS AGREEMENT EACH HEREBY WAIVE, AND AGREE TO CAUSE THEIR AFFILIATES TO WAIVE, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION OR CAUSE OF ACTION (i) ARISING UNDER THIS AGREEMENT OR (ii) IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO IN RESPECT OF THIS AGREEMENT OR ANY OF THE TRANSACTIONS RELATED HERETO, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER IN CONTRACT, TORT, EQUITY OR OTHERWISE.  THE PARTIES TO THIS AGREEMENT EACH HEREBY AGREES AND CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY AND THAT THE PARTIES TO THIS AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OF A COPY OF THIS AGREEMENT WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE PARTIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.

 

Section 3.10                             Severability of Provisions.  Any provision of this Agreement that 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 or affecting or impairing the validity or enforceability of such provision in any other jurisdiction.

 

Section 3.11                             Entire Agreement.  This Agreement is intended by the parties as a final expression of their agreement and intended to be a complete and exclusive statement of the agreement and understanding of the parties hereto in respect of the subject matter contained herein.  There are no restrictions, promises, warranties or undertakings, other than those set forth or referred to herein with respect to the rights granted by Southcross set forth herein.  This Agreement supersedes all prior agreements and understandings between the parties with respect to such subject matter.

 

Section 3.12                             Amendment.  This Agreement may be amended only by means of a written amendment signed by Southcross and the Holders of a majority of the then outstanding Registrable Securities; provided, however, that no such amendment shall adversely affect the rights of any Holder hereunder without the consent of such Holder.

 

Section 3.13                             No Presumption.  In the event any claim is made by a party relating to any conflict, omission, or ambiguity in this Agreement, no presumption or burden of proof or persuasion shall be implied by virtue of the fact that this Agreement was prepared by or at the request of a particular party or its counsel.

 

Section 3.14                             Obligations Limited to Parties to this Agreement.  Each of the parties hereto covenants, agrees and acknowledges that no Person other than the Purchaser, their

 

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respective permitted assignees and Southcross shall have any obligation hereunder and that, notwithstanding that one or more of Southcross and the Purchaser may be a corporation, partnership, limited liability company or other entity, no recourse under this Agreement or under any documents or instruments delivered in connection herewith or therewith shall be had against any former, current or future director, officer, employee, agent, general or limited partner, manager, member, stockholder or Affiliate of any of Southcross, the Purchaser or their respective permitted assignees, or any former, current or future director, officer, employee, agent, general or limited partner, manager, member, stockholder or Affiliate of any of the foregoing, whether by the enforcement of any assessment or by any legal or equitable proceeding, or by virtue of any applicable Law, it being expressly agreed and acknowledged that no personal liability whatsoever shall attach to, be imposed on or otherwise be incurred by any former, current or future director, officer, employee, agent, general or limited partner, manager, member, stockholder or Affiliate of any of Southcross, the Purchaser or any of their respective assignees, or any former, current or future director, officer, employee, agent, general or limited partner, manager, member, stockholder or Affiliate of any of the foregoing, as such, for any obligations of Southcross, the Purchaser or their respective permitted assignees under this Agreement or any documents or instruments delivered in connection herewith or therewith or for any claim based on, in respect of or by reason of such obligation or its creation, except in each case for any assignee of a Holder.

 

Section 3.15                             Interpretation.  Article and Section references in this Agreement are references to the corresponding Article and Section to this Agreement, unless otherwise specified.  All references to instruments, documents, contracts and agreements are references to such instruments, documents, contracts and agreements as the same may be amended, supplemented and otherwise modified from time to time, unless otherwise specified.  The word “including” shall mean “including but not limited to.”  Whenever any determination, consent or approval is to be made or given by Southcross under this Agreement, such action shall be in the Southcross’ sole discretion unless otherwise specified.

 

[Signature Page Follows]

 

20

 

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

 

	
 
    	
SOUTHCROSS   ENERGY PARTNERS, L.P.
    
	
 
    	
 
    
	
 
    	
By:
    	
Southcross   Energy Partners GP, LLC,
    
	
 
    	
 
    	
its   general partner
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    
	
 
    	
 
    	
Title:
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
SOUTHCROSS   ENERGY LLC
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    
	
 
    	
 
    	
Title:
    

 

Signature Page to Registration Rights AgreementExhibit 10.5

 

Execution Version

 

LIMITED WAIVER AND SECOND AMENDMENT TO
 SECOND AMENDED AND RESTATED CREDIT AGREEMENT

 

THIS LIMITED WAIVER AND SECOND AMENDMENT TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT (this “Amendment”) is entered into effective as of the 12th day of April, 2013, among SOUTHCROSS ENERGY PARTNERS, L.P., a Delaware limited partnership (the “Borrower”), WELLS FARGO BANK, N.A., a national banking association, as the Administrative Agent (the “Administrative Agent”), and each of the Lenders (as defined below) that has executed this Amendment (the “Consenting Lenders”).

 

W I T N E S S E T H:

 

WHEREAS, the Borrower, the Administrative Agent and the financial institutions party thereto as lenders (the “Lenders”) are parties to that certain Second Amended and Restated Credit Agreement dated as of November 7, 2012 (as amended prior to the Second Amendment Effective Date (as defined in Section 3 of this Amendment), the “Credit Agreement”) (unless otherwise defined herein, all terms used herein which are defined in the Credit Agreement shall have the meanings given such terms in the Credit Agreement, as amended hereby); and

 

WHEREAS, pursuant to the Credit Agreement, the Lenders have made Loans to the Borrower and provided certain other credit accommodations to the Borrower; and

 

WHEREAS, the Borrower has advised the Administrative Agent and the Lenders that it has failed to satisfy the financial covenants set forth in Subsections 9.01(a)(i) and 9.01(c) of the Credit Agreement for the Rolling Period ending March 31, 2013, which failure has resulted in immediate Events of Default under Subsection 10.01(d) of the Credit Agreement (collectively, the “Specified Defaults”);

 

WHEREAS, the Borrower has requested that (i) the Administrative Agent and the Lenders waive the Specified Defaults and (ii) amend certain terms and provisions of the Credit Agreement, in each case as provided in this Amendment; and

 

WHEREAS, subject to the terms and conditions set forth herein, the Consenting Lenders have agreed to the Borrower’s requests.

 

NOW THEREFORE, for and in consideration of the mutual covenants and agreements herein contained and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged and confessed, the Borrower, the Administrative Agent and the Consenting Lenders hereby agree as follows:

 

SECTION 1                               Limited Waiver.  In reliance on the representations, warranties, covenants and agreements contained in this Amendment, and subject to and upon the terms and conditions set forth herein, the Administrative Agent and each of the Consenting Lenders hereby waive the Specified Defaults effective as of the Second Amendment Effective Date.  The limited waiver contained in this Section 1 is a one-time waiver applicable solely to the Specified Defaults, which are limited to the Rolling Period ending March 31, 2013, but to no other Default or Event of Default.  Nothing contained in this Section 1 shall be deemed a consent to or waiver of, or a

 

 

commitment or obligation on the part of the Administrative Agent or the Lenders to any future consent to or waiver of, any other action or inaction on the part of the Borrower or any other Credit Party that constitutes (or would constitute) a violation of or departure from any covenant, condition or other obligation of the Credit Parties under the Credit Agreement and the other Loan Documents.  Neither the Lenders nor the Administrative Agent shall be obligated to grant any future waivers or consents with respect to any provision of the Credit Agreement or any other Loan Document.  Any further waivers or consents must be specifically agreed to in writing in accordance with Section 12.02 of the Credit Agreement.

 

SECTION 2                               Amendments.  In reliance on the representations, warranties, covenants and agreements contained in this Amendment, and subject to the satisfaction of each condition precedent set forth in Section 3 hereof, the Credit Agreement shall be amended effective as of the Second Amendment Effective Date in the manner provided in this Section 2.

 

2.1                               Deleted Definition.  Section 1.02 of the Credit Agreement shall be amended by deleting the definition of “Permitted Notes Covenant Option” contained therein.

 

2.2                               Restated Definitions.  Each of the following definitions set forth in Section 1.02 of the Credit Agreement shall be amended and restated in its entirety as follows:

 

“Annualized Consolidated EBITDA” means, with respect to each Rolling Period ending on or prior to December 31, 2013, the sum of (a) the product of (i) the Borrower’s Consolidated Unadjusted EBITDA for such Rolling Period multiplied  by (ii) the factor set forth for such Rolling Period in the grid below plus (b) the aggregate Specified Projects EBITDA Adjustments for In Process Specified Projects as calculated on the last day of such Rolling Period plus (c) any amounts added to Consolidated Net Income in the calculation of Consolidated EBITDA for such Rolling Period pursuant to clauses (v), (vi), (vii), (viii) and (ix) of the definition of Consolidated EBITDA:

 

	
Rolling Period Ending
    	
 
    	
Factor
    
	
September 30, 2013
    	
 
    	
2
    
	
December 31, 2013
    	
 
    	
4/3
    

 

“Annualized Consolidated Interest Expense” means, for each Rolling Period ending on or prior to December 31, 2013, the product of (a) the Borrower’s actual Consolidated Interest Expense for such Rolling Period multiplied  by (b) the factor set forth for such Rolling Period in the grid below:

 

	
Rolling Period Ending
    	
 
    	
Factor
    	
 
    
	
September 30,   2013
    	
 
    	
2
    	
 
    
	
December 31,   2013
    	
 
    	
4/3
    	
 
    

 

2

 

“Availability Block” means, (a) at any time prior to the Borrower’s exercise of the Target Leverage Option, an amount equal to (x) $100,000,000 minus (y) the dollar amount of immediately available funds on deposit in the GP Cash Collateral Account at such time minus (z) the sum of (i) the LC Exposure at such time (as determined after giving effect to the issuance, amendment, renewal or extension of any Letter of Credit for which such request is being made and in connection with which the Availability Block is being calculated for the purposes of Section 2.07(a) or Section 2.07(b)) plus (ii) the aggregate amount of all LC Disbursements that have been reimbursed by or on behalf of the Borrower with the proceeds of an ABR Borrowing made after the First Amendment Effective Date at such time, and (b) at any time from and after the Borrower’s exercise of the Target Leverage Option, an amount equal to zero ($0.00).

