FIRST AMENDMENT TO AMENDED AND
RESTATED AGREEMENT OF LIMITED PARTNERSHIP
OF
NOARK PIPELINE SYSTEM, LIMITED PARTNERSHIP
This FIRST AMENDMENT TO AMENDED AND RESTATED AGREEMENT OF LIMITED
PARTNERSHIP OF NOARK PIPELINE SYSTEM, LIMITED PARTNERSHIP (this "First
Amendment") dated as of June 18, 1998 amends that certain Amended and Restated
Agreement of Limited Partnership of NOARK Pipeline System, Limited Partnership
dated as of January 12, 1998 (the "Partnership Agreement") between Southwestern
Energy Pipeline Company, as a general partner, and Enogex Arkansas Pipeline
Corporation, as a general partner and a limited partner. Capitalized terms used
herein and not defined herein shall have the meanings assigned thereto in the
Partnership Agreement.
In consideration of the mutual promises made herein, and for other good
and valuable consideration the receipt and sufficiency of which are hereby
acknowledged, the Partners hereby agree as follows:
1. The definition of "Existing Loans" in Section 1.1 of the Partnership
Agreement is hereby amended in its entirety to read as follows:
" "Existing Loans" means the NOARK Debt, and any subsequent loans to
the Partnership or any NOARK Related Entity replacing the then existing
principal balance of the NOARK Debt, or the then existing principal
balance of such subsequent loans, as applicable."
2. The definition of "NOARK Debt" in Section 1.1 of the Partnership
Agreement is hereby amended by inserting at the end thereof, the following:
"; provided, however, that from and after June 18, 1998 "NOARK Debt"
shall mean the Finance Notes, and shall exclude for all purposes of
this Agreement the debt incurred by the Partnership pursuant to the
terms of that certain Loan Agreement dated as of June 1, 1998 between
the Partnership and NOARK Pipeline Finance, L.L.C., an Oklahoma limited
liability company."
3. Section 1.1 of the Partnership Agreement is hereby amended by
inserting the following definitions:
"Defaulting Guarantor" shall have the meaning assigned thereto in the
Indenture.
"EAPC Allocated Existing Loans" shall mean, at any time after
indebtedness is incurred pursuant to the last sentence of Section
3.5(b) hereof, (i) 40% of the Existing Loans immediately prior to the
incurrence of such indebtedness and the application of the
proceeds thereof; less, if and only if Southwestern Energy Company is
the Defaulting Guarantor (as defined in the Indenture), the principal
amount of Finance Notes redeemed upon application of the proceeds of
such indebtedness and (ii) if and only if Southwestern Energy Company
is the Defaulting Guarantor, the indebtedness incurred pursuant to the
last sentence of Section 3.5(b) hereof, and any subsequent loans to the
Partnership replacing the principal balance thereof at the time such
subsequent loans are made.
"Enogex Guaranty" shall have the meaning assigned thereto in the
Indenture.
"Finance Notes" shall mean the 7.15% Notes Due 2018 issued by NOARK
Pipeline Finance, L.L.C. in the original aggregate principal amount of
$80,000,000 pursuant to the Indenture.
"Indenture" shall mean the Indenture dated as of June 1, 1998 between
the NOARK Pipeline Finance, L.L.C. and The Bank of New York, as
trustee, as it may be amended or supplemented from time to time.
"Non-Defaulting Guarantor" shall have the meaning assigned thereto in
the Indenture.
"Southwestern Guaranty" shall have the meaning assigned thereto in the
Indenture.