 

“Collateral” means any and all Property of the Loan Parties or any other Person that is secured by a Lien under one or more Security Instruments.

 

“Consolidated Interest Coverage Ratio” means, for any period of determination, the ratio of (a) Consolidated EBITDA (or Annualized Consolidated EBITDA, in the case of the Rolling Periods ending on or prior to December 31, 2013) divided by (b) Consolidated Interest Expense (or Annualized Consolidated Interest Expense, in the case of Rolling Periods ending on or prior to December 31, 2013).

 

“Consolidated Senior Secured Leverage Ratio” means, for any period of determination, the ratio of Consolidated Senior Secured Indebtedness as of the last day of the fiscal quarter for which such determination is being made divided by Consolidated EBITDA (or Annualized Consolidated EBITDA, in the case of the Rolling Periods ending on or prior to December 31, 2013) for the Rolling Period ending on the last day of such fiscal quarter.

 

“Consolidated Total Leverage Ratio” means, for any period of determination, the ratio of (a) Consolidated Total Funded Indebtedness as of the last day of the fiscal quarter for which such determination is being made divided by (b) Consolidated EBITDA (or Annualized Consolidated EBITDA, in the case of the Rolling Periods ending on or prior to December 31, 2013) for the Rolling Period ending on the last day of such fiscal quarter.

 

“Consolidated Unadjusted EBITDA” means, for any period of determination, Consolidated EBITDA prior to giving effect to (a) any amounts added to Consolidated Net Income in the calculation of Consolidated EBITDA pursuant to clauses (v), (vi), (vii), (viii) and (ix) of the definition of Consolidated EBITDA, and (b) any Specified Projects EBITDA Adjustments for In Process Specified Projects for such period.

 

“LC Sublimit” means, at any time, $50,000,000.

 

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“Rolling Period” means (a) for each of the fiscal quarters ending on June 30, 2013, September 30, 2013, and December 31, 2013, the period commencing on April 1, 2013 and ending on the last day of such fiscal quarter, and (b) for the fiscal quarter ending on March 31, 2014 and for each subsequent fiscal quarter, the period of four (4) consecutive fiscal quarters ending on the last day of such fiscal quarter.

 

2.3                               Additional Definitions.  Section 1.02 of the Credit Agreement shall be amended to add thereto in alphabetical order the following defined terms:

 

“Adjusted Consolidated Total Leverage Ratio” means, for any period of determination, the ratio of (a) an amount equal to the difference of (x) Consolidated Total Funded Indebtedness as of the last day of the fiscal quarter for which such determination is being made, minus (y) the dollar amount of funds on deposit in the GP Cash Collateral Account as of the last day of the fiscal quarter for which such determination is being made (which, for the avoidance of doubt, shall exclude any Equity Cure Amount deposited therein to cure a Financial Covenant Default occurring on such day) divided by (b) Consolidated EBITDA (or Annualized Consolidated EBITDA, in the case of the Rolling Periods ending on or prior to December 31, 2013) for the Rolling Period ending on the last day of such fiscal quarter.

 

“Equity Cure Amount” means, with respect to any Equity Cure Test Date (subject to the proviso at the end of this definition), an amount equal to the quotient of:

 

(a)                                 an amount equal to the difference of:

 

(i)                                     the difference of (x) Consolidated Total Funded Indebtedness as of such Equity Cure Test Date, minus (y) the dollar amount of funds on deposit in the GP Cash Collateral Account as of such Equity Cure Test Date (which, for the avoidance of doubt, shall exclude any Equity Cure Amount deposited therein to cure the Financial Covenant Default occurring on such Equity Cure Test Date); minus

 

(ii) an amount equal to the product of (x) Annualized Consolidated EBITDA for the Rolling Period ending as of such Equity Cure Test Date, multiplied by (y) the maximum Adjusted Consolidated Total Leverage Ratio set forth in the grid contained in Section 9.01(a)(i)(B) for the Rolling Period ending on such Equity Cure Test Date; divided by

 

(b)                                 4.5;

 

provided, however, that, if the “Equity Cure Amount” is being calculated in connection with the Borrower’s exercise of the Equity Cure Right with respect to a Financial Covenant Default resulting from the Borrower’s failure to satisfy the

 

4

 

requirements of Section 9.01(d), then the “Equity Cure Amount” shall be an amount equal to the difference of (x) $9,000,000 minus (y) the Borrower’s Consolidated EBITDA for the fiscal quarter ending June 30, 2013.

 

“Equity Cure Notice” has the meaning set forth in Section 9.01(e)(i).

 

“Equity Cure Right” has the meaning set forth in Section 9.01(e).

 

“Equity Cure Rollover Amount” means, with respect to any Equity Cure Amount deposited in the GP Cash Collateral Account pursuant to Section 9.01(e)(ii) in connection with the Borrower’s exercise of the Equity Cure Right (subject to the proviso set forth at the end of this definition), the lesser of:

 

(a)                                 such Equity Cure Amount; and

 

(b)                                 an amount equal to the difference of:

 

(i)                                     an amount equal to the quotient of:

 

(A)                               the difference of (x) Consolidated Total Funded Indebtedness as of the Equity Cure Test Date, minus (y) the dollar amount of funds on deposit in the GP Cash Collateral Account as of the Equity Cure Test Date (which, for the avoidance of doubt, shall exclude any Equity Cure Amount deposited with respect to the Financial Covenant Default occurring on such Equity Cure Test Date); divided by

 

(B)                               the maximum Adjusted Consolidated Total Leverage Ratio set forth in the grid contained in Section 9.01(a)(i)(B) for the Rolling Period ending on such Equity Cure Test Date; minus

 

(ii)                                  an amount equal to the quotient of:

 

(A)                               the difference of (x) Consolidated Total Funded Indebtedness as of the Equity Cure Test Date, minus (y) the dollar amount of funds on deposit in the GP Cash Collateral Account as of the Equity Cure Test Date (which, for the avoidance of doubt, shall exclude any Equity Cure Amount deposited with respect to the Financial Covenant

 

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Default occurring on such Equity Cure Test Date); divided by

 

(B)                               the sum of (x) the maximum Adjusted Consolidated Total Leverage Ratio set forth in the grid contained in Section 9.01(a)(i)(B) for the Rolling Period ending on such Equity Cure Test Date plus (y) 0.50;

 

provided, however, that if such “Equity Cure Rollover Amount” is being calculated in connection with the Borrower’s exercise of the Equity Cure Right with respect to a Financial Covenant Default resulting from the Borrower’s failure to satisfy the requirements of Section 9.01(d), then the “Equity Cure Rollover Amount” with respect to such Equity Cure Test Date shall be an amount equal to the Equity Cure Amount for Equity Cure Test Date.

 

“Equity Cure Test Date” has the meaning set forth in Section 9.01(e)(i).

 

“Equity Funded Capital Expenditure Amount” has the meaning set forth in Section 9.23(b).

 

“Financial Covenant Default” has the meaning set forth in Section 9.01(e).

 

“Growth Capital Expenditures” means all Capital Expenditures other than Maintenance Capital Expenditures.

 

“Initial Equity Amount” means $40,000,000.

 

“Initial Equity Contribution” has the meaning set forth in Section 8.20(a).

 

“Initial Equity Contribution Date” has the meaning set forth in Section 8.20(a).

 

“Initial Equity Proceeds” has the meaning set forth in Section 8.20(a).

 

“Maintenance Capital Expenditures” means all Capital Expenditures that are, at the time such Capital Expenditures are incurred, (a) made to maintain long term operating income or operating capacity of the Loan Parties, including Capital Expenditures for routine equipment and pipeline maintenance or replacement due to obsolescence.  For the purposes of this definition, “long term” generally refers to a period of not less than twelve (12) months, or (b) required to be made by the Borrower or any other Loan Party under applicable law.

 

“Qualified Equity Securities” means any Equity Interests in the Borrower (other than Disqualified Capital Stock) that meet each of the following conditions:

 

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(a) such Equity Interests do not provide for any required periodic cash payments to the holder thereof prior to the Borrower’s exercise of the Target Leverage Option (other than with respect to “General Partnership Units” under and as defined in the Partnership Agreement issued to the General Partner pursuant to Section 5.2(b) of the Partnership Agreement to the extent necessary to maintain the General Partner’s percentage interests in the Borrower; provided that any cash payments received by the General Partner in respect of such Equity Interests are deposited in the GP Cash Collateral Account); and

 

(b) such Equity Interests do not provide for any dividends or distributions to the holder thereof, other than dividends or other distributions payable solely in additional shares of Equity Interests (other than Disqualified Capital Stock) in the Borrower, prior to the Borrower’s exercise of the Target Leverage Option (other than with respect to “General Partnership Units” under and as defined in the Partnership Agreement issued to the General Partner pursuant to Section 5.2(b) of the Partnership Agreement to the extent necessary to maintain the General Partner’s percentage interests in the Borrower; provided that any cash payments received by the General Partner in respect of such Equity Interests are deposited in the GP Cash Collateral Account).

 

“Required Equity Amount” means the Initial Equity Amount, the aggregate amount of all Equity Cure Amounts, or the Subsequent Equity Amount, as applicable.

 

“Required Equity Contribution” means, the Initial Equity Contribution or the Subsequent Equity Contribution, as applicable.

 

“Required Equity Contribution Date” means any Initial Equity Contribution Date or Subsequent Equity Contribution Date, as applicable.

 

“Required Equity Proceeds” means the Initial Equity Proceeds or the Subsequent Equity Proceeds, as applicable.

 

“Second Amendment” means that certain Limited Waiver and Second Amendment to Second Amended and Restated Credit Agreement dated April 12, 2013, entered into by and among the Borrower, the Administrative Agent, and the Lenders party thereto.

 

“Second Amendment Effective Date” has the meaning assigned to such term in the Second Amendment.

 

“Southcross Holdings” means Southcross Energy LLC, a Delaware limited liability company.

 

“Subsequent Equity Amount” means:

 

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(a)                                 if the Subsequent Equity Contribution Test is satisfied, an amount equal to the sum of:

 

(i)                                     the aggregate amount of all Equity Cure Amounts deposited into the GP Cash Collateral Account pursuant to Section 9.01(e)(ii); plus

 

(ii)                                  the Equity Funded Capital Expenditure Amount; and

 

(b)                                 if the Subsequent Equity Contribution Test is not satisfied, an amount equal to the lesser of:

 

(i)                                     an amount equal to 100% of the funds on deposit in the GP Cash Collateral Account on the last Subsequent Equity Contribution Date (without giving effect to any disbursements from the GP Cash Collateral Account required to be made with respect to the Subsequent Equity Contribution); and

 

(ii)                                  an amount equal to the sum of the following:

 

(A)                               an amount equal to the difference of:

 

(1)                                 the quotient of (x) Consolidated Total Funded Indebtedness as of June 30, 2014; divided by (y) 4.50; minus

 

(2)                                 Consolidated EBITDA for the Rolling Period ending June 30, 2014; plus

 

(B)                               the amount calculated in accordance with clause (a) of this definition.

 

“Subsequent Equity Contribution” has the meaning set forth in Section 8.20(b).

 

“Subsequent Equity Contribution Date” has the meaning set forth in Section 8.20(b).

 

“Subsequent Equity Contribution Test” means a test that is satisfied if the Consolidated Total Leverage Ratio for the Rolling Period ending June 30, 2014 (calculated without adding any Equity Cure Amounts or Equity Cure Rollover Amounts in the calculation of Consolidated EBITDA) is not greater than 4.50 to 1.00.

 

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“Subsequent Equity Proceeds” has the meaning set forth in Section 8.20(b).

 

“Target Leverage Date” means the date that is five (5) Business Days after each of the following conditions is satisfied:

 

(a)                                 the Target Leverage Test is satisfied as of the most recent Target Leverage Test Date; and

 

(b)                                 the Administrative Agent has received a certificate from a Financial Officer of the Borrower in accordance with Section 8.01(d), which certificate shall include calculations of the Target Leverage Ratio in form and substance satisfactory to the Administrative Agent.

 

“Target Leverage Option” means a one-time option of the Borrower, which option shall be exercisable only after the occurrence of the Target Leverage Date, to elect (by delivering irrevocable written notice to the Administrative Agent of such election) the application of the covenants set forth in Section 9.01(a)(i)(A).

 

“Target Leverage Ratio” means, as of any Target Leverage Test Date, the ratio of (a) an amount equal to (i) Consolidated Total Funded Indebtedness as of such Target Leverage Test Date (calculated after giving effect to any mandatory prepayments made on such date pursuant to Section 3.04(b)), minus (ii) the dollar amount of funds on deposit in the GP Cash Collateral Account on such Target Leverage Test Date (after giving effect to any disbursements from the GP Cash Collateral Account made on such date), divided by (b) Consolidated EBITDA (or Annualized Consolidated EBITDA, in the case of Rolling Periods ending on or prior to December 31, 2013) for the most recently ended Rolling Period for which financial statements have been delivered to the Administrative Agent pursuant to Section 8.01(a) or (b) (which, for the avoidance of doubt, shall be calculated without adding any Equity Cure Amounts or any Equity Cure Rollover Amounts thereto).

 

“Target Leverage Test” means, as of any Target Leverage Test Date, a test with respect to the Target Leverage Ratio that is satisfied if either of the following conditions is met:

 

(a)                                 the Target Leverage Ratio calculated as of such Target Leverage Test Date is not more than 4.25 to 1.00; or

 

(b)                                 (A) the Target Leverage Ratio calculated as of such Target Leverage Test Date is not more than 4.50 to 1.00, and (B) the Target Leverage Ratio calculated as of the last day of the Rolling Period immediately preceding the Rolling Period used in the calculation of the Target Leverage Ratio referred to in the foregoing subclause (A) of this definition is not more than 4.50 to 1.00.

 

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“Target Leverage Test Date” means (a) the last day of each fiscal quarter commencing with the fiscal quarter ending June 30, 2013 ending on or prior to the Borrower’s exercise of the Target Leverage Option, and (b) at the election of the Borrower, any date on which the Borrower issues Equity Interests (other than Qualified Equity Securities issued in connection with any Required Equity Contribution).

 

2.4                               Amendment to Definition of Applicable Margin.  The definition of “Applicable Margin” set forth in Section 1.02 of the Credit Agreement shall be amended as follows:

 

(a)                                 The first sentence of the definition of “Applicable Margin” set forth in Section 1.02 of the Credit Agreement shall be amended by inserting the parenthetical “(subject to the proviso in the last paragraph of this definition)” immediately after the phrase “in the grid below” contained therein; and

 

(b)                                 The proviso contained in first sentence of the last paragraph of the definition of “Applicable Margin” set forth in Section 1.02 of the Credit Agreement shall be amended and restated in its entirety as follows:

 

provided, however, that (x) if at any time the Borrower fails to deliver any financial statements or a compliance certificate required by Sections 8.01(a), (b) or (d), as applicable, then the “Applicable Margin” means the rate per annum set forth on the grid when the Consolidated Total Leverage Ratio is at its highest level,(y) for the period from the Effective Date until March 31, 2013, the Consolidated Total Leverage Ratio shall, for purposes of this definition, be deemed to be greater than or equal to 4.50 to 1.00, and (z) for the period from April 1, 2013 until the date on which the financial statements and compliance certificate required pursuant to Sections 8.01(a), (b) and/or (d), as applicable, are delivered to the Administrative Agent for the period ending on the last day of the fiscal quarter in which the Borrower exercises the Target Leverage Option, “Applicable Margin” means, for any day, (i) 4.50% per annum with respect to Eurodollar Loans, (ii) 3.50% per annum with respect to ABR Loans and (iii) 0.500% per annum with respect to the Commitment Fee Rate

 

2.5                               Amendments to Definition of Consolidated EBITDA.  The definition of “Consolidated EBITDA” set forth in Section 1.02 of the Credit Agreement shall be amended as follows:

 

(a)                                 Clause (b) of the definition of “Consolidated EBITDA” set forth in Section 1.02 of the Credit Agreement shall be amended by amending and restating clause (iv) thereof as follows:

 

(iv) amortization (including amortization of equity compensation expenses), depreciation and other noncash nonrecurring items during such period,

 

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(b)                                 Clause (b) of the definition of “Consolidated EBITDA” set forth in Section 1.02 of the Credit Agreement shall be further amended by (i) deleting the word “and” immediately before sub-clause “(v)” thereof, and (ii) inserting the following new clauses “(vi)”, “(vii)” and “(viii)” and “(ix)” immediately before the word “plus” at the end of such clause (b):

 

(vi) nonrecurring cash expenses for employee severance, employee relocation and employee hiring costs incurred during such period, (vii) nonrecurring cash expenses for accounting and reorganization costs incurred during such period in an aggregate amount not to exceed $750,000 in any Rolling Period, (viii) fees, costs and expenses incurred in connection with the negotiation, documentation, closing and consummation of the Second Amendment in an aggregate amount not to exceed $2,000,000, and (ix) nonrecurring cash expenses for insurance deductible costs incurred during such period,

 

(c)                                  Clause (c) of the definition of “Consolidated EBITDA” set forth in Section 1.02 of the Credit Agreement shall be amended by inserting the following immediately before the phrase “the aggregate Specified Projects EBITDA Adjustments during such period” contained therein:

 

any Equity Cure Rollover Amount in such period, plus (d)

 

2.6                               Amendment to Definition of Material Acquisition.  Clause (b) of the definition of “Material Acquisition” set forth in Section 1.02 of the Credit Agreement shall be amended and restated in its entirety as follows:

 

(b)                                 such acquisition occurs prior to the incurrence of Permitted Notes Indebtedness by the Borrower and/or any of its Subsidiaries; and

 

2.7                               Amendment to Definition of Permitted Acquisition.  The definition of “Permitted Acquisition” set forth in Section 1.02 of the Credit Agreement shall be amended by inserting the phrase “, in each case made after the Borrower’s exercise of the Target Leverage Option and” immediately before the phrase “meeting each of the following conditions” contained in such definition.