"SWPL Allocated Existing Loans" shall mean, at any time after
indebtedness is incurred pursuant to the last sentence of Section
3.5(b) hereof, the sum of (i) 60% of the Existing Loans immediately
prior to the incurrence of such indebtedness and the application of the
proceeds thereof, less, if and only if Enogex Inc. is the Defaulting
Guarantor (as defined in the Indenture), the principal amount of
Finance Notes redeemed upon application of the proceeds of such
indebtedness and (ii) if and only if Enogex Inc. is the Defaulting
Guarantor, the indebtedness incurred pursuant to the last sentence of
Section 3.5(b) hereof, and any subsequent loans to the Partnership
replacing the principal balance thereof at the time such subsequent
loans are made.
4. Subsection (b) of Section 3.5 of the Partnership Agreement is hereby
amended as follows:
(i) by inserting the words "by the Partnership (including any NOARK
Related Entity)" immediately after the words "indebtedness for borrowed money"
in the first line thereof; and
(ii) by inserting at the end of said subsection (b), the following
sentence:
"Notwithstanding the foregoing, (i) if Southwestern Energy Company
shall be a Defaulting Guarantor and Enogex Inc. shall be a
Non-Defaulting Guarantor, the Partnership, at the direction of EAPC,
may incur indebtedness for borrowed money (x) upon a declaration of
acceleration of the Finance Notes pursuant to Section 6.1(b) of the
Indenture, in a principal amount equal to the Guaranteed Principal
Amount (as defined in the Enogex Guaranty) or (y) otherwise, in a
principal amount equal to the Redemption
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Price (as defined in the Indenture) applicable to the redemption of
Finance Notes in an aggregate principal amount equal to the Guaranteed
Principal Amount (as defined in the Enogex Guaranty), in each case
without the consent of the SuperMajority in Interest of Partners, and
the proceeds of such indebtedness shall be applied on behalf of Enogex
Inc. to the payment of the Finance Notes upon acceleration thereof or
to the redemption of Finance Notes pursuant to Section 3.1(b) of the
Indenture, as applicable, and (ii) if Enogex Inc. shall be a Defaulting
Guarantor and Southwestern Energy Company shall be a Non-Defaulting
Guarantor, the Partnership may, at the direction of SWPL, incur
indebtedness for borrowed money (x) upon a declaration of acceleration
of the Finance Notes pursuant to Section 6.1(b) of the Indenture, in a
principal amount equal to the Guaranteed Principal Amount (as defined
in the Southwestern Guaranty) or (y) otherwise, in a principal amount
equal to the Redemption Price (as defined in the Indenture) applicable
to the redemption of Finance Notes in an aggregate principal amount
equal to the Guaranteed Principal Amount (as defined in the
Southwestern Guaranty), in each case without the consent of the
SuperMajority in Interest of Partners, and the proceeds of such
indebtedness shall be applied on behalf of Southwestern Energy Company
to the payment of the Finance Notes upon acceleration thereof or to the
redemption of Finance Notes pursuant to Section 3.1(b) of the
Indenture; provided that any indebtedness incurred pursuant to this
sentence without the consent of the SuperMajority in Interest of
Partners shall be unsecured, shall be non-recourse to each of the
Partners (unless with respect to either Partner, such Partner shall
otherwise consent in writing) and shall not contain any covenants,
agreements or provisions which would in any material respect be more
restrictive on the Partnership and the NOARK Related Entities and their
respective businesses and affairs than the covenants, agreements or
provisions of the Indenture and the Finance Notes. In the event that
EAPC directs the Partnership to incur indebtedness as described in the
preceding sentence, (i) EAPC, on behalf of the Partnership, and the
Partnership are hereby authorized to take such action as may be
reasonably required in order for the Partnership to incur such
indebtedness in conformity with the requirements of the preceding
sentence, without any further action by the Partners or the Management
Committee and (ii) SWPL shall take all such actions and execute any and
all documents reasonably required by it as a general partner of the
Partnership to facilitate the incurrence of such indebtedness by the
Partnership; provided that SWPL shall not incur any liability in
respect thereof. In the event that SWPL directs the Partnership to
incur indebtedness as described in the preceding sentence, (i) SWPL, on
behalf of the Partnership, and the Partnership are hereby authorized to
take such action as may be reasonably required in order for the
Partnership to incur such indebtedness in conformity with the
requirements of the second preceding sentence, without any further
action by the Partners or the Management Committee and (ii) EAPC shall
take all such actions and execute any and all documents reasonably
required by it as a general partner of the Partnership to facilitate
the incurrence of such indebtedness by the Partnership; provided that
EAPC shall not incur any liability in respect thereof.