 

2.8                               Amendment to Definition of Permitted Notes Indebtedness.  The definition of “Permitted Notes Indebtedness” set forth in Section 1.02 of the Credit Agreement shall be amended by inserting the phrase “after the Borrower’s exercise of the Target Leverage Option” immediately before the semicolon contained in such definition.

 

2.9                               Amendment to Definition of Specified Projects EBITDA Adjustment.  The first sentence of the definition of “Specified Projects EBITDA Adjustment” set forth in Section 1.02 of the Credit Agreement shall be amended by deleting the reference to ‘September 30, 2013” contained therein and inserting a reference to “December 31, 2013” in lieu thereof.

 

2.10                        Amendment to Pro Forma Compliance Provision.  The second sentence of Subsection 1.05(c) of the Credit Agreement shall be amended and restated in its entirety as follows:

 

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For the purposes of the definition of “Permitted Note Indebtedness” and the definition of “Permitted Acquisition” (but only in the event that such Permitted Acquisition is a Material Acquisition), the covenants (and levels thereof) that must be complied with are those set forth in Sections 9.01(a)(ii), 9.01(b), and 9.01(c).

 

2.11                        Amendments to Mandatory Prepayment Provisions.  Subsection 3.04(b) of the Credit Agreement shall be amended as follows:

 

(a)                                 Clause (ii) of Subsection 3.04(b) of the Credit Agreement shall be amended by inserting the phrase “for any Asset Sale made after the Borrower’s exercise of the Target Leverage Option” immediately after the phrase “provided, however, that” contained therein.

 

(b)                                 Clause (iii) of Subsection 3.04(b) of the Credit Agreement shall be amended by inserting the phrase “for any Recovery Event that occurs after the Borrower’s exercise of the Target Leverage Option” immediately after the phrase “provided, however, that” contained therein.

 

(c)                                  Subsection 3.04(b) of the Credit Agreement shall be amended by (i) renumbering clause “(iv)” thereof as clause “(v)”, (ii) renumbering clause “(v)” thereof as clause “(vi)”, (iii) deleting the references to “Section 3.04(b)(iv)” contained in clauses “(ii)” and “(iii)” thereof and inserting references to “Section 3.04(b)(v)” in lieu thereof, and (iv) inserting the following new clause “(iv)” in appropriate numerical order:

 

(iv)                              On each Required Equity Contribution Date contemporaneously with the consummation of the relevant Required Equity Contribution, 100% of the Required Equity Proceeds with respect to such Required Equity Contribution shall be applied by the Borrower as a mandatory repayment in accordance with the requirements of Section 3.04(b)(v).

 

2.12                        Amendments to Financial Statements Covenants.  Section 8.01 of the Credit Agreement shall be amended as follows:

 

(a)                                 Clause (d) of Section 8.01 of the Credit Agreement shall be amended and restated in its entirety as follows:

 

(d)                                 Certificate of Financial Officer — Compliance.

 

(i)                                     Concurrently with any delivery of financial statements required pursuant to Section 8.01(a) or Section 8.01(b), a certificate of a Financial Officer in substantially the form of Exhibit D-2 hereto (A) certifying as to whether a Default has occurred and, if a Default has occurred, specifying the details thereof and any action taken or proposed to be taken with respect thereto, (B) setting forth reasonably detailed calculations demonstrating compliance with Section 9.01, including, without limitation, (i) reasonably detailed calculations of the Specified Projects EBITDA Adjustment for each Specified Project (including a reasonably detailed summary of the terms of the applicable customer contracts

 

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relating to such calculation), each Specified Project’s Scheduled Completion Date, and each Specified Project’s Projected Capacity (and, if applicable, any changes to such Projected Capacity and supporting information as required), and (ii) calculations of Consolidated Total Leverage Ratio (whether or not the Target Leverage Date has occurred and whether or not the Borrower has exercised the Target Leverage Option), (C) stating whether any change in GAAP or in the application thereof has occurred since the date of the financial statements referred to in Section 7.04 and, if any such change has occurred, specifying the effect of such change on the financial statements accompanying such certificate, (D) attaching reports setting forth the processing volumes for the periods covered by such financial statements, (E) certifying as to whether the Target Leverage Test has been satisfied and setting forth reasonably detailed calculations of the Target Leverage Ratio if such certificate is being delivered on a Target Leverage Test Date, and (F) in the case of such financial statements for the period ending June 30, 2014, setting forth reasonably detailed calculations of the Consolidated Total Leverage Ratio in accordance with the definition of “Subsequent Equity Contribution Test” (separately from and in addition to any calculation of the Consolidated Total Leverage Ratio required for the purpose of determining compliance with Section 9.01(a)); and

 

(ii)                                  at the election of the Borrower on any Required Equity Contribution Date or any other date on which the Borrower issues Equity Interests, as applicable, a certificate of a Financial Officer certifying as to whether the Target Leverage Test has been satisfied as of such Target Leverage Test Date and setting forth reasonably detailed calculations of the Target Leverage Ratio.

 

(b)                                 Section 8.01 of the Credit Agreement shall be amended by (i) renumbering subsection “(n)” thereof as subsection “(o)” and (ii) inserting the following new subsection “(n)” in alphabetical order:

 

(n)                                 Monthly Financial Statements.  As soon as available, but in any event within thirty (30) calendar days after the end of each calendar month that is not the last calendar month in a fiscal quarter or a fiscal year, its unaudited consolidated balance sheet and related statement of operations reflecting results of operations as of the end of and for such calendar month and the then elapsed portion of the fiscal year, setting forth in each case in comparative form the figures for the corresponding period or periods of (or in the case of the balance sheet, as of the end of) the previous fiscal year, together with reports setting forth the processing volumes during such calendar month and the then elapsed portion of the fiscal year, all certified by one of its Financial Officers as presenting fairly in all material respects the financial condition and the results of operations of the Borrower and its Consolidated Subsidiaries on a consolidated basis in accordance with GAAP consistently applied, subject to normal quarter-end or year-end adjustments, as the case may be, and the absence of footnotes.

 

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2.13                        Addition of Equity Issuance Covenant.  Article VIII of the Credit Agreement shall be amended by inserting the following as new “Section 8.20” immediately after Section 8.19 thereof:

 

Section 8.20                             Required Equity Issuances.

 

(a)                           Initial Equity Contribution.  Prior to June 30, 2013, the Borrower shall issue Qualified Equity Securities in one or more transactions (the date of each such issuance, an “Initial Equity Contribution Date”) to the General Partner and/or Southcross Holdings for cash consideration (such issuances, collectively, the “Initial Equity Contribution”), which issuances shall result in the Borrower receiving cash proceeds on or prior to the June 30, 2013 in an aggregate amount of no less than the Initial Equity Amount (such proceeds, the “Initial Equity Proceeds”).

 

(b)                           Subsequent Equity Contribution.  Prior to August 31, 2014, the Borrower shall issue Qualified Equity Securities in one or more transactions (the date of each such issuance, a “Subsequent Equity Contribution Date”) to the General Partner and/or Southcross Holdings for cash consideration (such issuances, collectively, the “Subsequent Equity Contribution”), which issuances shall result in the Borrower receiving cash proceeds on or prior to August 31, 2014 in an aggregate amount equal to the Subsequent Equity Amount (such proceeds, if any, the “Subsequent Equity Proceeds”).

 

Concurrently with any issuance of Equity Interests in the Borrower pursuant to this Section 8.20, the Borrower shall furnish the Administrative Agent with (A) written notice informing the Administrative Agent that such issuance has been completed, (B) a certificate of a Financial Officer of the Borrower, in form and substance satisfactory to the Administrative Agent, certifying as to the aggregate amount of cash proceeds received by or on behalf of the Borrower in connection with such issuance, (C) fully executed and assembled copies of the material agreements and documents governing such issuance, and (D) such other information, documents or agreements relating to such issuance as the Administrative Agent may reasonably request.

 

2.14                        Addition of Post-Closing GP Cash Collateral Covenant.  Article VIII of the Credit Agreement shall be amended by inserting the following as new “Section 8.21” immediately after new Section 8.20 thereof:

 

Section 8.21                             Post-Closing Deposit of GP Cash Collateral.  On or prior to April 22, 2013, the Borrower shall cause the General Partner to deposit $24,200,000 in immediately available funds into the GP Cash Collateral Account (which funds shall be above and in addition to the amount on deposit in the GP Cash Collateral Account prior to such date and shall not be netted or credited against any other amounts required or permitted to be deposited or maintained in the GP Cash Collateral Account pursuant to Section 9.01(e)(ii) or 9.23 or any

 

14

 

other terms or conditions of this Agreement or any other Loan Document), and, after giving effect to such deposit, the GP Cash Collateral Account shall have a balance of at least $34,200,000 in immediately available funds (without giving effect to any amounts deposited therein pursuant to Sections 9.01(e)(ii) or 9.23).

 

2.15                        Amendments to Financial Covenants.  Section 9.01 of the Credit Agreement shall be amended and restated in its entirety as follows:

 

Section 9.01                             Financial Covenants.

 

(a)                                 Consolidated Total Leverage Ratio.

 

(i)                                     Prior to the incurrence by the Borrower and/or any of its Subsidiaries of Permitted Notes Indebtedness:

 

(A)                               if the Borrower has exercised the Target Leverage Option thereof prior to the first day of such fiscal quarter, the Borrower will not, as of the last day of any fiscal quarter commencing with the fiscal quarter ending September 30, 2013, permit its Consolidated Total Leverage Ratio to exceed the ratio set forth in the grid below for the corresponding Rolling Period:

 

	
Rolling Period Ending
    	
 
    	
Maximum
   Consolidated Total
   Leverage Ratio
    
	
September 30,   2013
    	
 
    	
4.75 to 1.00
    
	
December 31,   2013 and thereafter
    	
 
    	
4.50 to 1.00
    

 

and

 

(B)                               if the Borrower has not exercised the Target Leverage Option prior to the first day of such fiscal quarter, the Borrower will not, as of the last day of any fiscal quarter commencing with the fiscal quarter ending September 30, 2013, permit its Adjusted Consolidated Total Leverage Ratio to exceed the ratio set forth in the grid below for the corresponding Rolling Period:

 

	
Rolling Period Ending
    	
 
    	
Maximum Adjusted
   Consolidated Total
   Leverage Ratio
    
	
September 30,   2013
    	
 
    	
7.25 to 1.00
    
	
December 31,   2013
    	
 
    	
6.75 to 1.00
    
	
March 31,   2014
    	
 
    	
6.25 to 1.00
    
	
June 30,   2014
    	
 
    	
5.25 to 1.00
    
	
September 30,   2014
    	
 
    	
5.00 to 1.00
    
	
December 31,   2014
    	
 
    	
4.75 to 1.00
    

 

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Rolling Period Ending
    	
 
    	
Maximum Adjusted
   Consolidated Total
   Leverage Ratio
    
	
March 31,   2015 and thereafter
    	
 
    	
4.50 to 1.00
    

 

; provided, that upon the Borrower closing a Material Acquisition after the Borrower’s exercise of the Target Leverage Option, the Borrower may elect (by delivering written notice of such election to the Administrative Agent on the closing date of such Material Acquisition) for the Rolling Period ending on the last day of the fiscal quarter in which such acquisition occurs and for the immediately following two Rolling Periods to increase the maximum Consolidated Total Leverage Ratio that is permitted to 5.00 to 1.00; provided, further, that the Borrower is not permitted to make more than one such election in any period of four consecutive fiscal quarters;

 

(ii)                                  From and after the incurrence by the Borrower and/or any of its Subsidiaries of Permitted Notes Indebtedness, the Borrower will not, as of the last day of each fiscal quarter then remaining during the term of this Agreement, permit its Consolidated Total Leverage Ratio to exceed 5.25 to 1.00.

 

(b)                                 Consolidated Senior Secured Leverage Ratio.  From and after the incurrence by the Borrower and/or any of its Subsidiaries of Permitted Notes Indebtedness, the Borrower will not, as of the last day of each fiscal quarter then remaining during the term of this Agreement, permit its Consolidated Senior Secured Leverage Ratio to exceed 3.50 to 1.00.

 

(c)                                  Consolidated Interest Coverage Ratio.  The Borrower will not, as of the last day of any fiscal quarter commencing with the fiscal quarter ending September 30, 2013, permit its Consolidated Interest Coverage Ratio to be less than the ratio set forth in the grid below for the corresponding Rolling Period:

 

	
Rolling Period Ending
    	
 
    	
Minimum
   Consolidated Interest
   Coverage Ratio
    
	
September 30,   2013
    	
 
    	
2.25 to 1.00
    
	
December 31,   2013
    	
 
    	
2.25 to 1.00
    
	
March 31,   2014 and thereafter
    	
 
    	
2.50 to 1.00
    

 

(d)                                 Minimum Consolidated EBITDA.  The Borrower will not permit the Consolidated EBITDA of the Borrower and its Consolidated Subsidiaries for the fiscal quarter ending June 30, 2013 to be less than $9,000,000.

 

(e)                                  Borrower’s Right to Cure.  Notwithstanding anything to the contrary contained in this Section 9.01, in the event that the Borrower fails to 

 

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comply with the requirements of clauses (a), (b), (c) and/or (d) of this Section 9.01 as of the last day of any fiscal quarter ending on or prior to December 31, 2013 (such event, a “Financial Covenant Default”), then the Borrower shall have the right to cure any such Financial Covenant Default (such right, the “Equity Cure Right”) subject to the following terms and conditions:

 

(i)                                     The Borrower shall deliver to the Administrative Agent irrevocable written notice of its intent to exercise the Equity Cure Right (an “Equity Cure Notice”) no later than ten (10) calendar days after the date on which financial statements and a compliance certificate as of and for the period ending on the last day (such last day, the “Equity Cure Test Date”) of the fiscal quarter for which such Financial Covenant Default occurred are required to be delivered pursuant to Sections 8.01(a), (b), and (d), as applicable.  The Equity Cure Notice shall set forth the calculation of the applicable Equity Cure Amount and be certified by a Financial Officer of the Borrower.

 

(ii)                                  No later than five (5) calendar days after receipt by the Administrative Agent of an Equity Cure Notice the Borrower shall cause the General Partner and/or Southcross Holdings, as applicable, to deposit immediately available funds into the GP Cash Collateral Account (which funds shall be above and in addition to the amount on deposit in the GP Cash Collateral Account prior to the Equity Cure Test Date and shall not be netted or credited against any other amounts required or permitted to be deposited or maintained in the GP Cash Collateral Account pursuant to Sections 8.21 or 9.23 or any other terms or conditions of this Agreement or any other Loan Document) in a dollar amount equal to the Equity Cure Amount.

 

(iii)                               The Equity Cure Right shall not be exercised more than two (2) times.

 

(iv)                              From the date on which financial statements and a compliance certificate as of and for the period ending on the Equity Cure Test Date are required to be delivered pursuant to Sections 8.01(a), (b), and (d), as applicable, until the earliest of (A) five (5) calendar days after receipt by the Administrative Agent of an Equity Cure Notice or (B) the date on which the Administrative Agent is notified by the Borrower that immediately available funds in an amount equal to the Equity Cure Amount will not be deposited by the General Partner and/or Southcross Holdings into the GP Cash Collateral Account, the applicable Financial Covenant Default shall constitute an Event of Default for all purposes under this Agreement, but neither the Administrative Agent nor any Lender shall impose default interest, accelerate the Secured Obligations, terminate the Commitments or exercise any enforcement remedy against any Credit Party or any of their respective Property, in each case solely with respect to such Financial Covenant Default.  Notwithstanding anything to the contrary in this Section

 

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9.01(e)(iv) the Administrative Agent and the Lenders shall be entitled to exercise any of their respective rights and remedies under this Agreement and under applicable law to the extent that any other Event of Default (other than the applicable Financial Covenant Default) has occurred and is continuing.

 

(v)                                 Upon the timely deposit by the General Partner and/or Southcross Holdings of immediately available funds in a dollar amount equal to the Equity Cure Amount into the GP Cash Collateral Account, the Borrower shall be deemed to have satisfied the requirements of clauses (a), (b), (c) and (d) of this Section 9.01, as applicable, as of the applicable Equity Cure Test Date with the same effect as though there was no failure to comply therewith as of such Equity Cure Test Date, and the Financial Covenant Default shall be automatically deemed cured and waived for all purposes of this Agreement.

 

(vi)                              With respect to any Equity Cure Amount deposited in the GP Cash Collateral Account in accordance with Section 9.01(e)(ii), solely for the purposes of calculating the Borrower’s compliance with clauses (a), (b) and (c) of this Section 9.01, as applicable, for each Rolling Period ending after the applicable Equity Cure Test Date that includes the fiscal quarter ending on such Equity Cure Test Date, (A) the Borrower shall be deemed to have received the Equity Cure Rollover Amount during the fiscal quarter ending on such Equity Cure Test Date and (B) the Borrower may add the applicable Equity Cure Rollover Amount in calculating its Consolidated EBITDA (or Annualized Consolidated EBITDA, in the case of Rolling Periods ending on or prior to December 31, 2013) for such Rolling Period.  For the avoidance of doubt, (1) no Equity Cure Amount deposited to the GP Cash Collateral Account shall be netted or credited against Consolidated Total Funded Indebtedness in the calculation of the Consolidated Total Leverage Ratio, Adjusted Consolidated Total Leverage Ratio, or Consolidated Senior Secured Leverage Ratio, as applicable, for the purpose of determining the Borrower’s compliance with clauses (a), and (b) of this Section 9.01 for the Rolling Period ending on the Equity Cure Test Date for which such Equity Cure Amount is received, and (2) no Equity Cure Amount or Equity Cure Rollover Amount shall be added in the calculation of Consolidated EBITDA when determining whether or not the Borrower has satisfied the Subsequent Equity Contribution Test.