5. Section 4.2(c) of the Partnership Agreement is hereby amended in its
entirety to read as follows:
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(c) The Partners agree that (i) prior to the incurrence of any
indebtedness pursuant to the last sentence of Section 3.5(b), the
Existing Loans, including applicable interest, shall be repaid as
follows: (x) sixty percent (60%) of the Existing Loans, including
applicable interest, shall be repaid out of any amounts otherwise
distributable to SWPL, before taking into account debt service on the
Existing Loans, under this Agreement and (y) forty percent (40%) of the
Existing Loans, including applicable interest, shall be repaid out of
any amounts otherwise distributable to EAPC, before taking into account
debt service on the Existing Loans, under this Agreement, and (ii) from
and after the incurrence of any indebtedness pursuant to the last
sentence of Section 3.5(b), the Existing Loans, including applicable
interest, shall be repaid as follows: (x) the SWPL Allocated Existing
Loans, including applicable interest, shall be repaid out of any
amounts otherwise distributable to SWPL, before taking into account
debt service on the Existing Loans, under this Agreement and (y) the
EAPC Allocated Existing Loans, including applicable interest, shall be
repaid out of any amounts otherwise distributable to EAPC, before
taking into account debt service on the Existing Loans, under this
Agreement. If such amounts referred to in clause (i) of the preceding
sentence are insufficient to pay a Partner's percentage share (i.e. 60%
or 40% as set forth above) of the debt service on the Existing Loans,
including applicable interest, in accordance with their terms, then
such Partner shall be responsible to contribute to the capital of the
Partnership amounts sufficient to pay its percentage share (i.e. 60% or
40% as set forth above) of the debt service on the Existing Loans,
including applicable interest, and shall do so upon notice from the
Project Leader. If such amounts referred to in clause (ii) of the
preceding sentence are insufficient to pay the debt service on the SWPL
Allocated Existing Loans or the EAPC Allocated Existing Loans, in each
case including applicable interest, in accordance with its respective
terms, then SWPL or EAPC, as the case may be, shall be responsible to
contribute to the capital of the Partnership amounts sufficient to pay
the debt service on the SWPL Allocated Existing Loans or the EAPC
Allocated Existing Loans, as applicable, including in each case
interest thereon, and shall do so upon notice from the Project Leader.
Notwithstanding the foregoing, if either SWPL or EAPC obtains knowledge
that it is responsible to contribute to the capital of the Partnership
pursuant to this Section 4.2(c), then such Partner shall be obligated
to make such contribution of capital to the Partnership on a timely
basis notwithstanding the fact that the Project Leader has not given
notice to such Partner as contemplated hereby. Capital Contributions by
the Partners pursuant to this Section 4.2(c) shall not alter the
Partnership Percentages of the Partners. Default by a Partner in the
making of such Capital Contributions shall cause it to be deemed a
Delinquent Partner subject to the provisions of Section 4.3 hereof.
6. Section 4.2(d) of the Partnership Agreement is hereby amended in its
entirety to read as follows:
(d) Notwithstanding anything to the contrary in Section 4.2(c) above or
elsewhere in this Agreement, it is understood and agreed that the terms
of any Existing Loans may in the future (but do not currently) provide
that the amortization of the principal amount thereof shall be borne or
allocated in a manner different from the percentages set forth in
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Section 4.2(c) or any Partner may direct the Project Leader to apply
amounts of Partnership cash otherwise distributable to such Partner
(except amounts to be paid to other Partners pursuant to the other
provisions of this Agreement) to the repayment or prepayment of the
principal amount of the Existing Loans in excess of the amounts
required to be repaid under the terms of the Existing Loans, provided
such Partner bears all costs and penalties of doing so. In addition,
either Partner may elect to redeem from such Partner's own funds a
portion of the Finance Notes pursuant to Section 3.1 of the Indenture.