 

2.16                        Amendments to Indebtedness Covenant.  Section 9.02 of the Credit Agreement shall be amended as follows:

 

(a)                                 Subsection 9.02(b) of the Credit Agreement shall be amended by inserting the following proviso immediately after the semicolon at the end of such subsection:

 

provided, further, that from and after April 1, 2013 until the date on which the Borrower exercises the Target Leverage Option, the aggregate amount of all Indebtedness described in this Section 9.02(b) at any one time outstanding shall not exceed $2,000,000 in the aggregate;

 

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(b)                                 Subsection 9.02(h) of the Credit Agreement shall be amended by inserting the following proviso immediately after the semicolon at the end of such subsection:

 

provided, further, that from and after April 1, 2013 until the date on which the Borrower exercises the Target Leverage Option, the Borrower shall not be permitted to incur, create or assume any additional Indebtedness (i.e., any such Indebtedness funded or incurred after March 31, 2013) pursuant to this Section 9.02(h);

 

2.17                        Amendments to Restricted Payments Covenant.  Section 9.04 of the Credit Agreement shall be amended as follows:

 

(a)                                 Subsection 9.04(c) of the Credit Agreement shall be amended and restated in its entirety as follows:

 

(c)                                  the Borrower may declare and pay quarterly cash distributions of Available Cash to the holders of any Equity Interests in the Borrower in accordance with the Borrower’s Organization Documents; provided, that, (i) no Default or Event of Default exists at the time of or after giving effect to such Restricted Payment, (ii) with respect to the quarterly cash distributions declared and paid with respect to the fiscal quarter ending March 30, 2013 (the “Q1 2013 Distribution”), the aggregate dollar amount of such Q1 2013 Distribution shall not exceed $10,000,000, and (iii) with respect to any other quarterly cash distributions declared and paid by the Borrower prior to the date on which the Borrower exercises the Target Leverage Option, the per-unit dollar amount of such quarterly cash distributions (adjusted for any distributions paid in kind, unit splits, combinations, recapitalizations, reclassifications or similar events) shall not exceed the per-unit dollar amount of the Q1 2013 Distribution; provided, further, that no such Restricted Payments shall be made in respect of Qualified Equity Securities issued pursuant to Section 8.20, other than payments in kind consisting of additional Qualified Equity Securities, prior to the Borrower’s exercise of the Target Leverage Option.

 

(b)                                 Subsection 9.04(e) of the Credit Agreement shall be amended by (i) inserting the phrase “from and after the date on which the Borrower exercises the Target Leverage Option,” immediately prior to the first word of such subsection, and (ii) inserting the following proviso immediately after the semicolon at the end of such subsection:

 

provided, that, no such Restricted Payments shall be made in respect of Qualified Equity Securities issued pursuant to Section 8.20, other than payments in kind consisting of additional Qualified Equity Securities, prior to the Borrower’s exercise of the Target Leverage Option;

 

2.18                        Amendments to Investments Covenant.  Section 9.05 of the Credit Agreement shall be amended as follows:

 

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(a)                                 Each of Subsections 9.05(c), (d), (e) and (f) of the Credit Agreement shall be amended by inserting the following proviso immediately before the semicolon at the end of such subsection:

 

; provided, further, that from and after April 1, 2013 until the date on which the Borrower exercises the Target Leverage Option, the Borrower shall not be permitted to make any additional Investments (i.e., any such Investment made after March 31, 2013) pursuant to this subsection except such Investments as are made for the account of the Borrower or a Subsidiary pursuant to and in accordance with any Treasury Management Agreement between the Borrower or such Subsidiary and a Treasury Management Counterparty

 

(b)                                 Each of Subsections 9.05(j), (k) and (n) of the Credit Agreement shall be amended by inserting the following proviso immediately before the semicolon (or, in the case of Subsetion 9.05(n), the period) at the end of such subsection:

 

; provided, further, that from and after April 1, 2013 until the date on which the Borrower exercises the Target Leverage Option, the Borrower shall not be permitted to make any additional Investments (i.e., any such Investment made after March 31, 2013) pursuant to this subsection

 

2.19                        Amendment to Affiliate Transactions Covenant Section 9.13 of the Credit Agreement shall be amended by inserting the following proviso immediately before the period at the end of such section:

 

; provided, however, that notwithstanding any contrary provision in this Section 9.13, no fees, expense reimbursements or other costs in respect of management, consulting, advisory or similar services shall be paid by the Borrower or any Subsidiary to the Sponsor or any of Sponsor’s Affiliates prior to the Borrower’s exercise of the Target Leverage Option except (i) fees and expense reimbursements paid by the Borrower to the General Partner pursuant to and in accordance with the Partnership Agreement as in effect on April 1, 2013 and consistent with past practices, and (2) customary director fees and expense reimbursements paid to Affiliates of the Sponsor under and in accordance with the Borrower’s compensation arrangements for non-employee directors as in effect on April 1, 2013.

 

2.20                        Addition of Limitation on Capital Expenditures.  Article IX of the Credit Agreement shall be amended by inserting the following as a new “Section 9.23” immediately after Section 9.22 thereof:

 

Section 9.23                             Limitation on Capital Expenditures.  The Borrower shall not, and shall not permit any Subsidiary to, directly or indirectly make or commit to make any Capital Expenditure prior to the date on which the Borrower exercises the Target Leverage Option except:

 

20

 

(a)                           Maintenance Capital Expenditures; and

 

(b)                           Growth Capital Expenditures; provided, that, after giving effect to any such Growth Capital Expenditure the aggregate amount of Growth Capital Expenditures made or committed to be made (measured as of the date that each such Growth Capital Expenditure is made or committed to be made) during (i) the period commencing on April 1, 2013 and ending on December 31, 2013, and (ii) the period commencing on January 1, 2014 and ending on June 30, 2015, for each such period calculated separately does not exceed $25,000,000; provided, however, that the Borrower may make or commit to make (or permit any Subsidiary to make or commit to make) additional Growth Capital Expenditures of up to $3,000,000 for each such period calculated separately so long as (A) the Borrower causes the General Partner and/or Southcross Holdings to deposit funds in a dollar amount equal to the excess of (x) the aggregate amount of Growth Capital Expenditures for such period over (y) $25,000,000 (the aggregate dollar amount of all funds so deposited being referred to herein as the “Equity Funded Capital Expenditure Amount”) into the GP Cash Collateral Account prior to the time that such Growth Capital Expenditure is made or committed to be made and, in any case, on or prior to the last Subsequent Equity Contribution Date (which Capital Expenditure Collateral Amount shall be above and in addition to the amount on deposit in the GP Cash Collateral Account on such date and shall not be netted or credited against any other amounts required or permitted to be deposited or maintained in the GP Cash Collateral Account pursuant to Section 9.01(e)(ii) or any other terms or conditions of this Agreement or any other Loan Document), and (B) the aggregate amount of Growth Capital Expenditures made or committed to be made in each such period calculated separately does not exceed $28,000,000 at any time.

 

2.21                                        Addition of Required Equity Contributions Event of Default.  Subsection 10.01(d) of the Credit Agreement shall be amended by inserting “, Section 8.20, Section 8.21” immediately after the reference to “Section 8.19” contained therein.

 

2.22                        Addition of Release of GP Collateral Provision.  Article XII of the Credit Agreement shall be amended by adding the following new “Section 12.20” thereto immediately after Section 12.19 thereof:

 

Section 12.20                      Release of GP Collateral.

 

(a)                                 Disbursements from GP Cash Collateral Account.  Contemporaneously with each Required Equity Contribution, if the Borrower has provided the Administrative Agent a funds flow memorandum signed by a Financial Officer of the Borrower, including irrevocable instructions to transfer the relevant Required Equity Amounts in accordance therewith (which signed funds flow memorandum and irrevocable transfer instructions shall be delivered to the Administrative Agent no later than three (3) Business Days prior to the applicable Required Equity Contribution Date), and other documentation 

 

21

 

demonstrating that such funds will be applied in accordance with the terms and conditions of this Agreement and the other Loan Documents, in each case in form and substance satisfactory to the Administrative Agent, then the Administrative Agent shall, so long as no Default or Event of Default exists or would result therefrom, cause funds to be released from the GP Cash Collateral Account in an amount equal to the applicable Required Equity Amount; provided, that the Administrative Agent shall not be required to release such funds (A) to the extent that the Borrower, the General Partner or Southcross Holdings has failed to cause any other funds required to be deposited or maintained in the GP Cash Collateral Account pursuant to Sections 8.21, 9.01(e)(ii) or 9.23 hereof or any other terms or conditions of this Agreement or any other Loan Document, as applicable, or (B) if after giving effect to such release, the total Revolving Credit Exposures would exceed an amount equal to (x) the total Commitments minus (y) the Availability Block.  Any funds released from the GP Cash Collateral Account pursuant to this Section 12.20(a) shall be used solely for the purpose of consummating the applicable Required Equity Contribution, and the related Required Equity Proceeds shall be applied as a mandatory repayment in accordance with Section 3.04(b)(iv) on the applicable Required Equity Contribution Date immediately after the Borrower’s receipt thereof.

 

(b)                                 Final Release of GP Collateral.  After June 30, 2014, if (i) the Borrower has exercised the Target Leverage Option, and (ii) either (A) the Borrower has satisfied the Subsequent Equity Contribution Test, and no amounts have been deposited to the GP Cash Collateral Account pursuant to Sections 9.01(e)(ii) or 9.23(b), or (B) the Borrower has failed to satisfy the Subsequent Equity Contribution Test, and the Subsequent Equity Contribution has occurred, then the Administrative Agent shall, so long as no Default or Event of Default exists or would result therefrom, take any and all actions necessary (including any actions necessary to terminate the GP Cash Collateral Account Control Agreement and the GP Cash Collateral Pledge Agreement) to cause its Lien on and security interest in the GP Collateral, including, without limitation, the GP Cash Collateral Account, to be released.

 

2.23                        Replacement of Ongoing Compliance Certificate Exhibit.  Exhibit D-2 to the Credit Agreement shall be amended and restated in its entirety in the form of Exhibit D-2 to this Amendment, and Exhibit D-2 to this Amendment shall be deemed to be attached as Exhibit D-2 to the Credit Agreement.

 

SECTION 3                               Conditions Precedent.  This Amendment will be effective as of the date that each of the following conditions precedent has been satisfied (such date, the “Second Amendment Effective Date”):

 

3.1                               Closing Deliveries.  Administrative Agent shall have received each of the following documents, instruments, and agreements, each of which shall be in form and substance and executed in such counterparts (if applicable) as shall be acceptable to Administrative Agent 

 

22

 

and each of which shall, unless otherwise indicated, be dated as of the Second Amendment Effective Date:

 

(a)                                 counterparts hereof duly executed by the Borrower and Consenting Lenders that are sufficient to constitute the Required Lenders and consent and agreement counterparts hereof duly executed by the other Loan Parties;

 

(b)                                 counterparts of an amended and restated or replacement deposit account control agreement duly executed by the General Partner, the Administrative Agent and Wells Fargo Bank, N.A. (the “A&R GP Cash Collateral Control Agreement”), which shall, among other things, restrict the General Partner’s access to and establish the Administrative Agent’s “control” (as such term is defined in Section 9.104 of the Texas UCC (as defined in the Guaranty and Collateral Agreement)) of the GP Cash Collateral Account;

 

(c)                                  counterparts of an amendment and restatement of the Equity Holder Agreement (the “A&R Equity Holder Agreement”) duly executed by the General Partner, Southcross Holdings (together with the General Partner as the owners of at least 58% of the issued and outstanding Equity Interests in the Borrower, the “Equity Holders” and each individually, an “Equity Holder”), and the Administrative Agent, which shall require (i) each Equity Holder to (A) promptly deposit or cause to be deposited, as applicable, into the GP Cash Collateral Account any and all proceeds received by such Equity Holder (or received by any transfer agent holding Equity Interests on behalf of such Equity Holder) in respect of the quarterly cash distributions of Available Cash to be declared and paid by the Borrower for the fiscal quarters ending March 31, 2013, June 30, 2013, September 30, 2013 and December 31, 2013, and (B) consummate the Initial Equity Contribution and the Subsequent Equity Contribution, and (ii) the Administrative Agent to release funds from the GP Cash Collateral Account, in each case in accordance with and subject to the terms and conditions of the Credit Agreement (as amended hereby);

 

(d)                                 a perfection certificate date as of the date hereof and signed by a Responsible Officer of the Borrower, together with all attachments contemplated thereby, in form and substance satisfactory to the Administrative Agent;

 

(e)                                  an opinion of Gardere Wynne Sewell LLP, as special counsel to the Loan Parties and the General Partner, favorably opining as to such matters as the Administrative Agent may reasonably request; and

 

(f)                                   such other documents, instruments and certificates as the Administrative Agent or its counsel may reasonably request relating to the foregoing, the organization, existence and good standing of the General Partner and each of the Loan Parties, the authorization of this Amendment and the transactions contemplated hereby, and any other legal matters relating to the General Partner, the Loan Parties and this Amendment.

 

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3.2                               Fees and Expenses.  The Borrower shall have paid to the Administrative Agent all fees due and owing to the Administrative Agent or the Consenting Lenders in connection with this Amendment including, without limitation, (a) an amendment consent fee in an amount equal to 0.250% of the aggregate amount of the Commitments of the Consenting Lenders (including Wells Fargo), and (b) all reasonable fees and expenses incurred by the Administrative Agent (including, without limitation, fees and expenses of counsel to the Administrative Agent) in the preparation, execution, review and negotiation of this Amendment and any other related documents for which the Borrower shall have been invoiced by the Administrative Agent on or before the Second Amendment Effective Date.

 

3.3                               Absence of Defaults.  After giving effect to the limited waiver set forth in Section 1 of this Amendment, no Default or Event of Default shall have occurred which is continuing.

 

3.4                               Representations and Warranties.  Each representation and warranty contained in Section 4 hereof shall be true and correct in all material respects.

 

3.5                               Other Documents.  The Administrative Agent shall have been provided with such documents, instruments, and agreements, and the Borrower and the other Loan Parties shall have taken such actions, in each case as the Administrative Agent may reasonably require in connection with this Amendment and the transactions contemplated hereby.

 

SECTION 4                               Representations and Warranties.  In order to induce the Administrative Agent and the Lenders to enter into this Amendment, Borrower hereby represents and warrants to the Administrative Agent and each Lender that:

 

4.1                               Minimum Consolidated EBITDA.  To the Borrower’s knowledge, the Consolidated EBITDA of the Borrower for the fiscal quarter ended March 31, 2013 (the calculation of which may include a one-time add back of fees, costs and expenses incurred in connection with the negotiation, documentation, closing and consummation of the First Amendment in an aggregate amount not to exceed $1,000,000, solely to the extent deducted in determining Consolidated Net Income in such period and solely for the purposes of this Section 4.1) will be equal to or greater than $4,000,000.

 

4.2                               Accuracy of Representations and Warranties.  After giving effect to the limited waiver set forth in Section 1 of this Amendment, each representation and warranty of each Loan Party contained in the Loan Documents is true and correct in all material respects as of the date hereof (except that (i) to the extent that any such representation and warranty is expressly limited to an earlier date, in which case, on the date hereof, such representation and warranty shall continue to be true and correct in all material respects as of such specified earlier date and (ii) to the extent that any such representations and warranties are qualified by materiality, such representations and warranties shall continue to be true and correct in all respects).

 

4.3                               Due Authorization, No Conflicts.  The execution, delivery and performance by the Borrower of this Amendment are within the Borrower’s limited partnership powers, have 

 

24

 

been duly authorized by necessary action, require no action by or in respect of, or filing with, any governmental body, agency or official (other than filings with the SEC required under applicable law) and do not violate or constitute a default under any provision of applicable law or any material agreement binding upon the Borrower or any of its Subsidiaries, or result in the creation or imposition of any Lien upon any of the assets of the Borrower or any of its Subsidiaries.

 

4.4                               Validity and Binding Effect.  This Amendment constitutes the valid and binding obligations of the Borrower enforceable in accordance with its terms, except as the enforceability thereof may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditor’s rights generally, and subject to general principles of equity, regardless of whether considered in a proceeding in equity or law.

 

4.5                               Absence of Defaults.  After giving effect to the limited waiver set forth in Section 1 of this Amendment, no Default or Event of Default has occurred which is continuing.

 

4.6                               No Defense.  The Borrower has no defenses to (a) payment, counterclaims or rights of set-off with respect to the Secured Obligations on the date hereof or (b) the validity, enforceability or binding effect against the Borrower of the Credit Agreement or any of the other Loan Documents or any Liens intended to be created thereby.

 

4.7                               Review and Construction of Documents.  The Borrower (a) has had the opportunity to consult with legal counsel of its own choice and has been afforded an opportunity to review this Amendment with its legal counsel, (b) has reviewed this Amendment and fully understands the effects thereof and all terms and provisions contained in this Amendment, and (c) has executed this Amendment of its own free will and volition.  Furthermore, the Borrower acknowledges that (i) this Amendment shall be construed as if jointly drafted by the Borrower and the Lenders, and (ii) the recitals contained in this Amendment shall be construed to be part of the operative terms and provisions of this Amendment.

 

SECTION 5                               Miscellaneous.

 

5.1                               Limitations; Reservation of Rights.  Except for the limited waiver set forth in Section 1 hereof and the amendments set forth in Section 2 hereof, nothing contained herein shall be deemed a consent to or waiver of any action or inaction of the Borrower or any other Loan Party that constitutes a violation of any provision of the Credit Agreement or any other Loan Document, or which results in a Default or Event of Default (including any and all existing or prospective Defaults or Events of Default) under the Credit Agreement or any other Loan Document.  Neither the Lenders nor the Administrative Agent shall be obligated to grant any future waivers, consents or amendments with respect to the Credit Agreement or any other Loan Document.  No failure or delay on the part of Administrative Agent or any Lender to exercise any right or remedy under the Credit Agreement, any other Loan Document or applicable law shall operate as a consent to or waiver thereof, nor shall any single or partial exercise of any right or remedy preclude any other or further exercise of any right or remedy, all of which are cumulative and are expressly reserved.

 

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5.2                               Reaffirmation of Loan Documents; Extension of Liens.  Any and all of the terms and provisions of the Credit Agreement and the Loan Documents shall, except as amended and modified hereby, remain in full force and effect.  The Borrower hereby extends the Liens securing the Secured Obligations until the Secured Obligations have been paid in full, and agrees that the amendments and modifications herein contained shall in no manner affect or impair the Secured Obligations or the Liens securing payment and performance thereof.

 

5.3                               Parties in Interest.  All of the terms and provisions of this Amendment shall bind and inure to the benefit of the parties hereto and their respective successors and assigns.

 

5.4                               Counterparts.  This Amendment may be executed in counterparts, and all parties need not execute the same counterpart; however, no party shall be bound by this Amendment until this Amendment has been executed by the Borrower and the Required Lenders, and the consent and agreement counterparts have been executed by the other Loan Parties, at which time this Amendment shall be binding on, enforceable against and inure to the benefit of the Borrower and all Lenders.  Facsimiles or other electronic copies (e.g., .pdf) shall be effective as originals.

 

5.5                               COMPLETE AGREEMENT.  THIS AMENDMENT, THE CREDIT AGREEMENT AND THE OTHER LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT AMONG THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR ORAL AGREEMENTS OF THE PARTIES.  THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.