Consequently, a Partner may thereby pay or bear more than its
attributable percentage of the principal amount of the Existing Loans
to be repaid. In such event, the percentages of the then outstanding
principal amount of the Existing Loans payable out of the distributable
amounts attributable to the Partners set forth in Section 4.2(c) shall
be adjusted as appropriate to reflect the resulting percentage of the
aggregate outstanding principal amount of the Existing Loans then
attributable to each Partner.
7. Section 5.3 of the Partnership Agreement is hereby amended in its
entirety to read as follows:
5.3. Special Interest Expense. The Partnership interest
expense deductions incurred with regard to the Existing Loans and the
Finance Notes as referenced in Section 4.2(c) shall be allocated to the
Partners as follows:
(i) prior to the incurrence of any indebtedness pursuant to
the last sentence of Section 3.5(b), 60% to SWPL and 40% to
EAPC; and
(ii) following the incurrence of any indebtedness pursuant to
the last sentence of Section 3.5(b), the Partnership interest
expense deductions incurred with regard to the SWPL Allocated
Existing Loans shall be allocated to SWPL and the Partnership
interest expense deductions incurred with regard to the EAPC
Allocated Existing Loans shall be allocated to EAPC.
In the event the percentages of the outstanding principal amounts of
the Existing Loans payable out of the distributable amounts
attributable to each Partner are adjusted pursuant to Section 4.2(d),
the foregoing percentages shall be subject to adjustment to reflect the
same percentages as the percentages established pursuant to Section
4.2(d).
8. The Partnership Agreement, as amended hereby, shall remain in full
force and effect and is hereby ratified, approved and confirmed in all respects.
9. From and after the date hereof, each reference in the Partnership
Agreement to "this Agreement," "hereof," or "hereunder" or words of like import,
and all references to the Partnership Agreement in any and all agreements,
instruments, documents, notes, certificates and other writings of every kind and
nature shall be deemed to mean the Partnership Agreement, as modified and
amended by this First Amendment.
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10. THE PROVISIONS OF THIS FIRST AMENDMENT SHALL BE GOVERNED BY AND
CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF ARKANSAS
(EXCLUDING ANY CONFLICTS-OF-LAW RULE OR PRINCIPLE THAT MIGHT REFER SAME TO THE
LAWS OF ANOTHER JURISDICTION), EXCEPT TO THE EXTENT THAT SAME ARE MANDATORILY
SUBJECT TO THE LAWS OF ANOTHER JURISDICTION PURSUANT TO THE LAWS OF SUCH OTHER
JURISDICTION.
11. This First Amendment may be executed in multiple counterparts, each
of which shall be deemed an original agreement, and all of which shall
constitute one agreement, by each of the parties hereto on the dates
respectively indicated in the signatures of said parties, notwithstanding that
all of the parties are not signatories to the original or to the same
counterpart, to be effective as of the day and year hereinabove set forth.
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IN WITNESS WHEREOF, the Partners have executed this First Amendment on
the date first set forth above.
GENERAL PARTNERS:
ENOGEX ARKANSAS PIPELINE CORPORATION
By:
Name: E. Keith Mitchell
Title: Vice President
SOUTHWESTERN ENERGY PIPELINE COMPANY
By:
Name: Stanley D. Green
Title: Executive Vice President-Finance
& Corporate Development
LIMITED PARTNER:
ENOGEX ARKANSAS PIPELINE CORPORATION
By:
Name: E. Keith Mitchell
Title: Vice President
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