 

5.6                               Release.  The Borrower and each other Loan Party on their own behalf and on behalf of their predecessors, successors, heirs, legal representatives and assigns (collectively, the “Releasing Parties”), hereby acknowledge and stipulate that as of the Second Amendment Effective Date, none of the Releasing Parties has any claims or causes of action of any kind whatsoever against Administrative Agent, any other Secured Party or any of their officers, directors, employees, agents, attorneys, or representatives, or against any of their respective predecessors, successors, or assigns (each of the foregoing, collectively, the “Released Parties”).  Each of the Releasing Parties hereby forever releases, remises, discharges and holds harmless the Released Parties, from any and all claims, causes of action, demands, and liabilities of any kind whatsoever, whether direct or indirect, fixed or contingent, liquidated or nonliquidated, disputed or undisputed, known or unknown, which any of the Releasing Parties has or may acquire in the future relating in any way to any event, circumstance, action, or failure to act from the beginning of time through the date of this Amendment.

 

5.7                               Covenant Not to Sue.  The Borrower and each other Loan Party, on their own behalf and on behalf of the Releasing Parties, hereby absolutely, unconditionally and irrevocably, covenants and agrees with and in favor of each Released Party that it will not sue (at law, in equity, in any regulatory proceeding or otherwise) any Released Party on the basis of any claim released, remised and discharged by Borrower or such other Loan Party pursuant to Section 5.6 above.  If the Borrower or any other Loan Party or any of their successors, assigns or other legal representatives violates the foregoing covenant, such Person, for itself and its successors, assigns and legal representatives, agrees to pay, in addition to such other damages as 

 

26

 

any Released Party may sustain as a result of such violation, all attorneys’ fees and costs incurred by any Released Party as a result of such violation.

 

5.8                               Headings.  The headings, captions and arrangements used in this Amendment are, unless specified otherwise, for convenience only and shall not be deemed to limit, amplify or modify the terms of this Amendment, nor affect the meaning thereof.

 

5.9                               No Implied Waivers.  No failure or delay on the part of the Administrative Agent or the Lenders in exercising, and no course of dealing with respect to, any right, power or privilege under this Amendment, the Credit Agreement or any other Loan Document shall operate as a waiver thereof, nor shall any single or partial exercise of any right, power or privilege under this Amendment, the Credit Agreement or any other Loan Document preclude any other or further exercise thereof or the exercise of any other right, power or privilege.

 

5.10                        Arms-Length/Good Faith.  This Amendment has been negotiated at arms-length and in good faith by the parties hereto.

 

5.11                        Interpretation.  Wherever the context hereof shall so require, the singular shall include the plural, the masculine gender shall include the feminine gender and the neuter and vice versa.  The headings, captions and arrangements used in this Amendment are for convenience only and shall not affect the interpretation of this Amendment.

 

5.12                        Severability.  In case any one or more of the provisions contained in this Amendment shall for any reason be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality, or unenforceability shall not affect any other provision hereof, and this Amendment shall be construed as if such invalid, illegal, or unenforceable provision had never been contained herein.

 

5.13                        Loan Documents.  The Loan Parties acknowledge and agree that each of the A&R Equity Holder Agreement and this Amendment is a Loan Document and the A&R GP Cash Collateral Control Agreement is a Security Instrument.

 

5.14                        Further Assurances.  The Borrower agrees to execute, acknowledge, deliver, file and record such further certificates, instruments and documents, and to do all other acts and things, as may be requested by the Lenders as necessary or advisable to carry out the intents and purposes of this Amendment.

 

5.15                        Governing Law.  THIS AMENDMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAW OF THE STATE OF TEXAS.

 

[Signature Pages Follow]

 

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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed by their respective authorized officers on the date and year first above written.

 

 

	
THE   BORROWER:
    	
SOUTHCROSS   ENERGY PARTNERS, L.P.
    
	
 
    	
 
    
	
 
    	
By:
    	
Southcross   Energy Partners GP, LLC,
    
	
 
    	
 
    	
its   general partner
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   David W. Biegler
    
	
 
    	
 
    	
David   W. Biegler
    
	
 
    	
 
    	
Chairman   and Chief Executive Officer
    

 

SIGNATURE PAGE

LIMITED WAIVER AND SECOND AMENDMENT TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT

SOUTHCROSS ENERGY PARTNERS, L.P.

 

 

The undersigned (i) consent and agree to this Amendment, and (ii) agree that the Loan Documents to which it is a party (including, without limitation, the Second Amended and Restated Guaranty and Collateral Agreement dated as of November 7, 2012, as applicable) shall remain in full force and effect and shall continue to be the legal, valid and binding obligation of the undersigned, enforceable against it in accordance with its terms.

 

	
 
    	
CONSENTED, ACKNOWLEDGED AND AGREED TO BY:
    
	
 
    	
 
    
	
 
    	
SOUTHCROSS   ENERGY OPERATING, LLC
    
	
 
    	
SOUTHCROSS   ENERGY LP LLC
    
	
 
    	
SOUTHCROSS   ENERGY GP LLC
    
	
 
    	
SOUTHCROSS   DELTA PIPELINE LLC
    
	
 
    	
SOUTHCROSS   PROCESSING LLC
    
	
 
    	
SOUTHCROSS   ALABAMA PIPELINE LLC
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   David W. Biegler
    
	
 
    	
 
    	
David   W. Biegler
    
	
 
    	
 
    	
Chairman   and Chief Executive Officer
    
	
 
    	
 
    
	
 
    	
SOUTHCROSS   CCNG GATHERING LTD.
    
	
 
    	
SOUTHCROSS   CCNG TRANSMISSION LTD.
    
	
 
    	
SOUTHCROSS   GULF COAST TRANSMISSION
    
	
 
    	
 
    	
LTD.
    
	
 
    	
SOUTHCROSS   MISSISSIPPI PIPELINE, L.P.
    
	
 
    	
SOUTHCROSS   MISSISSIPPI GATHERING, L.P.
    
	
 
    	
SOUTHCROSS   ALABAMA GATHERING
    
	
 
    	
 
    	
SYSTEM,   L.P.
    
	
 
    	
SOUTHCROSS   MIDSTREAM SERVICES, L.P.
    
	
 
    	
SOUTHCROSS   MARKETING COMPANY LTD.
    
	
 
    	
SOUTHCROSS   NGL PIPELINE LTD.
    
	
 
    	
SOUTHCROSS   GATHERING LTD.
    
	
 
    	
SOUTHCROSS   MISSISSIPPI INDUSTRIAL
    
	
 
    	
 
    	
GAS   SALES, L.P.
    
	
 
    	
 
    
	
 
    	
By:
    	
Southcross   Energy GP LLC,
    
	
 
    	
 
    	
 
    	
as   general partner
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   David W. Biegler
    
	
 
    	
 
    	
David   W. Biegler
    
	
 
    	
 
    	
Chairman   and Chief Executive Officer
    

 

CONSENT AND AGREEMENT SIGNATURE PAGE

LIMITED WAIVER AND SECOND AMENDMENT TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT

SOUTHCROSS ENERGY PARTNERS, L.P.

 

 

	
THE   ADMINISTRATIVE AGENT
    	
 
    
	
AND A   LENDER:
    	
WELLS   FARGO BANK, N.A.,
    
	
 
    	
as   the Administrative Agent and a Lender
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
Andrew   Ostrov
    
	
 
    	
 
    	
Andrew   Ostrov
    
	
 
    	
 
    	
Director
    

 

 

Exhibit D-2-1

 

	
LENDER:
    	
CITIBANK,   N.A., as a Lender
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Thomas Benavides
    
	
 
    	
Name:
    	
Thomas   Benavides
    
	
 
    	
Title:
    	
Senior   Vice President
    

 

Exhibit D-2-2

 

	
LENDER:
    	
BARCLAYS   BANK PLC, as a Lender
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Vanessa A. Kurbatskiy
    
	
 
    	
Name:
    	
Vanessa   A. Kurbatskiy
    
	
 
    	
Title:
    	
Vice   President
    

 

Exhibit D-2-3

 

	
LENDER:
    	
JPMORGAN   CHASE BANK, N.A.,
    
	
 
    	
as   a Lender
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Preeti Bhatnagar
    
	
 
    	
Name:
    	
Preeti   Bhatnagar
    
	
 
    	
Title:
    	
Authorized   Officer
    

 

Exhibit D-2-4

 

	
LENDER:
    	
COMPASS   BANK,
    
	
 
    	
as   a Lender
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Blake Kirshman
    
	
 
    	
Name:
    	
Blake   Kirshman
    
	
 
    	
Title:
    	
Senior   Vice President
    

 

Exhibit D-2-5

 

	
LENDER:
    	
AMEGY   BANK NATIONAL ASSOCIATION, as a Lender
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Jill McSorley
    
	
 
    	
Name:
    	
Jill   McSorley
    
	
 
    	
Title:
    	
Senior   Vice President
    

 

Exhibit D-2-6

 

	
LENDER:
    	
ROYAL   BANK OF CANADA, as a Lender
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
Jason   S. York
    
	
 
    	
Name:
    	
Jason   S. York
    
	
 
    	
Title:
    	
Authorized   Signatory
    

 

Exhibit D-2-7

 

	
LENDER:
    	
COMERICA   BANK, as a Lender
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Brandon M. White
    
	
 
    	
Name:
    	
Brandon   M. White
    
	
 
    	
Title:
    	
Corporate   Banking Officer
    

 

Exhibit D-2-8

 

	
LENDER:
    	
MIDFIRST   BANK, as a Lender
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   W. Thomas Portman
    
	
 
    	
Name:
    	
W.   Thomas Portman
    
	
 
    	
Title:
    	
Vice   President
    

 

Exhibit D-2-9

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00215-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00215-of-00352.parquet"}]]